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Showing posts from January, 2013

Spectrum Policy Innovations are Coming

If AT&T, Verizon and T-Mobile USA are actively working to explore how to share spectrum now used by the U.S. Department of Defense, that is a signal that the carriers believer there is a serious chance spectrum sharing could happen, even if the carriers typically prefer to use only licensed spectrum.

The immediate focus is a proposed sharing of 95 MHz of spectrum currently used by DoD and other federal agencies, in the 1755 to 1850 MHz spectrum band.

Spectrum sharing, releasing more unlicensed spectrum and new spectrum auctions, plus reassignment of frequencies originally awarded for mobile satellite service are key ways regulators now are trying to make more spectrum available as a way of promoting mobile and wireless competition and innovation.


Since their introduction in 1994, the United States has conducted more than 70 spectrum auctions to assign thousands of wireless licenses.

But regulators also are working to increase the amount and ease of using unlicensed spectrum as wel…

What is the "Value" of the Fixed Access Network

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Studies of smart phone user behavior confirm what most of us might have concluded, namely that Wi-Fi has become a key access method for smart phone users, and provides the answer to a question some might now be asking about the respective roles of mobile and fixed access networks.

That there are synergies between mobile and fixed networks is incontestable. All forms of access, whether fixed, untethered or mobile, are essentially “tail circuits” that connect users to core networks.

What is harder to determine is precisely where those synergies exist, and how big the synergy might be, when considering the highest value provided by fixed access, as compared to mobile access.

That issue increasingly is important as most people, in virtually all markets, rely on smart phones, potentially raising the issue of mobile substitution for the fixed network, and as fast mobile networks using Long Term Evolution create, in a new way, a chance to substitute mobile networks for Internet access that for…

A Few Tips for Increasing Your Influence at the FCC

Sharon Gillett, former chief of the FCC's Wireline Competition Bureau, talks about some of the FCC major activities affecting broadband  that communities can participate in and/or influence;the typical process for moving from policy ideas to actual programs;how to work the public comment period; andways in which communities and small or regional ISPs and telcos may partner to influence the FCC policy and programs.

Will U.K. Mobile Market Change after LTE Auctions?

It is of course axiomatic that without access to spectrum, no entity can be in the mobile service provider business. That access can be through owned or leased spectrum, but fundamentally, spectrum access is necessary. That naturally raises the question of whether “winning” fourth generation Long Term Evolution spectrum is “necessary” for a firm to be a market leader in mobile services, in the future.

Some might say so. “The importance of this spectrum auction in shaping the future of the U.K. wireless market cannot be understated,” said Daniel Gleeson, mobile analyst at IHS iSuppli. “Access to spectrum is the main barrier to entry for any company looking to build a new wireless network.”

It is true that seven companies are bidding for spectrum: the country’s four existing mobile operators along with three new players. With only three companies likely to win spectrum, at least one of the United Kingdom’s existing operators is likely to lose out,” said Gleeson.

The four existing players t…

DT Delays joyn Launch

Deutsche Telekom apparently has delayed its launch of the “joyn ” messaging service. Joyn originally was scheduled to launch in December 2012 but DT apparently has run into implementation issues.

Joyn, the GSMA-backed effort to create a carrier over the top messaging service, will allow DT customers to chat and send files, free of charge,  on all smart phone tariffs, at no incremental cost incurring data usage charges, for all customers who have a calling plan with flat-rate data usage or text messaging plans.

Some have questioned whether joyn really will be able to compete with WhatsApp and other over the top messaging services, but the retail packaging plan DT has chosen is intended to make joyn usage an amenity for users who already are paying what DT considers to  be reasonable amounts of money for voice and messaging usage.

Smart phone adoption is driving mobile service provider mobile broadband revenue. But smart phones also are cannibalizing service provider voice and messaging …

France Telecom LTE Will Cost More than 3G Service

France Telecom will raise the prices of some of its mobile offers in France when it launches faster fourth-generation Long Term Evolutionmobile networks later in 2013, according to  Gervais Pellissier, France Telecom CFO.

France Telecom had done so in the U.K. market when it launched LTE services, boosting plan prices by about six to 10 pounds.

France Telecom plans to launch 4G LTE in France in April 2013.


Justice Department Asks FCC for Time to Review Softbank Acquisition of Sprint

The U.S. Justice Department has asked the Federal Communications Commission to to defer consideration of the Softbank acquisition of Sprint to give DoJ time to review the deal from a national security perspective, Bloomberg reports.

Separately, Dish Network Corp., which has submitted a bid of its own for parts of Clearwire, and also has asked for a careful review of the proposed Softbank acquisition of Sprint, said it won’t seek regulatory action to block the transaction. Dish still is pursuing its own deal to buy parts of Clearwire. 

Some observers might argue that the Dish decision not to try and block the Softbank deal is a signal that what Dish really wants is a business deal with Sprint, not an actual takeover of Clearwire. By that line of thinking, Dish really is seeking leverage to convince Sprint to partner with Dish to help Dish build its own Long Term Evolution network. 


Tablets Outsell PCs 4:1 in 2012

Tablet sales for the full year of 2012 were 267 percent higher compared to 2011. December 2012 alone saw more tablets sold in GfK’s tracked retail channels than notebook sales in the whole of the fourth quarter of 2012, according to researchers at GfK. So you might roughly say that tablets outsold notebooks roughly four to one.

Lower average selling prices might have helped. ASPs declined 23 percent year over year from 2011 to 2012, GfK says.

YouTube to Introduce Paid Subscriptions

YouTube reportedly will launch paid subscriptions for individual channels, perhaps as early as the second quarter of 2013, according to Advertising Age.  It appears that the first paid channels will cost somewhere between $1 and $5 a month, and likely will be created by programmers already producing original content successfully for YouTube.

YouTube is treating paid subscriptions as an experiment. much like video rentals when it began in 2010. The initial group of channels will be small, likely about 25 at the outset. The revenue split from subscriptions is expected to be similar to the 45-55 split that is common for ads on YouTube. Partners will also have the option to include ads in their pay channels, but its unclear what form those will take.


Machinima, Maker Studios and Fullscreen are likely among the programmers YouTube has asked to submit ideas for paid channels. 

YouTube would initially launch around 25 paid channels. 

In the past, observers have argued that YouTube could represen…

Global Telecom Revenue Will Grow 3.8% Annually, to 2018

Forecasting is a hazardous business. Though one analysis shows European telecom service provider revenues have fallen for three straight years, other analysts continue to show steady growth, in ways that obscure the more granular trends.

Overall growth is undoubtedly a correct way to characterize the global business. It is just that growth will not be universal, for every service, in every country, for every provider, in every region.

Insight Research projects that global carrier revenue will grow from $2.2 trillion in 2013 to $2.7 trillion in 2018, at a compounded annual growth rate (CAGR) of 3.8 percent.

Insight Research, for example, lumps the “Middle East” region with “Europe” and “Africa.” It is a standard way of reporting the data, if increasingly inaccurate, given growth in Africa and Middle East, and shrinkage in Europe.

Since 2010, revenue has been declining in Europe, according to the European Telecommunications Network Operators Association. Declines continued in 2011 and 20…

What "Grow Internationally" Might Mean, for AT&T

Neither Verizon Wireless, nor AT&T Mobile, currently earns significant international revenue (aside from some roaming revenue or some enterprise accounts). But that could change in the future. AT&T has been talking more than Verizon about such potential developments.

The issue is what form such initiatives might take, or what the revenue drivers might be. Most observers would simply observe that "consolidation" has been a feature of nearly every segment of the communications business, for some decades. 

There perhaps is a "negative" way to characterize consolidation, and a "positive" way. One would expect any executive at a public company to take the "positive" approach. 

AT&T might see LTE as a significant enabling event. "There are probably some opportunities to create some unique roaming arrangements, roaming each other’s networks at different cost structures," said AT&T CEO Randall Stephenson, on AT&T's fourth …

Android, Apple Account for 92% of Global Smart Phone Shipments

You might say a business lead by two firms with 92 percent market share fits the notion of "market domination." And by that definition, the global smart phone market is dominated by Apple and Samsung.  According to the latest research from Strategy Analytics, global smart phone shipments grew 38 percent annually to reach 217 million units in the fourth quarter of 2012.  To the point, Android and Apple iOS together accounted for 92 percent share of all smart phones shipped worldwide, representing the largest market share the two firms ever have had.  Global shipment growth slowed from 64 percent in 2011 to 43 percent in 2012 as penetration of smart phones began to mature in developed regions such as North America and Western Europe,” says Neil Shah, Senior Analyst at Strategy Analytics. Strategy Analytics estimates 152.1 million Android smart phones were shipped globally in the fourth quarter of 2012, nearly doubling from 80.6 million units in the fourth quarter of 2011. Android’s…

Google+ Now Second-Biggest Global Social Network?

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Google+ now is the second-largest social network globally, behind Facebook, while YouTube is number three, according to Globalwebindex. Ignore for the moment whether Google+ is actually an identity service, or YouTube a video application.

Most would agree that Facebook users are more active than Google+ users, in all the ways that social network activity normally is measured. 


Some will argue that Google+ "usage" is largely passive because Google is using Google+ as an identity mechanism, not a full-fledged social network, so the ranking does not necessarily mean too much.

On the other hand, it would not be hard to argue that the overall trend is that the largest networks, with scale effects, are winning share at the expense of small social networks with less scale.




How Investment Rules Shape Canada's Communications Market

No set of government regulations, no matter the intent, always and everywhere have impact strictly confined to the problem the rules are meant to address. In fact, the unplanned and unexpected consequences can work to undermine the "solutions" the rules are supposed to achieve. 

Like many other countries, Canada has foreign investment rules that prohibit non-Canadian firms from owning a majority of shares of leading communications service providers. In Canada's case the rule is that no foreign entity can own more than 33.3 percent of voting shares in a dominant Canadian telco. 

On the other hand, foreign firms can own up to 100 percent of Canadian service providers with market share of 10 percent or less. 

Some Canadian telcos now think the rules are unfair. The rules, for example, can allow much-larger foreign telcos to get a foothold in the Canadian market by investing in smaller firms. On the other hand, the foreign ownership rules also mean that the large Canadian provi…

FCC Acts to Ease Deployment of Temporary and Small Cells

The Federal Communications Commission says it plans to streamline procedures related to deployment of temporary cell sites, and will this year also act to clear administrative barriers to building small cell sites and distributed antenna systems as well.

The FCC wants to expedite the placement of "temporary cell towers" such as "Cells on Wheels" (COWs) that can be used during special events, or possibly emergencies.

The FCC also says it will act to expedite the deployment of small cells and distributed antenna systems. 

In the communications business, we sometimes forget that regulatory and legislative bodies enable, or can bar, creation of communications businesses. Financing, entrepreneurial skill and technology also are necessary, as well as clear value for end users. But it all begins with government permission to use spectrum, or to allow entities to enter a market.

Younger observers sometimes forget that it once was illegal for any company but one, in any area, t…

U.K. LTE Auctions Begins

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The U.K. auctionof spectrum intended to support new Long Term Evolution networks in that country have formally begun. 

And observers expect a bifurcated strategy to emerge, with the leading national mobile service providers, including Vodafone, O2 , Three and EE, largely competing for the 800-MHz frequencies most suitable to national coverage, even in less dense areas.


On the other hand, three potential new providers, including  BT, PCCW and MLL, are expected to bid for the higher frequencies more suitable for denser areas and cities. 

The primary issue of coverage suggests the current national providers want to replicate their 3G coverage when adding LTE. 

The new providers presumably will favor business plans that include wholesale, such as selling LTE capacity to other carriers in heavy-traffic areas, enterprise and business services. In other words, the 2.6-GHz frequencies will lead to building of networks whose primary value is "capacity," not "coverage."

The spect…

"Broadband for Everyone" is Not Just a Slogan

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Some might think the phrase “broadband for everyone” is only a slogan. On the contrary, over the next decade or so, we might find an extraordinary jump in the percentage of human beings in developing regions who have access to the Internet, can afford to buy access on a regular basis, and therefore create a big business opportunity for suppliers.

For example, if one assumes that in 2005 the middle class population of China was about eight percent, by 2030 it will be as high as 72 percent. In India, where the percentage of middle class people in 2005 was perhaps in the low single digits, by 2030 some 41 percent of India’s people will be middle class, defined as households with annual disposal income between 200,000 rupees up to one million rupees ($3,606 to $18,031 in annual disposable income).

Over the last decade, there has been a 50 percent jump in the number of people in the “middle class in Latin America and the Caribbean, The World Bank reports. Roughly speaking, about 30 percent…

Will U.K. LTE Auctions “Pick Winners and Losers?”

It is of course axiomatic that without access to spectrum, no entity can be in the mobile service provider business. That access can be through owned or leased spectrum, but fundamentally, spectrum access is necessary. That naturally raises the question of whether “winning” fourth generation Long Term Evolution spectrum is “necessary” for a firm to be a market leader in mobile services, in the future.

Some might say so. “The importance of this spectrum auction in shaping the future of the U.K. wireless market cannot be understated,” said Daniel Gleeson, mobile analyst at IHS iSuppli. “Access to spectrum is the main barrier to entry for any company looking to build a new wireless network.”

It is true that seven companies are bidding for spectrum: the country’s four existing mobile operators along with three new players. With only three companies likely to win spectrum, at least one of the United Kingdom’s existing operators is likely to lose out,” said Gleeson.

The four existing players t…

Safaricom, Intel Introduce Yolo, Smart Phone for Cost Conscious Kenya Consumers

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Safaricom Limited has launched the "Yolo" smart phone, touted as the first smart phone for Africa.

The Yolo is the third model with  Intel branding

Yolo is powered by the Intel Atom Z2420 processor (1.2GHz. It also comes with a 3.5-inch touch screen, a 5-megapixel camera with full HD video capture support, FM radio and HSPA+ support.

"We're redefining what cost-conscious Kenyans can expect from a smartphone," said Peter Arina, general manager, Safaricom' s Consumer Business Unit.

The device is aimed at the growing number of cost-conscious and first-time buyers in Kenya who do not want to sacrifice device performance or user experience for cost, Intel says.


The Yolo smartphone will be sold in Safaricom shops countrywide at the entry price of Kshs. 10,999 (about US $125) and comes bundled with a free 500 MBytes of data.

In some ways, the surprise here is the Intel brand being associated with a smart phone, in something other than an "Intel Inside" sense…

Smart Phone Market Shifting to Developing Nations, says Samsung

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All markets saturate at some point. And the smart phone marketmight be closer to that point than most believe. In fact, Samsung, in reporting its latest fourth quarter 2012 earnings, already is warning that sales of smart phones will slow in 2013. 

That might be important, as Apple and Samsung represent the two profitable suppliers of smart phones. By most reckoning, all the other smart phone suppliers earn only a little, or lose money. 

"The furious growth spurt seen in the global smart phone market last year is expected to be pacified by intensifying price competition compounded by a slew of new products," Samsung said. In other words, expect slower growth in 2013. To be sure, one might argue that Samsung is talking here about its own prospects.

Growth in the overall market might continue. In fact, that is what Samsung seems to expect. 

"In the first quarter, demand for smart phones in developed countries is expected to decelerate, while their emerging counterparts will s…