“The problem with mobile broadband so far has been most of the revenue it has generated has gone to over-the-top Internet content services, not to the operators,” says Pat McCarthy, Telcordia VP. “That’s what they are trying to change.”
And that is the heart of the matter as far as wrangling over network neutrality. Over time, consumers will have many options for buying customized wireless broadband plans, McCarthy says. And nearly everyone believes that will mean very-heavy users will have to pay more, in some way.
The key notion is that retail price will be related, in some way, to the cost of the services consumed. That doesn't necessarily mean billing by the byte, but probably a range of options for basic access that are similar to wireless voice plans, where users buy buckets of minutes or text messages a various prices, or unlimited use for higher prices.
Some have suggested pricing based on the value of services and applications and most providers tend to believe there should be the ability to buy optional services that maintain quality of service when the network is congested.
Standard users might get messages during peak congestion periods--perhaps rush hour or at a major sports or concert venue--that the network is congested, with their services shaped in some way. Premium users might get priority access and all users might be offered a temporary "power boost," for an additional fee, during the period of congestion.
About 77 percent of 200 senior marketing executives believe that developing a video strategy for the iPad is important to their businesses' success, says KIT Digital, which took the non-scientific study during a webinar on the iPad.
The survey also asked attendees if their businesses currently have a mobile solution for other devices. About 38 percent of respondents say they do, while 43 percent say they are currently working on developing a mobile solution.
Overall, however, 62 percent of respondents do not currently have a mobile video solution.
When asked if they were prepared to take advantage of the iPad's video capabilities, 21 percent of businesses responded that they are, while 48 percent) responded that it is an area "currently being worked on."
After studying Twitter and Facebook as business marketing vehicles, Irbtrax says "Twitter performed better in the general business to business marketing category due to its viral marketing benefits."
But Facebook performed better in the business to business marketing category for select companies that are 'personalities'. In other words, "hot" products or services with high user inmvolvement can use Facebook in ways that other firms cannot. That also means Facebook likely is better for consumer products.
The study concluded that it is not even necessary to have a large group of Twitter followers to benefit from Twitter's viral marketing advantages. Twitter also might be better for real-time promotions, events, special offers or location-based offers, the study suggests.
The study concludes that both work, and that it is best to create a presence on both. But extrapolating from the findings, one might argue that a business-to-business campaign is better suited to Twitter, while consumer products might fare better on Facebook. That especialy would be true for products without a high degree of personal and emotional involvement.
Forbes continues to have a higher-than-average interest in technology and its impact on work and life, compared to some other major business news media, and in a series of related essays Forbes takes a look at where we will be in 2020, in terms of jobs, health, working and so forth.
One of the points made in one of the essays is that because of Moore's Law, we will by 2020 have 32 times more compute power available to apply to all of those tasks, and that not all the effects will be positive. Those of you who believe manufacturing (I admit I do) remains an important part of any advanced economy will be discouraged by the likely implications. read the essays here
Those of you who are parents might likewise be chastened by some findings of a recent Kaiser Family Foundation report on "Generation M2," which takes a look at the role of media in the lives of youth and children.
The study shows, as I suspect most parents suspect, that reading and good grades tend to go together. About 72 percent of "heavy" readers report getting good grades, while 60 percent of the light readers say so. Read the study
There also is a direct--and inverse--relationship between "time spent with media" and "good grades," as many of you likely also suspect is the case. Children who are heavy media users get lower grades; children who are light media users get higher grades. About 47 percent of "heavy media users" say they get "fair to poor" grades, compared to 23 percent of "light users." And that remains the case when controlling for age, gender, race, parent education, or whether a child is in a one-parent or two-parent household, Kaiser says.
Conversely, 66 percent of "light users" report getting good grades. It isn't clear whether the relationship between grades and heavy media consumption is causal or only a correlation, though. Still, the findings likely correspond to what many parents would conclude.
"There is a proposal afoot developed by Sen. John Kerry that could undermine free speech on the Internet," says technology analyst and commentator John Dvorak. The proposal is to regulate broadband access as a regulated common carrier service, like telephone service.
You can ask yourself whether you think such a change would lead to more, or less, innovation; more or less investment; more or less choice. You can ask whether a 1934 method of regulating a stodgy monopoly service is appropriate in the 21st century for Internet services.
You can ask yourself whether having more choices, rather than less, is the likely outcome of such a move. You may ask yourself whether application priorities routinely available on private networks used by businesses, or application acceleration, as practiced by hundreds to thousands of content providers already, is a good thing or a bad thing to be forbidden.
So here comes the great idea from John Kerry: reclassifying broadband services as "telecommunications services" rather than "information services."
"This is the worst possible outcome as the FCC will eventually regulate the Internet like it does all the entities under its jurisdiction," says Dvorak.
"Why would we want the FCC to regulate the Internet?" Dvorak asks. "It's a terrible idea."
By redefining information services to telecommunications services, the Internet as we know it will be neutered as the FCC begins to crack down on foul language, porn, and whatever else it sees fit to proscribe, he argues.
"No matter the net neutrality outcome, it has nothing to do with increasing broadband penetration and speeds," he says. "It's a total scam invented to censor the Internet once and for all.
"I'm surprised people, no matter how idealistic, cannot see through it," he says.
"Should the FCC have sway over the Internet?" a Washington Post Co. editorial asks.
For the past eight years, the FCC has rightly taken a light regulatory approach to the Internet, though it believed it had authority to do more. Now that the agency has lost in court, some advocates in the technology industries are urging the agency to invoke a different section of law and subject ISPs to more aggressive regulation, until now reserved for telephone companies and other "common carriers."
Such a move could allow the FCC to dictate, among other things, rates that ISPs charge consumers. This level of interference would require the FCC to engage in a legal sleight of hand that would amount to a naked power grab. It is also unnecessary: There have been very few instances where ISPs have been accused of wrongdoing -- namely, unfair manipulation of online traffic -- and those rare instances have been cleared up voluntarily once consumers pressed the companies. FCC interference could damage innovation in what has been a vibrant and rapidly evolving marketplace.
Some oversight of ISPs would serve the public interest as long as it recognizes the interests of companies to run businesses in which they have invested billions of dollars. Transparency and predictability are essential to encourage established companies and start-ups to continue to invest in technologies dependent on the Internet. ISPs, for example, should be required to disclose information about how they manage their networks to ensure that these decisions are legitimate and not meant to interfere with applications that compete with the ISPs' offerings.
Congress should step in to strike the appropriate balance. Enacting laws would take some time, but the process would allow for robust debate. In the meantime, any questionable steps by ISPs will be flagged by unhappy consumers or Internet watchdog groups. If ISPs change course and begin to threaten the openness of the online world, Congress could and probably would redouble its efforts.
By Thomas W. Hazlett, published in the Financial Times
A federal appeals court has bopped the Federal Communications Commission yet again. In Comcast v. FCC – the “network neutrality” case – the agency was found to be making up the law as it went. In sanctioning the cable operator for broadband network management it found dubious, the Bush-era FCC exceeded its charter. Cable modem services and digital subscriber line (DSL) connections provided by phone carriers compete – officially – as unregulated “information services.”
Congress could now mandate broadband regulation. This could have happened four years ago, when the Democrats took majority control and announced that they would impose network sharing mandates. That has not happened, and – with unemployment running at above 9 per cent – is not likely now. Net neutrality is seen, bluntly, as a jobs killer. That’s one take Congress has actually gotten right.
Alternatively, the FCC could flip its own rules, going back to a DSL regime discarded in 2005. But it would have to go further, extending “open access” to cable broadband, something is has always rejected. In 1999, when AOL and phone carrier GTE lobbied hard for cable regulation, Clinton-appointed regulators stood firm. “We don’t have a monopoly, we don’t have a duopoly,” stated FCC Chair Bill Kennard, “we have a no-opoly.” Forget regulation, encourage investment, get amazing new stuff.
But “open access” rules for DSL remained. These permitted phone company rivals to lease capacity at rates determined by regulators. It was not until February 2003 that the major requirements were ended. In August 2005, remaining rules were scrapped. A test was created. Deregulation would further investment and deployment, or quash competition and slow broadband growth. FCC member Michael Copps predicted the latter. He challenged the Commission to see if the policy would “yield the results” anticipated. “I’ll be keeping tabs,” he warned.
Yet, the market’s verdict is in – and the proponents of regulation have ignored them. Obama economic adviser Susan Crawford, arguing in the New York Times for broadband re-regulation, said that ending government DSL mandates was “a radical move… [that] produced a wave of mergers,” raising prices and lowering quality.
It is simply untrue. Mergers, governed by the FCC and antitrust agencies, have had no material impact on broadband rivalry. And the rate of broadband adoption significantly increased following deregulation. This pattern continued a trend.
Cable, unregulated, led DSL in subscribers by nearly two-to-one through 2002. Then, with DSL deregulated, phone carriers narrowed the gap, adding more customers, quarter-to-quarter, than cable operators by 2006. The spurt in DSL growth relative to cable modem usage takes place at precisely the time the former was shedding “open access” mandates, and cannot be explained by overall changes in technology. In short, DSL subscribership was up 65 per cent by year-end 2006 compared to the predicated (pre-2003) trend under regulation.
The story in ultra-high-speed fiber-to-the-home (FTTH) services is similar. There was virtually no deployment until the Commission, in late 2004, declared that fiber networks would not be subject to access regulation. That move, according to industry analysts, unleashed investment. FTTH is now offered to over 15m homes, and networks are capable of supplying 100 MBPS downloads, on a par with services delivered anywhere.
Not only has access regulation been shown to retard advanced networks, the Internet is loaded with “non-neutral” business deals where Internet Service Providers (ISPs) give preference to favored firms or applications. These negotiated contracts rationalize resource use, and drive incentives for innovation.
Data flows, unregulated, across large backbone networks that pay no fees to exchange their traffic, but collect billions from smaller networks that must fork out to inter-connect. This pay-to-play structure pushes networks to invest, grow, and cooperate.
Cable TV systems reserve broadband capacity for their own branded “digital phone” services. This special “fast lane” provides a premium service not available to independent VoIP applications. It has also transformed the competitive landscape, helping to forge fixed line competition for over 100m US households -- what the 1996 Telecommunications Act tried failed to do via network sharing mandates (tossed out by a federal court in 2004).
And the corporate history of Google offers a landmark date: on Feb. 1, 2002, the company’s search engine popped up as the default choice on 33m AOL subscribers’ home page. The coveted spot was purchased; the young firm mortgage its future to outbid search engine rivals. An application provider paying the country’s largest ISP for preferred access to its customers. That may not be a violation of net neutrality. But if not, many lawyers will be very busy explaining why.
Today’s FCC Chair, Julius Genachowski, has made a pledge: the Commission’s “processes should be open, participatory, fact-based, and analytically rigorous.” That would be a refreshing approach. In addressing new regulations for broadband, let’s first see how these markets actually work, and how well the last batch of network sharing mandates performed.
As it turns out, some think the "very best" Android devices available on any U.S. mobile carrier are made by just one company: HTC. The firm seems to be betting its future on Android, and from the looks of things, is doing a heck of a job rolling out top of the line Android devices for every leading U.S. carrier.
For T-Mobile customers the most future-proof choice is a Nexus One. For Sprint 4G customers, it is the HTC Evo. At AT&T the top device is the Nexus One. Verizon customers should get the HTC "Incredible," at least when it goes on sale on April 29, 2010.
The biggest companies in major markets generally tend to favor heavy-handed regulation, says a Canadian IT consultant. That's why Google, among others, has spent tens of millions pushing for “net neutrality” regulations in the United States, he argues. That's an unusual twist on the debate.
"Just go ahead and net neutrality on your own network and for your own users. Day one you’re going to find that net neutrality requires you to give incoming porn packets exactly the same forwarding priority on your network as text messages to sales or voice traffic for the CEO’s office - and as soon as you decide to block one set while giving the other a priority boost, you’ll have both demonstrated the fundamentally Orwellian nature of the whole net neutrality sales pitch and turned yourself into one of its opponents."
I admit I do not use Google Docs as much as I used to, only because so much of what I write is uploaded directly to a Web site, or in some cases sent as an email message. That's wasn't the case several years ago, when the primary form of document I was required to create was a "Word" document.
I still sometimes need to do a bit of modeling, create a presentation or create a document, so it isn't as if an office productivity suite does not get used, they simply get used less, as most of my daily routine involves creating Web-compatible content.
The exception seems to be that I frequently must capture a graphic or chart of some sort from a .pdf file or Web page and reformat it as a picture for insertion into a post. In that case I find myself using the presentation software simply to launder an image into a .jpg file. That wasn't why presentation suites were created, but that is how I generally will be found using a presentation program, day in and out.
But there is another point about new developments to Google Docs. Lots of people are required to create documents in a word processor, read or create spreadsheets and presentations on a regular basis. And, up to this point, with some salient exceptions, that has meant using Microsoft's "Office" suite.
Google Docs has been useful for students and some enterprises, but has not matched Office feature for feature and with equal and transparent functionality. Most of us still find the default format for any shared bit of work is "Word" for documents and "PowerPoint" for presentations and "Excel" for spreadsheets.
But any attacking company will start low and then gradually begin to enhance the utility of a competitive offering, and that is what Google is doing with Docs.
These days most innovation happening in applications, features and devices is happening in the wireless realm or in the world of over-the-top applications. That can be discomforting for some.
I recently moderated a panel of application developers and enablers recently and asked where they panelists believed there were opportunities to work with "service providers" such as telcos and cable companies. There was an initial awkward silence, then some mutterings even I cannot remember. But I think that tells the story: over-the-top application providers largely assume the existence of broadband; broadband is not a required "partner" in the delivery.
People in the telecom or cable or satellite business hate the term "dumb pipe," but it resonates because it sums up the essential nature of today's application environment, captured by the term "loosely coupled."
And matters might change even more. The Wi-Fi-only version of the iPad does not require any sort of relationship with a wireless access services provider. In fact, if, as some believe, devices such as the iPad wind up being devices picked up and used casually, when people are sitting on a couch in their homes, and not primarily as a substitute for a netbook or notebook PC, there might never been a need for such relationships. People will simply use their at-home Wi-Fi connections.
Still, it is hard to ignore the fact that most innovation these days is happening in the mobile space.
You might not think a market that declines 13 percent year over year, and declines a whopping 35 percent, year over year, is a "growth" market. But that undoubtedly is the case. U.S. mobile gaming activity declined 13 percent between February 2009 and February 2010, posting a sharper drop of 35 percent among owners of feature phones, according to comScore. So why the optimism?
As it turns out, mobile gaming by smartphone owners increased 60 percent over that same period.
“Although the number of mobile gamers has declined in the past year, there is reason for significant optimism about the future of this market,” says Mark Donovan, comScore SVP. “As the market transitions from feature phones to smartphones, the dynamics of gameplay are also shifting towards a higher-quality experience," and that seems to be why smartphone gaming is up so much.
The inevitable ascent of the mobile gaming market depends not only on smartphone subscribers’ higher propensity to play games on their mobile devices, but also their heavier gaming activity across nearly every dimension, comScore says.
Smartphone subscribers (47.1 percent) are three times more likely than feature phone subscribers (15.7) to play games on their device at least once a month, comScore says.
They are more than five times as likely to play games almost every day and far surpass their feature phone counterparts across various methods of game play.
Smartphone subscribers also install significantly more games on their devices with 27.3 percent having installed at least one game compared to just 5.6 percent of feature phone subscribers.
A third of smartphone subscribers with games have more than five games installed on their phones, while less than one percent of feature phone subscribers have that many games installed.
“Smartphones offer a more accessible and compelling mobile gaming experience that is enabling adoption of this behavior, even among consumers who have not traditionally been gamers,” says Donovan.
And of course we haven't yet seen the impact of devices such as the iPad, which offer bigger screens and therefore potentially better gaming experiences.
Smartphone subscribers are more likely to play mobile games than feature phone subscribers across every gaming genre. The genre with the highest penetration among smartphone subscribers is arcade puzzle games at 12.9 percent, followed by card games (11.9 percent), word/number games (11.4 percent) and casino games (7.6 percent).
Though acquisition of more mobile spectrum is a key strategic imperative for leading U.S. mobile operators, it is not clear how much capacity and flexibility Verizon Communications and AT&T have within their credit ratings to absorb future spectrum purchases, say analysts at Fitch Ratings.
That is a significant opinion. Despite the apparent belief in some quarters that the largest U.S. telecom providers are so well positioned they can handle any shock to their financial models, Fitch Ratings does not believe that is the case.
In fact, a number of factors, including the cost of acquiring new spectrum, ability to monetize broadband services more effectively and competition from application-based wireless services all pose "longer-term threats to telecom operators' balance sheets and cash flows," Fitch Ratings say.
Fitch believes Verizon Wireless and AT&T Wireless, because of their scale, market power, and financial strength, will be in a better position to cope with these challenges than many lower-margin contestants, should the market environment shift. But increased reliance on wireless communications is an issue for many other contestants as well.
A key issue for cable companies is whether their wholesale arrangement with Clearwire can bundle competitive offerings that can successfully offset the significant threat from next generation broadband wireless networks as the telecom industry transitions more and more traffic longer-term to wireless, Fitch analysts say.
The Federal Communication Commission's "National Broadband Plan" aims to release 70 megaHertz of spectrum available for auction in the 2011 time frame.
Depending on the timing of the auction, the final amount of spectrum available, and the aggressiveness of the bidding, it’s not clear how much capacity and flexibility Verizon Communications Inc. and AT&T Inc. have within their credit ratings to absorb future spectrum purchases.
The good news is that, by the end of 2010, leverage is expected to decline for Verizon and AT&T due to strong free cash generation and management commitment to debt reduction. Both companies’ leverage has been at the high end of Fitch’s expectations due to past acquisitions and spectrum purchases.
Other well-capitalized, smaller operators or new entrants with strong balance sheets and good
free cash flow prospects should be in a favorable position to acquire additional spectrum.
New entrants or smaller companies without good operational cash flow characteristics or
strong balance sheets would likely have a difficult time funding any commitments for
spectrum purchases or buildout requirements.
That suggests the coming spectrum auctions will reshape the competitive environment in significant ways, favoring the well-capitalized contestants and weakening the financially weaker firms.
The transition to 4G networks also would seem to provide an opportunity for operators to
implement a new pricing model for data services. But it is not clear the opportunity is all "upside."
Clearwire, for example, already offers unlimited mobile data usage for $40 per month. Clearwire does not currently cap subscribers’ data usage, where most cellular operators limit monthly data
usage at 5 gigabytes. Since AT&T and Verizon offer capped plans costing $60 a month, Clearwire is using its 4G spectrum to disrupt current levels of pricing.
The company’s management has indicated that Clearwire’s mobile WiMAX subscribers already average approximately 7 GBytes of data usage per month.
Given the current indication by operators that Internet video will be a key driver of traffic on 4G networks, operators will need to create larger “data bucket” plans with tiered pricing, as the current 5 GB 3G plans currently offered for aircards and netbooks would not be sufficiently large enough to handle subscriber demands from streaming video.
What will Apple do to upend Google's dominance in search advertising, as advertising emerges as a major revenue stream in the mobility business? For starters, it will leverage its strength in devices and strong consumer market share. That will be the least of Apple's concerns.
Apple will leverage iTunes as the distribution portal and media manager, something it also will not have a problem with.
Apple will try to leverage the "closed" or "integrated" way it approaches device operation and design, which sacrifices "openness" for assured application operation. And it will block third party applications and ad networks from access to advertising analytics that are the heart of all efforts to personalize advertising for mobile apps.
But there are challenges. Apple has to hope that the Android ecosystem will not flourish. A functional definition might be that Apple gets as much as 50 percent market share for smartphones, while Android fails to approach those levels. It is too early to predict whether this could happen.
There is a bit of execution risk as Apple tries to stake out a "premium" position for its own ad network, compared to others.
Of course, all of this assumes mobile marketing gets critical mass, but most observers think that is only a matter of time.
It would take a brave prognosticator indeed to argue that Apple does not have an excellent shot at upending Google in the emerging mobile marketing business. But there currently is only a small group of large firms in the mobile advertising space, though there are lots of emerging firms trying to muscle their way into the emerging business.
"There's AdMob (Google), Apple and us," says Paran Johar, Jumptap CMO. "That's pretty much it." The Federal Trade Commission might be preparing a challenge to Google's purchase of AdMob. Some of us might be so sure that is necessary. Apple is the company to watch, it might appear.
The Google Chrome operating system apparently will be designed to support output to printers without the use of onboard printer drivers, says Mike Jazayeri, Google Chromium group product manager.
"Since in Google Chrome OS all applications are Web apps, we wanted to design a printing experience that would enable web apps to give users the full printing capabilities that native apps have today," says Jazayen.
Google Cloud Print is a service that enables any application (Web, desktop, or mobile) on any device to print to any printer, he says.
Rather than rely on the local operating system or drivers to print, apps can use Google Cloud Print to submit and manage print jobs. Google Cloud Print will then be responsible for sending the print job to the appropriate printer with the particular options the user selected, and returning the job status to the app.
