Billions and Billions Served...

Sort of reminds you of the McDonald's signs: "X billions of burgers served." Looks like over the top Internet video is going that way as well, if forecasters at The Yankee Group are correct. Bandwidth demand is about to go bananas.

Surprise Success, Again

Voice SMS was launched in early 2005 under the name “Bubble Talk” by mobile operator Digi in Malaysia and within six months, more than 35 percent of Digi’s subscribers were using Bubble Talk and the other mobile operators in Malaysia were losing market share, says Brough Turner, NMS Communications SVP. If you're familiar with Pinger, voice SMS is a way to send a quick voice message to another mobile user.

The recipient gets an SMS message saying they've got a message and to go pick it up.
It's an intentionally nonsynchronous communications mode.

Multimedia Messaging Service can do the same thing, of course. But MMS hasn't gotten much traction, though this forecast by The Yankee Group certainly anticipates growth. Still, Voice SMS apparently has advantages. It works on any handset or network, requiring simple text and voice, which most handsets now have.

Users seem willing to use it even though it comes with price points 30 percent to 100 percent above those of text messages, says Turner. More than a dozen networks offer Voice SMS, mostly in Asia. Once again, we see surprise success, while the industry's standards-driven services (not that there's anything wrong with that) struggle.

At least so far, experience with voice SMS and MMS suggests that changing user behavior too much is a tough way to get people to do new things. Experimentation and surprise remains the order of the day. Listen more, talk less.

No More PBX: Bill Gates

Bill Gates, Microsoft chairman, in pointing out that software is becoming more advanced and capable every year for hosting multimedia content, notes that "every year we just move to more of a digital environment. We take away the older approaches." One of the changes Gates expects is the disappearance of the private branch exchange. "In voice telephony, you have a thing called a PBX. You won't have those anymore. You'll have a communications system that is using your Internet network and it's a far richer, more flexible software-drive system." That's not going to stop small businesses from buying them. But most haven't made firm choices so far, as this forecast from The Yankee Group might suggest.

Hot Media, Cool Media

In the past, some media have been described as "hot," meaning there is more emotional content. Video is "hot." Newspapers are "cool." As people start to multitask, there is a new meaning. Hot media require more active attention. Cool media are easier to deal with in the background. In this new context, TV is "cool," while talking and texting or instant messaging are "hot," in the sense of requiring fuller and more active attention. Music might be "cool," and in the background, while gaming is "hot", and requires active attention. Voice mail, being non real time, is cool. Talking now, that's hot. Web surfing is pretty "hot," as you have to pay attention.

It isn't yet immediately clear how this affects advertising potential. But it might be a clue that formerly "hot" media can become "cool" in a new context, while formerly "cool" media such as words can become quite "hot" in a new environment. Videoconferencing remains "hot" and telepresence maybe theoretically the hottest of all.

More Wi-Fi, 3G, for Enterprise Next 3 Years

Today there might be 11 million enterprise users of wide area wireless services, says The Yankee Group. Over the next 3 years, enterprises will equip more PCs with 3G and Wi-Fi. Hand held devices will tend to get Wi-Fi. More mobile phones will be dual mode, capable of connecting over cellular and Wi-Fi networks. And there will be more smart phones.

One of the issues is whether, or how much, devices such as the iPhone can wrest market share away from RIM's BlackBerry and other smart phone implementations. As important as the answer is for Apple and at&t, as well as Apple's rival handset manufacturers and carriers such as Verizon, lots of carriers in global markets are going to contend with Apple as well.

For some of us, there are other issues, such as how well, and in what user segments, devices such as the iPhone will penetrate professional and business markets, even if Apple never targets enterprise customer segments outside of the education, marketing and advertising verticals.

Strategy Differences Emerge...

Verizon Wireless, the No. 2 U.S. cellphone carrier, passed on the chance to be the exclusive distributor of the iPhone almost two years ago, balking at Apple's rich financial terms and other demands, says USA Today. Among other things, Apple wanted a percentage of the monthly cellphone fees, say over how and where iPhones could be sold and control of the relationship with iPhone customers, says Jim Gerace, a Verizon Wireless vice president. "We said no. We have nothing bad to say about the Apple iPhone. We just couldn't reach a deal that was mutually beneficial."

We don't know what deal Cingular struck with Apple. But there's a difference of opinion here about how far one can go in partnering with strong partners bringing assets into a relationship with a service provider. The cable industry decided sometime ago it couldn't partner too closely with Microsoft for advanced set-top boxes because customer control was at stake. at&t is making different decisions. Verizon seems to have taken the cable approach, at&t perhaps has taken a similar approach to its Yahoo! and Microsoft partnerships.

Some will say Verizon and the cable companies acted to maintain customer control. Others will argue at&t is taking a more open and collaborative approach. It isn't clear yet which is the better path, or whether either path will ultimately prove to be better than the other. It simply is worth noting a difference in perspective here. One approach offers more control, at the risk of less innovation. The other offers more innovation at the risk of losing at least some customer control.

Perhaps it is enough to note that The Yankee Group expects more purchased infotainment content to be supplied by "off deck" providers compared to the walled garden "on deck" interfaces used by mobile providers, over time. The same sort of process should be at work in just about all phases of wireline service provider offerings as well. Over time, more value will be contributed by partners, even as walled garden offerings controlled directly by service providers are created.

Leaning towards open and collaborative efforts, even at some risk, seems like a good idea.

Things Change...

Google is planning to share advertising revenues on its YouTube video sharing site with the individuals who submit the films, if they prove popular enough. Which is more evidence that Web forms of video are developing in the direction of "media," if not the legacy forms that have developed before. Where you find media, you find advertising.