Doesn't Qualify as a Headset

So we won't be sumbitting this to Jajah's "ditch your headset" contest. Besides, my granddaughter wouldn't want the Jajah T-shirt in any case. It would have to be pink, and illustrated with horses. My wife wouldn't be caught dead wearing a headset, it goes almost without saying. If I really want to know whether some new innovation is thoroughly mass market, she's the market sample. She wouldn't intentionally use VoIP; doesn't use instant messaging or SMS, either. Will not check email at home after work, for any reason. Does think the iPhone is worth owning. That's significant.

Jajah Attacks Headset Metaphor

Jajah is running a "dump your headset" contest. Users send in photos and videos and win prizes. It's an entertaining and interesting way to dramatize the difference between Jajah's approach to web-enabled calling and Skype's. Jajah is IP-enabled callback, using any telephone or device a user chooses. Skype remains a PC-initiated experience. Hence the "attack" on headsets.

Web 2.0 Enterprises

I wouldn't say many small or mid-sized businesses or entities are adopting tools such as wikis, blogs and the like, but it appears lots of enterprises have figured out they are quite helpful. At least that's what one IDG survey finds. Nor would I venture so far as to say the generally more collaborative world we seem to be moving towards is transforming older hierachical and closed modes of organizing enterprises. But something is happening. And it ultimately doesn't matter whether a transformation creates the new tools that are needed, or the existence of the tools foment a transformation in the ways things are done. Either way, more collaboration results.

It's a trade show, after all...

...so some snafus are to be expected. That worried look on Seamus Hourihan, Acme Packet SVP? He's got his presentations all queued up. But there's no overhead projection equipment in the room, and there is supposed to be. His panel ultimately proceeded without visual aids.

The subject was voice and application peering. As far as drivers, though quality is an issue, Derek Koecher, Qwest wholesale VoIP manager quipped that "price represents nine of the ten criteria for buying wholesale VoIP services." And, presumably also drives desire to peer.

The session was held at NxtComm, which was pretty quiet, though vendors put on a brave face about the quality of their meetings and booth traffic. Nothing like the old SuperComm. Of course, there's a huge current of weariness and dissatisfaction with just about all of the bigger trade shows IP executives have been attending (and I am being polite). People honestly are questioning why they keep coming. And if they are coming, lots of people are saying they won't be exhibiting. Clear signs of trouble for major telecom show producers...

Do the Math

IPTV might have been the one overarching theme at NxtComm, but at&t CEO Randall Stephenson left no doubt about where at&t is anchoring its strategy. "To succeed you have to be a wireless centric company," Stephenson said. "The wireless decision is the first decision a consumer makes."

"Everything else comes after that, because the wireless is the most personal communications device and goes everywhere with you," Stephenson said. Of course, he fairly quickly added that at&t is not neglecting its wireline broadband strategy.

But there's an important principle here. If one totes up the actual revenue any telecom provider can generate from video (ARPU is nice, but gross margin for an entertainment product has to be sliced in half to figure out what "gross revenue" actually is for a service provider), and then compares that to what a service provider can lose from current voice and data, the potential loss from voice and data is a larger number than the potential gains from new video services.

That isn't an argument against providing video. It is an argument for not getting defocused on core data and voice revenues. That's where the money is.

John Chambers on Surviving the Coming Shift

I had forgotten that John Chambers has worked both at IBM and at Wang Laboratories. That means he worked at companies that were leaders of two previous waves of computing technology. IBM is about as good a proxy for leadership of the mainframe era as one could find. Wang also was a leader of the minicomputer era. That's signficant as Cisco Systems attempts something no other company has achieved in the semiconductor era: leading in at least two separate eras of computing. So what's the most dangerous thing that could prevent Cisco from making history in this regard?

Hubris: the idea that your company is so powerful, so well managed, so agile that it cannot fail, even as a new computing paradigm replaces an older one.

"You have to keep it constantly in front of yourself," Chambers says. As in, looking nervously and constantly over one's shoulder, hoping to hear approaching footsteps before anyone can be seen. "We make Andy Grove look relaxed," Chambers says, alluding to the classic Grove dictum that "only the paranoid survive."

"Transition will happen; not could happen," says Chambers, who is as aware as any executive ever has been of what it would mean to lead in two waves of computing. It would make history.

It's Quite a Metaphor

On the day NxtComm convenes, drawing most of the North American telecom press, Google convenes its press day. Not many North American telecom media types will be there (okay, the meeting is in Europe, so logistics are a factor). Apps are separated from transmission. So is the value chain and the business. Where the press is parked today shows that.

WiFi Will Supplement, Not Replace...

A recent survey by Ipsos Insight suggests a third of users would "sign up for or replace" their existing connection. As with all surveys, one should always be skeptical. Some people might attempt to replace their current service. Then they'll find out indoor coverage is a major issue, and will switch back. Or they'll figure out that the bandwidth isn't what they were expecting. Of course, there is another way to look at the results, and that is supplemental use of muni Wi-Fi for portable devices of various types, not the PC. If the cost is low enough, lots of people might be convinced to spend a bit more money for an incremental muni Wi-Fi connection to support connections to devices other than PCs or phones.But full replacement? Not many will find that a reasonable trade-off, in all likelihood.

Not Convinced, Eh?

Canadian small and mid-sized businesses remain more than a little unsure about the wisdom of out-tasking their information and communication systems and services, say researchers at The Yankee Group.

telx|vision:IP Business's Gary Kim TMC's Conference Topic #1

enterprise peering

telx|vision:IP Business's Gary Kim TMC's Conference Topic #2

Is voice a commodity?

Ad-Supported Calling?

There can be no doubt about the direction of advertising. So if the trend is so clear, it is inevitable that ad-supported calling will get closer attention. Jajah has been trying this in Germany and Austria, for example. Jajah has partnerships with three large media companies, including Bild, Germany’s largest newspaper; ProSiebenSat1, which owns two major German TV stations, and NewsAT, an Austrian station. The partners will spend seven million euros to advertise Jajah’s Internet phone service.

They will point users to their own Web pages, which will have a co-branded Jajah service from which people can make calls. Essentially, the media companies will subsidize voice to build traffic on their sites. Deutsche Telekom, Germany’s large phone company, is part owner of Bild. So, in a sense, DT is kicking the tires to see what's there.

Jajah will keep 50 percent of any advertising revenue that it sells on the pages it shows people while they make calls. It will sell a banner and a skyscraper on each page.

Separately, Globe7 offers a softphone-based approach integrated with video streaming. The play seems to be that the content downloading creates an ad potential. Ad viewing then earns calling credits. The angle here is possibly more interesting than the old "listen to a short ad and then I will connect your call" approach. PC-based or Web-activated sites can show ads on a home page, without disrupting a call.

Duh! at&t Should Have Talked to Some Cable Guys

at&t is promoting U-Verse IPTV services in Connecticut from an Ice Cream truck outfitted with a flat panel HDTV showing off the service. at&t also is holding U-Verse block parties and free concert or movie nights. It sounds as though the new tack is being taken because mass media advertising is a mixed blessing when a company is in the middle of a network build. Apparently at&t has finally discovered that it creates problems for itself when it advertises new services that only are available in a portion of a service territory reached by the mass media where the ads run.

Potential customers call in to get it and then have to be told service isn't available in their neighborhood. That's why cablers used to send out people with door hangers block by block as networks were built out. They tended to use the same "micro" targeting as their networks successively were upgraded. at&t couldn't ask anybody who had ever done this before what the pitfalls would be? It's not like it would have cost any money to get the insight. It's a one-sentence question and a one-sentence answer.

Healthy SME Communications Spending Forecast

The typically highly reliable Knecko Burney, owner of Compass Intelligence, predicts that U.S. spending for nearly every category of small and mid-sized business spending for information technology and communications will be headed north for the next five years. About the only things SMEs will be spending less on are PCs, truly a commodity, as well as personnel. Software, communications, network infrastructure and support all are headed north at about an eight to 10 percent rate over the forecast period.

(By the way, you can just click on any image in any post on this site and the larger version of the graphic will appear...just in case you are reaching for your magnifying glass to read the numbers!)

Ad Supported Wi-Fi?

Nobody knows whether ad support for municipal Wi-Fi services will work, though most seem to have given up on the notion that a network can be supported solely by advertising. Perhaps the more germane question at this point is how much ad-support models will complement subscription and municipal underwriting models (where a government entity becomes an anchor tenant).

Microsoft's own polling on the subject suggests a combination of free and subscription is viable. Penetration for a fee-based service might range from five to eight percent, while a "free" service might be used, some times, by 21 percent of people. Offer free and fee service and overall penetration could rise to about 26 percent.

Of course, the issue is whether an operator can get any significant amount of ad support. And as others in the field now have found, user potential in dense urban areas might be four times more than in a suburban area. All of which suggests muni Wi-Fi will be a supplemental form of access, useful at times but with single-digit subscriber potential. That's not shabby. Even independent WiMAX providers can't expect to do much better than that.

Significant capture of most of the access market by telcos and cable companies is part of the answer. But increasing use of 3G and 4G services by mobile users will be a significant factor as well.

If independent providers of mobile WiMAX can offer service cheap enough, they might yet carve out a niche in the "connected personal devices" space. The issue is competition from the likes of Sprint Nextel or others who may adopt mobile WiMAX as their 4G platform.

If the equivalent of "multi-user" plans were to be offered aggressively by a mobile carrier, with reasonable broadband plans plus significant discounts for plan member use of additional devices (gaming consoles, PDAs, cameras), that will prove attractive for much of the market.

Mobile voice and broadband to a "mobile phone", plus PC data card, plus connections for other devices from a single provider offering price discounts for each additional unit. That's especially true if the user-perceived value of connectivity for things like cameras is seen as low. A mobile carrier can afford to price such connectivity at low levels if it is capturing reasonable value from 3G phones and PC cards from a single customer.

But tethered PC connections used by the mass market will be dominated by cable and telco providers. Broadband for mobile "phones" will be dominated by the wireless carriers. What remains uncertain is how the "connected personal devices" segment might develop (cameras, iPods and MP3 players, game players, PDAs). There will be niches. The issue is how big any of those niches will be, and whether providers can operate at costs low enough to serve those niches.