T-Mobile Handles Churn

Though it doesn't appear T-Mobile USA will be changing its market share position in the near term, it appears to be doing a good job on the churn front.

It added 951,000 net new customers added in the fourth quarter of 2007, up from 901,000 in the fourth quarter of 2006. That's important because "net" adds are what one has left after deducting the customers who churned away in any given time period. The other data point is that, in its most-recent quarter, T-Mobile's churn dropped to 1.8 percent, down from 2.1 percent in the fourth quarter of 2006.'

That is notable because T-Mobile has a large percentage of contracts that are of the one-year variey, not the the two-year contracts that increasingly are the norm in the postpaid segment of the market. It also is notable because there is some evidence T-Mobile customers are more active than customers of some of the other leading mobile carriers in investigating alternatives.

"T-Mobile customers are the most active in checking out competitive products and services," says Compete.com analyst Jeff Hull.

"This is partly because they are a younger, more active subscriber base, and partly because of the legacy of one-year contracts at T-Mobile," says Hull.

"If you look at an upstart like Helio, four percent of their site traffic is from existing T-Mobile customers, with two percent from both AT&T and Verizon Wireless, and Sprint/Nextel customers seemingly uninterested in checking out the MVNO."

T-Mobile customers also are over-represented at the Boost Mobile site, another youth oriented brand that is successfully attracting T-Mobile user interest. At the margin, and it might only be at the margin, there does seem to be a difference between customer bases at T-Mobile and Sprint or Nextel, for example.

Given the apparent high "shopping" and "comparison" behavior, the lower churn is an accomplishment.

Senate Bill Mandates VoIP E911

Several years ago some VoIP proponents argued that regulators should not impose "legacy" emergency calling rules on new VoIP providers. That was back when some providers were aiming to replace legacy calling services with a variety of new applications or services, not all of which logically seemed to be "like" public network services. That largely remains true for services that remain in the PC-to-PC domain. But it appears the battle to avoid emergency calling regulations for all "replacement" services is moving inexorably to a conclusion.

Though similar legislation will have to be passed by the U.S. House of Representatives, the Senate has passed the IP-Enabled Voice Communications and Public Safety Act, a bill proposed by Senator Ted Stevens (R-AK). The legislation now moves to the House of Representatives for further consideration.

The bill requires all VoIP companies to provide enhanced 911 (E911) services to all subscribers. The bill gives the Federal Communications Commission authority to add 911 requirements into all new phone services as they evolve, without needing Congress' involvement. Elemental fairness, some would say.

For providers who once hoped relaxed regulatory oversight would provide a price advantage in the market, that hope increasingly is dashed. VoIP services that are effective replacements for public network calling will carry the same tax, safety and regulatory burdens legacy services do. And some would say that's just fair.

Jaduka Widgets Released

Jaduka has launched a new program to entice application developers to use Jaduka communication apps. It now offers free Web telephony service and widgets that bring voice communication to Web sites, browsers, blogs, and email.

Software developers can set up a free Jaduka Labs account that links their standard home, office, or mobile phone with their online activities.

dukaDIAL (www.dukadial.com) lets users make phone-to-phone calls to anyone in North America for free. The concept is similar to Jajah, if you are familiar with that service. A user goes to the Web site, enters the number of the device that will make a call and the number to be dialed.

When “Start your Call” is clicked, the application automatically dials both parties and connects the call. Users also can view call history and add numbers to the contact list that is shared with other Jaduka applications.

dukaLINK (www.dukalink.com) creates personal HTML hyperlinks that users can post on Craigslist, Facebook, a blog or emails. When users click the dukaLINK, they’re prompted to submit their phone number to automatically trigger a free phone call to you.

The application also supplies a public number and then forwards calls to the number a user has set up in a profile.

dukaBUZZ (www.dukabuzz.com) was developed for bloggers and social media junkies who want to hear from their readers. dukaBUZZ enables Web site visitors to leave “audio comments” or testimonials on your blog or Web site that can be heard by others.

Instead of typing and posting written comments, visitors record audio comments using the dukaBUZZ widget and their standard phone. dukaBUZZ works with any blogging software, including bBlog, Blogger, Drupal, Moveable Type / TypePad, Serendipity, WordPress, etc.

dukaBAR (www.dukabar.com) is a toolbar plug-in that automatically scans Web pages and converts all phone numbers into clickable links that initiate phone calls. It also stores a user's frequently called numbers in a contact list so that you can speed dial right from your browser. No software downloads or headsets required.

duhBATE (www.duhbate08.com) lets users create their own presidential campaign by adding their voice to the likeness of theirfavorite politician. The interactive political parody uses a user's telephone as the microphone for you to record "campaign promises", for example. When finished, the character speaks in the user's recorded voice online.

All of these widgets are examples of ways voice is being integrated into the fabric of other applications such as email, social networking and blog sites.

Mobile, Landline Have Switched Roles

Since 2002, U.S. consumers have dramatically changed their perceptions of the value of mobile and fixed voice services, according to a new survey by the Pew Internet and American Life Project.

In 2002, 63 percent of respondents said it would be hard to give up their landline telephone. In 2007, just 40 percent say that would be hard.

In 2002, 38 percent of respondents said it would be hard to give up their mobile phones. In 2007, 51 percent said it would be hard to give up their mobiles.

In other findings, a greater percentage now say it would be hard to give up their Internet access. Where 38 percent thought so in 2002, in the latest survey 45 percent said it would be tough to give up.

Fewer people are as attached to their TV services as they were in 2002. But lots more people now expect to have mobile email service. Just six percent in 2002 said it would be hard to give up their BlackBerry or similar device. Now 36 percent say they would find it hard.

Trouble at Clearwire?

Clearwire generated $45.4 million in service revenues in its most recent quarter, a 91 percent growth rate year over year. Not bad. But it is the guidance for 2008 that is troublesome.IT expects a 29 percent to 35 percent subscriber growth to end 2008 with 510,000 to 530,000 subscribers.

Growth businesses aren't supposed to slow that much, so early into their growth trajectory. Average revenue per user doesn't seem to be headed in the right direction, either. ARPU in the fourth quarter was just over $36.00, slightly below the year-ago quarter.

Disney Launches Mobile Service in Japan

Disney's new mobile phone service in Japan, based on use of Softbank Corp.'s mobile network, will be Disney's third attempt to define a new content-heavy or otherwise segmented approach to the mobile market.After experimenting with sports content and service for kids, it now is targeting Japanese women in theirDisney's new mobile phone service in Japan, based on use of Softbank Corp.'s mobile network, will be Disney's third attempt to define a new content-heavy or otherwise segmented approach to the mobile market.After experimenting with sports content and service for kids, it now is targeting Japanese women in their 20s and 30s.

The reeason? The company reasons that since females older than 20 represent 75 percent of the 3.5 million subscribers to Disney's myriad Japanese mobile websites, Disney Mobile can use designer handsets and that content interest to drive adoption.

The new service launches with three phones, each programmed to speed access to Disney websites. Users also can personalize their screens and emails with Disney characters.

You have to appreciate Disney's willingness to experiment. It launched two segmented wireless services in the U.S. market, Mobile ESPN, based at male sports nuts, and Mobile Disney, used by children but aimed at worried parents. Neither got traction. Other retail providers arguably should hope the latest attempt will fail as well.

The reason is that if a content brand can carve out a new space for itself in mobile, with a slightly-different business model (driving traffic to content Web sites, supported by advertising or commerce, for example), it attacks the subscription-based traditional model.

Just as important, it would represent a further shift in value towards independent brands in the communications space, much as Apple as emerged as a mobile brand in its own right, and as Google hopes to. Some will argue that Disney has learned nothing from two earlier unsuccessful efforts. Others will say the Japanese market is sufficiently different that it is a reasonable bet.

It's an experiment of the sort IP Multimedia Subsystem is supposed to provide mobile operators: allow rapid new service trials to see what sticks. One has to appreciate Disney's willingness to keep experimenting, despite earlier lack of success.

Traditional prDisney's new mobile phone service in Japan, based on use of Softbank Corp.'s mobile network, will be Disney's third attempt to define a new content-heavy or otherwise segmented approach to the mobile market.After experimenting with sports content and service for kids, it now is targeting Japanese women in their 20s and 30s.

The reeason? The company reasons that since females older than 20 represent 75 percent of the 3.5 million subscribers to Disney's myriad Japanese mobile websites, Disney Mobile can use designer handsets and that content interest to drive adoption.

The new service launches with three phones, each programmed to speed access to Disney websites. Users also can personalize their screens and emails with Disney characters.

You have to appreciate Disney's willingness to experiment. It launched two segmented wireless services in the U.S. market, Mobile ESPN, based at male sports nuts, and Mobile Disney, used by children but aimed at worried parents. Neither got traction. Other retail providers arguably should hope the latest attempt will fail as well.

The reason is that if a content brand can carve out a new space for itself in mobile, with a slightly-different business model (driving traffic to content Web sites, supported by advertising or commerce, for example), it attacks the subscription-based traditional model.

Just as important, it would represent a further shift in value towards independent brands in the communications space, much as Apple as emerged as a mobile brand in its own right, and as Google hopes to. Some will argue that Disney has learned nothing from two earlier unsuccessful efforts. Others will say the Japanese market is sufficiently different that it is a reasonable bet.

It's an experiment of the sort IP Multimedia Subsystem is supposed to provide mobile operators: allow rapid new service trials to see what sticks. One has to appreciate Disney's willingness to keep experimenting, despite earlier lack of success.

Traditional providers will be watching as well, for signs a further shift in value towards "applications," and away from "access," might be possible. On the other hand, naysayers will say the communications business has only so much room for content-centric approaches. At the end of the day, they argue, the quality of services, measured in terms of dropped calls performance, audio quality, access speed and so forth, plus service attributes, are far more important to the typical mobile user than "content" features.

So far, the naysayers have been largely correct. The issue is who, and where, this might not prove to be such an iron-clad rule. Disney hopes to find out.oviders will be watching as well, for signs a further shift in value towards "applications," and away from "access," might be possible. On the other hand, naysayers will say the communications business has only so much room for content-centric approaches. At the end of the day, they argue, the quality of services, measured in terms of dropped calls performance, audio quality, access speed and so forth, plus service attributes, are far more important to the typical mobile user than "content" features.

So far, the naysayers have been largely correct. The issue is who, and where, this might not prove to be such an iron-clad rule. Disney hopes to find out. 20s and 30s.

The reeason? The company reasons that since females older than 20 represent 75 percent of the 3.5 million subscribers to Disney's myriad Japanese mobile websites, Disney Mobile can use designer handsets and that content interest to drive adoption.

The new service launches with three phones, each programmed to speed access to Disney websites. Users also can personalize their screens and emails with Disney characters.

You have to appreciate Disney's willingness to experiment. It launched two segmented wireless services in the U.S. market, Mobile ESPN, based at male sports nuts, and Mobile Disney, used by children but aimed at worried parents. Neither got traction. Other retail providers arguably should hope the latest attempt will fail as well.

The reason is that if a content brand can carve out a new space for itself in mobile, with a slightly-different business model (driving traffic to content Web sites, supported by advertising or commerce, for example), it attacks the subscription-based traditional model.

Just as important, it would represent a further shift in value towards independent brands in the communications space, much as Apple as emerged as a mobile brand in its own right, and as Google hopes to. Some will argue that Disney has learned nothing from two earlier unsuccessful efforts. Others will say the Japanese market is sufficiently different that it is a reasonable bet.

It's an experiment of the sort IP Multimedia Subsystem is supposed to provide mobile operators: allow rapid new service trials to see what sticks. One has to appreciate Disney's willingness to keep experimenting, despite earlier lack of success.

Traditional providers will be watching as well, for signs a further shift in value towards "applications," and away from "access," might be possible. On the other hand, naysayers will say the communications business has only so much room for content-centric approaches. At the end of the day, they argue, the quality of services, measured in terms of dropped calls performance, audio quality, access speed and so forth, plus service attributes, are far more important to the typical mobile user than "content" features.

So far, the naysayers have been largely correct. The issue is who, and where, this might not prove to be such an iron-clad rule. Disney hopes to find out.

Don't Worry about Blu-ray

There has been some speculation that the Sony victory in the high-definition digital video recorder war is somewhat "Pyhric", to the extent that content is moving to digital distribution, and away from physical media.

That might be premature,if a recent survey of U.K. consumers is any indication. The survey suggests Blu-ray DVRs will have the highest growth of any digital entertainment activity in 2008, according to Russell Hart, Chief Executive of Entertainment Media Research.

The survey asked about usage of 49 digital and entertainment activities. Around 24 percent of consumers surveyed reported they will start watching movies in the Blu-ray format in the next six months. "This is at least double the intention rate of any other entertainment activity," Hart says.

The other issue is that consumers are happy to watch on-demand programming as long as it is free. There's high interest in new movie releases (84 percent are interested and 48 percent say they are definitely interested.

Live music concerts are attractive to 72 percent of respondents. So is comedy, interesting to 79 percent of respondents.

When confronted with three options--subscription with unlimited content, PPV and free ad-supported models--the free model wins. About 70 percent of respondents would rather put up with the ads than pay for the content.

Still, 48 percent of respondents say they are "definitely interested" in new release movies and 53 percent are willing to pay to watch them.

Singapore Gets 10 Bidders for 100 Mbps Network

Singapore’s Infocomm Development Authority has pre-qualified ten bidders for a new optical access network that will be open to any retail providers who want to use it.

The proposed network would feature initial capacities of 100Mbps downstream and 50Mbps upstream, with the ability to upgrade to 1 Gbps.

Alcatel-Lucent Singapore, Axia NetMedia Corporation of Canada, BT Singapore, City
Telecom Hong Kong, NTT West, Nokia Siemens Networks Singapore, Singapore Computer Systems Limited, Singapore Telecommunications Limited, Singapore Power Telecommunications and StarHub are on the list.

Covad Dips Toe into Metro Wi-Fi

Covad Communications is trying a different approach to metro Wi-Fi services, targeting services at businesses rather than consumers to create a revenue base.

Covad will build a Wi-Fi test network in a square-mile business district in San Carlos, Calif., using an approach far more narrow than what a regional nonprofit and a consortium including Cisco Systems and IBM had once envisioned. Covad also will limit its downside by agreeing to operate the network for a period of three months.

An earlier proposal by the Silicon Valley Network and Silicon Valley Metro Connect didn't take off, and revenue was the chief culprit. Azulstar, the startup that was to build and operate the network, couldn't get funding for two test networks at about $500,000 each.

That was supposed to be the start of a project serving 1,500 square miles and about 40 cities.

Technology really isn't the issue. Covad wants to find out whether it can get enough small business users to anchor a larger or more permanent effort.

Covad’s wireless business unit already serves business customers in San Carlos, allowing Covad to overlay the Wi-Fi capability on top of its fixed wireless broadband service. Central to the test is discovery of whether a repeatable financial and operational model exists.

Following the completion of the test, Covad Wireless will explore expanding the mesh service to additional locations in the region.

Covad Wireless operates California’s largest fixed broadband wireless network serving businesses, and the company views the trial as a way to test a theory: that it can reach incremental new customers in the very-small and home office segments it so far has not focused on.

Up to this point, Covad Wireless has focused on business customers requiring a T1 or higher bandwidth. So the issue is whether a sustainable business case exists for users who may not need, or are not willing to pay for, nailed up T1 connections.

P2P Issue is Hairy

P2P users amount to only one percent of Comcast's users, but those users are consuming 50 percent of the company's bandwidth, according to George Ou, an editor at large at ZDNet and the former technical director at TechRepublic.

Some say the ultimate solution is "more bandwidth." The problem is, that doesn't really address P2P bandwidth consumption, which automatically will scale to devour the additional bandwidth as well, some point out.

The problem is figuring out whether or not P2P applications really do pose outsize network loads, and must therefore be managed to preserve quality of experience for the 99 percent of other users, or whether P2P constitutes a lawful application that shouldn't be subject to rate shaping.

It doesn't immediately appear clear that there is a single answer. Traffic shaping isn't blocking. And even outright blocking sometimes is socially desirable. Blocking of viruses and spam come to mind. But even voice networks are designed to block some traffic when peak loads occur. One has to re-dial. Traffic shaping is somewhat analogous to the means used to cope with voice congestion at peak hours.

And, unfortunately, "more bandwidth" isn't by itself a solution to P2P network loading, it wouldn't appear. At some point, market mechanisms will have to be applied. At some point, the business pricing model will be applied in the consumer space: you can use as much as you want; you just have to pay for the usage.

Access Bandwidth: Size Doesn't Matter As Much As You Think

AT&T has been doing some testing recently. It bought cable modem service and then tested peak throughput and average throughput.

As you might have guessed, there's a huge difference. But the point is not to show that Digital Subscriber Line access is any better. It is to emphasize the point that access is only part of what determines end user quality of experience.

Every element of the delivery chain has to be optimized or quality of experience will be bounded by the weakest link. In fact, the tests suggest that real-world performance is precisely what users encounter.

Peak advertised speeds are possible at 3 a.m. During the evening hours, when home usage peaks, average throughput routinely drops as low as 300 to 400 kbps.

And that's just the difference between peak and average bandwidth. IP-delivered communications and entertainment also is subject to degradation because of latency and jitter, port contention and any number of other issues. In fact, port contention might in some ways be a bigger problem for mobile providers than raw bandwidth.

Mobile Broadband is Inevitable: History Will Repeat

About 22 percent of U.S. consumers go online wirelessly outside the home, compared with 16 percent of U.S. online households a year ago, says Sally Cohen, Forrester Research analyst.

Almost half of consumers Forrester surveys say they would like to do so.

Cohen says the growing interest is due in part to familiarity with home Wi-Fi networks as well as public hot spots. About a quarter of of consumers use Wi-Fi at home, she says.

The issue now is how fast mobile operators, Clearwire and Sprint can move to capture additional demand in the form of handheld and PC card forms of mobile Web access.

Because one thing is certain: history tends to repeat itself in the communications business. And that story is that services and features once considered "luxuries" become necessities, and therefore mass market products or even commodities.

Once upon a time families would gather around a phone at Christmas and make a long distance call across the country or world, at some point being exhorted to "keep it short." Once upon a time homes shared a party line.

The point is that broadband use has expanded pretty much as wired voice did. It was place based. At some point a small number of people started to use mobile voice. Now virtually everybody does.

The same thing is going to happen with broadband. People used to share bandwidth at work. Then they got service at home. The next wave will be mobile broadband used by people, just as mobile voice now is.

U.S. industrialists and entrepreneurs have been turning luxuries into everyday experiences and necessities has been going on since the 1870s, depictions of many as robber barons notwithstanding. As with many other innovations, the key is to systematize and standardize and wring cost out of the production of former luxuries so they can be provided as mass market necessities.

Mobile broadband isn't going to be any different. History does repeat.

Online Video Viewed by Half of U.S. Internet Users

eMarketer predicts that over half of the U.S. population will have watched video on the Web before the year is out.

By next year, more than 80 percent of all Internet users will have done so.

New Peak Load Issues for Mobile

There's only one problem worse than dealing with peak load, and that is average load that starts to look like peak load. In the voice world, peak load has been the bigger issue, not average load.
Data networks have peak load issues as well, but those issues are mostly about the number of bits to pushed through the pipe, not generally use of circuits or network elements or ports.

Wireless is starting to have other problems, though, as data usage grows. And you instinctively would think bandwidth has to be the issue. It isn't. But take the easy stuff first.

Just as there are two “rush hours” on the road (6 a.m. to 9 a.m. and 5 p.m. to 7 p.m.), enterprises typically experience two “rush hours” on their phone systems, says Art Yonemoto, owner of his own telecom expense auditing firm. For most enterprises those PBX rush hours happen at mid morning (10 a.m.) and early afternoon (2 p.m.). Hospitals, though, tend to have one of their busiest hours at 9 a.m., especially on Mondays, as their patients call to schedule appointments.

For the most part, though, enterprises handle their phone system peak loads quite well. Mobile networks cannot say the same. as they generally are designed to handle about 80 to 90 percent of calls on a non-blocking basis. At peak hours, blocking occurs.

Some calls simply go straight to your voice mail. The other obvious issue is a dropped call, which happens because you are moving from one area to the next, and the next cell tower has no free radio assets to hand off the call.

But there are other problems emerging, and that is amount of data traffic, and the different characteristics data applications impose on the network. Bandwidth alone is not the entire problem, any more than bandwidth is really the problem for voice traffic.

The issue is that radio resources are tied up even when not that much bandwidth is flowing over the radio network. An obvious example is a mobile virtual private network client, which essentially nails up a connection even when actual data is not flowing. The issue then is the strain on radio resources, not bandwidth as such. Other applications that don't actually consume much bandwidth might have lots of signaling and pinging. Some social networking applications and even mobile email devices can create that sort of stress.

So for wireless networks, it now appears application interactivity--not just bandwidth--is becoming a gating issue. It is an issue bandwidth alone does not fix. The additional new issue is occupation of radio resources.

Enterprise iPhone? Just talk to RIM Servers

Though there are other issues, Apple would get far down the road as an enterprise device if it did just one thing: ensure compatibility with Blackberry servers.

Though Microsoft Mobile is growing its share, BlackBerry is the device to beat. Apple will keep getting heat for its lack of security as well.

But the main thing is the ability of a user to get company email on an iPhone, not just on a Blackberry.