CableVision Passes 25% Residential Voice Share

CableVision Systems Corp. now finds that more than 37 percent of its customers buy a voice product. If CableVision has 68 percent penetration of homes in its market, that means it has gotten more than 25 percent share of the voice market.

20 Mbps Services Get Traction in U.K.

Virgin Media's 20-Mbps U.K. broadband service seems to be seeing strong consumer interest. Over the last 12 months, Virgin Media has seen an 82 percent increase in the number of subscribers taking the 20 Mbps service, up to this point the fastest tier of service available, though Virgin Media now is adding a 50 Mbps service as well. About 9.3 percent of Virgin Media's broadband access subscribers buy the 20 Mbps service. Virgin Media also has found increasing numbers of customers upgrading from 2 Mbps to 10 Mbps levels of service.

Search Emerging as Internet's Second Killer App

The percentage of Internet users who use search engines on a typical day has been steadily rising from about one third of all users in 2002 to a new high of just under one half (49 percent), say researchers at the Pew Internet & American Life Project. To the extent that email has been the closest thing to an Internet killer app, search is emerging as the second.

The number of those using a search engine on a typical day is pulling ever closer to the 60 percent of Internet users who use email on a typical day. The percentage of internet users who search on a typical day grew 69 percent from January 2002 to May 2008.

During the same six-year time period, the use of email on a typical day rose from 52 percent to 60 percent, for a growth rate of just 15 percent.

3:1 Margin of Mobile to Fixed Lines Globally

There now are three times more mobile subscribers than access line subscribers worldwide in 2007 (3.3 billion vs. 1.1 billion), say researchers at Infonetics Research. The firm also expects continued strong growth in mobile subscribers, mainly driven by basic voice service needs in BRIC countries (Brazil, Russia, India, and China).

The number of mobile subscribers jumped 31 percent in 2007 over 2006, while access line subscribers declined five percent.

The number of worldwide mobile subscribers will reach 5.2 billion by 2011, Infonetics further suggest, while mobile broadband subscribers grow at a 104 percent compound annual growth rate from 2007 to 2011. At that point, there will be one cellular mobile broadband subscriber for every four wireline broadband subscribers.

Free Content Needed to Prime the Pump

Since consumers are not sold on mobile video services, mobile service providers should try offering users free content to prime demand, say researchers at Parks Associates.

While nearly one third of U.S. households have a video-capable mobile phone, operators are struggling to find an audience for their mobile video services, according to John Barrett, Parks Associates research director.

Most consumers with a video-capable mobile phone never have used the video features, Parks Associates finds. About 56 percent never have watched a video clip using a mobile phone, Barrett notes

“Buy before you try is always a tough sell,” says Barrett. "Many consumers are hesitant to pay for a new, unfamiliar service, but they will remain unfamiliar with the service until they or someone they know uses it.”

U.K. Broadband Saturating

In the U.K. market, as in the U.S. market, the number of likely new customers for broadband access services is dwindling. In the U.K., there now are about a million dial-up users left.

"The number of dial-up homes ripe for migration to broadband is rapidly dwindling, there are barely a million of them left now and they are an increasingly resistant minority," says Tim Johnson, Point Topic chief analyst.

There are about 16,735,000 broadband lines already in service, and it would be reasonable to expect a sharp deceleration in 2008. For the 12-month period from June 2006 to June 2007, nearly three million new subscribers were added. Between June 2007 and June 2008 about two million were added. With just about one million dial-up subscribers left to convert, it seems unlikely the gross additions will hit even a million between now and June 2009.

There are 9.6 million households without Internet access at all, but that includes homes with no PCs as well as homes with users who do not use the Internet. Point Topic estimates 58 pecent of U.K. households use broadband, about 4.5 percent use dial-up while 37 percent have no access.

Economic woes might be having some effect, but the primary issue is market saturation.

Netflix Users: 89% on "3 or fewer" Plans

Netflix has never given a breakdown on the number of subscribers in each type of rental plan, but using Feedflix, a site set up to allow Netflix users to track their usage of Netflix, some guesses can be made.

According to Netflix’s latest earnings report, they currently have 8.4 million subscribers. By extrapolating Feedflix’s breakdown of Netflix service plans to the larger subscriber base, we get the following estimates on where customers are spending their money, according to an investment advisor who goes by the pen name of Davis Freeberg.

1 at a time - 2.1 million subscribers
2 at a time - 2.4 million subscribers
3 at a time - 3.1 million subscribers
4 at a time - 500K subscribers
5 at a time - 168K subscribers
6 at a time - 84K subscribers

Since heavier users cost Netflix more (more postage, more DVD rentals, more handling), one would assume the profit is generated by the lighter users who rent less (less postage, fewer rentals, less handling cost).

VoIP 40% of French Market Traffic

VoIP now represents close to 30 percent of all telephone subscriptions in France, according to French regulatory authority ARCEP, and is growing by about one million subscriptions every quarter.

IP calls now represent 40.5 percent of traffic originating on fixed phones(compared with less than 27 percent a year earlier) and 59 percent of traffic for international calls. VoIP traffic now represents 42 percent of in-France calling and 18 percent of traffic to mobiles.

VoIP services are generally used more intensively (5 hours and 34 minutes) than “traditional” telephone service (3 hours and 16 minutes) per subscriber, per month in the first quarter of 2008.

Most fixed lines (66 percent) in service represent a single “traditional” telephone subscription on the PSTN, dropping by three percentage points each quarter. The reduction primarily is caused by customers substituting VoIP services.

Some 15 percent of lines in service at the end of the first quarter 2008 support both VoIP and legacy telecom.

Text Still Will Dominate Mobile Data in 2011

Text messaging is now, and will still be, the top revenue-generating mobile data application in 2011, say researchers at Informa. Video is the application that will have the fastest growth rate between now and 2011, though.

AT&T to Clarify DSL Speed Expectations

AT&T expects to modify the way it packages its broadband Internet service, offering more precise levels of service that promise minimum and maximum transmission rates.

AT&T Senior Vice President Robert Quinn told the Federal Communications Commission the company would offer "non-overlapping tiers" of broadband service, rather than its current offerings which go "up to" varying speeds of data transmission.

"When we provide broadband services based on speed, we will do so in discrete tiers that are disclosed to our end-user customers," Quinn said.

Quinn said the changes were among "clarifications and improvements" AT&T plans to make to its customer disclosure policies, which the company hopes to roll out later this year.

"If we find that we are not providing service within the ordered speed tier, AT&T will take action either to bring the customer's service within the ordered tier or give the customer an option to move to a different tier," Quinn said.

Comet Resurrects "Push"

If Web-based applications are to have a true shot at displacing apps run off local hard disk drives, response time issues must be solved. As is typical for Web apps, though, new tools may help solve that problem. Comet (or Reverse AJAX), for example, is a significant departure from the “click-and-wait” interaction we traditionally associate with Web applications.

In fact, as with so many innovations--recall "push" technology or "application service providers"--timing is everything. Some applications that simply were too cumbersome 10 years ago now are possible with the spread of broadband, faster broadband, caching, peer-to-peer and software such as Comet.

Being right often is less "good" than being timely.

Comet is said by its supporters to resurrect push capabilities with better IP communications.

Simply put, push communications like Comet remove the requirement for an end user to explicitly click on a link or button to request information from a server.

Instead, the server is free to send messages to clients anytime a server-side event occurs. Therefore, content no longer needs the tried and true “click” to reach you. Web pages from hereon out will simply update as new data is made available, finally laying to rest the refresh button on your browser.

That has implications for bandwidth usage profiles, bandwidth intensity and usefulness of interactive or social applications.

Comet makes it possible to build any application that requires real-time updates, enabling true desktop-like functionality to be delivered over the Internet. That has implications for the effectiveness of chat applications, social networking, online games; news updates and online collaboration, for example.

User Generated Video: Limited Ad Revenue

User-generated video will continue to account for close to half of total online video streams between 2008 and 2013, but disappointingly will produce no more than four percent of ad-related online video revenue at any time during this period, acccording the Diffusion Group.

According to Mugs Buckley, UGV currently accounts for 42 percent of online video streams, yet generates less than four percent of video ad-related revenue. Conversely, professional online video (including both short-clip and long-form content) accounts for 58 percent of streams and 96 percent of ad-related revenue, a reality unlikely to change over the next five years.

While the business of online video remains immature, Buckley notes that the continued growth in online TV viewing among consumers and the push to get this content directly to the TV will cultivate the larger audience for professional online video content.

No Mobiles on Planes?

H.R. 5788, "The Halting Airplane Noise to Give Us Peace Act of 2008," was approved by the House Transportation and Infrastructure Committee on Aug. 31, 2008. That does not necessarily mean anything much. It is just a committee vote, and the legislation is not yet scheduled for a floor vote, much less for consideration by the Senate. But some of us agree that people talking on mobiles can be quite an annoyance in the now-cramped confines of aircraft.

The European Union, though, seems to be moving ahead on inflight cellular service.

AT&T Bet on Jobs

Leslie Cauley, USA Today staff writer, says AT&T got a one-year extension of its exclusivity deal for iPhone sales in the U.S. market as part of the new deal with Apple to pay an upfront fee, rather than a share of monthly recurring revenues. The original exclusive deal was set to expire at the end of 2009. So AT&T has another two and a half years to wring more magic out of the iPhone before contending with other carriers.

The iPhone might seem like a no-brainer now, but back then it was little more than a concept, with no name, design plan or software operating system. And it was offered by a computer company that had zip experience in wireless.

And credit AT&T CEO Randall Stephenson for making a key, and somewhat "un-telco-like decision." in staking so much on the Apple deal.

"We're not betting on the handset," Stephenson says. "We're betting on Jobs."

That appears so far to have been the right decision. It isn't just the handset. It was the intuition that Steve Jobs, whose firm never had built mobile phones before, could bring something spectacularly new to handset design, and by extension to the mobile data business.

Imagine any stodgy, old school CEO at a firm that big, betting on a person, rather than a company track record. It's a sign of new thinking, for sure.

UK VoIP: Naked DSL Will Help

Continental Research estimated in April 2006 that Vonage had about six percent share of VoIP usage in the U.K. market, which is heavily skewed towards PC soft clients. But Vonage U.K. seems these days to be focusing on several user segments with higher propensity to use landline replacement services. A key segment is users with frequent needs to call the United States, says Vincent Potier, managing director, Vonage U.K.

But change could be coming. It is possible that customers will be able to buy a "naked DSL" service in the U.K., in the future. That will be important since 75 percent of broadband customers in the U.K. use DSL.

Still, the European VoIP market really was defined by Skype. Users expected to use headsets and make occasional calls on a scheduled basis, especially when calling internationally.

So Vonage has had to position itself as a different sort of experience: a replacement for the landline. Up to this point that has been a bit of a marketing challenge as U.K. users must buy a bundled voice line when buying DSL. So the opportunity for cost savings is not as great as would be the case in a "naked DSL" environment.

Still, more and more European countries are offering naked DSL, including France, Norway and the Netherlands. There being a fairly clear correlation between mass market VoIP and naked DSL availability, Vonage U.K.'s growth prospects will be aided quite a lot if the naked DSL option surfaces