People Now Text More than Talk

The typical U.S. mobile subscriber sends and receives more SMS text messages than telephone calls, according to new research conducted byNielsen Mobile. 

During the second quarter of 2008, a typical U.S. mobile subscriber placed or received 204 phone calls each month.  In comparison, the average mobile customer sent or received 357 text messages per month, a 450 percent increase over the number of text messages circulated monthly during the same period in 2006.

U.S. teens (ages 13 to 17) had the highest levels of text messaging in the second quarter 2008, sending and receiving an average of 1,742 text messages per month. In comparison, teens took part in an average of 231 mobile phone calls per month, during the same time period.

Access Restrictions Will Hand Verizon a Marketing Advantage

Some U.S. communications executives say that service providers may have to implement tiered pricing to deal with the massive explosion in streaming video. Video might be growing even faster than most project, Lisa Guillaume Level 3 Communications VP. But Verizon Communications obviously thinks it will have an advantage if that happens. 

"There are choices that can be made in the home broadband market," says Doug Pasko, Verizon Communications principal member of technical staff . "It's not like video is a surprise -- we all saw it coming." If tiered pricing, bandwidth caps, traffic shaping and other bandwidth management techniques become an "industry standard" issue, Verizon will have a marketing advantage handed to it, as its FiOS access network simply has way more bandwidth than any of the other competitors. 

DirecTV to Stream to DVRs

DirecTV is betting that the Web will serve as a major technological ally as it tries to match cable in delivering on-demand video content.

The top U.S. satellite-TV provider now says DirecTV On Demand will deliver content over broadband Internet connections The service provides more than 4,000 standard-definition and HDTV titles through a DirecTV PlusHD DVR or R22 DVR receiver.

The service allows customers to download programming to their digital video recorders. 

Ditch the PBX?

Though it might not seem an approach very-large enterprises will want to take, at least not now, all sorts of smaller organizations might well find they do not need to buy new IP-based phone systems to take advantage of most of the features most users at most smaller organizations or branch offices will need. They might find it makes more sense to equip users with smart phones and then map hosted PBX features to those mobiles. In other cases it probably will make more sense to map hosted PBX features to both desk and mobile phones. 

The BroadSoft MobileMax Enterprise Edition Mobile Client is a software application that resides in the mobile user’s device and extends the functionality of a BroadSoft powered hosted solution to the mobile device, replicating desk phone functions. Among the features possible are "single number" service for both inbound and outbound calls, single voicemail, least cost routing, short code dialing,  transfer, redial, hold, conference, record, call waiting, simultaneous ring, conference calling, email and synchronization to PCs. 

Though it might seem an improbable choice, here's a scenario that is more likely by the day. An enterprise issues its employees a smart phone of their choice, and then maps phone system features to those mobiles, positioning the move as an employee benefit. Given the right companywide plan, users then can use the smart phones they want, for business and personal use, without having to worry about submitting reimbursement claims.

The other conceivable benefit is that employees can be issued new models periodically, as another benefit. Older users might need to get used to such things. Younger workers might find the deal appealing. Desk phones are hard to position as any sort of employee benefit. 

Use of a smart phone costing $400 to $700, with periodic replacement and ability to use the device for personal and business use can be positioned as a company benefit. 

Cloud Computing Changing Markets

Cloud computing today includes contestants in multiple markets, arguably based on existing segments that are reforming into one vast new and broad business, in much the same way that the "global telecom business" might be thought of as a single economic category, though it is composed of many distinct segments. 

There are myths, though, says Frank E. Gillett, Forrester Research analyst. One myth is that cloud service offerings are one large market. So far, as has been the case with other potential markets such as IP Multimedia Subsystem (IMS), providers have rushed to rebrand existing offerings as "IMS compatible." The same thing is happening with cloud computing. 

Other misconceptions are that cloud computing mostly is synonymous with "virtualization" of servers or that cloud computing applications and services will compete on price. It is more than either of those trends, says Gillett.

In fact, one might distinguish at least five separate markets within the broader cloud computing universe. Two of these markets, Web-based services such as Google and software-as-a-service offerings such as salesforce.com, are known markets delivered from the cloud. In that sense, most consumers now use cloud computing applications. 

But there are business-to-business markets emerging as well, including the notion of  app-components-as-a-service, software-platform-as-a-service, and virtual-infrastructure-as-a-service. Those segments essentially provide building blocks for application and service providers to create retail offerings. 

So why might this be important for telecom or cable service providers? Cloud computing should change the way enterprises build their computing infrastructures, deemphasizing on-premises, "build your own" data centers and increasing demand for remotely-sited data centers. That should lead to a reconfiguration of the hosting business, at the very least, increasing the role for service providers and decreasing the role for smaller independent providers. 

Roughly the same thing is happening in the enterprise and consumer software businesses, shifting delivery from physical media to networked, online access. That likewise creates new demand for networking services, especially quality-assured networking services. 

Australian ISPs Say U.S. Pricing Plans Are Wrong

There is no need for network neutrality rules, say executives of Australian Internet service providers. U.S. ISPs simply need to stop offering "unlimited" access and switch to metered usage, argues Justin Milne, Telstra Media group managing director. The only problem is the business model," argues Simon Hackett, Internode managing director, reports ZDNet.com.

"The U.S. problem isn't about running out of capacity," says Simon Hackett, the managing director of Adelaide-based ISP Internode. "It's a business model that's about to explode due to stress."

The problem with an "unlimited access" plan is that it devalues what a megabyte is worth, they argue. U.S. ISPs have a couple basic options, they argue: absorb the costs, stop offering unlimited access plans or charge business partners for quality-ensured delivery of video and other high-value traffic.

Malone says that when users are offered truly unlimited access to download as much as they want, three per cent of customers use over 50 per cent of all the downloads. Download quotas can eradicate that problem and have no impact on 95 percent of users.

The Australian model gives ISP's predictability about income and network costs, and is self correcting: users trade up to higher-cost plans when they need to, the Australian ISPs argue.

Wal-Mart Gets its Own Geek Squad

Wal-Mart and Dell are testing the Solution Station by Dell in 15 Dallas stores, creating a service and support operation along the lines of the Best Buy Geek Squad, the Circuit City Firedog or AT&T Tech Support 360. Solution Station will repair PCs and set up home entertainment and wireless networking gear sold by Wal-Mart.

The move shows the increasing need for end user support, in the small business and consumer markets, as more complex digital technology sales now require more set-up, training and configuration services.

The AT&T service allows customers to receive live help for everything from setting up and configuring their computer to setting up Wi-Fi networks and hooking up printers, scanners and routers via the Internet. Subscription plans range from $19 to $28 a month, per computer, with an $89 initial setup cost.

As IP technology becomes the dominant way service providers deliver services to customers, it no longer is possible to terminate services cleanly at some demarcation point. Increasingly, support must be provided for end user devices as an integral part of the customer experience. 

T-Mobile Sells out G1 Stock

T-Mobile USA apparently has sold out all of their pre-sale stock of the Android-powered G1 smart phone, according to TmoNews.com. Current T-Mobile customers were offered a chance to buy the device early, before the actual mass market launch on October 22. The site says T-Mobile planned on offering 60,000 pre-sale devices.

Bandwidth Caps Inevitable

T-Mobile USA's swift retraction of a 1 Gbyte monthly cap on 3G data access to G1 Android phones was wise. The cap was paltry, compared to competing offers available from Verizon, AT&T and Sprint. Granted, T-Mobile probably wanted to avoid taxing its brand-new 3G network, and likely was aware that five class action lawsuits filed against AT&T for misrepresentation suggest legal liability if 3G performance was compromised by excessive demand. 

That said, bandwidth caps are inevitable for mobile users, and likely inevitable for fixed broadband access as well, as video becomes a more-common application. The reason is simple: video consumes an order of magnitude, or in some cases two orders of magnitude, more bandwidth than anything Internet service providers yet have encountered.

Anybody who has followed the cost of fiber-to-home construction knows how expensive access to core bandwidth actually is. In fact, the business case is quite difficult, under nearly all circumstances. 

User expectations aside, when demand jumps that much, one can expect either bandwidth caps, or metered usage or new higher-priced tiers of service that better match the underlying cost of providing service. For some of us, Internet access, using broadband, is as much a utility as water, electricity, wastewater services, heating or cooling. 

And it simply does not make, long term, to provide most of those services on a "flat fee, irrespective of usage." There are real costs (carbon footprint, drilling, refining, construction, maintenance) for providing clean water, water removal or electrrical services. It would not make sense to provide them on a flat rate basis for all customers, as well as that might work for most customers, most of the time. 

At Work Social Media Overblown?

Researchers at the Pew Internet & American Life Project recently found that very few workers actually create or read blogs while at work. About 11 percent of respondents who have Internet access at work say they have read blogs while at work.

Reading is most prevalent among younger generations of employed Internet users. About 33 percent of Iinternet-using employees say they have read someone else’s blog or online journal, either at home or at work.

Among young working adults, 46 percent are blog readers, compared with 33 percent of 30-49 year olds and

25 percent of employed Internet users ages 50-64. At-work blog reading is equally prevalent among all of these groups, though. 

Some might seize on that finding as an example of workers not taking advantage of all the information-bathering and communication tools they now have at their disposal.

Some will leap to the conclusion that workers are doing themselves a disservice by avoiding blog readership or creation while they are at work. That might be true. But there is another way to look at matters. 

Those of us who have done journalism for any length of time sometimes believe--apparently incorrectly--that most people in a business or profession "need" to read news and other information sources to do their jobs. But hang around in the mailroom at any organization. What you will find is that after the "C" titles, very few people who work in organizations actually read publications of any kind related to their industry verticals or horizontal job responsibilities.

It simply is not true that most people "need" to know what is happening at a high level in their industries to do their actual jobs. If it were true, then almost everybody would be reading and acquiring such information at work. But most people do not. 

One can argue that "most" people thereby are harming their careers. To be sure, there is no way to prove or disprove such a thesis. But it has not been my experience, as somebody who has picked up mail in the mailroom, that most people actually think they "must" know what is happening in an industry at a high level, in order to do their actual jobs. "C" titles obviously have greater incentive to monitor industry trends, as they must raise and allocate capital. Marketing staffs often have higher incentive to know what's going on because they must create and manage a wide variety of sales-related and product development tasks. 

Information technology managers typically spend more time than most staying "up to date" on technology trends. But most people simply do not, because they don't have to. 

Media publishers and content providers of all sorts have a vested interest in persuading people that a particular product is a "must read" for most people who "matter." That just isn't true, in most cases. Most people not only have no such need, they have no such habit, either.

Ping Patent, Ding Providers

Google has filed a patent application that essentially would allow end users of communications services to conduct real-time auctions and then select the best deal. 

Think of it as an application of "on demand" bandwidth to virtually any voice, video or data session a user wants to create "right now."

Customers like this sort of thing, carriers typically don't, as prices tend to drop when there is real-time transparency into cost and quality parameters of available access and transport options. 

Cisco Makes Big Move into Cloud Computing

Cisco has undertaken a major new initiative in the unified communications space, introducing a new architecture for its former WebEx Connect service, making Cisco a provider of Web-based productivity applications including email, instant messaging, voice, calendaring and virtual whiteboards.

The offering is part of Cisco’s Software as a Service (SaaS) platform and is part of a vision Cisco now has for "everything as a service." Predictably, the initiative has pundits touting Cisco's new move to compete with the likes of Google and Microsoft in Web-based services and applications. The strategy has elements of that, to be sure. But that's almost a by-product of the larger move towards cloud computing services that use a browser front end as the portal to services and applications of all sorts that once were delivered using physical media and local storage. 

Cisco says Verizon Communications is an initial partner, and that further deals are expected with European and Asia-based service providers as well. Cisco executives say business models might vary from carrier to carrier, but that subscription fees will drive the retail offerings and carriers will share in that revenue. 

Though initially services are expected to be consumed by PC users, the service also will be made available to "most" mobile platforms by the first quarter of 2009, including support for Symbian, BlackBerry, and Windows Mobile

operating systems.

EC Wants to Slash Texting Rates 60%

The European Commission, as expected, has proposed a new law slashing international text messaging rates by 60 percent by the summer of 2009. Specifically, the EC has proposed a retail cap of €0.11 (about 16 cents), excluding value-added tax, on roaming text messages, combined with a €0.04 cap at wholesale level, to be introduced by July 1, 2009. 

Tracfone Plumbs a Niche

TracFone Wireless Inc. has launched a program in Florida that provides low-income households with phone service. SafeLink Wireless will operate as part of Lifeline, a U.S. government-supported program providing phone service for low-income households.

It provides households a free mobile phone, mobile access to emergency services and 68 minutes of free monthly air time for a year. The cell phone offers in-demand features like voicemail, text messaging, call waiting, international calling to over 60 destinations and caller ID.

Families may qualify for SafeLink Wireless service if their household income is not above 135 percent of the federal poverty income guidelines, or if they receive government assistance that including Medicaid, food stamps and other programs.

The program is yet another example of a niche voice service that does not fit the classic definition of a "commodity." That is to say, this particular voice application is not a functional substitute for other voice products, but rather a particular implementation of voice that is the foundation for a vertical revenue segment within the broader market. 

Some providers of voice services for retailers would probably note that very little outbound traffic or features typically are used in such settings. Most of the value is provided by inbound calling features such as automated attendant and call transfer, for example. Low-cost mobile service might be part of the reason. But part of the reason for this use pattern is simply that many retailers do no outbound telesales. They simply wait for customers to walk in the front door or call. 

Restocking functions might require some outbound calling, but in many cases local distributors supply that function, so "long distance" is not required. 

The point is that, in actual practice, there are all sorts of real-world use cases for voice communications that do not fit the classic definition of a "commodity," with the implications that typically has for pricing, conditions of use and packaging. 

Xohm Launch Slips to October

Sprint Nextel will launch its Xohm mobile WiMAX network Oct. 8 in Baltimore, the company says. But that doesn't mean we should expect a full commercial launch. Initially, the network will be used by "friendly" partners such as Intel and other Xohm partners who will seed the market with selected friendly users. 

Motorola, Nokia, Nokia-Siemens Networks, Samsung, ZTE, ZyXEL, Ciena, DragonWave and Mformation also will be providing software, hardware and applications during the test period. 

Future service will launch in Chicago and Washington, D.C. as well. Aside from the normal shakedown issues, backhaul has been a key issue, and carrier Ethernet is a key technology for solving those problems.