By the Time the Broadband $ is Spent, It Won't be "Stimulus"

For all of the interest companies now are showing in the $7.2 billion broadband access spending that is supposed to happen as part of the "stimulus" package, it is possible the only people who will "get" any incremental money any time soon are lawyers and consultants who claim they can help clients get some of the money.

A large percentage of the money for broadband in the stimulus package won't be spent until 2011 or later, says Jeffrey Eisenach, chairman and managing partner of Empiris, an economic consulting firm. The money, split between the U.S. National Telecommunications and Information Administration (NTIA) and the Rural Utilities Service (RUS) of the U.S. Department of Agriculture, will go out in the form of grants, and neither agency is currently set up to allocate billions of dollars, he says.

"In 2014, you're not going to need stimulus in this economy," says Robert Atkinson, president of the Information Technology and Innovation Foundation, a tech-focused think tank. "There's a sort of half-life for stimulus spending."

Blockbuster Defies Expectations

The conventional wisdom is that Blockbuster's business model is the equivalent of "toast." In fact, fears of an impending bankruptcy filing caused shares to fall as much as 86 percent early in March, as a result. 

But Blockbuster says domestic same-store sales increased 4.4 percent in the fourth quarter of 2008, representing a 5.3 percent increase when compared to a decline of 0.9 percent in the same period in 2007. 

The increase in same-store sales was comprised of a 2.6 percent decrease in domestic same-store rental comparables and a 36.5 percent increase in domestic same-store retail comparables, which was largely driven by increased sales of games, game merchandise and consumer electronics.

For the full year of 2008, Blockbuster achieved a 6.4 percent increase in domestic same-store sales, compared to a decrease of 6.9 percent in 2007. The 2008 domestic same-store comparables included a 1.2 percent increase in domestic same-store rental comparables and a 37.4 percent increase in domestic same-store retail comparables.

Companies and executives frequently manage to outperform conventional wisdom, and it appears Blockbuster has done so. 

Mobiles are Disruptive to Ad Business

Media and advertising professionals say the pullback of ad dollars and mobile devices becoming personal computers are the most disruptive forces in media today, according to a recent survey by KPMG LLP, the U.S. audit, tax and advisory firm. With media time and spending seen moving away from traditional channels, attention to social media and mobile consumption is expected to increase.

In polling more than 200 media, marketing and advertising executives, KPMG found that 49 percent of respondents indicated that the pullback of advertising dollars is the most disruptive force in media today, followed closely by mobile devices becoming personal computers (40 percent).

The KPMG survey also found that some 75 percent of executives predict that advertisers will move more than a quarter of media time and spending away from traditional channels in the next five years, while social networks and mobile marketing are expected to see increased activity.

While the marketing and branding power of social networking is expected to be increasingly harnessed in the future, 61 percent of executives indicate that fewer than 30 percent of ad agencies have a plan in place to leverage the medium for their clients.

A Humorous Look at Soccer

In my case, something more true of my grandkids than my kids, who preferred football, track and wrestling. Then again, I only have one daughter and three sons, and they managed to get to high school before the soccer craze hit. 

The grandkids have tons of "gold medals" hanging on their bedroom walls, many earned for seasons where no scores were kept and no goalies played. 

Mobile Marketing Evolution: A Prediction

There's one consistent pattern I have noticed for decades in the telecom business, and I'd be willing to bet the same pattern plays out in the mobile marketing business as well. New things start out when pioneers, typically exemplified by new companies, start making a business of the new innovations. 

As the new practices, channels, services and applications start to become mainstream, larger and established players move in and ultimately represent most of the sales volume. We saw that in the mobile business, in digital subscriber line, VoIP, the dial-up Internet access business, content distribution networks and cable TV, for example.

The big exception to this general rule is that a few of the upstarts will so dominate new parts of the ecosystem that they themselves will become the leaders. Google and Amazon come to mind. Still, over the long term, even large assets of this sort might ultimately be absorbed by other contestants in the ecosystem. 

In the mobile advertising business, that means specialists will prove the channel works. Later, though, the full-service agencies will simply incorporate mobile channels within their larger practices. We are quite some way from that sort of consolidation, however. Right now, it's a specialist's game. 

The Outcome Might be Inescapable, But Plan on 20 Years

If the newspaper and magazine business model increasingly is "toast," is TV next? You will find no shortage of observers who say the answer is "yes;" that over time, more content will shift to some Internet-delivered modality. 

It might also be worth keeping in mind that transitions of this sort typically take decades. As a journalism graduate student I worked on a Gannett-funded project on the future of journalism education as electronic forms of media became more important. Keep in mind, the World Wide Web had not yet been invented at the time we conducted that exercise. 

I hate to admit it, but that was nearly 30 years ago. Only this year have we seen massive signs that the transition is hitting print media on a permanent basis. 

So the direction might be there, but the transition will take far longer than most expect. In fact, most technology-driven displacements of this sort take longer than most observers expect. If the Internet TV displacement follows the typical curve, progress will be far more stubborn than people expect, in the early years. And "early years" can last for decades. Once the inflection point is hit, change will occur faster than people expect, though.

For those of us who have been anticipating a major shift to electronic forms of all media for quite some time, it has taken quite a long time to get here. Now that we have, watch out. The structural change now will occur far more rapidly than anybody suspects. 

That you are reading this on a blog is but one example. 

I do not think it will take 30 years for stunning change to occur in the packaged, linear video business. But neither do I think anything other than relatively incremental changes in revenue volume will occur in the near term, if only because technology substitution, and the changes in industry structure technology enables, take time to unfold.

I do believe the inflection point for print media already has been reached, and do expect massive changes on a scale and pace most practitioners are not expecting. That is one reason why I began to shift gears two years ago. Well, maybe shifting gears is too incremental an analogy.  Jumping ship is the better, if imperfect, analogy. 

Somehow, I still find myself doing "print" content. But it is not the future. 

A similar inflection point for mainstream replacement of multi-channel video services by Internet replacements is far off, yet, even though we now can see the change coming. It might be inevitable or inescapable. It will not be transformative for some time to come, though. Think decades, not years. History suggests that is the right time frame.

Help! We Need Unified Communications

Communications barriers and latencies can cost small and medium businesses up to 40 percent of their productive time, according to a Siemens-sponsored global study suggests.

On average, 70 percent of of small and medium business execitives recently surveyed say they spend 17.5 hours each week addressing the pain points caused by communications barriers and latencies, according to a global study sponsored by Siemens Enterprise Communications and conducted by SIS International Research.

Researchers at SIS International Research determined that the time spent per week dealing with communications issues was more than 50 percent higher in companies with more than 20 workers.

Companies of 100 employees could be losing more than $500,000 each year by not addressing their employees’ most painful communications issues, considering only "hard costs."

The top five pain points are inefficient coordination; waiting for information; unwanted communications; customer complaints; and barriers to communication.

Premium Video Not Conforming to Historical Patterns?

In past recessions cable operators and other multi-channel video suppliers have seen a dip in growth rates for premium services such as HBO, Showtime or Starz. That might not be happening this time. Or at least the impact has not yet been seen.

At the same time, Netflix growth seems to have accelerated as well.

Perhaps consumers will behave differently this recession than they have in the past, and in ways that are good for video providers. Better promotion from more providers or a change in the value of in-home entertainment might be explanations.

So far, this is a bit of a surprise to the upside.

Smaller Businesses Warming to Cloud Computing

The most important factors driving businesses of all sizes to implement cloud computing solutions are the same factors that have prompted companies to outsource IT services for years: lower costs, better performance and agility, according to Hosting.com, which recently surveyed 644 executives in a broad range of industry verticals, and including firms with fewer than 100 employees as well as firms with more than 1,000 employees. About 69 percent of the respondents say they have fewer than 100 employees.

The driving factors for adopting cloud services are nearly the same for all company sizes, the report suggests, and business size plays no role in how quickly the executives believe cloud technologies will be adopted.

Cost savings, availability and performance are the top three values respondents believe cloud computing represents, but scalability also ranks high.

Security and support are seen as the two top obstacles cloud computing providers must surmount.

But roughly a third of executives in the small business and mid-sized business categories think they will be using cloud computing in some way at their firms within the next 12 months.

About 70 percent of respondents say Web applications are best suited to cloud computing, but 41 percent say data base operations are best suited to cloud computing. About 37 percent see application servers as ideally suited for cloud computing.

About 18 percent of respondents prefer to buy using annual contracts while 48 percent prefer month-to-month payment schemes.

It is worth noting that Amazon Web Services (Amazon's cloud computing service) says it now has 490,000 developers in its program.

Voice Mail to Text Using Skype

Skype now offers voicemail-to-text conversion for all Skype voicemail users. SpinVox converts voice messages to text in English, Spanish, French and German and the messages are then sent by Skype as an SMS text message directly to a designated mobile phone.

The intended use case for 'visible voicemail' is an on-the-go user away from a PC and using a phone not equipped with a data plan and smart phone to receive those messages directly on the mobile device.

Recipients of converted voice mail messages can listen to the full voice message by either signing into Skype or by calling their "Skype To Go" number. Skype users may choose instead to receive voicemail notification using SMS or for free by email.

"Skype is the first internet communications software provider to deploy SpinVox, further reinforcing our position as the only provider of voice to text messaging services which are used daily by millions of people on five continents," says SpinVox co-founder and CEO, Christina Domecq. "Our user base has grown over twenty-fold in the last 12 months and bringing Skype's voicemail subscribers on board will accelerate this trend."

PC Subsidies Now Joining Phone Subsidies at AT&T

AT&T wants to move beyond subsidizing mobile phones with that strategy to other hardware, led by netbooks, that use the AT&T wireless broadband network. After rebates, consumers can buy netbooks from Acer and Dell for $99 and AT&T says it is in talks with other computer makers as well.

The payback is substantial, as AT&T gains customers paying $60 a month under contract and spends a couple hundred dollars upfront on the subsidies. The move also should help offset weakening sales from enterprise customers.

AT&T says it will expand its subsidy program to cameras, portable video game machines, GPS devices.

Depending on how AT&T decides to price those connections, the firm could undercut some of the demand Clearwire has been talking about stimulating. "Casual use" plans are a prime example.

Where this all culminates, of course, is an omnibus plan that allows users access for a number of devices as part of a single account, much as users now buy "family plans" for multiple mobiles.

Viewers Want Widgets, Parks Associates Says

Video-on-demand libraries and widgets will be the first generation of video services driving adoption of connected television experiences in the U.S., according to Parks Associates.

Some 33 percent of respondents are interested in widgets, and almost 50 percent are interested in premium Web content, including TV shows and movies, through a connected set-top box, says Parks Associates.

Among TV widgets Parks Associates believes have appeal are customized news, weather, sports, or traffic information.

“Broadband households are growing accustomed to viewing video off the Internet,” says Kurt Scherf, Parks Associates VP.

Scherf says consumers are willing to pay – either on the price of a television or as an additional subscription cost – for certain features.

iPhone is Global Mobile Web Leader

Apple's iPhone is now responsible for 66.61 percent of global mobile Web traffic according to a NetApplications.

The Java ME platform follows a distant second at 9.06 percent, trailed by Windows Mobile at 6.91 percent. NetApplications notes that despite the iPhone's commanding lead in mobile browsing share, Android (6.15 percent, tied with Symbian) and BlackBerry (2.24 percent) are rapidly gaining market share, but the report notes that doesn’t mean Apple's lead is shrinking, but that the overall market is growing fast.

Though one must be wary about imputing too much, the current figures indicate that there are clear end user behavioral differences between iPhone and BlackBerry users. That might be caused by user interface barriers or other user preferences, but the differences are striking.

Mobivox Introduces CRM Capabilities

Mobivox has introduced "CRM over Voice," allowing insertion of context-sensitive, unobtrusive messaging into user interactions while they are occurring, Mobivox says. That capability is made possible by two innovations, the ability to integrate and update a unified address book into the voice session, irrespective of what type of voice device or access network is used, and the ability to connect to transaction data bases.

“Mobivox partners can now perform all-important CRM in the course of service delivery, rather than before or after it, by dynamically inserting context-sensitive, unobtrusive messaging into user interactions,” said Diedrich.

Messages about special rewards or promotions based either on past behavior are one example.

“Over time, the platform’s multilingual voice user interface, or VUI, establishes a unique and very cost-effective relationship with the user,” Diedrich said. “Our network-hosted address book and user database allow for insightful user profiling throughout the customer lifecycle. By mashing the VUI with rich and relevant behavioral database information, we have created an unprecedented set of highly contextual CRM processes, executed in real time.”

Thomas Howe to Head Jaduka

Jaduka has promised "big news" at eComm, and one would have to say that some of that news already is leaking out. Consultant Thomas Howe has shut down his consulting business and now is the new Jaduka CEO.

NetworkIP, Jaduka's parent, clearly has decided that it cannot get the traction or valuation it seeks without a recognizable name at the top of its executive ranks.

I believe people refer to this as "street cred."