FTC Opens Probe of Apple Mobile Ad Practices

The U.S. Federal Trade Commission will investigate whether Apple Inc.'s business practices harm competition in the mobile advertising market, Bloomberg reports.

It appears Apple's refusal to allow third-party firms access to analytics, as well as the apparent refusal to allow some competing ad networks access to Apple mobile applications, are contributing to the FTC's concern.

Regulators want to know whether moves by Apple will result in less competition in the growing market for ads on handheld computers and phones. Separately, Apple has barred applications using Adobe Flash, requiring all apps to use HTML5 for video.

This may not be the only antitrust investigation Apple faces. Justice Department lawyers recently contacted companies about Apple's practices in the music business. The Justice Department could forge ahead with that inquiry independent of the FTC's investigation.

The Justice Department is already investigating whether Apple and a range of other tech companies improperly agreed not to poach each other's employees, the Wall Street Journal says.

The starkly higher attention Apple has drawn suggests how Apple's role in several businesses--from content and devices to advertising--seems to have changed recently.

Apple recently surpassed Microsoft Corp.'s market value, a sign of its growing power in the technology industry.

Apple also controls around 70 percent of online music sales and has more of the overall music market than Wal-Mart Stores Inc., according to market research NPD Group. Apple's MP3 player market share is well over 70 percent, and its share of mobile phones is growing steadily, not to mention the explosive debut of its iPad tablet device.

The fear seems to be that Apple could be headed for such outsized domination of high-end mobile phones, a possible new tablet device category, and mobile advertising, now viewed as a key revenue source for mobile applications.

Some antitrust enforcers say that if they wait until a tech company has cornered a market, before moving to limit its power, it may be too late. The technology sector has powerful "network effects" that, some say grant outsize advantages to first movers and make it particularly difficult for competitors to break in, regulators say.

"The Commission has reason to believe that Apple quickly will become a strong mobile advertising network competitor," the FTC said last month. "Apple not only has extensive relationships with application developers and users, but also is able to offer targeted ads…by leveraging proprietary user data gleaned from users of Apple mobile devices."

It added that Apple's ownership of the iPhone software development tools, and its control over the developers' license agreement, "gives Apple the unique ability to define how competition among ad networks on the iPhone will occur and evolve."

Verizon Wireless Extending Skype Functionality

Skype isn't the danger telecom service provides once believed it was. There are lots of reasons, including the growing importance of data plan revenues and the decline of voice revenues. Basically, it now makes more sense to "merchandise" voice calling as a way of building data plan penetration.

Also, Google generally has replaced Skype as a significant worry. That isn't to say executives worry more about Google than they do the instability of communications regulation and policy. But after regulatory threats and competition between cable and telcos at the local level, Google--as a proxy for "over the top" applications--probably is an issue.

That worry likely will fade over time as well, however. Over time, as access providers figure out better ways to expose core access functionality to business partners, and executives start to see a path forward in the new ecosystem, fear about displacement from the likes of Google will recede, as it in many ways already is at companies such as Verizon Wireless.

Verizon Wireless now has partnered with Google to create new handsets and applications, as it also is doing with Skype. Verizon Wireless has since integrated Skype into 12 smartphones and says it will add the feature to a number of "3G multimedia phones" soon.

Apart from being available on normal feature phones, the Skype expansion will also support Korean and simple Chinese languages. Skype will also be upgraded to include a better user interface with drop-down menus and flags for international calling, Verizon Wireless says.

“The value prop is that we have 90 million customers who have in-calling, and now it expands to 580 million Skype users," John Stratton, EVP and CMO of Verizon Wireless, recently said.

Skype-to-Skype calls and chats are unlimited and free when users have a data plan. Skype mobile calls made to landline and wireless numbers in the United States ("SkypeOut," in effect) use minutes from customers’ voice plans.

Verizon Wireless To Bring VoIP To Non-Smartphones Using Skype | mocoNews

eWEEK - Latest News - Motorola to Answer iPhone 4 with 2GHz Android Phone

http://mobile.eweek.com/19878/show/c139fc6b6da7171791190855abdc4e09&t=4b3d7db9df15001f4cbb76a0ec50550c

iPad Internet Usage Patterns Compared to Smartphone and PC

Normalizing Internet appliance behavior by setting Apple iPhone usage as the baseline, you can see pretty clearly that smartphone web behavior is distinct from PC usage.

So far, iPad usage (page views) is roughly twice what iPhone usage typically is, but less than what people tend to do on either Windows or Macintosh PCs.

Page views aren't the same thing as "bandwidth consumed," but you can see the pattern: desktop usage is heavier than smartphone patterns.

One suspects today's PC dongle user has a usage pattern more similar to an iPad user than a desktop user. Most of us probably think page view and bandwidth usage will intensify over time on every platform, but that the disparity between PC desktop and "phone" behavior will remain.

There likely are some people who view more web pages on their phones than on their desktops. Generally speaking, though, heavier use occurs on a PC, while smartphone usage is much lower, volume-wise.

Scratch Test for HTC Evo

That's one way to test for scratches. Apparently the HTC Evo resists scratches well, but it is unnerving to watch this.

iPhone Ecosystem Drives Itself

Some new analysis by Chitika Research suggests a reason why the Apple ecosystem is so powerful: it has a base of customers that are highly motivated to buy other Apple products they don't yet own. Or at least one would infer from an analysis of search terms entered by iPhone, BlackBerry, Palm, Android, and iPad users.


The reason that Apple is so tough to compete with is that it has a fanatically loyal fan base, builds lots of producs on a single OS, is a single provider of hardware with a standard approach with products across a broad range of prices, from cheap iPods without screens up to Mac Pros that will break your budget.

Then it has the  iTunes and the App store that are becoming a hub for everything digital, including e-books and apps.

Search Study: iPhone Users Want New, Palm Users Want Out – Chitika Research

51% Mobile Video Growth Since 2009

Nielsen's latest "Three Screen Report" shows 51 percent growth of video watching on mobile phones, with a perhaps-surprising skew of demographics.

About 55 percent of the mobile video audience is aged 25 to 49. Also, the number of people with multi-tasking behavior, where users "watch" TV while using their PCs, was down in March 2010, though the length of time spent was up about 10 percent for people who did multi-task.

More than half of U.S. TV households now have a high-definition television and receive high-definition signals, while HDTV penetration grew 189 percent between the first quarter of 2008 and the first quarter of 2010.

More than a third of homes have a digital video recorder, up 51percent over the last two years.

About 64 percent of U.S. homes now use broadband Internet access while nearly a quarter of households (up 38%
year-over-year) have smartphones. The former trend means more uses can stream or download Internet video, while the latter trend means more place-shifting behavior, as well as some amount of incremental video consumption.

The amount of time spent watching television is still increasing. U.S. viewers watched two more hours of
TV per month in the first quarter of 2010 than in the first quarter of  2009.

The average time spent simultaneously using TV and Internet in the home also grew 9.8 percent, to 3 hours and 41 minutes per month, though the number of people doing so declined.

The number of people who are timeshifting has grown 18 percent since last year to 94 million, with the
average user now timeshifting 9 hours and 36 minutes per month.

The mobile video audience grew 51.2 percnet  year over year, surpassing 20 million users for the first time.

Beyond the TV, technology is helping drive video use on the “second” and “third” screens. The proliferation of broadband access is bolstering online video, creating an alternative mass outlet for distributing television content and “timeshifting” long-form TV.

Similarly, the increased popularity of smartphones has created yet another opportunity for incremental viewing, and Nielsen logically expects smartphone video viewing to keep growing. On top of that are new devices such as tablet PCs that also are expected to increase the amount of mobile video viewing.

Walled Gardens on the Web?

Though it might have seemed a ridiculous notion just a few years ago, the web now is fragmenting into various walled and curated gardens as devices, service provider business deals and even operating system environments begin to favor and curate web services.

Of course, for some users curated environments might be a good idea. Children's use of the Internet, for example, seems an area where parents might welcome more control and curation.

"Now fraught with pornography, scams, spam, fraud, malware, adware, and viruses, the Web has become a dangerous place to raise children or conduct any other form of educational endeavor," says Chris Poley, a financial markets participant and trader.

It is not entirely clear whether most users will prefer curated experiences, and if so, when and where. What seems incontestable is that there are use cases (iPads and smartphones, for example) where curation increasingly is the case and might even be welcomed.

It is a stunning reversal of the trend to openness, though.

Internet Evolution - Chris Poley - An Argument for Walled Gardens on the Web:

O2 Scraps Unlimited Mobile Plans

U.K.-based O2 is ending its unlimited data access plans and is switching to buckets of usage.

Beginning June 24 a variety of plans ranging from 500 MBytes to 1 GByte.

O2 to step back from unlimited mobile data deals • reghardware

E-Reader Maker IRex Files For Bankruptcy

E-Reader maker IRex Technologies has filed for bankruptcy, citing disappointing sales of its consumer device in the United States.

The firm's DR800SG e-reader was notable because it used an “open” model that gave publishers lots of control over how their content was distributed. Unlike the Kindle, for instance, publishers could set their own pricing. But most observers expected there would be a shake out in the market, and that now has happened.

E-Reader Maker IRex Files For Bankruptcy | paidContent

Apple Faces Another Antitrust Probe

U.S. antitrust regulators--it is not clear whether it is the Federal Trade Commission or the Department of Justice, are reported by the Financial Times to be weighing another investigation of Apple for restraint of trade, this time because of its plans to block rivals from access to its mobile app advertising network.

The ironic point is that regulators continue to bustle about, trying to regulate an access industry fighting simply to replace revenues it is losing, while the arguably-more-important gatekeeper decisions are being made by device and application providers, whose businesses everyone conversely expect will power the businesses of tomorrow.

The latest concern comes less than a month after concluded an  investigation of Google's purchase of AdMob. So powerful is Apple seen to be that the mere presence of Apple in the market with its own iAd network and a suite of "must have" devices was seen by regulators to be enough of a counterweight to Google that there was no risk of anti-competitive behavior.

According to the Financial Times, it is not yet clear whether it will be left to the Federal Trade Commission, which carried out the recent Google investigation, or the Department of Justice to take an investigation forward.

Apple’s latest rules about analytics for bar access to such information by competing ad platforms, third-party analytics firms or companies that compete with Apple in hardware.

Google is saying, and most observers agree, that the rules effectively bar Apple apps from using Google's ad network.

So consider the possible other implications. Perhaps in retaliation for its exclusion from the Apple application ecosystem, Google makes YouTube inaccessible from iPhones, iPads or iPod Touch devices. Or search, or other apps. You get the point: serious gatekeeping happens all over the Internet and broadband ecosystems these days.

Phone.com Mobile Office for Android Devices

Is There a Need for Economic Regulation of the Internet

Two necessary preconditions must be satisfied to justify market intervention in the form of economic regulation on the part of the government, says Dennis Weisman, Professor of Economics at Kansas State University and an editor of the Review of Network Economics and a member of the Free State Foundation's Board of Academic Advisors.

The first one inquires as to whether there is a problem and the second one inquires as to whether there is a solution? Only if both questions can be answered in the affirmative can such intervention be justified.

He says the case for economic regulation of broadband markets is weak at best. The Federal Communications Commission can point to, at most, two cases where things went awry — Madison River and Comcast.

Madison River was resolved with dispatch; and in the case of Comcast, the supposed cover-up was arguably worse than the alleged crime, Weisman says. "There is no offense in reasonable network management practices designed to prevent congestion and maintain service quality," he adds.

Nor is there evidence that the major incumbent telecommunications carriers or the cable companies were earning supra-normal returns that might be suggestive of market power," which might imply there is a problem waiting to be solved. http://ssrn.com/abstract_id=1525568

The structure of broadband prices is a problem in the economics of two-sided markets, though. The issue is that it is difficult to determine how the price structure should be changed to enhance economic welfare. "In other words, there can be no reasonable assurance that regulatory intervention to alter the price structure would not do more harm than good," says Weisman.

Google Caffeine Boosts Content Refresh Rate 50%

Google's new indexing engine, Caffeine, is said to provide 50 percent fresher results for web searches than Google's last index.

Google's older index had several layers, some of which were refreshed at a faster rate than others. The main layer would update every couple of weeks, for example. To refresh a layer of the old index, Google would analyze the entire web.

With Caffeine, Google analyzes the web in small portions and updates its search index on a continuous basis, globally. That means fresher information.

Official Google Blog: Our new search index: Caffeine

Apple Bans Google Mobile App Ads

Apple has changed the terms of its application developer agreement to block apps from using competitive ad networks operated by rivals such as Google.

That's ironic in light of "network neutrality" debates that some claim involve packet blocking, in the "restraint of trade" sense. Others point out that network management and grooming, as well as ability to create value-added services and features, are more the issue.

What is striking are the many ways packets are being groomed, blocked and shaped by application and device providers. Apple blocking Google ad network ads, or Apple refusing to share analytics with some third-party ad networks, are new examples.

Blunt instruments do not work well in a business and an ecosystem that changes this fast, especially when content pay walls, app stores, even operating systems and browsers can favor or deny access to "Internet bits."

Apple bans Google mobile app ads | News | New Media Age: