Enterprises Dominate Mobile Ad Spending

More than a third of interactive marketers have implemented or plan to pilot mobile search and display advertising in the next year, according to Forrester Research analyst Melissa Parrish. And just about everyone believes such spending will grow.

For that reason, Forrester Research expects that interactive marketer spending on mobile search and display will grow at a 28 percent compound annual growth rate over the next five years.

Forrester expects that mobile Internet usage will increase at a compound annual rate of 12.7 percent, with 117 million people — 36 percent of the US population — searching and browsing while using their mobile devices by 2015, Parrish says.

Mobile marketing opportunities will grow as more people use the mobile Internet, of course. At the end of 2007, only 10 percent of U.S. adult subscribers used the mobile Internet. In 2010, mobile Internet usage is up to 27 percent of mobile subscribers, representing 64 million consumers in the
United States market.

Mobile Internet users also are learning to use their mobiles to make purchases. And they aren’t just looking for the nearest coffee house; they’re buying airline tickets, researching cars, and receiving coupons for products like coffee or detergent.

Forrester forecasts that mobile search and display dollars will grow to $2.8 billion by 2015, at a
28 percent CAGR.

But critical mass still is lacking. Though mobile Internet usage is increasing rapidly, marketers still can’t get enough eyeballs on content to justify spending big bucks in the space, says Parrish.

Currently, 78 percent of the US population access the Internet at least monthly while only 21 percent access the mobile Internet. By 2015, mobile Internet usage is expected to reach 43 percent of total desktop Internet usage, making the mobile medium a much more viable channel.

Inability to track performance against spend. More than half of interactive marketers feel they have no capability to measure the ROI or brand impact of their mobile marketing campaigns.

Interactive marketers prefer performance-based campaigns and are willing to pay more for these metrics. Vendors like Google and Bing offer cost-per-click pricing for click-to-call and click-to-get-directions type activities, but mobile display is still largely based on potential impressions, an unsatisfactory metric to most marketers.

Additionally, the holy grail of mobile is location-based marketing, but it’s still unclear how the connection between location-marketing efforts and in-store purchases will occur. Vendors must develop the tools for marketers to track performance and then help marketers understand the value and how to use these new tools.

·Spending by small and mid-sized business is not having too much impact, says Parrish. Forrester’s data suggests that fully 95 percent of mobile advertising dollars currently come from companies with more than $100 million in revenue.

Though the value of mobile advertising is highly relevant to small and mid-sized businesses, which benefit greatly from local and location-specific advertising, smaller budgets and less marketing
expertise will make the percentage of overall spend from SMBs consistently less than eight percent of total mobile spend.

Concerns over privacy, specifically location and carrier information, could provoke a backlash among consumers, leading to some caution as well. Consumers consider mobile phones personal devices to a greater extent than PCs and, for that reason, might continue to expect greater privacy in a mobile context, Parrish suggests.

Faster Upstream Cable Speeds Arriving In 2011

The first incarnation of the cable broadband DOCSIS 3.0 standard is theoretically capable of 160 Mbps downstream, and 100 Mbps upstream, on a shared basis. But upstream channel bonding has been hard to perfect, some would note.

For that reason, cable broadband tiers like 50 Mbps down and 5 Mbps upstream, or even in some cases 100 Mbps downstream and just 2 Mbps upstream. Such problems tend to get resolved over time, and new gear might be part of the solution.

Faster Upstream Cable Speeds Arriving In 2011

Will Streaming Displace More Radio Listening?

A new study of 12 to 24 year-old Americans reports Internet usage of two hours and fifty-two minutes per day, roughly triple this age group's reported usage from 2000 (59 minutes).

Radio continues to be the medium most often used for music discovery, with 51 percent of those 12 to 24 reporting that they frequently find out about new music by listening to the radio. 

Other significant sources include friends (46 percent), YouTube (31 percent) and social networking sites (16 percent). Some 20 percent of users 12 to 24 have listened to streaming radio provider Pandora in the last month, with 13 percent indicating usage in the past week. 

By comparison, six percent of those 12 to 24  indicate they have listened to online streams from terrestrial AM or FM stations in the past week.

It is difficult to predict how overall radio listening might change as these users grow older, since much U.S. radio consumption occurs while people are in their cars commuting to and from work. 

The American Youth Study 2010 - Radio's Future

Apple Looking at Mobile Payments?

Apple is among companies just about anybody might argue is in position to make mobile payments more mainstream. Apple already handles payments through iTunes, which boasts 160 million active credit card accounts. PayPal only has 90 million, by way of example.

Of course, such micropayments for online goods are not the same thing as use of a mobile for retail transactions in place of a credit or debit card. But online micropayments could create an important habit that prepares the way for use of an Apple mobile device for other types of transactions.

Apple’s Next Big Strategic Opportunity Could Be Mobile Payments

IBM Looks at The Social Workplace

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As you would expect, younger workers have different expectations about social networking in the workplace.

What Cable Will Do if Online Video Takes Off

Consumers should have the freedom to buy over-the-top video if content owners want to sell it. But one should not expect distributors to stand by and watch their current businesses be damaged as that happens. Neil Smit, president of Comcast's cable division, says that if over-the-top video starts to displace some amount of traditional cable TV viewing, Comcast is more than happy to change its product offerings to accommodate those demands.

"We feel very good about our capacity," says Smit.

Obviously, if a significant percentage of today's subscribers to multichannel video entertainment start to drop those services in favor of online offerings, providers are going to change. But some already are taking steps to protect their legacy businesses while adapting to online video.

To encourage consumers not to abandon cable TV, for example, Comcast has introduced Xfinity, which allows Comcast video subscribers to watch some of that content online. Should that effort succeed, there could be a more gradual shift of viewing and content packaging, as end user value simply is enhanced by the addition of new capabilities that encourage consumers to keep their subscriptions.

If the initiatives don't work, and customers start to abandon even the Xfinity style offers, though, cable and other distributors will confront declining revenues for the base business, which might cause distributors to weigh retail price increases, a shift of programming to emphasize networks that still offer a robust revenue model, price increases for the remaining customers, or renegotiated contracts with programming suppliers to account for the new economic realities.

Of course, the increased over-the-top consumption will drive higher usage of broadband access connections. Under those conditions, it is reasonable to expect that access providers will move towards more reliance on usage-based charging for use of broadband access services.

"People should not think of cable companies as media companies," said Craig Moffett, a senior analyst at Wall Street equities research firm Sanford C. Bernstein. "They are infrastructure companies."

Rather than raising prices on cable broadband across the board, it is logical to expect tiered pricing that reflects usage. That actually makes sense, if one assumes broadband access increasingly might be a differentiated product, offering different buckets of "best effort" usage, as well as services that might be optimized for real-time services. Beyond that, cable operators and telcos have other ways to repackage triple-play or quadruple-play services in ways that optimize value and pricing for multiple products.

Broadly stated, distributors can tweak traditional video subscription prices, terms and conditions in ways that compensate for higher broadband access consumption, and perhaps equally importantly, reward customers for using bandwidth "efficiently."

With Internet TV, cable wins even if it loses

Ethernet Will Dominate Mobile Backhaul by 2014

By 2014, more than half of North American mobile backhaul will support Long Term Evolution networks, says In-Stat.

“Nearly every major mobile operator is, or will shortly be, at capacity,” says Chris Kissel, In-State analyst.

Total expenditures for last mile backhaul (including line leasing, new equipment spending, and spectrum acquisitions) will reach nearly $117 billion by 2014, a 41 percent increase over 2009 expenditures of $83 billion.

Wireless last mile backhaul capacity in Western Europe will more than triple between 2010 and 2014, to nearly 60,000 Gbps. Also, by 2014, Ethernet will be the dominant carrier technology with 85 percent usage in base stations.

In-Stat - Press Releases

The NPD Group: Android Extends its Smartphone Market Share in the Third Quarter of 2010

The Android smartphone operating system significantly grew its lead in the U.S. consumer smartphone market in the third quarter of 2010, according to The NPD Group.

Android’s OS was installed in 44 percent of all smartphones purchased in the third quarter, an increase of 11 percentage points since the second quarter.

The Apple iOS held relatively steady versus last quarter, rising one percentage point to 23 percent. The RIM OS fell to third position, declining from 28 percent to 22 percent.

The NPD Group: Android Extends its Smartphone Market Share in the Third Quarter of 2010

T-Mobile Adds Tethering for Some Devices for $15 a Month

T-Mobile USA apparently is offering a new tethering that allows some of its smartphones to function as wireless modems for connecting devices such as laptops, tablets and netbooks to the Internet through the T-Mobile network. At the moment you will not find that information on the T-Mobile USA website, as nearly as I can determine.

Customers who buy the unlimited data access plan will be able to add the "Tethering and Wi-Fi Sharing" plan for an additional $14.99 per month.

Tethering is available for some devices offered by Verizon Wireless and Sprint Nextel as well, for about $30 a month. Some consumers won't see the logic here, the thought being that they've already bought unlimited mobile data access and should be able to share that bandwidth with a PC they also use.

Service providers of course make substantial money selling mobile data connections on a "per device" basis, so their resistance to the notion is probably predictable. Sooner or later, though, as more mobile devices become Internet-capable, pressure is bound to mount for the broadband equivalent of family plans. In a sense, a fixed broadband connection already operates that way: users can attach as many devices as they like to a single fixed broadband connection.

At some point, mobile providers will start offering those sorts of data plans as well, allowing a single account to attach multiple mobile devices and pay one price for shared access.

T-Mobile New Low-Cost Data Service Plans

Virgin Media banks on 100 Mbps

At the end of September 2010 the number of customers subscribing to the top tiers (20 Mbps and 50 Mbps) increased by 40.7 per cent to reach 708,300, says Virgin Media, with 91,600 of those taking the flagship 50 Mbps service, an increase of 23.8 per cent over June 2010).

Virgin claims that 10,000 customers signed up for the 100 Mbps service on the first day of launch.

Virgin Media banks on 100Mbit/s broadband for growth

Game Consoles Expand Video Streaming Services

Netflix has reported a recent increase in the uptake of their streaming service with subscribers, with 66 per cent of subscribers watching more than 15 minutes of content online in the third quarter of 2010, compared to 41 per cent of subscribers during the same period last year, suggesting its improved online movies and TV shows line-up is strengthening the service's appeal.

Netflix and other streaming services also are making efforts to integrate more centrally with game playing platforms, in an attempt to position the game player as a hub for premium content delivery.

Although Netflix is not yet causing subscription TV customers to cut the cord (that is, end their traditional pay-TV subscription), it is now an essential content partner for any connected device platform in the United States, say researchers at Screen Digest.

Game Consoles Expand Video Streaming Services

Video on Demand: After 25 Years, Still Not that Big a Deal

Despite all the attention now paid to online delivery of movie and video programming, after 25 years, consumers globally still show an overwhelming preference for renting shows using some form of physical media.

Video-on-demand services, which have been available for 25 years, continue to lag other methods of delivery, DVD rentals and purchases being the dominant method.

The other significant issue is that demand for all forms of on-demand video seems to have flattened out, globally. That suggests displacement, not growth, is the strategic imperative. For VOD providers, the issue remains: can VOD grab more share of the market than developing online delivery methods?

Google is the World's Most Successful Ad-Funded Software Company

Google represents 91.4percent of all global searches, according to Pingdom, 98.3 percent of mobile searches, 69 percent of online advertising and 59 percent of web analytics. Google's YouTube business represents 53 percent of all online embedded video and audio.

Then there's Android, Chrome, Gmail, Google Docs, Blogger, Google Maps and Google's own content delivery network. Google is working on a Chrome operating system, has released Google TV and operates its own public domain name server network as well.

The point, Pingdom notes, is that Google has has an enormous presence on the Web and the Internet, and advertising drives it. Among other things, Google the world's most successful ad-funded software company.

How Google dominates the Web

PayPal To Launch Payment Service Using iPhone

Sprint Will be Shutting Down a Network, But it is iDEN

Sprint and Clearwire have been testing Long Term Evolution as an air interface using fallow spectrum. obviously raising questions about whether Sprint Nextel and Clearwire might ditch WiMAX for LTE.

Sprint CEO Dan Hesse says the only networks that are slated for replacement at some point are Sprint Nextel's legacy networks, ranging from iDEN, used for the Nextel part of the operation, to the older second-generation and third-generation networks Sprint also supports.

LTE isn't necessarily on Sprint's roadmap, Hesse says, though it is conceivable Sprint Nextel might be interested in supporting dual-mode "WiMAX-plus-LTE handsets.

It is a simple fact that each generation of mobile networks gets replaced, about every 10 years, though the transition periods can last longer. Hesse notes that “2G will eventually come to an end; CDMA will come to an end; GSM will come to an end and iDEN will come to an end.”

“Over time, as fewer customers are using our 2G networks, we can use that spectrum for the CDMA/EVDO network.” Even the current iDEN spectrum might eventually be switched over to support CDMA and EVDO on that band of frequencies, especially to support voice services.

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