Is Sprint's Fate Linked to Clearwire?

Clearwire has issued a "going concern" warning in its latest 10Q report to the Securities and Exchange Commission, saying it could run out of money by mid-year 2011 if it does not secure a large infusion of new capital, estimated to be in the couple of billion dollars range.

It seems unlikely Clearwire would fail to secure such funding, though it seems to have proven unusually difficult so far.

The unknown is whether Clearwire's potential troubles might also lead to changes at Sprint Nextel, which owns 54 percent of Clearwire. In principle, even a dramatic change of ownership at Clearwire would not directly lead to changes at Sprint Nextel.

But it appears there is some level of interest by offshore buyers in Sprint Nextel. Some speculate a combination deal to buy Sprint Nextel and Clearwire would make sense for both companies.

Clearwire Says It May Not Make It - 24/7 Wall St.

Video Entertainment Decline Seems Not to be a Blip

Much was made of a first-time-ever decline in multichannel video subscibers in the second quarter. So the big issue became "what will happen in the third quarter?"

Though all of the data is not available (some firms are private and do not have to report), it does appear that the second quarter decline was not a one-time anomaly.

Dish Network lost about 29,000 net subscribers during the third quarter of 2010. CableVision Systems Corp. lost 24,500 basic video subscriptions in the quarter. Comcast earlier reported a loss of 275,000 subscribers in the third quarter, while Time Warner Cable says it lost 155,000 video subscribers, representing a collective loss of 483,500 customers.

Verizon's FiOS TV service had an increase of 204,000 net new subscribers, while AT&T's U-Verse had an increase of 236,000 new video subscribers. That represents a gain of 440,000 subscribers. DirecTV added 174,000 net new U.S video customers. So telcos and DirecTV gained a net 614,000 net new customers.

Based on what happened with the major public companies, telcos and satellite companies (at least DirecTV) gained 130,500 more customers than the cable companies and Dish Network lost.

So here's an exercise to figure out what might have happened. Comcast, Time Warner Cable, Cox, Charter Communications and Cablevision Systems between them represent about 80 percent of all U.S. cable video customers.

Comcast and Time Warner represent 59 percent of all U.S. cable video customers. So asume every cable operator lost customers at the same rates as Comcast and Time Warner.

That would suggest overall cable industry losses at about 728,800 customers. If the telco and satellite competitors gained 614,000 net new customers, that leaves 115,000 customers who simply stopped buying.

But what that that means for the "video cord cuttting" thesis is unclear. We don't know whether the estimated 115,000 lost customers corresponds to reality. If the number is mostly correct, we don't know whether the change in behavior is permanent or temporary.

But it seems possible that the overall size of the U.S. multichannel video market is contracting at the moment. It seems to have done so for two quarters in a row, an unprecedented event. Whether that means a shift to over-the-top video consumption, a shift to over-the-air viewing or something else cannot yet be determined. Nor can we tell whether the behavior is temporary or permanent.

But the cord cutting thesis cannot be discounted. Up to this point consumers seem to have responded to tougher times by cutting back on premium services, pay per view and other ancillary services that have been driving cable video revenue growth. Over the last two quarters, consumers might be cutting even more than that, abandoning video service altogether and perhaps shifting scarce discretionary income to other services deemed more important, such as mobile or broadband services.

Will Enterprise Mobile Security Issues Slow Mobile App Adoption?

You always can get an argument about the importance of data security in an enterprise setting, and that applies to use of mobile devices as data appliances as well.

Nick Jones, Gartner analyst, argues that Android is "probably" the least secure of the mainstream mobile platforms if only because it’s the least mature and has one of the least regulated app stores.

Even the best of them, RIM, is dependent on things outside the platform’s control, such as trusting the person who provides an application, says Jones.

When will mobile the security backlash happen?

Banks Rush to Fix Security Flaws in Mobile Apps

Wells Fargo & Co., Bank of America Corp. and USAA are issuing updates to some of their wireless banking applications to fix security flaws. Some of the applications store usernames, passwords and financial information as "clear text," the Wall Street Journal reports.

The problem only points out the greater need for security and privacy protection as software ecosystems become more complex.

Banks Rush to Fix Security Flaws in Wireless Apps - WSJ.com (subscription required)

US News & World Report Goes Digital Only

U.S. News & World Report is going digital-only in 2011. Its last regular print issue will be published in December 2010.

Going forward, the magazine's non-subscription print offerings will be for newsstand sale and targeted distribution. That includes the college and grad guides, as well as hospital and personal finance guides. The magazine also says it will publish four other newsstand special editions, focusing on history, religion and some of the other subjects that have been a success for us in the past.

Poynter Online - Romenesko

Clearwire Issues "Going Concern" Warning

As required by law, Clearwire has filed an "on-going concern" statement with the Securities and Exchange Commission.

"Our ability to continue to operate our business is substantially dependent on our ability to raise additional capital in the near term," the SEC filing (10Q) says.  "Our expected continued losses from operations and the uncertainty about our ability to obtain sufficient additional capital raise substantial doubt about our ability to continue as a going concern."

The filing notes that during the first nine months of fiscal 2010, Clearwire incurred $1.55 billion of net losses. The company consumed $840.8 million of cash in operating activities and spent $1.96 billion for capital expenditures.

"As of September 30, 2010, we had available cash and short-term investments of approximately $1.38 billion," Clearwire said. "Based on our current projections, we do not expect our available cash and short-term investments to be sufficient to cover our estimated liquidity needs for the next twelve months."

That's why Clearwire has been out looking for debt, equity or spectrum sales for financing. "Without additional financing sources, we forecast that our cash and short-term investments would be depleted as early as the middle of 2011."

"Thus, we will be required to raise additional capital in the near-term in order to continue operations. Further, we also need to raise substantial additional capital over the long-term to fully implement our business plans," the filing says.

read the whole filing here

Take Viewing Breaks When Watching 3D Sports, ESPN Says

Researchers at ESPN have been testing user reaction to three-dimensional sports programming. While some viewers in an ESPN lab study experienced eye strain and headaches while watching the soccer World Cup in 3D, the adverse effects were reduced after viewers took breaks, ESPN says.

"We think that breaks are a good thing for 3D viewing," says Duane Varan, executive director of the Disney Media and Advertising Lab.

Most adverse effects are reported on the first day that a viewer watches 3D programming, and are reduced in subsequent days as viewers get more accustomed to it.

Light Reading Cable - Video - 3DTV Eye Strain? Take a Break, ESPN Says

U.S. International Calling Estimated at Nearly $24 Billion

About 25 percent of U.S adults make international calls, and of those who spend money to make such calls, the average spend is approximately $34 every month, according to Harris Interactive.

With an estimated 235 million U.S. adults, this works out to roughly 58.8 million Americans spending nearly $1.98 billion on international calls outside of the U.S. monthly and $23.8 billion annually.

For adults who make international calls, the majority do so using a landline (51 percent), either a traditional landline service provider (42 percent) or a VoIP service such as Vonage (12 percent). Another 44 percent make international phone calls using their mobile phones.

About 25 percent of those who make international phone calls do so using their computer through software based services like Skype, while 20 percent use calling cards.

New Harris Interactive Survey Projects 58.8 Million Americans Now Calling Abroad and Spending $23.8 Billion Annually - FierceVoIP

BroadCloud Simplifies Hosted UC and IP Telephony

It sometimes is difficult to keep clear the distinctions between hosted and "cloud-based" services, but for BroadSoft, the difference between "BroadWorks" and BroadCloud" is the difference between a service provider hosting the app servers in their own network and having BroadSoft host the apps "in the cloud."

As you might imagine, there is a key difference in terms of how fast a customer can get a branded service up and running, the degree of resilience and the amount of integration work that might have to be done to get a BroadWorks solution up and running.

BroadCloud will include BroadSoft’s current SaaS products, PacketSmart and Casabi, as well as new unified communications services including instant messaging and presence; "BroadCloud Video," a high-definition, always-on, meet-me videoconferencing service, "BroadCloud Web Collaboration," a suite of web-based collaboration options, including screen sharing, a document library, chat, audio and video support and whiteboarding.

BroadCloud PacketSmart is a network assessment and monitoring service, while BroadCloud Casabi enables the delivery of group SMS, personalized content and tools that help keep families organized.

US Smartphone Penetration Leads Europe

It is common for observers to decry some way in which the United States lags other regions by some measure of Internet, broadband or wireless adoption. Sometimes that is accurate, but only for a time. In other areas, the U.S. adoption rate exceeds that of other regions. Smartphone devices and applications and Internet apps provide examples.

"It’s strange that the US, which was light years behind Europe, which itself was light years behind Japan, is now the hotbed of change where this innovation originates," an opinion piece in the Register argues.

US smartphones – Once you’ve had Android there’s no going back

Both "Open" and "Closed" Information Models Work on Web

Two fundamentally different models have competed in Web-based information markets.

In one model, an information provider formats the presentation of information, selling advertising space to another party. These sites want search engines to find them. This model involves little gatekeeping of the user. Much of the open commercial Web operates this way.

In the other model, an information provider sells passwords to users. The passwords either allow unlimited access to a wide range of material, or they allow the vendor to track usage and require incremental payments roughly proportional to the material delivered and received. The passwords are a form of gatekeeping, and these sites generally do not allow search to threaten that gatekeeping ability.

The recent testing of "paywalls" for newspaper content will shift some content from an "open" to a "gatekeeper" mode. Will it work? It likely depends on the uniqueness of the content, and whether users can find reasonable substitutes elsewhere on the open Web.

Both ad-supported and "paywall" models can work, but the latter really does require uniqueness, one might argue. The Wall Street Journal has been behind a paywall all along, and has been the salient example of a gated approach that seems to work.

Gateway economics Virulent Word of Mouse

Study Suggests 20% Would Cut Broadband Access Cord and Go Mobile

About 20 percent of fixed broadband access users surveyed by Nokia Siemens Networks in France, Germany, Spain and the United Kingdom want to "cut the cord" and buy mobile broadband service instead, the Nokia Siemens Networks "Mobile Broadband Study 2010" has found.

More than half of mobile broadband users say they are interested in high-speed mobile broadband or LTE and half of respondents report they already use mobile broadband, mostly on their phones.

Study shows spending on mobile broadband up 40% year on year | Nokia Siemens Networks

Google Instant for Mobile

How Smartphone Users See Themselves, How Others See Them

I'm not sure this cartoon is right up there with the classic "if operating systems were airlines," but it's funny.

For many of you, the "operating systems as airlines" references won't make sense. You weren't born when they were used.

For some of you, the depiction of airlines will make perfect sense. Read it here:  http://webaugur.com/bibliotheca/field_stock/os-airlines.html

What Does "4G" Mean, Now that ITU Has Defined it Out of Existence?

The International Telecommunications Union has settled on a definition of "fourth generation" networks that requires 100 Mbps in a mobile deployment and 1 Gbps in a fixed deployment. None of the actual 4G networks now in operation or planned are actually going to run that fast. So now users have to decide whether standards are set in the marketplace or by standards bodies.