TechNet Wants Debit Card Rule Delay

TechNet, a group representing executives at major technology companies, sent a letter to senators late last week urging support of legislation by Sen. Jon Tester (D., Mont.) to delay the start-date of the Dodd-Frank law that mandates limits on interchange fees, the volume-related part of debit card fees. The limit on interchange fees, touted as a consumer protection measure, actually is leading debit card issuers to raise fees and charges on all sorts of other banking services to compensate for lost revenue from interchange fees.

The net result will an end to free checking services and higher fees for lots of other services banking customers now use. TechNet wants a delay of implementation for two years so the economic impact can be studied.

TechNet includes Facebook, Apple, Microsoft, Google, Craigstlist, Netflix and Yahoo! among other high-tech companies, along with financial companies such as card-processor Visa, which has long fought against the debit-fee proposal.

The limit on interchange revenue is important for any number of reasons. The cost of financial services will rise for consumers across a wide range of economic levels, say analysts at the Mercator Advisory Group. See http://www.mercatoradvisorygroup.com/images/durbin_analysis.pdf.

The largest card issuers will have less of an incentive to promote debit related products and services and will either shift activities toward credit-based services or will cover their costs differently by fee-based approaches to debit

accounts.

Also unknown is how consumer behavior might change if debit cards are harder to get and more expensive to use, and how retailers might react to supporting cards of various types, issued by institutions of different sizes. If small institutions, exempted from the mandatory interchange revenue caps, charge higher fees, retailers won't want to accept the cards, for example.

Merchants empowered to set minimum and maximum transaction amounts may act to increase consumer usage of cash and checks for pay-now purchasing, which are less efficient and therefore more costly to process, or will lose sales to merchants who chose not to set minimums and maximums, Mercator argues.

An overall decrease in electronic payments may lead debit card issuers to increase the cost of their products to recoup an interchange income shortfall, motivating consumers to choose other forms of payment including cash and

paper checks.

Smaller financial institutions may be faced with higher operating costs should their customers’ debit card usage decline. Any decline in transaction volumes or debit user accounts will drive small banks’ debit operations costs

higher per account and per transaction, again making it likely that consumer end-user fees will need to be increased to pay for operations.

Other prepaid programs that will likely be impacted include payroll cards, which depend on float and interchange fees to offset costs. Due to various laws, both state and federal, payroll cardholders typically do not pay upfront

fees on the cards and despite the fact ATM access is costly to the issuer, cardholders always get some ATM access for free.

The Durbin amendment to the Dodd-Frank bill is yet another illustration of activity that benefits legislators, who get to claim they are protecting the public, while the public actually does not benefit.

For Facebook, Apple, Microsoft, Google, Craigslist, Netflix and Yahoo!, the interest is a bit less direct. TechNet is worried there might be less investment in technology, and a decrease in security. Security breaches will be a negative for application providers.

Tech Giants Weigh In on Debit-Fee Cap

Gawker Moves Highlight Value of Content in Marketing

Gawker founder Nick Denton might arguably have been known as a 'blogger' and 'blog business' entrepreneur in the past, serving up 'snarky' commentary on news.

These days, he seems to prefer the alternate strategy of becoming an actual provider of original news. For some people, that will represent a huge shift; for others simply an affirmation that the lines between blogging and journalism are porous.

Gizmodo, Gawker, IO9 and Lifehacker might be viewed as blogs. Some of us would disagree, in part. But the larger point might be that a Google-like attention to 'data driven' decision making has driven Denton to realize that 'news' drives readership.

'Duh!' you might say. Media outlets tend to complain that they are the source of most fodder for blog commentary. That's true. Denton now sees that the way to grow is to simply shift attention from commentary on news, to becoming a news outlet.

It's a shift that might be subtle on some levels, and more significant on others. Despite the debates of several years ago about the difference between blogging and journalism, there still is limited clarity about the differences and similarities, because both pursuits have changed, and are changing.

Observers might disagree about the ultimate success of AOL's "Huffington Post" makeover. But there is little disagreement about the fact that both content curation and content creation now are seen as important ports of the enterprise. The former is collecting and pointing to work already created by others, while the latter consists of more-traditional writing or journalism.

The Gawker moves also highlight a separate but related trend: more brands or companies are becoming "media" in their own right.

The way I would describe it is that buyers of products begin their search for solutions to problems, in both a business and consumer context, long before any supplier has any idea those potential customers actually have begun their buying process.

The key insight is that the end user buying process begins long before a supplier sales process can begin. In other words, people and companies start a buying process without letting the suppliers know. The obvious implication is that by the time some formal interest is expressed to a supplier, by a buyer, lots of the fundamental decisions already have been made.

Buyers already have rejected some approaches, and embraced others. They have culled the potential suppliers to a manageable and small list. Buyers have decided why certain approaches make sense for them, what they think they should be paying, and why.

If a supplier waits until this buyer process is finished, many suppliers already have been rejected. So the reason any brand needs to establish a credible, reliable presence in the content space is to be visible and relevant during the early "research" stages of any buying process, which, by definition, occur before any particular brand can start its own "selling" process.

Gawker Moves Highlight Value of Content in Marketing - Content Marketing News Blog - Content Marketing News

LG-Ericsson USA Launches PBX Family

LG-Ericsson USA is getting into the business phone system market, launching "iPECS-LIK" in North America. "iPECS-LIK" is said to be a full-featured business communications product family, enabling IP communications.

The family of systems is said to fit a wide range of organizations, from a small 10-user office to a 1000-user corporation.

LG-Ericsson USA

What LivingSocial is Doing with New Investment

LivingSocial recently raised $400 million in new venture capital funding, saying that the money would be used pursue "aggressive domestic and international growth and continued product innovation."

But half the money appears to be going to an early cash out of early investors and members of company management. That isn't illegal. But it might make other investors wonder whether the current valuations of social shopping companies are warranted.

Groupon used $573 million of a $950 million funding round for liquidity purposes, essentially allowing early backers to gain some liquidity from some of their holdings. Of course, in Groupon's case the board had just rejected a $6 billion buyout offer from Google, and some of its shareholders were upset about missing out on an early payday.

LivingSocial plans to repay early supporters

Online Video Usage Up 45%

Online video usage in the United States has grown considerably from the same time last year as time spent viewing video on PCs of all types from home and work locations increased by 45 percent, according to Nielsen.

The number of unique online video viewers only increased by three percent from last January 2010, though.

One might conclude from those statistics that most people who see value in online video already are watching it, and watching lots more, while people who do not see the value are not adopting the behavior.
Among viewers who do watch online video, users streamed 28 percent more video and spent 45 percent more time watching. Total video streams also saw significant year-over-year growth, up 31.5 percent to 14.5 billion streams.

Online video, as it turns out, is like any other application. Not everybody sees the value. But those who do find it valuable are increasing their consumption.

January 2011: Online Video Usage Up 45% | Nielsen Wire

On the Go Ad Exposures: More than Phones and Tablets

For most of us, on-the-go media consumption is mostly about smart phones and tablets. But there also is growing place-based media exposure as well. Viewer exposure to advertising at 12 monitored bars, restaurants, airports, hotels, retail stores and other place-based venues in the last quarter of 2010 was up nearly 250 percent, compared to the eight location-based networks measured that same period one year ago.
For the fourth quarter of 2010, that translates to more than 500 million gross minute exposures per month.

Exposures Per Visit, P18+
VENUE	COMPANY	“Q4 2010 (P18+) Visits “	Exposures per Visit	Total Exposures (P18+)
Retail	Best Buy	29,269,628	1	29,269,628
Airports	CNN Airport Network	17,788,966	1.3	22,660,178
Health Clubs	Zoom Fitness	16,699,365	1.8	30,342,746
Gas Stations	Outcast/PumpTop	16,601,527	1	16,601,526
Bars & Restaurants	TouchTunes Interactive Networks	14,980,016	15.2	228,104,737
Restaurants	indoorDIRECT	13,005,969	1	13,005,969
Hotels	The Hotel Networks	10,415,475	2.8	29,104,737
Bars & Restaurants	TargetCast	10,157,147	5.1	51,591,435
Health Clubs	RMG Fitness	10,036,663	1.5	15,205,544
Health Clubs	Outcast: Health Club Media Network	5,357,425	2.7	14,206,215
Stadiums	Access 360-AMNTV	3,747,805	11.3	9,393,868
Bars & Restaurants	AMI	1,808,600	5.2	42,325,398
TOTAL		149,868,586		501,811,981
Source: The Nielsen Company

Report: On-the-Go Ad Exposures are On the Rise | Nielsen Wire

mSpot Challenges Netflix?

Mobile and PC entertainment company mSpot delivers music, movies, radio and TV to more than six million mobile customers across 10 wireless carriers in North America, including Verizon, AT&T and Sprint.

The company, which actually has an earlier release window for new movies than Netflix does, also plans to show them at the same prices. In other words, mSpot is offering more recent movies than Netflix does, about matching Netflix’s all-you-can eat movie pricing. So some wonder if mSpot might e the next candidate to grab market share from Netflix and others in the streaming video business.

Daren Tsui, chief executive of Palo Alto, Calif.-based mSpot, says mSpot has been able to secure new release movies on the same day that studios release them on DVDs. Netflix, by contrast, has to wait as much as 28 days longer.

mSpot offers Netflix-like movie club for new streaming movies | VentureBeat

Apple and Google Capture U.S. Video Game Market Share in 2010

Apple iPhone and Android smart phones are taking game revenue and market share from dedicated mobile game playing units, a new analysis by Flurry suggests. From 2009 to 2010, iOS and Android game sales increased from five percent to eight percent market share within the U.S. video game market.

Flurry estimates that iOS and Android game revenue increased from $500 million in 2009 to more $800 million in 2010. Of this, the significant majority of revenue was generated by iPhone games.

Flurry estimates that retail PC game revenue was $700 million in 2010. That implies that smart phone and tablet game revenue has surpassed the U.S. PC game category, for the first time, in 2010.

Overall, total U.S. game revenue from 2009 to 2010 was relatively flat, totalling $10.4 billion and $10.7 billion, respectively. However, while console game revenue increased slightly, from about $7.4 billion in 2009 to $7.8 billion in 2010, the combination of declines in portable gaming software and a jump in smart-device app sales has squeezed the portable game category down from 24 percent market share in 2009 to just 16 percent in 2010.

It’s clear that prolific intalled base gains by Apple and Android devices, low priced games (including a very robust free-to-play model enabled by in-app purchases) and seamless digital distribution to games on devices so near to consumers 24-hours-a-day, is driving potent industry-disruption.

Over 2011, Flurry expects to see continued and significant smart-device game growth fueled by the recent launch of iPad 2, iPhone coming into distribution on Verizon, the expected release of iPhone 5, a relentless expansion of Android devices by leading OEMs across all major U.S. carriers, and Google’s enablement of in-app purchase billing, a proven key driver in iOS game revenue.

Apple and Google Capture U.S. Video Game Market Share in 2010

U.S. Internet Users Watched 4.3 Billion Video Ads in March 2011

Americans viewed 4.3 billion video ads in March 2011, with Hulu generating the highest number of video ad impressions at more than 1.2 billion, according to comScore.

Tremor Media Video Network ranked second overall (and highest among video ad networks) with 804.3 million ad views, followed by Adap.tv (553 million) and BrightRoll Video Network (398 million).

Time spent watching videos ads neared 1.9 billion minutes during the month, with Hulu delivering the highest duration of video ads at 520 million minutes. Video ads reached 43 percent of the total U.S. population an average of 33 times during the month.

Hulu also delivered the highest frequency of video ads to its viewers with an average of 47 over the course of the month.

comScore Releases March 2011 U.S. Online Video Rankings

North America Will Have Half of all NFC Phones in Service in 2014

At least one in five smart phones globally will have near field communications functionality by 2014, Juniper Research estimates.

Worldwide, Juniper Research forecasts almost 300 million NFC capable smart phones by 2014. Juniper’s analysis shows that this growth will be driven in the short term by mobile network operators launching services in 20 early adopting countries before the end of 2012.

Juniper Research forecasts that NFC-based mobile payments and retail marketing capability via coupons and smart posters will become common amongst smart phone users in Western Europe, North America and other developed regions.

North America will account for half of all NFC smart phones in 2014, followed by Western Europe.

Kotak Mahindra Bank Launches Mobile Banking

Kotak Mahindra Bank has launched "Interbank Mobile Payment Service" (IMPS) for its customers. The mobile banking system allows customers to transfer funds between retailers or people who have banking services and are part of the IMPS network.

In order to send money using IMPS, the sender losg into the Kotak mobile banking application, enters the mobile number and the Mobile Money Identifier (MMID) of the beneficiary along with the amount to be transferred.

The beneficiary gets the credit instantly.

MMID is a 7-digit code issued by the bank which along with the mobile number will identify the customer’s bank and account number. To receive money using IMPS, the customer needs to share the mobile number registered with the bank along with the MMID for the account in which he/she wishes to receive money.

Kotak Mahindra Bank Launches Interbank Mobile Payment Service - CIO India News on The Internet | CIO.in:

T-Mobile Adds 10 New 4G Markets

Ten more markets have T-Mobile's 4G (HSPA+)network, bringing the 4G network up to 167 markets and more than 200 million people in the United States.

The new 4G markets include:
Ames, Iowa
Anderson, Indiana
Battle Creek, Michigan
Benton Harbor, Michigan
Jackson, Michigan
Fort Collins-Loveland, Colorado
Lawrence, Kansas
Manhattan, Kansas
Springfield, Illinois
Wichita Falls, Texas.

T-Mobile is also working to double the speeds of its 4G service to 42 Mbps in 25 of its 4G markets, covering more than 140 million people, this year.

New York City, Las Vegas and Orlando are already online with 42 Mbps service. Chicago, Long Island and parts of New Jersey are slated to follow soon.

G-Slate by LG, on T-Mobile USA

T-Mobile is launching a new Android tablet, the GSlate by LG.

Google Capex for Data Centers Grows

Google invested $890 million in its data center infrastructure in the first three months of 2011, the second-highest total in its history.

In fact, it’s Google’s biggest capital expenditure spending for any quarter in which it hasn’t bought real estate for other reasons.

Of course, Google also slowed investment in 2008 and 2009.

Google spent a record $2.55 billion on capital expenses in the fourth quarter of 2010, most of it related to the purchase of 111 8th Avenue, a 2.9 million square foot building in New York that is one of the city’s premier Internet and telecom hubs. It also serves as the main New York office for Google, which has about 2,000 employees on site.

Google 1Q 2011 Earnings

Google says there have been three billion Android apps downloaded. Apple just passed 10 billion app downloads mark in January 2011. But sales of Android phones are growing fast, so Google app downloads should accelerate as well. The first billion installs took 20 months, the second billion installs took another five months, and the third billion took only two months.