Application Usage Rules of Thumb

"One fairly common 'law of web and mobile physics' is the ratio of registered users or downloads to monthly actives, daily actives, and max concurrent users (for services that have a real time component to them), says venture capitalist Fred Wilson. "I call this ratio 30/10/10 and so many services that we see exhibit it within a few percentage points here and there."

What Wilson sees is that, for most providers, 30 percent of the registered users or number of downloads (if its a mobile app) will use the service each month. About 10 percent of the registered users or number of downloads (if its a mobile app) will use the service each day.

The maximum number of concurrent users of a real-time service will be 10 percent of the number of daily users.

A VC: 30/10/10

Mobile Has To Re-Think The "Ad"

Necessity is the mother of invention, and that is likely to be true for mobile advertising as well. Because of constraints on-screen size, display ads will not be the preferred or logical format, many would argue. That might explain why there is so much activity around e-commerce, coupons, promotional messages and other "non-traditional" marketing and advertising formats being tried in the mobile business.

Mobile Has The Opportunity To Re-Think The Ad

A Brief History of Apple Not Buying Things

For years, Apple has confounded the rest of us by not buying things that it should clearly be buying. Not purchasing other well-known companies is so core to Apple’s strategy that it must have a whole department devoted to non-mergers and un-acquisitions, whimsically argues Harry McCracken, editor of Technologizer

It's just part of Apple's culture, as making and integrating acquisitions is part of Cisco's culture, or how some other companies seem to make acquisitions whose value is destroyed after the acquisitions.

So a recent speculation that Apple might buy Barnes & Noble would likely wind up being the latest rumor not to prove accurage.

A Brief History of Apple Not Buying Things

Microsoft Spoofs Gmail

 Microsoft is sparring with Google about email privacy.

The purpose of this spoof video, apparently, is position Office 365 as more secure in the email area.

Why 'Apps' Will Not be a Major Opportunity for Telcos

To give you some idea of how hard it actually is for a large communications carrier to create a new line of business that has a meaningful impact on revenue, consider an analysis Tristan Louis at TNL.net recently conducted.

He took a look at valuations and implied average revenue per user for some of the leading Internet companies, including Pandora, LinkedIn, Groupon, LivingSocial and Zynga.

His analysis suggests it is possible to generate between $3.57 and $4.58 per user per year. By the same token, it could be possible that a user is worth between $106.46 and $126.24 over the user’s lifetime to a publicly traded web 2.0 company.

But assuming such deals were contemplated, you can see the problem. Even if a telco could somehow create enough value for any of these services to create a role in the revenue stream, the net result is that the effort is more trouble than it really is worth.

Assume an average of $4.25 annual revenue per user. Assume a telco could create enough value to warrant a revenue share of five percent of gross revenue. That would imply annual incremental revenue of 21 cents a year, or less than two cents a month, per subscriber.

If one assumes a large telco has to see a top-line revenue opportunity of roughly $1 billion to bother chasing the opportunity, one typically has to assume revenue potential in the dollars a month per subscriber range, ranging in many cases from $10 to $20 per user, per month, to be reach that level of significance.

Why 'Apps' Will Not be a Major Opportunity for Telcos

Application-Aware Charging Grows on Mobile Networks

Some 32 percent of mobile operators already are offering application-aware charging models, a new study by Allot Communications suggests. 'Our findings show that operators have responded to this challenge (differential demand imposed by growing video bandwidth consumption) by implementing usage and application-aware charging models and service plans,' Allot says.

Application-Aware Charging Grows on Mobile Networks - Carrier Evolution

Telcos Invest in Cloud, Immediate Return not the Issue

Communication service providers committed almost $8 billion to cloud-related pursuits in the first six months of 2011, but recent acquisitions won’t boost cloud revenues overnight and service differentiation remains poor, according to Informa Telecoms & Media. That finding is not terribly surprising, given the relative newness of the business and the cost of investing in facilities.

Informa estimates that the typical provider generates less than five percent of its enterprise revenues from annuity cloud services. That sounds like a small amount, but can be quite significant for a large provider. Some might point out that text messaging revenue only accounts for about five percent of Verizon Wireless revenue, but it is a quite-important revenue source.

Telcos Invest in Cloud, Immediate Return not the Issue - Carrier Evolution

Google Buys IBM Patents to Ward Off Lawsuits

Google has purchased 1,000 technology patents from International Business Machines Corp. as the Web-search giant stocks up on intellectual property to defend itself against lawsuits. The patents involve the "fabrication and architecture of memory and microprocessing chips," computer architecture including servers and routers and online search engines, among other things. Read more here. (subscription required)

Some might argue the litigation-heavy U.S. business climate is stifling innovation. There have been continual patent infringement lawsuits filed recently in the mobile device space, for example. Read more.

Amazon Uses Streaming Video for "Content Marketing"

Amazon.com has some advantages as a content marketer. Like other retailers of "content" or "entertainment" products, it can use trailers, book reviews and descriptions as content marketing vehicles. But unusually, even for a content retailer, Amazon has the ability to give away professional content as part of a direct revenue model.

Amazon Prime is a membership service that, for $79 a year, gives Amazon customers free shipping on their purchases as well as no-extra-charge access to the Prime Instant Video streaming library. The Amazon Prime membership is a revenue-generating loyalty device, which provides clear incentives for members to keep buying from Amazon.

Pursuant to that strategy, Amazon.com added a new licensing agreement with NBCUniversal Domestic TV Distribution that will allow Amazon Prime members to stream select Universal Pictures movies through Prime Instant Video. This deal with Amazon will bring the total number of Prime instant videos to more than 9,000 movies and TV shows in the summer fo 2011.

Sometimes it is harder to see the tie between content marketing and a firm's revenue model. There is no such obscurity in the case of Amazon Prime Instant Video.

Amazon Adds More Content

Five Lies About Social Media Marketing

Social media has caused businesses to set up, or to feel they have to set up, Facebook Pages, Twitter accounts and blogs to connect with as many customers as possible. Waylaid somewhere along the way, however, were the fundamentals of public relations, marketing, corporate communications and sales, giving way to erroneous assumptions about how businesses should manage their social marketing, some would argue.

Among the five biggest misconceptions is the notion that somebody other than you knows "social media," and is qualified to give you advice, argues Mikal E. Belicove is an "Entrepreneur" magazine columnist.

That might seem a "harsh" judgment, but for most smaller and start-up businesses, it is true enough.

The problem is that the art form still is developing. Some people have more experience, it is true, but at this point we all are still experimenting.

Perhaps one analogy is parenting. Some do it very well, almost instinctively, while others have to work at it. But humans wouldn't have been around very long if "parenting" were really so difficult that it had to be "outsourced" or conducted only by specialists. Some amount of common sense is needed, but social media is a tool like any other. Parents learn to be parents by doing it. Social media is like that, as well.

Also among the five top myths is the notion that social media, though "new," also represent "new media." As Belicove argues, all successive generations of media are new for a while. Then they just become "media." The implications are that social media can be approached just as any other medium can be: a tool.

Five Lies About Social Media Marketing

Telcos invested $8 billion in cloud in first half of 2011

Communication service providers committed almost $8 billion to cloud-related pursuits in the first six months of 2011, but recent acquisitions won’t boost cloud revenues overnight and service differentiation remains poor, according to Informa Telecoms & Media. That finding is not terribly surprising, given the relative newness of the business and the cost of investing in facilities.

Informa estimates that the typical provider generates less than five percent of its enterprise revenues from annuity cloud services. That sounds like a small amount, but can be quite significant for a large provider. Some might point out that text messaging revenue only accounts for about five percent of Verizon Wireless revenue, but it is a quite-important revenue source.

Of the 10 acquisitions and 21 investments announced in the first half of 2011, 80 percent involved data centers. Using a five-year return on invested capital rule of thumb, the invested $8 billion implies annual expected revenue of $1.6 billion. Of course, one also expects some amount of over-investment at this stage of business growth, so many would not be surprised if those projections for annualized revenue fall short.

By itself, cloud computing services might not be big enough to justify so much effort. But as part of a wider effort to expose network features to business partners, the provision of cloud facilities and software is seen as important. Few firms the size of AT&T or Verizon will waste time on new revenue initiatives that do not promise at least a $1 billion annual revenue stream. Right now, it isn't so clear that will be the case, for either firm, in the near term, and perhaps not even in the medium term.

But a reasonable argument can be made that revenues from additional products built on top of that platform, plus the cloud hosting services, will amount to new revenue of the threshold magnitude.

Telcos invested US$8 billion in cloud in first half of 2011

U.S. Consumer Interest In Mobile Payments Still Low

Recent surveys by Forrester Research show that U.S. consumer interest in mobile payments is low.

Less than six percent of U.S. online adults have ever used any type of mobile payment.

Over the past three years, Forrester has seen interest in mobile payments continue to grow slowly, though, up from 11 percent of survey respondents in 2008 to 18 percent in 2010.

Are Consumers Interested In Mobile Payments?

Sprint Shares Take Tumble; Strategy or Churn the Reason?

Sprint's shares on July 28, 2011 suffered their biggest intraday drop since 2008 as its second quarter results missed analyst forecasts, and an unclear 4G strategy, despite firm news of a deal with LightSquared that at least clarifies part of Sprint's Long Term Evolution approach. It isn't entirely clear whether the drop was caused by investor concerns about ongoing churn, or uncertainty about Sprint's long-term strategy.

The future of its relationship with Clearwire, though, remains unsettled. The deal with LightSquared is tactically helpful, assuming LightSquared can mollify the GPS community about interference issues. That is one major issue, but there are others, including the loss of about half its potential spectrum if LightSquared has to avoid using the "L" band frequencies where GPS interference issues exist.

Longer term, some will have questions about the viability of a wholesale-only strategy, as well as ability to raise the rest of the capital needed to finish the full LightSquared network.

Would Sprint kill its Clearwire golden goose?

Never wait on hold again with the FastCustomer app

FastCustomer, an iPhone and Android app, claims to have saved its users 220,000 minutes they otherwise would have spent "on hold." FastCustomer will call any company’s call center or any department and wait on hold for you. The app saves you time and eliminates the need to listen to elevator music

On the free iPhone or Android app, just tap a button telling the app which company you need to reach, then go back to living your life.

1-800 numbers suck. Never wait on hold again

Does Apple Want to Buy Barnes & Noble?

Are Apple executives weighing a possible bid to buy Barnes & Noble? That's the rumor reported to Boy Genius Report by an as yet "unproven" source.

Apple presumably then would fold the Barnes & Noble digital library of books and publication into Apple’s own iBooks store.

Apple would have no use for the Nook, and that would likely be discontinued in this scenario. Apple could then convert some of the brick and mortar Barnes & Noble stores into Apple stores and close the rest. Apple easily can afford the transaction.

Some of us would lament the loss of the retail bookstores, or the possible demise of the Nook. Along with Amazon's coming Android tablet, the Nook has seemed to some the best chance for a branded Android tablet to create a niche in the tablet market that actually answers the question of "why buy it instead of an iPad?"

Does Apple have any interest in buying Barnes & Noble?