AT&T Will Sell iPhone 3GS "Free" on 2-Year Contract

AT&T will be able to sell the Apple 3GS to customers in the United States "for no incremental cost" ("free") on two-year service contracts that must include a data plan.

Four years ago, the cheapest iPhone cost $400. Today, it's free, at least on the U.S. AT&T network. The move shows that growth in smart phone adoption now is moving rapidly into the mainstream, with most of the sales volume coming from mainstream feature phone users.

AT&T Only U.S. Wireless Carrier To Get iPhone 3GS

Microcells and Backhaul will Have to be Cheap

Whichever technology is used to backhaul small cells, it has to be cheap, "it has to be massively cheap," said Andy Sutton, Everything Everywhere principal architect, access transport. "We have a financial envelope for small cells and it's challenging."

Cost is so important because small cells will have relatively low usage compared to a macrocell and there will be lots of sites to support. Compared with macrocells, small cells will cover distance of about 50 square meters or 538 square feet. That's an area about 23 feet by 23 feet.

One way to look at matters is that this is an area smaller than the range of a consumer's home Wi-Fi router.

Small-Cell Backhaul Must Be Cheap

Paramount Offers Streaming of "Transformers: Dark of the Moon"

Don't hold your breath in expectation that a revolution in online delivery of streamed new release movies is at hand, Paramount Pictures is experimenting with a new digital distribution model for the most recently released Transformers movie. 


This is just a test, not the forerunner of a new service offering. But like an army gearing up for a battle it expects, without full knowledge of where the foe is, Paramount is probing and testing, trying to gain more experience with a delivery system that could erupt into a full battle at some point. 


By offering its own marketplace for customers to purchase the streaming video, Paramount’s parent company Viacom is essentially cutting out “middlemen” services like Netflix, Vudu and others, keeping a bigger cut of the overall revenue.


"Transformers: Dark of the Moon" can be rented in standard definition for $3.99. Windows users have the option of renting an HD version for $4.99. The movie is available to watch for 48-hours after making the purchase.

The promotion was emailed to an MTV mailing list. The offer will last through the end of February 2012, marking the first extended direct-to-consumer online streaming rental offered by Paramount. Paramount to test streaming

Google has no Ability to Dominate New Markets, Some Would Argue

Legislating and regulating "problems" that are just about to solve themselves is a real problem in either national economic "planning" or regulation. Most of you are too young to remember the real and serious debates and dialogues held by telecom policymakers back in the 1970s and 1980s about how to provide telephone service to "one billion people who have never made a phone call."

The daunting problem seemed intractable. But policymakers back then had no idea "mobile service" was about to revolutionize communications, making it now a silly question to worry about how to provide communications service to those billion people. These days, most people in developing regions have, or soon will have, mobile phone service.

Some might argue we more recently, in the United States, thought the Telecommunications Act of 1996, the first major reform of the U.S. telecom framework since 1934, would introduce more competition in communications, and promote innovation.

That was just about the point that the Internet, broadband, mobility and applications were about to cause wholesale changes in user experience, user expectations and the product life cycles of any number of products, including fixed line voice services.

These days, you would be hard pressed to find a highly-placed telecommunications executive who would argue that voice revenues in the future will be anything but smaller than they are today, both in the fixed line and the mobile environments.

Despite the good intentions, policymakers tried to stimulate competition in voice services right at the point that voice services were about to reach the peak of the product life cycle, and then enter the declining stage.

Some might argue that growing scrutiny of Microsoft a decade ago likewise was misplaced. Microsoft was about to hit a period when Internet-based applications were going to undermine its potential "monopoly" in any case. Regulators honestly worried that Microsoft's dominance of PC operating systems would lead to domination of browsers.

These days regulators seem to worry that Google's presence in PC-based search advertising will give it "unfair" advantage in mobile services, mobile banking or mobile advertising and social networks. There is not much evidence that Google has actually been so successful at dominating the many other potential businesses it seeks to enter, or has entered.

"While it's true that Google's stranglehold on mobile search and associated ad spending is near 100 per cent, according to recent reports, it's equally true that most of the "search" consumers do on their mobile devices isn't the kind that Google controls," the Register notes.

In fact, the common thinking now is that Facebook and other social sites are becoming the way people use search in a mobile context.

Why grill Google over web dominance? It has none

New Features for Apple iOS 5, Due Oct. 12, 2011

Though it will be overshadowed today by news about the iPhone 4S and delay of iPhone 5, Apple's latest version of iOS 5 arrives on October 12, 2012.

New support for digital publications, Twitter integration and notifications are among the features.

10 Features Coming To iOS 5

As an Incentive, Virtual Currency Works

Marketers often think of advertising as a trade off for consumers: People watch ads in exchange for free or subsidized content. 


But a new study suggests giving consumers social currency or virtual currency as a reward for spending time with a brand message is a powerful incentive. 


But some digital ads are now explicitly offer social currency rewards rather than access to free content.


For example, a brand may sponsor a social game, and make a reward of virtual currency contingent on watching a display ad. These incentivized ads, research from digital advertising technology company SocialVibe and KN Dimestore found, can be very effective, even when consumers just watched to get the incentive.

Social currency rewards boost ad effectiveness

Consumers Want to Know What Others Think about Brands

New research by NM Incite, a Nielsen/McKinsey Company shows that the number-one thing consumers use social media for as it relates to their favorite brands is to find out what others are saying about brands and services.

Perhaps the surprising finding is that the top reason for using social networks, in relationship to brands, is not to get coupons or discounts, or to get information about new products or even to provide feedback of their own, be it postive or negative.

Consumers use social media to read reviews

American Bankers Association Cals for Regulation of FarmVille’s Virtual Currency

It was only a matter of time before the banking industry began to ask for regulation of "social currency" and "virtual currency" as "real money" transactions are regulated.

In a letter to the Consumer Financial Protection Bureau, the American Bankers Association has asked the new Consumer Financial Protection Bureau to consider regulating virtual currencies, like those used on FarmVille and Second Life.

“We understand that in some instances virtual currencies, which were initially developed to help individuals manage virtual credits earned through online games, have also been used to pay developers of applications, and their use can be expected to expand even further,” the ABA wrote.

The move was highly predictable, and eventually, as use of social currencies and virtual currencies become mainstream, those calls for regulation will grow louder. It is hard to argue that social currency and virtual currency will not wind up more regulated than today.

Bankers want regulation of FarmVille’s "Virtual Currency"

Apple will launch iPhone 4S today, not iPhone 5

Apple apparently will launch the new iPhone 4S today. That might not be the biggest news, because many had expected an iPhone 5 launch. The 4S features an 8-megapixel camera with “enhanced optics” and “more definitive GPS features,” Apple says.

Apple will launch the iPhone 4S today

Kindle Fire Set to Outsell iPad at Launch

Six weeks before it officially goes on sale, Amazon’s $199 Kindle Fire is shaping up to be the biggest tablet launch ever, assuming one chooses to consider the Kindle Fir a tablet like the Apple iPad (some of us do not).

Orders for Amazon’s Android-based tablet are racking up at an average rate of over 2,000 units per hour, or over 50,000 per day.

In the five days since Amazon put the Kindle Fire up on their official site, over 250,000 tablets have been preordered. If this level of consumer demand for the Kindle Fire continues, Amazon will have 2.5 million preorders for the device before it officially goes on sale on November 15th.

Those numbers make the Kindle Fire’s launch likely to be the biggest tablet launch in history, many would argue, beating both the iPad and iPad 2 in first month sales.

Amazon Kindle Fire On Track To Outsell iPad

Sometimes Fiber to the Home is Not Enough

Sometimes, even optical fiber access isn’t enough. Consider Yukon Telephone, which serves extraordinarily isolated communities in rural Alaska. The company recently installed a fiber-to-the-home network serving Tanana, a village of about 300 people, mostly Athabascan indians, on the Yukon River in the vast interior of Alaska.

So you would  think Yukon Telephone customers in Tanana now can take advantage of optical fiber speeds. But there’s a problem, company  President Don Eller says. All the backhaul is by satellite (Tanana is really isolated. Historically, moving bulkier goods in and out of the village has required waiting until the Yukon unfreezes in the spring, and then halting again when the winter freeze comes again.)



And given the high cost of satellite backhaul (up to $12,000 a month for a single T1 circuit), the entire Tanana fiber to home network has 3 Mbps worth of bandwidth. If you wonder why so much of the “broadband stimulus” spending was for middle mile projects, Tanana shows why.



Tanana now has a state of the art fiber to the home network. What it doesn’t have is an affordable way to connect with an Internet point of presence at speeds that take advantage of that local access capability. The middle mile issue is the barrier, not the local access network.



The backhaul problem faced by Yukon Telephone, show the huge investment challenges and revenue models for fiber to home services. Everyone agrees people need more bandwidth, and for a fixed network, optical fiber is the long-term solution.



What remains unsettled is the revenue model, and therefore the wisdom of investing in such infrastructure.

EU Wants to Slice Copper-Based Wholesale Rates

European Union telecoms commissioner Neelie Kroes wants to create a new pricing model for wholesale access to incumbent telecom provider networks that would cut prices for copper access but exempt carriers from the rules if they sell fiber optic access to wholesale customers. The new rules would create incentives for replacement of copper infrastructure. Kroes calls for greater broadband investment

Private investors have been reluctant to invest the €270 billionn Kroes estimates is needed for Europe to replace its copper access network with an optical fiber network. Broadband investment is the issue

It’s a contentious issue, as you might guess, as service  providers remain unconvinced there is adquate end user demand for new services that would justify the investment, at least for the moment. And that has investors concerned as well.

Would Apple Want to Buy Sprint?

With the news that Sprint has agreed to buy $20 billion worth of Apple iPhones, and with Sprint having a market capitalization of about $6 billion, speculation will begin that it is well within Apple's potential to simply buy all of Sprint. 

That would cause Apple enormous channel conflict of course. In fact, Apple would not avoid much channel conflict even if it opted to create "iNet" using wholesale capacity leased from Sprint. 

Would Apple Buy Sprint?

Apple "Owns" Sprint

In a move that some believe could be a make-or-break move for Sprint, the company has committed to buy at least 30.5 million iPhones, even though it would likely lose money on the deal until 2014, according to the Wall Street Journal. The deal could represent a commitment of $20 billion at current rates, and Sprint has to buy the devices, whether or not it can sell them.

Apple was paid $632, on average, for each iPhone sold to mobile service providers  in its most recent quarter, according to Credit Suisse. Customers who are not happy with contract plans that allow mobile service providers to recoup the device subsidies can decide, and do decide, that a contract is a better value than paying full price for a new iPhone and avoiding a contract.

To sell that many iPhones, Sprint would have to double its rolls of contract customers, convert all of them to the Apple device or a combination of the two, the Wall Street Journal notes. 

Sprint virtually has to take some big risks as it attempts to get itself back on a growth track. As one of my sons would say, "Apple owns Sprint."

Inside Sprint's Bet on Apple's iPhone

What is Twitter, Really?

What is Twitter? Sure, it is a "social network," but lots of people also say blogs are social networks. Initially, the idea was that Twitter was Facebook in 140 characters. These days, most observers would tend to agree that Twitter is something different, which only raises the question of "what" Twitter actually is.

These days, some would say, Twitter might be seen less as a social network on the Facebook model, but something that is as much broadcast network as a "social network." Of course, these days all social networks seem to be "media" as well as the digital equivalent of any real world place where people casually hang out and talk.

These days, the term "information network" seems to be the accepted term. Dick Costolo, Twitter CEO, says “there’s this huge opportunity for us to surface all this great content.” The difference might be subtle, but it's a bit like the difference between "what you doing right now?" and "what's happening right now?"

The former is an example of personal communication. The latter is "media."

Will Twitter Become Profitable?