T-Mobile Will Introduce New “Unlimited” Data Plan?

T-Mobile USA might be preparing launch of a new unlimited plan without caps or rate limiting. The rumored plan is said to be priced at $30 for "Classic Plan" customers and $20 for "Value Plan" customers. If you want to use your device for personal hotspot service, though you will have to buy another plan, such as the 5GB and 10GB rate plan options, instead.

But the T-Mobile USA and new MetroPCS unlimited plans show that competition in the high-speed access space is not as limited as many would argue it is. 

MetroPCS Launches Unlimited "Everything" Plan for LTE

MetroPCS Communications Inc announced a "promotional" $55 4G LTE service plan that offers unlimited domestic talk, text and data, for $55 a month. 

The $55 price tag is for a single connection and families can get this offer for $50 per month on the their second, third and fourth connections. 

MetroPCS already had been selling such unlimited "everything" plans, but there generally were bandwidth consumption buckets that allowed unlimited use of data but on a rate-limited basis. 

Some will say MetroPCS is responding to the AT&T and Verizon Wireless shared data plans. Others might argue MetroPCS is simply trying to halt a slide in its customer net acquisitions. 

The deal is described as promotional, so it is not clear whether the plan will be retained as a "permanent" plan. 

Virtually All Video Subscription Providers Will Offer PC, Smart Phone, Tablet Viewing

Some 83 percent of video subscription providers plan to offer video streaming of some sort for PCs, smart phones and tablets by 2013, says Jeff Heynen, directing analyst for broadband access and video at Infonetics Research.

That is an eminently logical response for a video subscription services provider. The additional viewing adds value, while propping up the existing TV-based services.

Consumers Don't Really Care About "Interactive TV"

Nearly half of all consumers 16 to 24 use messaging, email, Facebook or Twitter to discuss what they are viewing on TV. 

Some 80 percent talk to other people in the same room while watching TV, another means of distracted viewing.

There is muted appetite for interaction with TV programs, one of the concepts that has been viewed as central to interactive TV,  though. 

Qube was in 1977 billed as the "world's first commercial interactive TV service," launched by Time Warner in Ohio, and failed commercially. In 1997 "Prestel" launched in the United Kingdom. It failed. 

People like to interact with video games. They like to interact with social networks. Some even like commenting on stories they read online. But few people really are interested in choosing their own camera angles during sporting events, changing the plots of TV shows or necessarily even playing along with TV quiz shows. 

Only 10 percent of surveyed respondents browse the Internet for information about the program they are watching, according to a survey conducted by Deloitte UK. 

Some viewers (40 percent) like being able to send their comments in to a live program, though. 

But 68 percent would not want the websites for products, personalities or advertising that have just been shown on television, to automatically appear on their computer, tablet, or smart phone.

The rise of ‘second screening’ - the use of other screens, such as laptops, smartphones and tablets while watching TV – is a source of excitement and concern for many in the TV and technology industry according to a new report from Deloitte UK. 

Nearly a quarter of all respondents (24 percent) use "second screens," typically a smart phone, or increasingly, a tablet. 

Nearly half of all respondents 16 to 24 use communication tools such as messaging, email, Facebook, or Twitter to discuss what they are watching on TV. The vast majority of over 55s (79 percent) never talk about what they’re watching on TV or the Internet.

Google, Boingo to Expand Ad-Supported Wi-Fi Test

Google and Boingo are building on their free Wi-Fi project in New York City, launching the advertising-paid access model in eight malls across the country.

Boingo and Google didn’t name the specific malls, saying only that at least four of them would be in San Francisco, Los Angeles, Tampa and Seattle. 

Google Offers will sponsor the service, meaning customers connecting to the hotspots with a smart phone, tablet or PC will encounter a welcome screen encouraging them to sign up for Google’s daily deal service. Regardless of whether customers sign up for the service or skip past the screen, they’ll get free, unrestricted access. 

In New York, Google and Boingo have offered the promotion in six subway stations and 200 hotzones throughout Manhattan on a trial basis until Sept. 7. The two firms also offer discounted Wi-Fi access in sixteen airports. 

Lots of entrepreneurs have tested the notion that Wi-Fi hotspot service can be supported by advertising. dSpot and AT&T are among them.  

Are There Really Any U.S. Households That Can’t Buy 12 Mbps Internet Access?

Some 19 million people in seven million U.S. households live where fixed broadband networks do not reach people with a minimum speed of 4 Mbps downstream, and 1 Mbps upstream , according to the U.S. Federal Communications Commission.

So it might seem silly to ask a serious question about whether there are any U.S. households that really “cannot” buy Internet access service operating at 12 Mbps, from at least two providers. The reason is that looking at fixed network access, while useful, does not actually exhaust the options already to potential buyers.

Exede, the satellite broadband service already offers 12 Mbps service. HughesNet, which has successfully launched a new satellite identical to the bird used by Exede, has not yet announced its retail packages, but will be able to offer similar speeds. Subject to business logic and some engineering constraints, HughesNet could offer faster services.

But most U.S. consumers also can buy mobile broadband services. The FCC report also notes that just 6.2 percent of people do not have access to mobile broadband services offering downstream speeds of at least 3 Mbps.

In other words, the percentage of people without access to speeds of 4 Mbps on a fixed network (about six percent, using the FCC calculation) is matched by six percent of people also unable to purchase a mobile broadband service operating at at least 3 Mbps.

Put in a positive way, some 94 percent of U.S. consumers have access to fixed or mobile broadband services of 3 Mbps to 4 Mbps, and in many cases, both, from multiple providers.

The FCC study also says that the percentage of people unable to buy either a fixed or mobile broadband access services of at least 3 Mbps is 1.7 percent. That represents about 5.5 million people, or about 2.2 million locations, using the 2.5 persons per household metric.

So in addition to the two U.S. broadband providers offering 12 Mbps services, one has to take into account mobile broadband, and some amount of fixed wireless, as well.

The FCC analysis implies some 5.9 percent of U.S. households are not reached by a fixed network, using 116 million U.S. households as the universe of places. Some might use a household base of 130 million, which would suggest five percent of U.S. housing is not reached by a fixed broadband network.

The point is that the same report also suggests that mght not be as big a problem as might seem to be the case. Keep in mind that the percentage of people or households not able to buy a 4 Mbps service does not mean they cannot presently buy a service that runs at lower speeds.

The report also suggests that in June 2011, some 9.6 Americans did not have service of at least 768 kbps downstream. Assuming a typical figure of 2.5 people per household, that would imply about four million U.S. households not able to get Internet access at speeds of at least 768 kbps, from a fixed network provider.

The FCC report also notes that 79 percent of telco-served locations nationally have access to service running at least as fast as 4 Mbps in the downstream direction, while 85 percent of cable-served high speed access locations have access running at a minimum speed of 4 Mbps in the downstream.

The point is that it is perhaps useful to note how well various contestants are doing, but less useful to argue that any one type of network is the benchmark for measuring the extent and quality of access.

Barnes & Nobles's Nook Sales Decline, Content Sales Increase

Sales of Barnes & Noble’s line of tablets and e-readers declined in the company’s fiscal 2013 first quarter ending July 28, 2012, the Barnes & Noble reported. But digital content sales increased 46 percent, generating enough revenue to offset lower device sales.

So you might say Barnes & Noble has the right strategy; it just needs to execute by selling more content players to support its media sales.

In earnings report, Barnes &  Noble broke out Nook sales in ways that obscure the dip in device sales and the growth of content sales. 

*Nook revenue is comprised of Nook devices, digital content and accessories.

Barnes & Nobles's Nook Sales Decline, Content Sales Increase

Sales of Barnes & Noble’s line of tablets and e-readers declined in the company’s fiscal 2013 first quarter ending July 28, 2012, the Barnes & Noble reported. But digital content sales increased 46 percent, generating enough revenue to offset lower device sales.

So you might say Barnes & Noble has the right strategy; it just needs to execute by selling more content players to support its media sales.

In earnings report, Barnes &  Noble broke out Nook sales in ways that obscure the dip in device sales and the growth of content sales. 

*Nook revenue is comprised of Nook devices, digital content and accessories.

Like Telcos, Cable Will Try to "Enhance Value" Rather than "Cut Price"

As telcos have tried to "add value" to their services rather than "cut prices," so too video entertainment subscription providers will try to emphasize "more value" as an alternative to "cutting prices." 

What remains to be seen is the success of such tactics, over time. At the moment, there doesn't seem to be much danger, though. 

Since people buy "content," and since most of the popular content is not easily available online or over the top on the Internet, video subscriptions still have drawing power. 

Monday Night Football is but one example of video content that remains exclusive to subscription services, The Hollywood Reporter reports. 

Adding online and mobile content access as a form of added value for video subscribers likely will remain a major tactic, even as some operators mull launching lower cost services in some way, and possibly will do, at some point.

In the past, telcos have had mixed success trying to "add value" rather than "cut prices." In fact, you might argue, even over the top messaging and voice services that do provide added value mostly are valued because they represent lower-cost alternatives to traditional voice and messaging services. 

But video is a different sort of product than "communications." The clearest example is the steady upward prices for video subscriptions every year, compared to declining nominal rates for communication services, or at least declining costs per unit. 

Ofcom allows Everything Everywhere to use existing spectrum for 4G

Ofcom has today approved an application by the mobile phone operator Everything Everywhere to use its existing 1800 MHz spectrum to deliver 4G services, a move similar to what Ofcom in 2011 allowed in the transition from 2G to 3G. 

Observers will note that the decision gives the largest U.K. mobile service provider a short window where it will be the only service provider to offer Long Term Evolution services in the United Kingdom, for a time. 

The United Kingdom is required to make the 900 MHz and 1800 MHz spectrum available for 4G use in light of a Decision of the European Commission, so the authorization is in line with the future 4G spectrum allocations. 

The move gives Everything Everywhere a bit of a headstart in 4G services, of course, compared to other competitors that will have to wait until 4G spectrum auctions are completed. 

Ofcom's decision means Everything Everywhere could, in principle, start offering Long Term Evolution services as early as Sept. 11, 2012, giving Everything Everywhere a market lead of perhaps a year or two over all the other providers of Long Term Evolution in the United Kingdom. 

It's an "Untethered" World

A new study conducted by Cisco of more than a thousand U.S. mobile users suggests that the amount of Wi-Fi usage each day is so prevalent that smart phone, tablet and e-reader device usage now is more “nomadic” than mobile; more untethered than mobile; less “on the move” than just “unplugged.”

What’s more, the Cisco survey also suggests 25 percent of users “see no difference” between the mobile and Wi-Fi networks. The implied 75 percent of users who do see differences perhaps is the measure of the importance of voice communications and quick Internet operations or use of social networks and other communications apps.

At some point, such trends could lead to some specialized revenue models within the broader mobile and untethered access business, focusing purely on “data connections,” not mobile voice, much as the Wi-Fi hotspot business has been a specialized “data access” service.

That could ultimately be more important in developing regions where full mobile access is relatively expensive and bandwidth constrained, and might well rely on use of unlicensed spectrum and well as “self organizing” network nodes of some sort.

A separate study conducted by Ipsos suggests the typical employed person, in a wide range of countries, is connected to the Internet nearly 10 hours a day, often by Wi-Fi, with mobile devices used inside the home about 2.5 hours a day, as well.

All consumers use their mobile devices at home, the Cisco  study found, averaging more than 2.5 hours of usage in a typical day, more than double the time that “mobile” devices are used “on the go,” which is about half an hour a day, the study also found.

A quarter of consumers surveyed by Cisco “see no difference” between the mobile and Wi-Fi networks. Consumers consider Wi-Fi easier to use and more reliable than mobile.

“We may be on the verge of a “New Mobile” paradigm, one in which Wi-Fi and mobile networks are seamlessly integrated and indistinguishable in the mobile user’s mind,” the Cisco study says.

Almost 60 percent of consumers were “somewhat” or “very” interested in a proposed offer that provides unlimited data across combined access networks for a flat monthly fee.

Separately, an Ipsos survey suggests people who work are connected to the Internet 9.8 hours a day, on average. That multi-country study surveyed users in in Argentina, Australia ,Belgium, Brazil, Canada, China, France, Germany, Great Britain, Hungary, India, Indonesia, Italy, Japan, Mexico, Poland, Russia, Saudi Arabia, South Africa ,South Korea, Spain, Sweden, Turkey, the United States and Hong Kong. The detailed tables are here.

The survey conducted by Cisco’s Internet Business Solutions Group (IBSG) suggests
mobile users are connecting their devices predominantly using Wi-Fi. In fact, most mobile users are connecting their devices using Wi-Fi at some point, including 70 percent of smart phone owners.

About 50 percent of tablets, laptops, and e-readers are connecting exclusively through Wi-Fi. Although 30 percent of smartphone owners are connected only using the mobile network, the remaining 70 percent are supplementing mobile connectivity with Wi-Fi, the Cisco study suggests.

In fact, on average, smartphone users use Wi-Fi a third of the time to connect their devices to the Internet.

With the exception of smart phones, users would prefer to connect all of their devices usingWi-Fi. More than 80 percent of tablet, laptop, and e-reader owners either prefer Wi-Fi to mobile access or have no preference.

Just over half of smartphone owners would prefer to use Wi-Fi, or are ambivalent about the two access networks.

If given a choice between access networks, mobile users choose Wi-Fi over mobile across all network attributes, with the obvious exception of coverage. That leads Cisco researchers to conclude that “we may be on the verge of a ‘New Mobile’ paradigm, one in which Wi-Fi and mobile networks are seamlessly integrated and indistinguishable in the mobile user’s mind.”


                                           Network Connectivity Type (by Time)

                                        Source: Cisco IBSG, 2012


The Cisco research shows that 75 percent of Americans now have laptop computers, while 52 percent of respondents own smartphones, versus 48 percent who use traditional mobile phones.

Also, some 20 percent of Americans now own some kind of tablet, and 20 percent own an eReader.

With the exception of smart phones, Wi-Fi now is the predominant access technology for mobile devices. More “nomadic” devices like laptops, tablets, and e-readers almost exclusively connect to the Internet through Wi-Fi, with only approximately 20 percent of these devices having any mobile connectivity capability.

                                            Device Network Connectivity (owned device)

                            Source: Cisco IBSG, 2012


Almost half of all mobile users regularly consume all forms of video, music, books, and games on their devices.

One of the insights is that while they may be called “mobile devices,” devices typically are used at home. All consumers use their mobile devices at home, averaging more than 2.5 hours of usage in a typical day, more than double the time that they spend using them at work.
While two thirds of people still use their devices on the go, the world of mobile devices is changing from a “mobile,” on-the-go world (average usage of 0.5 hours per typical day) to a “nomadic” world dominated by the home. And, people expect to increase their home use of mobile devices even more.

Cisco IBSG conducted its online study  of 1,079 U.S mobile users in March 2012. The study was also undertaken in Brazil, Canada, Mexico, and the United Kingdom.

Will Fixed Network Voice Connections Drop to Zero?

The latest report on U.S. fixed network voice connections by the Federal Communications Commission suggests that voice connections declined three percent between June 2010 and June 2011. That raises an obvious question: will number of fixed voice connections continue to drop, without end, to zero?

That seems highly improbable. There would seem to be some good reasons for predicting a perpetual demand for fixed voice connections, not the least of which is that voice quality likely always will be higher, and more consistent, on fixed connections, compared to mobile or forms of VoIP that do not use managed connections.

But that isn’t the only reason. Much might hinge on how voice services are packaged and priced.

In principle, service providers can package fixed network voice service in ways that impose little incremental cost over not buying the service, or in fact tie the purchase of another network service to the voice service. That is not to discount the “add value” approaches, but simply to note that the easiest path forward is simply to make fixed voice service so affordable there is no reason to drop it.

Service providers will not like the gross revenue implications, but the simple matter is that if the value of fixed voice keeps dropping, compared to mobile voice, erosion will continue. On the other hand, if voice and perhaps other features are bundled with the “lead” broadband access service in ways that users find reasonable, massive erosion might be avoided.

Under the new Verizon Wireless pricing scheme, for example, though users can still use over the top messaging and voice, there is no financial incentive to do so, at least for domestic calling.

At some point, fixed network providers will probably reach the same conclusion, and package “broadband access” with voice features in ways that make paying for fixed network voice a reasonable and preferable option. You might argue that Charter Communications and Verizon’s landline business already have moved in that direction.

A new policy by Charter, and the Verizon “Share Everything” plans simply make voice a feature of a broadband service.

Charter is going to stop selling voice subscriptions as a discrete product, and will in the future only sell voice in conjunction with at least one other service, either entertainment video or broadband access.

Verizon, for its part, also requires bundling of a voice line with DSL. Charter is adopting similar policies.

"Going forward, we will not offer Charter Phone as a standalone product," a Charter spokesman apparently has confirmed.
    source: Allied Telesis

In principle, the bundling is akin to the ways consumers buy many other products. When you buy a PC, a tablet, a smart phone, an iPod or an automobile, you get a battery as part of the device. Both Charter and Verizon Wireless now are making “voice” part of a product bundle, a feature, essentially.

If, as some of us suspect, voice and messaging eventually will be features of a network access service, then the number of voice “lines” in service will stop falling, in line either with the number of broadband access or video entertainment accounts in service.

The point is that landline voice accounts will not decline, without end, even if consumer prefer to use mobile voice, so long as retail policies tie the use of other valued network services to a bundle that includes a voice service.

No Digital Divide?

One doesn’t hear quite so much about “digital divides” as was common a decade ago. One suspects that is because the supply of communications, both voice and data, is a problem the world seems capable of solving.

Some of us can remember great "handwringing" an concern in international policy circles about how to bring telephone service to two billion people who never had made a phone call. You don't hear such concern anymore, since we rapidly are solving that problem with mobile communications, a solution not envisioned in the 1970s and 1980s.

Two decades ago the question largely had shifted to the problem of how to get computing into the hands of the next three billion people. There was some work around the notion of special devices optimized for rural villagers that would be low cost, perhaps $150 or so.

For many at the time, likely most knowledgeable observers, the prevailing thinking was that it couldn't really be done. And that remained true even as recently as the middle of the 2000 decade.

But as we stumbled upon a solution to the problem of getting communications to people at prices they could afford, we are about to solve the problem of getting computers to people, also at prices they can afford.

The notion, for some time, has been that in many parts of the world, the smart phone would be "the computer" most people used. That might turn out to be largely correct, for at least a time.

But it also now is possible that we know how to create and sell computers to people that cost no more than $150. Consider that the prototype "One Laptop Per Child" device had a screen of 7.5 inches diagonal and flash memory, with no keyboard.and used Wi-Fi for Internet connectivity.

Oh, that's right, we now call that a tablet, and it is made and sold commercially by the likes of Amazon, Barnes & Noble, and soon Google and likely Apple.

One might note a similar process at work even in the area of rural broadband access. Does it make sense to spend up to $50,000 per home to provide broadband access service to less than 200,000 U.S. rural locations, when at least two other approaches are already available?

The Federal Communications Commission, for example, conducted a  gap analysis that suggested $13.4 billion in subsidies would be required to  expand availability to only 250,000 of the highest cost homes (0.19 percent of all U.S. homes).

According to the FCC, those homes would require subsidies of about $53,600 – on top of what service providers would expect to spend to connect a typical home.

Excluding the cost of serving these 250,000 homes, the cost of connecting the remaining 6.75 million homes would entail a subsidy of about $1,500 per home passed.  

Keep in mind that the “broadband gap” affects less than five percent of U.S. homes. The Federal Communications Commission itself estimates that seven million U.S. households do not have access to terrestrial broadband service, representing about 5.4 percent of the 129 million U.S. homes.

Additionally, analysis assumes those households actually are occupied, but they are not. Some percentage is unoccupied, and some are used only partly as vacation homes.

According to the U.S. Census Bureau, about 18 million of the 130 million units are not occupied (about 14 percent).

On average, the gap estimated by the Commission is $3,357 per home passed, note Dr. George Ford, Phoenix Center chief economist, and Lawrence J. Spiwak, Phoenix Center president.

Even the then director of the  National  Broadband Plan, Blair Levin, said it will be too expensive to  provide service to the last two percent of home using terrestrial facilities. Therefore, those homes should be served by satellite broadband.

A more reasonable approach to satellite broadband at the time might have been that if it costs $50,000 to provide a 4:1 Mbps terrestrial broadband service to a household, then is it reasonable to accept a “lower” service level by a network that already reaches those locations?

The situation has also changed since that analysis. ViaSat’s “Exede” satellite broadband service already has been offering speeds up to 12 Mbps downstream and up to 3 Mbps upstream, for $50 per month, since early 2012.

The HughesNet service, which has launched a new satellite of its own, will begin offering faster service beginning this month. Since both the ViaSat and HughesNet services use exactly the same satellites, it would be reasonable to assume that HughesNet will offer speeds comparable to that of Exede.

In fact, the National Broadband Plan explicitly recognized that the cost of ubiquitous coverage of terrestrial broadband could not be justified and furthermore recommended the use of “satellite  broadband” as an alternative, as it is  ubiquitously available, Phoenix Center argues.

The cost picture has changed dramatically since the FCC conducted its gap analysis. Though the original plan called for a 4 Mbps capability, Exede already sells a 12-Mbps service for $50 a month. As of Aug. 13, 2012, Hughesnet has not announced firm pricing and speeds.

But there is no reason to believe HughesNet will offer speeds any less than offered by Exede. The point is that by spending an abundance of money, the government simply does not make sense at the margin.

The point is that one has to be careful about interpreting Internet or broadband usage trends. In past years, some observers have argued there is a significant “digital divide,” using statistics about Internet or broadband usage (people who buy and use that product or capability) rather than broadband or Internet “availability” (the service actually is available to purchase).

A decade ago, access mostly was measured by activity occurring only on the fixed networks, as well.

The point is that the difference between whether a product is available, and whether a consumer chooses to buy it, is highly significant. A “digital divide” argument assumes that a product such as broadband access is statistically “unavailable,” meaning there is an “access to the product” problem. Lower availability in rural or sparsely-populated areas is one form of the argument.

The latest study of mobile broadband behavior shows the relevance of the distinction between “available to buy” and “I want to buy it.”

About 17 percent of mobile phone owners do most of their online browsing on their phone, rather than a computer or other device, the Pew Center Internet & American Life Project reports.

Young adults and non-whites are especially likely to use their mobile phones for the majority of their online activity, the researchers say.

Nearly half of all 18 to 29 year olds (45 percent) who use the Internet on their mobile phones do most of their online browsing on their mobile device, the study found.

Half (51 percent) of African-American mobile Internet users do most of their online browsing on their phone, double the proportion for whites (24 percent). Two in five Latino cell internet users (42 percent) also fall into the “cell-mostly” category.

Digital marketing specialist Troy Brown, president of one50one thinks Hispanics generate 50 percent of their Internet traffic from mobile phones.

The important implications here are that people might prefer to use mobile Internet and mobile broadband, rather than fixed access, in numbers that are significant.

Additionally, those with an annual household income of less than $50,000 per year and those who have not graduated college are more likely than those with higher levels of income and education to use their phones for most of their online browsing, Pew researchers say.

In that sense, the adoption of mobile broadband might be a rational choice, similar to adoption of mobile “as voice,” when people choose to use a mobile exclusively for their voice service. In fact, we might already have reached the point where further growth of fixed network broadband connections is limited or slowed because users have better mobile alternatives.

The Pew data also suggests that mobile broadband has been particularly important to populations that in the past have “under-indexed” for use of fixed network broadband. The point is that, aside from buyer preferences being at play, fixed network broadband purchases increasingly are not suitable measures of “broadband adoption.”

When 17 percent of mobile users report “mostly” using their mobiles for Internet access, any metrics of adoption that ignore mobile access will be misleading.

On a larger level, one might make the argument that the digital divide, and the communications divide, simply are problems we are solving.

O2 Customers Talk 12 Minutes a Day

On average, U.K. mobile service provider O2 has found,  smart phone owners now spend over two hours a day using their devices, but talk only 12 minutes, and text only 10 minutes.

Smart phone users spend more time browsing the internet (25 minutes a day), social networking (17 minutes a day), playing games (13 minutes a day) and listening to music (16 minutes a day) than they do making calls (12 minutes), O2 says.

That illustrates the multi-function nature of smart phones, as well as the key role smart phones now play in a full range of "Internet access" activities.

Checking or writing emails represents 11 minutes of activity a day. Watching video consumes 9.4 minutes a day, while reading books represents about 9.3 minutes a day.

People spend about 3.4 minutes a day tacking pictures, as well.

For many people, the smartphone is replacing other possessions including alarm clocks, watches, cameras, diaries and even laptops and TVs as they become more intuitive and easier to use for things “beyond calls”.