Consumer Reports Says Apple iPhone 5 is "Best Yet"

The Apple iPhone 5 is among the best smart phones in the market by Consumer Reports. Consumer Reports also says the device is the "best" iPhone yet.

State of the Open Source Cloud Computing Business

Open source cloud computing services are seen by most members of the Zenoss community as immature, but they expect those issues to be resolved. You can get a copy of the full report here.

Dish Scraps Blockbuster Plans

Dish Network once hoped to turn Blockbuster and some new re-purposed satellite spectrum into a mobile video service. The plan, in April 2011, was to retain some of the Blockbuster retail locations to sell mobile devices supporting the new proposed service.

Those plans floundered when the Federal Communications Commission didn’t quickly approve a waiver allowing Dish to use its satellite spectrum for terrestrial data and voice transmission.

Dish indicates it has other plans for the Blockbuster assets, says Bloomberg.

Perhaps the mobile streaming plan was a high stakes gambit, but it was a gamble with small to negligible downside, with big potential upside.

When Dish acquired Blockbuster last year, the company had about $100 million in cash on the balance sheet. Shuttering and selling all 1,700 Blockbuster stores that Dish purchased would make Ergen’s company about $300 million, turning Dish a profit without using the brand for anything, Charlie Ergen, Dish CEO,  said.
The abandoned plan shows the growing importance of spectrum issues in creating, shaping or changing a number of communications and entertainment markets. LightSquared, for example, has so far been unable to launch its new wholesale Long Term Evolution network.
AT&T wanted to buy T-Mobile USA in large part for its spectrum assets. Sprint's board considered, then rejected, an early 2012 bid to buy MetroPCS. 
T-Mobile USA now wants to buy MetroPCS in part for its spectrum assets. 
Verizon has gotten approval to buy mobile frequencies from Comcast, Time Warner Cable, Cox Communications and Bright House Networks. 
AT&T is waiting for clearance of its purchase of more spectrum from NextWave.
The FCC now is trying to entice U.S. broadcasters to part with abandoned TV broadcast spectrum so it can be auctioned off to support U.S. Long Term Evolution networks.
And a new business based on use of "white spaces" spectrum might start in 2013 as commercial radios become available as well.

T-Mobile USA Has Lost $13 Billion Since Failed AT&T Merger

T-Mobile USA's equity value has dropped by $13 billion since the failed sale to AT&T in 2011.
T-Mobile USA is worth about $26 billion including debt, based on MetroPCS’s share price and analyst estimates, according to Bloomberg.

Deutsche Telekom had intended to sell T-Mobile USA for $39 billion.

Top Mobile Service Providers Globally

China’s three mobile operators all recorded double-digit subscriber growth over the last year, strengthening their respective standings in the latest Wireless Intelligence Wireless Intelligence ‘Scoreboard’ operator ranking.

China Mobile extended its lead as the world’s largest operator group, growing connections by 11 percent year-on-year to 683.1 million. Its two domestic rivals both moved up the ranking compared to a year ago - and all three now feature in the top ten for the first time.

China Unicom moved up one place on the back of a 21 percent increase connections to 219.3 million, while China Telecom climbed two places as connections increased 33 percent to 144.2 million.

China as a whole surpassed the one billion milestone earlier in the year. 

Rank	Operator-group	Connections (millions) 1	YoY Growth, connections	YoY Growth, rank	Mobile Revenue (US$ billion)
1	China Mobile	683.08	11%	-	22.05
2	Vodafone Group	386.88	5%	-	13.92
3	América Móvil Group	251.83	7%	-	7.98
4	Bharti Airtel Group	250.04	13%	+1	3.04
5	Telefónica Group	243.51	7%	-1	11.40
6	China Unicom	219.25	21%	+1	4.95
7	VimpelCom Group 2	205.05	7%	-1	4.58
8	Reliance Communications	154.60	8%	-	0.48
9	Telenor Group	152.74	24%	-	2.55
10	China Telecom	144.18	33%	+2	3.37
11	MTN Group	136.59	14%	-1	3.85
12	France Telecom Group	133.38	57%	+9	7.18
13	Telkomsel Group	117.24	15%	+2	1.43
14	Idea Cellular	117.16	23%	+3	1.00
15	Sistema Group 3	114.51	3%	-4	2.54
16	Verizon Wireless	111.37	5%	-3	15.78
17	Deutsche Telekom Group	107.86	2%	-3	8.38
18	AT&T	105.21	7%	-2	14.77
19	Telecom Italia	101.10	16%	+1	4.10
20	BSNL	98.28	5%	-2	0.44

Sprint Weighs MetroPCS Bid

Sprint is in the early stages of evaluating a counter offer for MetroPCS Communications Inc. (PCS) to top Deutsche Telekom AG (DTE)’s bid to combine it with T-Mobile USA, BusinessWeek reports.  

Should that happen, it would appear the Sprint board of directors made a bad decision in overruling CEO Dan Hesse's proposal that Sprint should buy MetroPCS, made earlier in 2012.  

Comparing Mobile Wallet Providers

Nice chart by GigaOm's Ryan Kim. 

“Mobiles” are Mostly Used “Untethered”

About 68 percent of consumer mobile phone use occurs in the home, a study sponsored by AOL and BBDO has found. That, as much as anything, shows the growing importance of “untethered” access for mobile devices.

The study, conducted by research firm InsightsNow, shows that a focus on “mobile” devices actually requires understanding the role of untethered access, which in fact might already represent as much as half of all mobile operations on a smart phone.

The study segmented into seven distinct "mobile motivations" that encompass most mobile use:
a. Accomplish - managing activities and lifestyle to gain a sense of accomplishment
b. Socialize- active interaction with other people
c. Prepare - active planning in order to be prepared for upcoming activities
d.Me Time - seeking relaxation and entertainment in order to indulge oneself or pass the time
e. Discover - seeking news and information
f. Shop - focusing on finding a product or service
g.Express Myself  -participating in passions and interests

“Me Time” is by far the biggest pasttime, accounting for almost half (46 percent) of all smart phone app and website activities, averaging 864 minutes per month per user, About 70 percent of those activities are “lean-back” experiences.

4G Retail Prices 20% Higher Than 3G: Can That Last?

​Compared to 3G data pricing, 4G is around 20 percent higher than 3G for the equivalent data plan, according to ABI Research.  Whether that will remain the case longer term is more debatable, ABI Research says.

“In South Korea, SK Telecom has cut its 4G pricing to remain competitive," ABI Research notes.

Their ‘LTE 62 Plan’ for smartphones used to be priced US$55.04 for 3 GB of data, but the monthly download quota has now been increased to 5 GB. 

ABI Research has seen similar 4G mobile data quota and/or pricing revisions in Norway, Hong Kong, and the US,” said Jake Saunders, VP for forecasting at ABI Research.

According to ABI Research’s cross-country comparison of mobile data pricing, the world’s cheapest 4G data plan is currently on offer by CSL Hong Kong, which launched its 4G service in November 2011. 

For 3G mobile data, the lowest tariff can be found in Singapore. Singapore’s M1 offers a 4 GB data plan for US$9.62.

France Telecom Promises Higher LTE Prices

France Telecom CEO Stephane Richard says the coming Long Term Evolution 4G network will be priced at a premium to the 3G network. That isn’t terribly surprising. The established pricing model for fixed or mobile broadband access is that faster networks cost more than slower networks.

And since there is a relatively linear relationship between network speed and data consumption, as a rule, there will be a tendency for usage-based plans to cost more when customers are on faster networks.

Beyond that, service providers always have used “new features” or “new capabilities” as a rationale for higher retail prices. Aside from the fact that LTE is more bandwidth efficient, an advantage for carriers, LTE does feature lower latency, for example, an advantage for end users.

Also, as a practical matter, expensive networks, with high fixed costs, facing significant loss of current revenue, necessarily will look to price increases. Consumers of electricity and water services, for example, sometimes are exhorted to “reduce” use as a “green” effort, or to conserve resources. But if too many electricity or water customers really do so, then revenue for the suppliers drops, and they raise their prices.

So, in a real sense, the growing competition in the market, not just evolving product demand, also would force suppliers to make up revenue losses, somehow.

Executives of European carriers including Vodafone and Spain’s Telefonica say European regulators need to ease restrictions on consolidation to free up resources for investments into faster networks.

“There are hundreds of telecom operators in Europe while there are three or four in major markets like the U.S. and China,” said Jose Maria Alvarez-Pallete, Telefonica’s COO.

For all of those reasons, higher mobile broadband pricing is coming, as mobile service providers build 4G LTE networks.

Clearwire May Delay LTE Network Build

Clearwire says it is evaluating its Long Term Evolution 4G network plans, to align spending with expected revenue, and "may elect to delay a portion of our deployment schedule accordingly."

In one sense, that is not helpful to Clearwire  at a time when other mobile service providers are building their LTE networks as fast as they can. On the other hand, helpful or not, Clearwire cannot afford to spend more capital than it has access to, even if it would prefer to build faster. 

Clearwire has said it will begin building the LTE network early in 2013 and have 5,000 LTE sites up by middle of 2013.

Clearwire had $1.2 billion in cash at the end of the second quarter and, based on its needs, had enough cash for "at least" the next 12 months. The company, which holds a large chunk of wireless airwave licenses, also has said it could sell assets to raise cash.

As a practical matter, Clearwire might ultimately wind up functioning as a "spot supplier" of additional LTE capacity in markets with heavy usage, rather than as a complete national network using only its own facilities. 

That would not be an unusual pattern in the industry, where virtually no networks have network everywhere. Such a plan also would better match the capital Clearwire seems to have available.  

Combined T-Mobile USA, MetroPCS Spectrum Holdings

This map of combined spectrum holdings of a merged T-Mobile USA and MetroPCS suggests that in a few markets--Los Angeles, San Francisco, Dallas, Boston, Detroit, Atlanta and Miami--the new company will have more than 70 MHz of capacity.

The impact elsewhere will be helpful, but less startling. MetroPCS has very good coverage in 14 city networks, including New York, San Francisco, and much of Florida,


Here's how AT&T once described its spectrum position, compared to other carriers, on a national basis (there are many local variations). The older AT&T chart does show why the merger is a big deal. Look at where T-Mobile USA stands, by itself. The MetroPCS spectrum, in some areas, is much larger. 

Roaming Revenue $80 Billion in 2017

Not all revenue earned in the global communications business, either fixed or mobile, comes from retail end users. Some portion of revenues comes from business partners, especially other service providers. In the global mobile business, roaming revenue paid by one carrier to another averages about eight percent of total revenue.

A new report from Juniper Research values mobile roaming revenues at more than $80 billion by 2017, compared to over $46 billion in 2012. Those revenues are driven by increasing data usage, but lower per-unit revenues.

Historically, roaming revenues have been earned by out of region mobile service providers who allow another network’s users access to the local network when those users are out of region. The new change is that customer access to out of region data networks, either mobile or Wi-Fi, is generating roaming revenue for the out of region suppliers.

T-Mobile USA to Become a Bigger "Number 4" Mobile Provider

The boards of Deutsche Telekom and MetroPCS Communications have approved a deal to merge MetroPCS with the German operator's U.S. subsidiary, T-Mobile USA, WSJ.com reports.

The deal would not change T-Mobile USA's installed base, compared to AT&T, Verizon and Sprint, but would narrow the gap with Sprint. The new entity would have about 42 million customers, up from 33 million.

Somewhat oddly, there have not been an immediate raft of objections that such a merger will be problematic becasue T-Mobile USA uses the GSM air interface, and MetroPCS uses CDMA.

In the past, every time rumors have arisen about Sprint buying T-Mobile USA, or merging the two companies, there have been immediate objections that the task of integrating the two companies would be technologically complex.

In the future, of course, all the U.S. mobile service providers will be using Long Term Evolution, so incompatible air interfaces will be a lesser problem over time, and then at some point, not much of a problem at all.

As a long term matter, many observers would say a stable mobile market in the United States would feature no more than three leading providers. That, if correct, suggests further consolidation will happen, even if the U.S. Justice Department already believes the market is too concentrated.

Carrier, Not Just Enterprise Hardware Changes with Cloud

Enterprise hardware platforms change with a switch to cloud computing, namely removing the need to tie applications and functions to discrete bits of dedicated hardware. In a cloud computing scenario, all those applications are computing "instances" run on virtual machines.

Metaswitch Networks Chief Technology Officer Martin Taylor says that means about a 30-percent performance hit, compared with running an app on a dedicated piece of hardware.  But the cost of computing drops every 18 months, so that isn't much of a financial issue. You just throw more processors at the problem.

Of course, technology changes often underpin potential changes of business model or operations. In a cloud environment, users extrapolate apps and execution of processes from physical devices and, potentially, locations.

Computing and app delivery itself becomes an "over the top" process. And that could have lots of implications for business models. Notably, communications access providers traditionally have operated on a territorial basis. Cloud computing makes that unnecessary, or simply a business model choice.