Inq Mobile Shuts Down

A couple of years ago, it seemed as though a few viable ways to optimize a smartphone existed. Blackberry was optimized for email.

And some tried to optimize for social media. Years earlier, some devices were optimized for sports content (ESPN).

One might argue that none of those approaches yet has proven sistainably viable.

Inq Mobile is the latest casualty.

Will Consumers Welcome a Digital Wallet from Apple or Starbucks?

Perhaps we will find out, if both Apple and Starbucks do introduce retail payment systems. One might speculate that the firms will take different tacks. 

Apple might be thinking about creating a mobile point of sale system using iPads. Starbucks already has an investment in Square, so that approach seems less likely for Starbucks. 

Instead, Starbucks might only be thinking about ways other retailers can be incorporated into the Starbucks mobile payment environment. 

Google Did Not Make Out Badly With Motorola Mobility Buy

Maybe it was not a slam dunk. But neither was it a huge mistake. I don't know whether Google will keep tax loss carry forwards or not. But if Google managed to do so, the simple financials will be even better than they appear.

We'll find out when the next quarterly earnings report is released. 

Rationality is a Virtue When Discussing Communications Policy

So is civility, even when people disagree about communications policy in fundamental ways. 

Tata Communications Selling to Vodafone?

Tata Communications reportedly is in talks with Vodafone about a deal that would have Vodafone buying all of Tata Communications, though talks are said to be at a preliminary stage.

Vodafone had been expected to go on a buying spree after selling its stake in Verizon Wireless to Verizon Communications, and the rumored Tata Communications deal is the first evidence that Vodafone is moving.

Tata Communications is the number one global international wholesale voice operator and number one provider of international long distance, enterprise data and Internet services in India, earning about $3 billion annually.

Apple' Sales Volume Drops In Two Biggest Markets

Lots of people are waiting for Apple's next launch of new products, or are finding other alternatives, it appears.



Apple revenue from its two biggest segments -- Europe and the Americas -- have begun to contract, Fortune reports.



In the first quarter of 2014, Apple's combined Asian sales were $17.4 billion, more than Europe ($13 billion) and closing in on the Americas ($20 billion).

2008 was Inflection Point for Mobile Broadband

Global mobile connections will grow from 6.5 billion connections in 2013 to nine billion in 2018, according to researchers at iGR. And that probably is not the most-significant change likely to happen between 2013 and 2018.

Instead, the big change is the overwhelming role mobile will have in bringing Internet access to end users. As recently as 2008, broadband Internet access remained a primarily fixed network service.

Oddly enough, 2008 also was the year mobile broadband subscriptions reached an inflection point.

Business Segment Drives Time Warner Cable Growth

Despite continuing challenges in its consumer segment, namely net customer losses, Time Warner Cable managed to grow full-year 2013 revenue 3.4 percent year over year.



Business customer revenues grew 21.6 percent, while consumer high speed Internet access revenues grew 14.4 percent. 



Fourth-quarter 2013 average monthly revenue per residential customer relationship (ARPU) grew 2.2 percent to $106.03, the highest rate of growth since the first quarter of 2012, Time Warner Cable says.



Residential high-speed data ARPU increased 12.4 percent to $46.21. Time Warner Cable says it  now offers residential high-speed data speeds of 100 Mbps in several cities and regions, including Los Angeles, Kansas City and Hawaii. 



Residential wideband high-speed data subscribers (which includes the 30, 50, 75 and 100 Mbps tiers) more than doubled year over year to 910,000 subscribers. 



But consider that Time Warner Cable has 11.08 million total residential high speed Internet access customers, meaning that just eight percent of Time Warner Cable customers actually buy a tier of service at 30 Mbps or higher. 



It isn't that the higher speeds are unavailable; just that consumers apparently do not see the value-price relationship of the faster tiers as providing good value, at the moment. 



And that is a key point: whether high speed Internet access services are available for purchase is one issue. Whether people actually buy those services is a separate issue. One might argue that only eight percent of Time Warner Cable customers buy 30 Mbps, 50 Mbps, 75 Mbps or 100 Mbps service because it is not provided. That largely is untrue.



What is true is that people are choosing to buy service at lower speeds. That means Time Warner Cable has a demand issue, not a supply issue, even if some would say Time Warner Cable has lagged in investment that would boost speeds higher. 



Some might argue investment is not the immediate issue. Instead, consumer demand is too low. That is a far-different sort of problem than lack of supply.

Telecom Industry is Backwards Looking: Government Makes it So

Mobile networks have experienced four complete transitions of network technology in a few decades, doing so about once every 10 years.



The fixed network has been through a couple of network eras, without completely revamping the whole platform.



Looking at switching, it moved from simple crossbar switches to analog electronic switches to digital switches. In access technology, it has begun to move from copper wires to optical fiber. 



The biggest single transition, though, is the move from time division multiplexing to Internet Protocol, a subject the Federal Communications Commission will address at its Jan. 30, 2014 meeting, taking up an AT&T request to run trials related to the transition from TDM to IP.



Many of the issues are largely "social" rather than "technical" in nature, relating to how universal service and consumer protections are maintained. Emergency calling and preservation of competition likewise will have to be addressed, though none of those issues is fundamentally a technology issue.



It is fair enough to criticize large telcos for not moving fast enough. Sometimes they can't help it. The government makes them move slow.

Amazon to Enter Retail Payments Business

Amazon, the Wall Street Journal reports, is hoping to sell retailers a Kindle-based retail checkout system, likely positioned like Square and other providers of mobile credit card reader systems. 



The attraction would seem to be the access to customer data, not so much the lucrative payment terminal business. 



But Amazon might also be thinking it can bring other "value add" to the systems, compared to existing offers from other established payment system providers. The immediate inducements could relate to offers, promotions or discounts, especially related to retailer sales on Amazon.com



Longer term, Amazon might eventually leverage other assets. Amazon Web Services could come into play, or possibly logistics support. 



Amazon also reportedly is considering a mobile wallet service that would be used by consumers. 

Google Selling Motorola Mobility

Google says it is selling what remains of Motorola Mobility--while retaining the patent portfolio, to  PC maker Lenovo for $2.9 billion.



Google, which bought Motorola Mobioity for $12.5 billion in May 2012, already had sold off the part of the business building cable set-top boxes, and seems now to retain what it really wanted: the patent portfolio. 



The move does not completely address the channel conflict of Google being in some parts of the device market, such as it now is with Nest, the home automation supplier. But the move does ease the channel conflict potential to a significant extent. 

U.S. Justice Department "Skeptical" About Possible Sprint Acquisition of T-Mobile UA

Sprint's Possible T-Mobile US acquisition, to nobody's surprise, is viewed "skeptically" by U.S. Department of Justice officials, Sprint board members Masayoshi Son and Dan Hesse apparently have been told at a meeting. 



But nothing is ever as it appears on the surface, where it comes to key communications developments. AT&T, in formally announcing it has no plans to make an immediate bid for Vodafone, might trigger thinking that AT&T does not want to make such a bid.



That undoubtedly is the wrong way to view the declaration. By law, AT&T, when asked by U.K. authorities, whether it planned to make such a bid in the next 30 days, had to answer "no," and thereby wait at least six months before making any such bid. 



But AT&T would not have made such a bid within the next 30 days. Too much depends on how European regulators treat other pending deals, in particular consolidation in Germany. AT&T had no choice but to respond the way it did.



Likewise, some might think Sprint could not win approval for a deal to buy T-Mobile US, no matter what the concessions. That probably also is not entirely certain. 



The Justice Department, though having a view that the U.S. mobile market already is too concentrated, and though it favors a minimum of four providers, might also be presented with an acquisition plan that maintains four providers, and especially the robust attacks T-Mobile US is making.



It could happen.

AT&T Pays $100 Credit for Every New Line Added

Market observers who were worried about the implications of a new marketing war in the U.S. mobile business have new reason to worry. 



AT&T now is offering all new and existing AT&T customers  a $100 bill credit for each new smartphone, tablet, feature phone, mobile hotspot or Wireless Home Phone line of service they add.



The offer is said to be good through March 31, 2014. 



The latest incentive comes on top of rival offers by T-Mobile US and AT&T that pay off any early termination fees customers might face when changing service providers before the end of a contract term. 

Retailer Mobile Card Readers are the Acknowledged Success in Mobile Payments Field

The usefulness of mobile payment services, as used by consumers, might be hard to ascertain.

But it is clear that retailer adoption is accelerating

Dunkin’ Donuts is launching its own mobile app, hoping to mimic the success Starbucks has had with its mobile payment app (and loyalty program).

Mobile transactions will account for about two percent of all credit and debit card volume in the United States in 2013 and four percent globally, according to BI Intelligence.

Just what percentage of small retailers have adopted mobile card readers such as Square is a matter of debate. What is not debatable is that mobile card readers such as those offered by Square have become a big deal.

By some estimates, 40 percent of retailers already are using mobile card readers.

U.K. Market Illustrates Rule that Household Spending on Communications is Highly Stable

Consumer spending on communications and video entertainment tends to be stable. In other words, households tend to spend about the same percentage of household income on communications and video entertainment services every year.

The variables are changes in household income, and changes in prices for the purchased items.

That implies any increase in household spending in one category likely is balanced by reduced spending in some other category, unless the prices of purchased goodds decreases.

In the U.K. market, households spend between three percent and four percent of household income on communications and video entertainment services. The sole exception is the highest 10th of U.K. households, ranked by household income, where spending is between two percent and three percent.

That is what one would expect. Households with higher incomes can buy a fixed set of services for a smaller percentage of total household income.

Over the years 2001 to 2013, U.K. households began spending more money on mobile services, and less on fixed voice, while also increasing consumption of broadband Internet access. In other words, demand shifted to mobile and broadband, even when unit prices fell.

Mobile accounts in the United Kingdom surpassed fixed network voice accounts in early 2009, according to Ofcom, the U.K. communications regulator. Between 2001 and 2013, U.K. household penetration of fixed line voice dropped from 93 percent to 84 percent, while use of mobile increased from 67 percent to 92 percent.

Fixed line broadband, meanwhile, grew from three percent in 2001 up to 72 percent of U.K. households

That appears to be what happened in the U.K. fixed Internet access business. The average price of a broadband package decreased by 48 percent between 2004 and 2012. 

In fact, since 2008, when Virgin Media began offering its 50 Mbps service, declining prices have been matched almost exactly as economics would indicate.

As price declined, demand increased in linear fashion, exactly what one would expect, if basic economic principles relating to supply and demand have validity.

In the U.K. market, average household spending on broadband has been roughly flat since about 2006, even as households have been increasing their consumption of higher speed services. The reason is lower retail prices.

And even though U.K. consumers are buying “more mobile service,” they also are spending a stable amount of money, as prices have fallen. The volume of voice calls made using a mobile device has more than doubled in the past ten years, while the volume of text messages has increased from 24 billion to over 170 billion, Ofcom notes.