A "Hellishly Difficult" Challenge

Some argue that most countries can supply their current energy requirements using only

renewable sources. Others disagree. 

But that is probably not the right question. The bigger questions are whether future energy consumption requirements can be met, using renewable sources, and whether the historic correlation between energy consumption and economic development can be broken. 

What is not so clear--and will require both lots of human ingenuity and some technology development--is whether most nations can improve living standardsf or their people while at the same time reducing carbon and other footprints.

It is likely to be hellishly difficult. Some will argue we do not need “growth.” Others will argue that is an immoral position, where it comes to most people of the developing world. 

source: Anthropocene

As Dennis Anderson argues in the UN Development Program’s Energy and Economic Prosperity, modern, abundant energy can improve living standards of billions of people, especially in the developing world, who lack access to services or whose consumption levels are far below those in industrialized countries.

But that means energy production and consumption levels far above what we now experience. 

"No country has been able to raise per capita incomes from low levels without increasing its commercial energy use," said Anderson.  

source: United Nations

The issue is whether that correlation can change, allowing development at lower levels of energy consumption. That is where the ingenuity and technology development will be required.

Do International Rankings of Internet or Mobile Access Speed Mean Very Much?

The United States never ranks at the top of countries for mobile internet access speeds. It never ranks at the top for fixed network internet access either. The United States never ranked at the very top for voice service adoption, either. Some would say such rankings do not matter.

The whole point of having communications capabilities generally is to support social, economic and other goods that we believe come with good communications. Deficiencies such as “lack of coverage” or service quality (audio quality, internet access speed) are therefore problematic since those conditions might hinder desired social and economic outcomes.

The rankings, per se, do not matter much. What matters is the ability to wring value from such capabilities. And while there is a generalized correlation between mobile internet access speed and measures of economic strength, the correlations are not necessarily causal. 

source: MGM Research

Whatever combination of factors “causes” economic well-being, it is impossible to say what percentage of economic health is produced by any single input element. Few would likely question the assertion that the U.S. economy is large and robust, despite never ranking at the top of measures of communications supply. 

Nor, some might well argue, can ranking at the top of measures of internet access speed propel most economies much further than they can, based on all the other background factors (population size, for example).

Fixed Networks are the Mainstay, but Mobile-Only Households are Growing

A rational observer would have to agree that fixed network internet access will remain the mainstay for most consumers. Still, in 2017, about 19 percent of U.S. homes were mobile-only for internet access, so there are a significant number of use cases where mobile data is deemed a reasonable choice. In 2019, 20 percent of U.S. homes are mobile only. 

source: Pew Research Center

High Altitude Pseudo Satellite (Drone) for 5G

Lanai to See Test of Solar-Powered Drone for 5G Service

A solar-powered unmanned aerial vehicle developed by SoftBank and built by U.S. drone manufacturer AeroVironment will test 5G delivery over the island of Lanai, Hawaii. The Hawk 30 High-Altitude Pseudo-Satellite drone is in the same family of aircraft developed by NASA. 

The University of Hawaii Research Organization has a support agreement with program sponsor HAPSMobile Inc. to perform the test project on Lanai. SoftBank Corp., Loon LLC and AeroVironment also are involved in the project.

source: NASA

Service Providers Believe Enterprise Will Generate Most New 5G Revenue

With the caveat that service provider executives can be collectively wrong at times, there is fairly broad concurrence that new revenue sources in the 5G era will come from enterprise use cases, according to GSMA. 

source: Cisco

How Do You Build a Communications Network at Population Density of 6 People Per Square Mile?

As rural areas have the lowest population density, and since communications network costs are density related, American Indian reservations are tough places to finance communication networks. By some estimates, the most-difficult places to connect are homes in the last two percent of locations, representing the most-isolated areas. 

The average population density for the U.S. is approximately 345 persons per square mile. The Navajo Nation has a population density of 6.33 persons per square mile. That means the business model is not only astoundingly difficult, it likely can be characterized as non-existent. In other words, service can only be provided if subsidies are provided, since there actually is no positive business case. 

Assume 55 locations per square mile, and two fixed network suppliers in each area. That means a theoretical maximum of 27 customers per square mile, if buying is at 100 percent. Assume for the moment that buying rates really are at 100 percent. Two equally skilled competitors might expect to split the market, so each provider, theoretically, gets 27 accounts per square mile.

At average revenue of perhaps $75 a month, that means total revenue of about $2025 a month, per square mile, or $24,300 per year, for all the customers in a square mile.

The network reaching all homes in that square mile might cost an average of $23,500 per home, or about $1.3 million.

At 50 percent adoption, that works out to roughly $47,000 per account in a square mile, against revenue of $900 per account, per year. Over 10 years, revenue per account amounts to $9,000.

The business case does not exist, without subsidies. The business case is, of course, far worse at densities of 6.33 persons per square mile. As one engineering analysis noted, “areas with a density density of less than 10 households per square mile (survey areas C, D, and F) are unlikely to see investment from the private sector.”

In rural areas everywhere, there are two fundamental reasons mobile networks have a better business case than fixed networks: customers want service and network costs are lower than for fixed networks.

CEO of Genexis on FTTH in United Kingdom

Gerlas van den Hoven, CEO of Genexis on full fiber connectivity in the United Kingdom. As an industry mentor once told me, a few decades ago, "fiber to the home is the future, and always will be." He was joking, but only in a sense. Since then, in the U.S. market, hybrid fiber coax has become the market leader for fixed network internet access, with service almost ubiquitously at 1 Gbps, and a roadmap to 10 Gbps. Other options keep popping up, and some might eventually become commercial forces.

In some markets, FTTH provided by a single wholesale provider might be the future. The issue is, when does it stop being the future, in the sense of finally being deployed as commonly as copper was. And, if the access market remains competitive, what is the financial return?

"Fiber to where you can make money" is my own formulation, when markets are seriously competitive.

The Earth is Getting Greener, Because of Higher CO2

Science is pretty amazing. Without minimizing carbon dioxide levels in the atmosphere, which can cause warming, carbon dioxide also is food for plants. That might explain why plant coverage now is increasing. 

Enterprise AI is in Early Stages, Expect Disappointment

A recent International Data Corporation survey of global organizations that are already using artificial intelligence solutions found only 25 percent have developed an enterprise-wide AI strategy. 

It is likely very few enterprises had comprehensive personal computing or local area networking strategies in place in the early days, either. In fact, one might be safe in arguing that productivity paradox will continue to hold, and that quantifiable benefits from a shift to AI-enabled processes will lage investment by quite some degree.

The primary drivers behind these organizations' AI initiatives were to improve productivity, business agility, and customer satisfaction via automation, IDC researchers say. 

Faster time to market with new products and services was another leading reason for implementing AI. 

As always, though, there is a lag between capital investment in new technologies and tangible business results, if only since entire business processes must be redesigned before the full advantage can be gained. 

So much disappointment with the outcomes of AI are to be expected. Quite often, big new information technology projects or technologies fail to produce the expected gains. 

That “productivity paradox,” where high spending does not lead in any measurable way to productivity gains, is likely to happen with artificial intelligence and machine learning, at least in the early going. And that “early going” period can last far longer than many believe.

To note just one example, much of the current economic impact of “better computing and communications” is what many would have expected at the turn of the century, before the “dot com” meltdown. Amazon, cloud computing in general, Uber, Airbnb and the shift of internet activity to mobile use cases in general provide examples.

But that lag was more than 15 years in coming. Nor is that unusual. Many would note that similar lags in impact happened with enterprises invested in information technology in the 1980s and 1990s.

So prepare now: artificial intelligence and machine learning are eventually going to have the impact many now expect. It simply will take far longer than many expect.

No doubt, spending is growing. Some surveys suggest enterprises have dived into machine learning (artificial intelligence).

Half of those adopting machine learning are looking for insights they can use to improve their core businesses. About 46 percent report they are looking for ways to gain greater competitive advantage. Some 45 percent are looking for faster gleanings of insight. And 44 percent are looking at use of machine learning to help them develop new products.

But clear and quantifiable benefits will lag the investments. Thus it always is.

Net Neutrality Rules, or Absence of Rules, are Just Noise

Some argue U.S. customers are worse off since the end of network neutrality regulations, referring to transparency of charges and fees. Others would offer argue that net neutrality rules are sort of “noise,” not signal. 

With or without the rules, speeds are climbing--and fast--while prices are in line with global norms or have decreased. 

source: Speedtest

Though there are many other reasons for investments in networks that lead to speed improvements, network neutrality rules were in place from 2015 to 2017. 

source: Trading Economics

The larger point is that average U.S. fixed network speeds have risen dramatically since 2010. 

source: Statista

Some focus on price as the problem, but absolute prices do not appear to have changed much, even as speeds and usage allowances have grown rapidly. Stand-alone pricing for residential internet access costs between $50 and $60 a month, less if purchased as part of a bundle, which most consumers do.  

Broadband prices also are not high in U.S. markets, as a percentage of household or national income. Prices over time arguably have dropped, as between 1990 and 2000, for example. Adjusting for purchasing power parity, U.S. prices are in line with global prices.

U.K. Service Provider Revenue has Dropped Since 2012

Connectivity traditionally has not been a “growth” business. Far from it, telecom had for most of its history been considered a natural monopoly, on a par with water, sewer and electrical service. Around the turn of the century there was some thinking that might have changed. 

Alas, the connectivity business still seems to be a slow growth--in some cases no growth--type of industry. The latest data from U.K. regulator Ofcom shows this. Since 2012, total service provider revenue in the United Kingdom has dropped. Monthly household spending on communications has remained relatively flat, growing about one pound per household, per month. 

source: Ofcom

Heavy Mobile Video Viewers More Likely to Drop Fixed Network Inrternet?

“Potential broadband cord-cutters rely on their mobile devices for entertainment,” says Parks Associates senior research director Brett Sappington. “They are significantly more likely to watch live video content via mobile, including live TV broadcasts and live streaming, averaging an hour more per week each compared to average broadband households.”

That is a partial answer to the question of whether heavier mobile video usage can lessen the value of fixed network internet access as well.

Parks Associates argues U.S. broadband households highly likely to drop linear video services  in the next 12 months watch more than six hours of video content on their mobile phone a week, compared to 2.5 hours among all US broadband households. 

“Roughly 10 percent of broadband subscribers are likely broadband cord-cutters, with half of them highly likely to make the change in the next 12 months,” said Sappington. 

source: Parks Associates

PTC Academy Bangkok

PTC Academy Bangkok: Executive Insight for Exceptional Leaders will be held 23 September through 25 September, 2019 at CAT Tower, 72 Charoen Krung Road, Khwaeng Bang Rak

Khet Bang Rak, Krung Thep Maha Nakhon 10500, Thailand. Registration is limited to the first 30 students. 

Register here.

The event begins with a dinner cruise on the Chao Phraya Princess, offering compelling views of the Bangkok metro area from the The Chao Phraya river. 

source: TripAdvisor

source: Bangkok.com

The first day of classroom instruction includes:

Pioneering Technologies: How Are They Breaking the Mold of Legacy Subsea Infrastructure? Learning Outcomes: What new technologies are changing long-haul networks? What new capabilities are most important? What apps/use cases will benefit? Presenter: Keith Shaw, VP Business Development EMEA, Equinix, Netherlands

Tea/Coffee Break

What is 5G All About, and Why Do You Care? Learning Outcomes: What is 5G? What will 5G mean for industry capabilities and competitors? How does 5G enable the Internet of Things? How does 5G enable edge computing? Presenter: Gary Kim, Content Developer, IP Carrier, USA

Lunch

What Unique Challenges Will You Face in Moving Towards a Next-Gen Future? Learning Outcomes: How will your own segment of the business change? What strategies are available to you? What organizational changes must you make? How can you make those changes? Presenter: Sean Bergin, Co-Founder & President, APTelecom, Cambodia

Tea/Coffee Break

Getting the Balance Right Learning Outcomes: How to manage revenue, social obligations, and costs Harvesting legacy revenue Building new revenues Presenter: Eric Handa, Co-Founder & CEO, APTelecom, USA

The second day’s class includes:

Evolution of OTTs and Their Impact on Traditional Revenue Streams: Opportunity or Threat? Learning Outcomes: Is OTT an opportunity or threat? What can executives do to convert threats into opportunities? What are the key threats to revenue? What are the key responses to create new revenue streams? Presenter: Tony Mosley, Director, Business Operations, Ocean Specialists, Inc. (OSI), Guam

Tea/Coffee Break

Capacity Procurement: Yesterday and Today Learning Outcomes: How has capacity procurement worked traditionally? How have interconnection models changed? Presenters: Eric Green, Senior Consultant, Cambridge Management Consulting Ltd., United Kingdom and Grant Kirkwood, Founder & CTO, Unitas Global, USA

Lunch

Using LinkedIn to Love a Career in Telecoms Learning Outcomes: Understanding the objectives of your LinkedIn Profile, and how to achieve them Learn how your routine use of LinkedIn can increase your knowledge, build your reputation, and grow your network Presenter: Russell Lundberg, CTO, Intelefy, LLC, and Bangkok Beach Telecom, Thailand

Tea/Coffee Break

Overview of the Mobile App Ecosystem Learning Outcomes: Understand how mobile apps monetize users Understand the importance of attribution for the app ecosystem Insights into app revenues by vertical Insights into the major players in the app ecosystem (advertisers, publishers, ad networks) Examples of telcos moving up the stack with apps and app partnerships Presenter: Jonah Kadish, Director, Learning & Development, APAC, AppsFlyer, Thailand

5G Spectrum Allocation Policies Differ in Japan, Korea

Communications policymakers in various countries will have to decide how to allocate additional mid-band and millimeter wave spectrum to various contestants. In some cases, policy might allow contestants to bid as vigorously as they like. In other cases, government policy might be more akin to “supporting a level playing field” by allocating spectrum on an equal basis. 

Here’s a look at mid-band spectrum held by the leading mobile operators in Japan, according to Gaku Nakazato of Japan’s Ministry of Internal Affairs and Communications. As you might guess, KDDI and NTT have the largest allocations. NTT and KDDI have the largest subscriber shares, and therefore arguably require the most spectrum. 

source: MIC

Policy in South Korea seems to aim for equal capabilities for the leading service suppliers. Both mid-band and 28-GHz millimeter wave allocations are virtually equal. 

source: Korea Ministry of Science and ICT