iPad 3...Only Issue is U.S. LTE Support

Verizon, has been installing LTE equipment in U.S. Apple retail stores ahead of the iPad 3 launch, cult of mac reports. 


Apple faces LTE issues for reasons related to the vast array of frequencies used around the world to support existing Long Term Evolution fourth generation mobile networks. 


As Apple resisted developing a CDMA version of the iPad for quite some time, preferring to build only models supporting the global GSM frequencies and networks, so it now will have to contend with an arguably more varied global landscape for LTE spectrum. 


Just in the United States, Apple would have to create different models for AT&T and Verizon Wireless, for example.


There's a third international model which does double duty on 3G and  CDMA/GSM model .


Manufacturing cost is the real implication. But there isn't much any firm can do, long term. Networks using Long Term Evolution are the future, globally. 

Tablet TV Viewing to Reach 3 Hours Per Month in 2014: Will It Matter for VOD?

Tablet TV viewing will reach 186 minutes per month in 2014, according to Juniper Research.
The increase will be most apparent in North America where there is already significant mobile TV usage, and where internet TV services such as Hulu and Netflix are extremely popular, Juniper Research says.

The number of users of streamed mobile TV services on smart phones also will increase by 2.8 times between 2011 and 2016, Juniper Research says.

In a perhaps-significant prediction, Juniper Research forecasts that subscriptions, not on-demand viewing,  will make up the vast majority of mobile TV revenues. Video on demand has had three decades to make its case, and still is a relatively small revenue contributor.

According to a new report released by The Diffusion Group (TDG), video-on-demand services provided by PayTV operators should be, but are not, generating significantly higher viewing and advertising revenue. Total VOD use is small, representing only one percent of all U.S. TV viewing.

By some measures, VOD is doing better. Magna Global has estimated that U.S. homes with VOD, a "category that includes both traditional multichannel VOD offerings and over the top services," will hit 70.1 million homes, about 57 percent of all TV homes at the end of 2016.

But note the conflation of traditional VOD and over the top services and apps. Some of us would not classify over-the-stop streaming as VOD, just as time-shifted viewing on a digital video recorder is not VOD, and Netflix streaming is not VOD.

Still, even availability is not the same thing as "usage." Hundreds of TV channels are available on cable, satellite and telco subscription video services. That doesn't mean those channels are viewed by most people. Much as fixed line voice service is available to most homes, but isn't necessarily purchased by all those homes, so too for-fee or ad-supported VOD is available relatively widely, but isn't used much.

TDG attributes that failure as a reflection of VOD's inadequate advertising support and awkward program guides that limit availability and viewing of ad-supported video-on-demand content. VOD hampered

Some of us might argue that "inattention" not withstanding VOD never has gotten much traction in the U.S. market and that the problem is lack of interest and demand on the part of consumers.

Service provider lack of attention to ad-supported VOD is the problem, TDG argues.

According to Bill Niemeyer, TDG senior analyst, "operators have failed to take advantage of VOD to build subscriber satisfaction, generate ad revenues, and head off competition from over-the-top (OTT) providers like Netflix."

Niemeyer estimates in the fourth quarter 2011, Netflix U.S. subscribers watched 80 percent more streaming video hours than were viewed in the same period on all U.S. PayTV VOD.

Some of us might argue that marginal failures to market and support VOD could be an issue. But there is a reason service providers do not market VOD so intensively. VOD simply does not contribute significant revenue for a service provider.

VOD in recent years has contributed about $2 billion a year worth of revenue for U.S. video entertainment providers. U.S. cable TV companies alone booked about $98 billion in 2011 revenue. That doesn't include the sizable revenue earned by satellite and telco providers as well.

The point is that VOD, as a service, has been a modest success, though it has had three decades to make its case.  Whether viewing on tablets will change that remains to be seen.

Small Business Tablet Adoption 34% in 2011

Small business adoption of tablets has jumped from nine percent in 2010 to 34 percent in 2011, indicating that the iPad is the fastest growing technology among the U.S. small and medium-sized business market, a study by The Business Journals has found.

About 75 percent of small business owners report said they are "very or somewhat familiar" with the device.

Godfrey Phillips, vice president of research at The Business Journals, says the adoption is fueled by smaller business executives and managers needing access to their business information and data, anytime and anywhere.

But smart phones and cloud computing also are among the trends that also correspond to that need.

"The iPad, as well as smartphones and cloud computing, are all part of this new trend and are experiencing significant growth as a result of that need," he said.

The study found that iPad users in the small business community are tech-savvy and financially successful. They also are highly educated, with 72 percent having a college education. The segment's annual household incomes averaged $176,000. Their companies are also well-established, having existed for an average of 28 years and averaging $9.2 million in annual sales.

In U.S. Market, Samsung is Top Device, Android Top OS

Samsung was the top handset manufacturer in the U.S. market in the fourth quarter of 2011, with 25.4 percent market share. Google Android continued to grow its share in the smart phone operating system market, accounting for 48.6 percent of user devices.

Apple undoubtedly will be found to have made the most profit, though. That has been true for some time.

Between them, Apple and Samsung earned fully 81 percent of all profits in the mobile handset business, on a global basis.

The number of U.S. smart phone subscribers surpassed the 100-million mark in January 2012, up 13 percent since October to 101.3 million subscribers, according to comScore. 

Google Android ranked as the top smart phone platform with 48.6 percent market share (up 2.3 percentage points) followed by Apple with 29.5 percent market share (up 1.4 percentage points). RIM ranked third with 15.2 percent share, followed by Microsoft (4.4 percent) and Symbian (1.5 percent).

But profitability, more than anything else, now is shaping the global smart phone business, one might argue after considering the latest estimate by Strategy Analytics of market share in the global handset business.

Globally, Apple and Samsung have, over the last 12 months, surged to the top of the charts in terms of smart phone sales volume. In the past, the “smart phone” category has not been significant, as all devices were feature phones or basic phones.

As the market begins to shift to a smart phone buyer pattern, differences in firm strategy and execution have lead to a rapid change in market leadership.

In the past, Nokia has been the global share leader, but Nokia has not been able to translate that prior success into smart phone success, where Apple has changed the game and Samsung apparently has been able to keep pace.

Apple overtook Samsung to become the world’s largest smart phone vendor by volume with 24 percent market share. Apple’s global smart phone shipments surged 128 percent annually to 37.0 million units, as distribution of the iPhone family expanded across numerous countries, dozens of operators and multiple price points.”

Apple took the top spot for share on a quarterly basis, but Samsung became the market leader in annual terms for the first time with 20 percent global share during 2011. With global smartphone shipments nearing half a billion units in 2011, Samsung is now well positioned alongside Apple in a two-horse race at the forefront of one of the world’s largest and most valuable consumer electronics markets, Strategy Analytics says.

In contrast, Nokia’s smart phone market share was cut in half from 2011 to 2011, dropping from 33 percent in 2010 to 16 percent in 2011.

That is one reason there has been so much focus on the Nokia partnership with Microsoft, as many would argue the Windows Mobile operating system represents the best shot Nokia will have to avoid collapse.

The other observation of note would be that profitability might now be emerging as the key differentiator, even though design and consumer demand clearly are driving the market overall.

Samsung’s most-recent quarterly earnings also set records. Samsung Electronics Co declared $4.7 billion in quarterly operating profit. jumping 76 percent year over year.

Top Mobile OEMs 3 Month Avg. Ending Jan. 2012 vs. 3 Month Avg. Ending Oct. 2011 Total U.S. Mobile Subscribers (Smartphone & Non-Smartphone) Ages 13+ Source: comScore MobiLens
	Share (%) of Mobile Subscribers
	Oct-11	Jan-12	Point Change
Total Mobile Subscribers	100.0%	100.0%	N/A
Samsung	25.5%	25.4%	-0.1
LG	20.6%	19.7%	-0.9
Motorola	13.6%	13.2%	-0.4
Apple	10.8%	12.8%	2.0
RIM	6.6%	6.6%	0.0

Top Smartphone Platforms 3 Month Avg. Ending Jan. 2012 vs. 3 Month Avg. Ending Oct. 2011 Total U.S. Smartphone Subscribers Ages 13+ Source: comScore MobiLens
	Share (%) of Smartphone Subscribers
	Oct-11	Jan-12	Point Change
Total Smartphone Subscribers	100.0%	100.0%	N/A
Google	46.3%	48.6%	2.3
Apple	28.1%	29.5%	1.4
RIM	17.2%	15.2%	-2.0
Microsoft	5.4%	4.4%	-1.0
Symbian	1.6%	1.5%	-0.1

Google Play Replaces Android Market

Google has launched Google Play, an integrated destination for apps, books, movies, and music, accessible to users on Android devices and to anyone on the Web, that also replaces the Android Market.

Google Play illustrates, as well as anything might, the growing role commerce is playing in the mobile device and applications ecosystems. The new branding obviously focuses attention on "Google" rather than "Android," as well.

To be sure, Android Market was a "commerce" vehicle before. In the future, Google Play will be more of a "shopping" venue as well.

Apple iPad Still Leads Tablet Market Share, but Kindle Fire is Pressing

To the extent that the Android operating system lies underneath the Amazon Kindle Fire, Android remains the operating system that is chasing Apple iOS for market share. In fact, one might argue that Android has passed iOS> 

No "Wallet War?" Really?

According to Michael Abbott, Isis CEO, “there is no mobile wallet war out there. ” The statement will strike some as a bit of bluster, good manners or delusion. But there always is a time, early in the development of a market, when it is helpful for lots of firms to enter the business.


The existence of multiple competitors helps to legitimize the market. That is probably the sense in which Abbott says there is no wallet war. It obviously is not based on a lack of substantial would-be competitors. 


Also, at the moment, there are niches within the broad mobile commerce space, including "payments" systems, wallet or credentials systems, point of sale systems and money transfer systems, for example. 


Those somewhat distinct niches will blur, over time, once the market begins to take more definite form. It won't be so easy to distinguish between payment, wallet, money transfer or terminal roles, for example. 


Nor will it be so easy to distinguish between firms that engage in online commerce, or brick and mortar retail. 


At the same time, many contestants will gain one footfhold in the market, and then use those positions to add other market roles, as Square is doing, for example. 

Try Explaining "Cloud Computing" Without Words

Apple does a fairly decent job of showing, in a consumer context, the advantage of iCloud. For users, "what" it is, or "how it works," doesn't really matter. The only thing that matters is the value. Remember the old concept of "write once, read many?" 


That's really the advantage of the cloud, and cloud storage of content. Store it once, use it anywhere, on any device. 

An Important Lesson about "Over the Top" Danger

Contestants in competitive communications markets tend to recognize the value of having the leading incumbents set a high price umbrella, the simple reason being that a common attacker strategy is to offer "same service, less price." 


The higher the price umbrella, the better the value proposition an attacker can offer, and still generate more revenue than under a low price umbrella. 


That seems to be the case for over the top applications in the messaging space, in European markets that feature high tariffs. 


European operators rely on high tariffs for international calls and texts. Whatever else one might say about that situation, the high tariffs allow lots of room for attackers to offer the same features at much lower cost.


Over the top application providers provide salient examples.


By way of contrast, U.S. service providers, operating with a continental-sized domestic market,  offer unlimited or huge buckets of calls and texts for a flat rate that offer much less room for attackers to exploit.


The exception is international calling, where apps such as Skype get serious amounts of use. But for domestic calling, tariffs are so reasonable that there is little incentive to modify domestic calling or texting behavior because the marginal cost of a domestic text or call is zero. The "Panic" About OTT Apps


The point is that the pricing umbrella has significant implications for competitive dynamics. Over the top will be a bigger danger where the pricing umbrella is high, and much less a compelling alternative for users where the pricing umbrella is low. 

What Role for End User Choice in Mobile Data Plans?

Many consumers probably would jump at the chance to buy virtually any TV show, series or channel, including current episodes, a la carte, much as they buy single songs, rather than the bundled collections we call "albums" or "compact discs."

One reason is the somewhat logical expectation that such buyers will get precisely what they want, while saving money.

The issue is whether many consumers will have something of the same reaction to mobile Internet plans that, for example, offer lower data plans in exchange for a curated experience big on Facebook, YouTube or Twitter.

Orange apparently wants to find out. For less than $14 a month, customers get unlimited use of Facebook and Twitter. Web browsing on other sites costs about 70 cents for every 20 minutes of use, the Wall Street Journal reports. All Mobile Traffic Isn't Equal

The issue isn't whether this is the best way to match end user preferences on mobile devices with retail packaging. The issue is that it is an interesting way to customize and personalize use of the web apps people really value, while offering savings at the same time.

To the extent that users already have indicated preference for buying songs, not albums, or might prefer buying shows rather than channels, they might also prefer a focused approach to web apps on their mobiles.

Some won't like the idea, but they can buy the standard plans, and pay more money. Some policy advocates will worry about the implications for app competition or any number of other issues.

But if choice provides end user value in music, video, or stories, it isn't so clear why such choice does not provide equivalent value when mobile users buy and use their favorite mobile apps.

Users Help AT&T Figure Out "Throttling"

AT&T’s new plan to throttle access speeds of customers on grandfathered “unlimited” service plans seems to have been withdrawn. AT&T had planned to throttle users in the top-five percentile of usage at any specific location.

But AT&T now says it will now throttle 3G network  users after 3 GBytes of usage and LTE users after 5 GBytes of usage. The former plan meant users could not tell whether they would face throttling. Under the new plan, they in principle will know when the throttling kicks in.

The rules do not affect customers on AT&T’s current tiered service plans.

The change came after significant pushback from customers who properly objected that the rules did not allow people to protect themselves. Even lighter users might find themselves in a coverage area where their usage put them, temporarily, into the “top five percent of users.”

Essentially, users complained that there was no way to modify and regulate their own behavior and consumption to comply with the guidelines. AT&T now seems to agree.


Just an observation: sometimes users can help their service providers figure out fair ways to manage networks. Most users are not unreasonable about usage limits. But they do understand rule clarity and fairness. In this case, users helped AT&T craft a "better" policy, in the sense that users agree it is fair.

Will Telcos Be Pipes or Service Providers?

Almost no question is strategically more important for any cable TV company or telco than the issue of what future is possible, or desirable. Telcos and cable TV companies always have been "service" providers, where applications and access were tightly bundled. 


Broadband access was the first consumer service to break from that mold, and private line services were the first big change in the business customer segment.


So the big issue now is what "should" be the strategy in a business environment where virtually every application can, in principle, be delivered to users "over the top."

Deutsche Telekom CEO Rene Obermann said the cloud was an opportunity for telcos to “make the most of our assets” and transform themselves into "smart pipes."


Still "pipes," mind you, but pipes that have features. 

“Most people expect us to become dumb pipes, but that’s wrong," says Obermann. "The question of whether we will be dumb pipes or smart pipes will be a thing of the past.” 


In areas such as traffic management and quality of service, network access and transport providers will essentially make substantial money providing various traffic management functions sold to third parties that have a business interest in the end user quality of experience. 


That assumes regulators will let access providers provide quality of service measures that end users can buy, or that application and service providers can buy. It also assumes customers are willing to pay. 

Though both over the top and owned apps, services and features are likely to be staples of any long-term future to some degree, the pipe function is going to be more important over time. Nor is it clear that the revenue contributed by the smart features ever will be quite so substantial as the "dumb" access feature. 


One is hard pressed to think of any "value-added" feature in the mobile or fixed network businesses that provides as much gross revenue as the "basic" service. In other words, do the security features offered to consumers as part of their broadband access subscription drive as much revenue as the access? 


Wll QoS mechanisms drive as much revenue as access and transport, for business customers? 


To be sure, one might argue that a content delivery network so blends a transport function with a value add that it is difficult to compare the incremental revenue provided by the "content acceleration," compared to "simple transport." 


The point is that the value adds probably never will be driving as much revenue as the "base" access products. The issue is to find the exceptions to the rule. 


If a mobile service provider sells a stand-alone personal Wi-Fi Hotspot feature for a smart phone subscription, is the incremental cost likely to approach the retail price of the smart phone's data plan? Probably not. 


But could the personal Wi-Fi Hotspot plan drive incremental revenue that is up to 50 percent of the cost of the basic smart phone access? That is possible, and highly significant. 

Keep in mind that a personal Wi-Fi Hotspot service is still a "dumb pipe" product. But one might conceive of it as a value-added feature of the basic smart phone broadband access service. 

The point is that dumb pipe, though derided, should continue to be the foundation for all the smart pipe features, and that these "smart" features will represent incremental revenue that is some percentage of the value of the "dumb pipe" access. 


Nor is the underlying wholesale cost of bandwidth necessarily related in linear fashion to retail value and pricing. The value of personal Wi-Fi Hotspot bits arguably is higher than that of smart phone bits, or no rational consumer would pay extra for the feature. 


The issue is how many of these enhancements to "dumb pipe" are conceivable and possible, even when the pipe remains the foundation for the rest of the business. . 

Cornelius Vanderbilt cut the price of rail freight 90 percent, Andrew Carnegie slashed steel prices 75 percent and John D. Rockefeller cut oil prices 80 percent between 1870 and 1900.

Malcom McLean, Sam Walton and Michael Dell did roughly the same for container shipping, discount retailing and home computing a century later. Such radical changes often are unwelcome by the producing community, though the consuming public benefits.


In some ways, what service providers are trying to do is sell automobiles and ships rather than steel, even as steel remains the underpinning of the business. 


Service providers always built services on top of pipes. They always have sold "voice" as a retail product to end users; the pipe was only a means to create the service.


What is is different now is that the pipe is becoming the foundation product for the future. Users will buy access to the Internet and apps, whether they buy apps and services from the "pipe services" provider, or not. 


That's the new strategic challenge: to build the whole new business around pipe services. 

Why Pay Attention to Mobile Payments?

It isn't always completely clear why people who care about the mobile business should necessarily pay attention to  "mobile payments," not a subject that represents the most-popular subject on this site.


The reason is that "mobile payments" is an answer to several key questions.  "What business are you in?" is one such important question. "Where will you find future sources of revenue?" is another key question. "How will you do that?" is a third important question mobile and fixed network executives have to ask themselves, and answer. 


One of the by-now clear implications of the Internet is that it enables competition on a different scale than in the past. In other words, "people who aren't in our business" can get into your business. 


The other salient observation is that new industries tend to get created when attackers use the Internet to disrupt an existing business. It isn't simply that the legacy industry is changed; sometimes an entirely new industry emerges. 


Mobile payments is akin to a massive collision of galaxies. Banking, telecom, retailing and marketing are huge industries in their own right, but find themselves colliding in new ways around the use of mobile to shop and pay. 


So the humble thesis is that when industries that big collide, something equally big is going to emerge. Hence, the coverage of mobile payments.


nevertheless keeps getting talked about. It's a strategic

What Comes Next Will Reshape Mobile Marketing, the Issue is "How?"

While delivering a speech at the San Diego Social Media Symposium, hosted by Nuffer, Smith, Tucker, the question of “what comes next,” or “who comes next,” in terms of computing industry leadership, came up.  

The reason for the question is that technology enables new forms of marketing at the same time technology changes the potential effectiveness of existing channels. Among the best examples is use of social networks for marketing.

Facebook finally has figured out how to use display marketing in a PC context. It is just now exploring how to do advertising and marketing in a mobile device context. Twitter has developed the promoted tweet, a new form of marketing messaging.

At least 40 percent of all Facebook activity, for example, now occurs on mobile devices. And though all channels used in a PC context can, in principle, also be used on tablets and smart phones, there are key contextual challenges.

The substitution of a touch and swipe user interface rather than keyboard and mouse are examples. The amount of screen real estate are other key issues.

Beyond that, the use case for each device tends to be distinct. Smart phones are the “best” device for “on the go” apps and messaging. Smart phones are best suited to location apps and communications.

Tablets are less “mobile,” and suited to content consumption activities, though the setting is more “couch” than “on the go.” It is nevertheless true that smart phones get used at home or at the office more than “in transit.”

PCs increasingly are being “relegated” to work or desktop settings.

The truthful answer is that nobody knows yet how computing, and marketing possibillity will change in the next era. Part of the indeterminacy is that it is hard to figure out what era, epoch or age is coming. We all sense that mobile and Internet will be foundational, as will the pervasiveness of computing.

But that doesn’t help refine one’s search for the “next big thing” or the characteristics of firms or enabling technologies that might lead the next era, epoch or age. It seems clear, in retrospect, that virtually nobody, or almost nobody, could have foreseen the power of “search” or “social networking.”

Few seem to have recognized the importance of the “browser” or visual computing. Many would be surprised that Apple could be called the most important technology firm on the planet, or that a technology firm as large as Google could be funded by advertising.

Asked to speak about mobile marketing, one has to acknowledge the immediate difficulty. Mobile is many things, including discrete devices ranging from notebook PCs to tablets to smart phones to game players to music players. In principle, any current form of digital or online marketing can be applied to any Internet-connected device with a screen.

So email, text messaging, display advertising, promoted tweets, promoted stories, content marketing, social networks, blogs and websites all are channels that can be used across all screens, whether mobile or stationary. So too are tactics including earned media, paid media and owned media.

What isn’t yet so clear is which approaches will ultimately emerge as ideally suited to each category of screen, type of user interface or application setting. Mobile is a bunch of things, marketing is a bunch of things and so is “digital” or “online.”

A 2008 Microsoft paper described eras largely in terms of the relationship between computers and people. In the mainframe era, one computer served many people. In the PC era (for analytical purposes, Microsoft apparently did not see the mini-computer era as qualitatively significant) there was one PC per person. In the 2000s, which Microsoft describes as the mobility era, there are several devices per user. In the coming ubiquity era there will be thousands of computing devices for every user.
You might therefore represent the change quantitatively. But it is the notion of pervasiveness that probably gets to the heart of the matter. In any era where computing is literally embedded widely into the fabric of life, “computing” itself fails to stand out. It becomes something like electricity, an underpinning more than a discrete pursuit.
Nobody would call the present era the “era of electricity,” as one might have spoken of the “age of the automobile.
In fact, geologic time is the polar opposite of computing or Internet time, where the taxonomy of eonothem (eons) , erathem (eras), system (period), series (epoch), and stage (age) are used to refer to the layers of rock that correspond to these periods of geologic time. On a scale where the most-granular measure of time is “millions” of years, the entire history of computing occurs on a time scale too short to measure. 

To the extent that one can apply the geologic taxonomy, the Internet eon and pre-Internet eon might make sense, as use of the Internet spans multiple computing eras.

Perhaps we are have mistaken eras for ages or epochs, though. Mainframe, PC and mobile “eras” might be better seen, from a longer time frame as ages, epochs or periods within the broader framework of tool use.

The point is that people might instinctively sense that Internet, broadband, web and apps have some significance in the history of computing that we’ve not had time to digest and put into perspective. Clearly something important has happened with the Internet, and clearly something important is coming in terms of mobility and mobile devices. Precisely how that fits with the taxonomy of computing is not so clear.