WebOS Coming to Slates and Printers - HP CEO

Hewlett-Packard has said it would leverage Palm's WebOS for additional devices such as tablet devices and printers, and HP CEO Mark Hurd has confirmed exactly that. HP “expects to leverage WebOS into a variety of form factors, including slates and Web-connected printers."

WebOS Coming to Slates and Printers - HP CEO

The Web Is Killing Radio, Newspapers, Magazines And TV

From 2004 to 2009, stats from Forrester say that use of the web is up 117 percent in terms of how people spend their time in a day. That may not be too surprising, but what’s interesting is that all of the other major forms of media consumption are down or flat during the same period.

Listening to the radio is down 18 percent, reading newspapers is down 17 percent, reading magazines is down six percent, and watching TV has seen no growth.

What is good for some contestants in some parts of each ecosystem obviously is not so good for others in the same ecosystem.

Google I/O: The Web Is Killing Radio, Newspapers, Magazines, And TV:

Android Sales Eclipse iPhone, Another Study Finds

Android phone sales have overtaken the iPhone in the North American market for the first time, Gartner found today. That is the second study conducted recently that suggests Android sales are overtaking Apple sales.

Thanks to a 906 percent surge in shipments worldwide to 5.21 million phones, Google's mobile OS outpaced Apple's in North America and the United States in particular.

Worldwide, Apple still comfortably outsold the combined Android platform, jumping from 10.5 percent of the market a year ago to 15.4 percent. Gartner however expects Android to overtake the iPhone before long as its worldwide sales grew six times larger over the same space of time, from 1.6 percent to 9.6 percent. Carolina Milanesi, Gartner VP, says the rapidly closing gap is an inevitable result of sheer scale.

"You have one vendor with one model and eight to nine vendors with many models -- of course you get bigger volumes," she said.

Most Android sales came from HTC and Motorola, which shipped 2.6 million and 2.3 million total smartphones each. Samsung has also been a significant contributor.

"In the first quarter of 2010, smartphone sales to end users saw their strongest year-on-year increase since 2006," said Carolina Milanesi, research vice president at Gartner. “This quarter saw RIM, a pure smartphone player, make its debut in the top five mobile devices manufacturers, and saw Apple increase its market share by 1.2 percentage points. Android’s momentum continued into the first quarter of 2010, particularly in North America, where sales of Android-based phones increased 707 per cent year-on-year.

In the smartphone OS market, Android and Apple were the winners in the first quarter of 2010. Android moved to fourth position, displacing Microsoft Windows Mobile for the first time. Both Android and Apple were the only two OS vendors among the top five to increase market share year-on-year. Symbian remained in the top position but continued to lose share, primarily based on its weakness at the high end of the market.

Smartphones accounted for 17.3 per cent of all mobile handset sales in the first quarter of 2010, up from 13.6 per cent in the same period in 2009.

Causeworld: Checking in a Good Cause

If you are going to "check in," check in for a good cause.

Causeworld: Checking in a Good Cause

If you are going to "check in," check in for a good cause.

Video Chat Behind Google Buy

Video chat probably is the top reason Google has bought Global IP Solutions.

Is Firefox Headed Towards A Massive Decline? Its Co-Founder Thinks So

It's hard to remember (and some never have known) a time when Google and Apple were upstart companies. But companies age, especially when they succeed.

Firefox was part of a "rag tag" open movement when it challenged the hold Microsoft’s Internet Explorer had in the browser market. When Mozilla began its assault, Internet Explorer had something on the order of 90 percent market share. Over the past five or so years, Microsoft's share has dropped below 60 percent, and Firefox has 25 percent to 30 percent share of the market.

But success has bred discontent is some quarters. At least some think Firefox is no longer the light, open alternative it once was.

Is Firefox Headed Towards A Massive Decline? Its Co-Founder Thinks So:

Content Businesses Face Devaluation

If the music business is any indication, digital distribution of content goods is going to change the economics of most parts of the content business, including print and perhaps some parts of the video market as well.

In the print business, there arguably are other forces at work besides "free" online distribution of content. But the expectation of access to quality content online is "devaluing" professionally-produced content, which means there will be less of it produced.

The video market is better placed to resist the commodity pressures that have hit the music business and are now affecting the print content business as well.

The reason video will fare better is that production costs in the print and music businesses are lower than they are in the movie or TV business. It just is harder and more expensive for useful and usable content to be created in the movie and video domains, compared to the music and print businesses.

The point is that the advent of digital distribution has complex impact. In some industries, digital distribution "only" changes distribution channels. Music, TV and news moves from plastic discs and paper to Internet distribution, for example.

In other businesses it undermines the historic business ecosystem. In the print and music business, the revenue and cost structures of producing content are changed.

Face It - In Music, Devaluation Is The New Reality | paidContent

Android Battery Life Victim of Open Approach

"Open and standards-based approaches to creating products are the industry norm, and generally result in faster development times and lower retail prices. But there sometimes is a price. Because it does not take the "open" approach, Apple is able to optimize performance of its hardware and software.

Conversely, open platforms such as Android are not able to take an end-to-end view, all the time. And that seems to be playing out with complaints of limited Android battery life, presumably from users who have downloaded many, or some particular applications.

Google CEO Eric Schmidt himself has taken the liberty to suggest that some of the third party applications offered through the Android Market are not completely efficient at resource management, thus requiring more power from an Android smartphone than they might otherwise need.

As with most other aspects of software and hardware development, there are trade-offs to be made. Android trades control for development speed, lower cost and diversity. Apple trades maximum third-party software development for better user experience.

Your Android suffers from poor battery life? 3rd party apps are to blame! (Phone Arena News):

Tawkon App Provides High RF Level Warnings

If you worry about radio frequency radiation coming from your mobile, and you use some BlackBerry models, you can download a $10 app that provides both a monitor and alerting system if your device is putting out excessively strong signal.

That can happen if you are inside a building with thick walls, if you are far from the closest cell tower, are in a deep signal fade area or even if you are holding the device in a way that increases signal interference.

Google Plans Battle for Tablet Dominance

To the extent that tablet devices are able to carve out a new consumer electronics niche, or perhaps even if all they do is create a new segment within the netbook or notebook product category, they also will create a new canvas for mobile advertisers.

If, as many expect, tablets emerge as content consumption devices, they will feature rich content. And rich content traditionally has meant new advertising venues.

For tablets, including the device Google and others are working on, that will mean a chance to grow a new rich media advertising venue. Historically, media and advertising have grown hand in hand.

It isn't so much the devices, though that is quite important for Apple. For many other contenders, it is the growth of a new advertising medium that likely is most significant about tablets.
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Best Buy Launches Video Service

Best Buy Co. has launched a new digital video service, called "CinemaNow,"  that will provide customers same-day access to new release movies and TV shows available on DVD.

The service will initially be accessible through select connected LG Electronics Blu-ray Disc players and HDTVs, and on most PCs at www.cinemanow.com. Samsung's Internet-connected home theater equipment and Insignia brands also will have the feature.

CinemaNow is also expected to launch on an array of other devices from various manufacturers, including Insignia, later this year.

The first update to the CinemaNow service is expected to release on select devices later this year and will include an advanced user interface and expanded video playback features aimed at further improving the video entertainment experience.

CinemaNow will have "first run" movies for sale as soon as they arrive on DVD, with rentals for $2.99  to $3.99 per movie and purchases at $9.99 to $19.99, including HD titles and some available in 1080p.

The company will be competing against other retail giants such as Walmart and Blockbuster, as well as Netflix and Hulu, among others.

There will be other changes as well, It might now happen for a couple year, but Best Buy has said it will phase out DVD sales as early as 2012.

http://www.bby.com/2010/05/18/best-buy-provides-customers-same-day-instant-access-to-new-release-movies-and-tv-shows-with-launch-of-cinemanow/

Droid Incredible..Is That...

Consumer Satisfaction With Video, Wireless Up, Sprint Gains Most

Customer satisfaction with cable and satellite TV rises to its highest level in 10 years, up five percent, with nearly all companies registering improvements, according to the American Customer Satisfaction Index.

Sprint Nextel seems to have made the largest gains over the last two years, jumping by double digits for each of the past two years. That's important as Sprint Nextel's customer service was widely seen as the cause of its high churn over the past several years. The improvement in customer satisfaction is mirrored by steadily better churn performance over the last couple of years.

Both Verizon’s FiOS and AT&T’s U-verse lead the way with scores of 73 and 72, respectively. Satellite TV still leads over traditional cable, with Dish Network soaring 11 percent to 71 to overtake rival DirecTV for the first time since 2005.

DirecTV fell four percent to 68 as aggressive pricing promotions by DISH, coupled with a price increase by DirecTV, has the two satellite TV providers moving in opposite directions.

All four of the largest cable providers show some improvement. Charter Communications makes the biggest leap, gaining 18 percent to 60. The company is now statistically tied with Comcast and Time Warner Cable, both up three percent to 61.  Cox Communications gained two percent to 67 to lead all traditional cable companies for a seventh straight year.

“Having enjoyed near-monopoly status in most areas for many years, cable companies had little incentive to provide quality services at a good price,” says Claes Fornell, founder of the ACSI.  “Now that satellite and fiber-optic TV providers have created a competitive challenge to cable, the cable companies have started to step up customer service and realize some gains in customer satisfaction, but they still remain far behind both satellite and fiber-optics.”  

Traditional local and long distance service improved four percent to 75, the highest level in more than a decade.  AT&T is on top after a six-percent surge to 75, followed closely by Cox Communications, unchanged at 74, and Verizon, up three percent to 73. CenturyLink and Comcast round out the bottom of the industry, with CenturyLink gaining three percent to 70 and Comcast rising two percent to 68.

Customer satisfaction with wireless telephone service set a new all-time high for the second consecutive year, rising four percent to 72.  T-Mobile gained three percent to 73, tying for the lead with Verizon Wireless, which declined one percent.

AT&T Mobility improved three percent to 69. Two years after the iPhone was introduced as an exclusive product, AT&T seems to have made strides to relieve some of the strains on its network caused by the rapid influx of iPhone customers.

Sprint Nextel had the largest improvement, gaining 11 percent to 70 a year after a similarly large 13 percent jump, pushing the wireless carrier from well below to very close to the industry average.

Perhaps the most-intriguing bit of commentary provided by ACSI was the brief note that "with wireless looking to be the future of telephone service, providers are ramping up efforts to provide new services, simplified usage plans, and better pricing." Note the language: "wrieless looking to be the future of telephone service."

Google Buys GIPS

Google is acquiring Global IP Solutions for about $68 million in an all-cash deal for the firm whose technology is used to reduce delay, jitter and echo in real-time audio and video on the Internet.

“The Web is evolving quickly as a development platform, and real-time video and audio communication over the Internet are becoming important new tools for users,” said Rian Liebenberg, Engineering Director at Google. “GIPS’s technology provides high quality, real-time audio and video over an IP network, and we’re looking forward to working with the GIPS team at Google to continue innovating for the Web platform.”

GIPS technology is widely used. In fact, Global IP Solutions bills itself as the world’s most widely deployed technology for processing real-time voice and video over IP networks, used by over 800 million end-points. As is always the case when a widely-used "original equipment manufacturer" is acquired, Google will have to balance use of the technology in a "captive" mode as well as supporting the product as an OEM offering for many third parties, some of whom may be Google competitors.

As well as providing technology that allows users of Yahoo Instant Messenger to make voice calls, GIPS technology also powers voice calls for Cisco’s WebEx system and voice and video technology for IBM’s Lotus Sametime, for example.

Google already has some voice services, including Google Talk, Google Voice, and video and voice chat on Gmail. It expanded these services last year with the acquisition of Gizmo5.  The GIPS acquisition will allow Google to create more powerful voice and video services, both for the consumer and enterprise.

Inevitably, the deal is going to raise more questions about whether Google plans to compete more directly and robustly with Skype and other IM-based services. At one point, telecom service providers might have taken the acquisition as a sign Google planned to compete more directly in the basic voice business. These days, most executives seem more resigned to changes in the voice market that are only indirectly related to "Google becoming a service provider."

The same GIPS technology that makes IP voice perform better also make IP video work better, and that may be the more-important part of Google's thinking.

South Korea to Cap Telecom' Marketing Costs - WSJ.com

Here's one way to boost profits for mobile service providers operating in intensely-competitive markets: forbid them from spending so much on marketing.

South Korea's telecommunications regulator will limit the amount telecom companies spend on marketing, in a move aimed at cooling intense competition and boosting profits in one of the world's most saturated telecom markets, the Wall Street Journal reports.

The Korea Communications Commission says that the country's major mobile operators—including KT Corp., SK Telecom Co., LG Telecom Co. and SK Broadband—shouldn't spend more than 22 percent of their respective revenues from fixed-line and wireless businesses on marketing.

The regulator said it expects the move, which take effect from May, to help lower total marketing costs to around 7.03 trillion won ($6.14 billion) in 2010, sharply down from the 8.02 trillion won spent last year.

It's hard to predict in advance how such restrictions will play out, but the limit obviously favors contestants with larger gross revenue, since the marketing cap is based on a percentage of revenue. Smaller providers might have benefited more if the restrictions were set at a flat amount per company, or some other formula that limits the ability of the larger carriers to outspend carriers with lower market share.

Phone.Com Launches Channel Program

There comes a point in a company's development when it makes sense to market to new customer segments. So it is that Phone.com is launching a channel partner program expected to extend the company's sales effort to businesses with five to 20 employees. Up to this point, Phone.com has sold directly and exclusively from its website, and many of its customers are small businesses that understand the value of a hosted business IP telephony service.

The new channel programis expected to be based on partners such as phone interconnect dealers, value-added resellers and other relatively technical firms that might normally sell premises-based phone systems, but find they are leaving business on the table because some firms cannot justify buying a new IP phone system, but might be amenable to buying a hosted equivalent.

"I have found that Phone.com's best channel partners are existing customers of ours," says Joel Malof, channel partner program manager. "Our target markets for channel partners are firms with two to 30 lines."

The ideal channel partners are firms that can provide first-level customer support, and typically will be more-technical firms such as phone interconnect dealers, for example.

Partners can earn a success fee for closing a new account, equivalent to a month's recurring revenue after a new customer has been on board for 90 days. Then there is a recurring revenue payment based on a percentage of revenue, and depending on volume of revenue.

The program starts at three percent and goes up to 10 percent, says Malof. "A $20 a month residual is not so interestingm, but at 100 of those, it is interesting," says Malof.

A customized web address is given to customers, with the agent's ID embedded in it," says Malof. "That's how we give them credit for the sale."

"We will have no direct sales force that agents are competing against," says Ari Rabban, Phone.com CEO.

What is iPad Cannibalizing?

If Apple Macintosh computer sales are up 39 percent, while iPod sales are down 17 percent, might that imply that sales of the Apple iPad are cannibalizing iPod sales? That is what Piper Jaffray research analyst Gene Munster appears to believe.

U.S. Mac sales are up 39 percent year over year for the month of April, and in fact have been up, year over year, every month so far in 2010, according to researchers at NPD. NPOD's data also suggests Apple iPod sales are down 17 percent year over year for the month of April, and have been down for half of the initial months of 2010.

It stands to reason that at least part of the market share the Apple iPad is getting is coming at the expense of other products or suppliers.

At the various least, consumers might be forced to put off buying something else if they decide to buy an iPad. But at least some observers think Apple is cannibalizing itself.

"April NPD data gives us the first sign of the degree to which the iPad cannibalizes iPod or Mac sales," says Munster. "From the early NPD data, it appears that the iPad has a minimal cannibalization impact on Mac sales, and could be slightly cannibalizing iPod sales."

Given the average selling price of the Mac, which is about four times greater than that of a typical iPod, that likely is good news for Apple, at least in terms of revenue, Munster thinks.

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Will 4G Adoption Mirror 3G?

Adoption of fourth-generation network services likely will miror adoption of 3G services in Europe, says Decaln Longeran, Yankee Group analyst, and that has to be seen as modestly good news, but not "great" news, as adoption will not be as fast as many will hope.

"Our assessment of the early days of 3G, from spectrum auctions through to the first one or two years of commercial services, tells us a lot about where 4G is today and where it’s heading," Lonergan says. The big danger is massive overpaying for spectrum, which happened with the 3G spectrum auctions.

"Overpaying for licenses will quickly destroy the 4G business case, just as it did for 3G in several countries, including the U.K. and Germany," says Lonergand. On the other hand, if bidders show reasonable restraint, they should be in a better position to the extent that the auctions will be dominated by incumbents, unlike the situation when 3G licenses were awarded.

There will be no new 4G contestants, Lonergan predicts.

Adoption will take longer than expected, he says. "Remember, it was a full five years after commercial launch before 3G handset ownership reached 6.5 percent penetration globally, and 4G will follow a similar path," he says.

The technology won’t sell itself, he says. Faster speeds will only provide so much incentive, and it is applications that could provide the bigger push to adoption.

Handsets matter more than most people think, as well. Early 3G players failed to understand the importance of quality and choice in their handset portfolios, Lonergan says. Prepaid plans might also be essential, as 3G adoption in Europe was severely hindered in the early stages due to limited availability of prepaid plans.

Coverage also matters less than most people think. Consumers don’t obsess about coverage, except in the places where they use their devices most. That might especially prove true where 3G service is available as a backup.

On the other hand, 4G is being deployed in different circumstances, where a reasonable base of mobile broadband customers exists, and new applications that take advantage of higher bandwidth and lower latency already are getting traction, ranging from video and social networking to mobile apps related to navigation and location.

The first commercial European 3G service was launched by Telenor in December 2001, with commercial 3G services launched in 2003 by 3 in the U.K. and Italy.

But it is worth remembering that 3G also promised major performance enhancements to existing mobile services, . new services, including video telephony, multimedia content and enhanced end user experience. Right now, 4G mostly promises "faster" broadband.

The issue is whether the shift from 1 Mbps to 3 Mbps, or 3 Mbps to 6 Mbps, represents so much a change in end user experience. One might argue the Apple iPhone or iPad represents something users find tangible, not the additional bandwidth.

One might argue that mobile Web access, like mobile email before it, and smartphones, are what is driving 3G adoption. Applied to 4G, will there be unique drivers, or will 4G simply be a 3G experience, albeit with more bandwidth?

In August 2005, for example, the Yankee Group predicted, at a time when 3G penetration in Western Europe was in the range of 0.5 to two percent, that by 2009, 3G penetration would reach 52.6 percent of the population. In reality, average 3G penetration in Western Europe was 27 percent as of December 2009.

The key takeaway from this comparison is that even 3G forecasts that were regarded as too conservative five years ago have proved to be too aggressive.

A new wireless technology will not in itself excite most consumers, no matter how amazingly super-fast its proponents claim it performs. Back in May of 2006, when 3G services had been actively promoted for at least two years in several European countries, Yankee Group conducted an end-user survey that suggested 29 percent of end users had no idea whether they had a 3G phone or not. About 27 percent of respondents claimed they owned a 3G phone. Of course, it is not always the case that a 3G phone uses a 3G connection, either.

In the U.S. market, matters are even more complicated, as various 3G platforms will be available nationwide by the end of 2010, and T-Mobile USA's network might actually operate faster than 4G networks, so even speed will not be a clear differentiator.

Handsets, on the other hand, could be more important. In the first 18 months after launch, Japan's DoCoMo failed to build any real momentum behind its 3G service, and 3G users accounted for well under one percent of the company’s total mobile customer base. Then DoCoMo moved aggressively on handsets, and penetration grew.

At least in the European market, prepaid service plans have been important. Prepaid was first introduced to Europe in 1995, and it was a major factor in the rapid growth in mobile services during the past 15 years, Lonergan notes. Mobile services penetration has now reached 130 percent of the population, and prepaid accounts for the majority of these connections, fully 54 percent at the end of 2009.

Back in the early days of 3G, most of the focus (misplaced, as we now understand) was on video telephony because this was one of the few services that 3G could support and 2.5G could not. It should therefore have been a 3G marketing manager’s dream, but it turned into something of a nightmare due to unreliable performance and largely apathetic consumers.

But the single biggest difference between 3G and 4G is the world of demand into which they were born. Smartphone penetration and use of mobile broadband applications clearly is different today than was the case when 3G first was being introduced.

Mobile broadband (the laptop/dongle version) is a good example. This service didn’t exist when 3G was introduced. Neither did the iPhone.

Consumers in 2010 understand the differences between a 2 Mbps, 7 Mbps and 20 Mbps connection. In 2001, most did not.

It took five years for 3G penetration to reach 6.5 percent of global mobile users. Our projections for 4G follow a similar curve: relatively slow adoption in the first three years, with a noticeable pickup in years four to five, says Lonergan.

Some possible areas of upside include handset options, retail pricing plans and indoor coverage. "No matter how lousy the service provider's network or customer service, if they achieve the right balance and choice in their handset portfolio and price plans, just about any provider can build market share," Lonergan says.

Indoor coverage possibly could be a differentiator as well. In the early days of 3G, it was assumed 3G would be used by individuals out and about and as a complement to home land-line broadband service. 4G might be different: onsumers might use it more as a substitute for some home broadband usage, as they already use their 3G mobiles indoors.

Marketers Still Can't Measure Social Media Return on Investment

Analytics continue to be an obstacle to heavier use of online, social media and mobile marketing campaigns, a new survey by Omniture suggests.


About 80 percent of survey respondents believe the ability to measure return on investment from online marketing activities is important, but only 31 percent of marketers can effectively measure it today.

About 86 percent of respondents think the conversion rate from online marketing activities is important to measure, but 25 percent cannot effectively measure it.



Only about 30 percent of marketers using mobile channels are able to measure mobile app conversions and, overall, only 23 percent say they are "very satisfied" with their current mobile measurement capabilities. That suggests there is pent-up demand for easier to use and easier to measure mobile marketing support.

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30% to 50% of All Advertising Will be Digital Within 8 Years, Google Exec Argues

"I personally expect in the next five to eight years 30 percent to 50 percent of advertising will be digital," says Nikesh Arora, Google's president of global sales, referring to online direct marketing, advertising and branding campaigns.


While Arora admits it is a bold claim, he backs up his forecast by pointing out that in the U.S. 10 percent of advertising is already digital and in the United Kingdom it is 20 percent.

In fact, late last year the U.K.'s Internet Advertising Bureau announced that online ad spending had risen above television for the first time.

Video will tip the balance, says Arora. If so, Apple's bet on creating a content-consumption tablet device might be precisely on target. The issue there is whether the iPad will be for video consumption what the iPod was to music consumption.

"I think mobile is a fantastic opportunity," says Arora.

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BT to Launch Own "Tablet," But Isn't Aiming at iPad

BT plans to launch its own touch-screen, tablet style computer, which inevitably will be seen as a way to compete with the Apple iPad, though BT apparently is not positioning the device in that way, and the comparison likely is misplaced.

The Telegraph reports that although no official details have been released by BT, the new device will have a screen larger than the 3.5-inch display found on the iPhone, but smaller than the 9.7-inch screen on the iPad.

In principle, the device could resemble the existing "OpenTablet 7," which is more an "advanced telephone" than a mobile device.

The BT device appears something more along the lines of the "Internet appliance" several telecom carriers have attempted to popularize in the past, though building on mobility rather than the fixed-line network. Previous attempts have focused on an easy-to-use device connected perhaps in a kitchen that allows light web browsing.

OpenPeak's "OpenTablet 7" can be used as a wireless, detachable tablet and features 3G HSDPA connections. It isn't yet clear what connectivity options BT will offer, but up to this point similar devices have been viewed as ways to enhance the value of a fixed-line connection by enabling use of new appliances and devices on those networks.

BT positions the new device as a cross between "a mini PC" and "the telephone of the future," which is roughly how the earlier attempts have been framed.

In a sense, that positions the new device as the latest attempt to build a "smart" fixed-line telephone, not a mobile tablet computer.

That will be the big issue. Prior attempts to create such an appliance have not gotten traction.

Shift to Prepaid Wireless Continues

I doubt this is news to anybody who follows subscriber trends in wireless, but prepaid accounts continue to grow, accelerating through all of 2009 and 2010 so far.

Up to a point that might be considered a good thing for  service providers who have made a business of prepaid, especially some of the regional providers.

But it never is too helpful when the "big guys," or at least some of them, decide they have to play in the prepaid segment, as Sprint now is doing.


The new "Common Cents" service is the fourth prepaid brand Sprint supports, after Boost Mobile, Virgin Mobile and Assurance Wireless, which is a government-subsidized cell phone program for people who are under or close to the poverty line.

Under the new plan, customers will pay seven cents per minute for phone calls and they will be charge seven cents per text message.

Wal-Mart is planning to sell phones, costing $20 to $70, in more than 700 stores.

Sprint will also give customers a break by rounding down on the minutes used in order to aattract more subscribers. Sprint says that "with minutes that round down after the first minute, not up, consumers get more minutes for their money."

In the first quarter of 2010, Sprint lost 578,000 postpaid subscribers. But it gained 348,000 prepaid customers.

Sprint also positions each of the prepaid brands in different segments. While Common Cents is geared toward value customers, who aren't looking for much beyond basic cell phone and texting service, Virgin Mobile's and Boost Mobile's services offer more data-centric plans that target the youth market.

TheVirgin Mobile and Boost brands have been offering flat-rate pricing for all-you-can-eat plans for $50 a month. Soon Virgin Mobile will also offer a $25 plan that comes with unlimited texting, e-mail, and Web surfing, plus 300 minutes a month of voice service. For $40 a month, customers can get 1,200 voice minutes.

Channel Conflict Develops in Mobile App Store Ecosystem

Channel conflict is an almost-inevitable by-product of complex ecosystems. A recent survey suggests channel conflict already is rising in the mobile application store ecosystem. A survey of 400 developers by Evans Data Corp. recently found that 80 percent of developers in North America think they should receive more than 70 percent of the revenue generated by their apps in an app store.

Of course, when Google launched its Android Market, the company pointed out that  "developers will get 70 percent of the revenue from each purchase; the remaining amount goes to carriers and billing settlement fees."

"Google does not take a percentage," the company said. "We believe this revenue model creates a fair and positive experience for users, developers, and carriers." But what is fair from Google's point of view might not be viewed the same way by developers or carriers.

That's channel conflict.

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Facebook To Create Ad Network?

It is widely believed that Facebook will soon follow the AdSense playbook by introducing an off-property ad network. They’ll try to use their strong base of advertisers to dominate intent-generating ads the way AdSense dominated intent harvesting ads.

Facebook Is About To Try To Dominate Display Ads The Way Google Dominates Text Ads

Apple Offers "Curated Computing," Not "Open"

The conventional wisdom is that open and standardized platforms are better than closed platforms, for any number of practical reasons, ranging from cost speed and speedier innovation to applications richness. For some, that is the importance of the "network neutrality" debate, though oddly, innovation arguments can be made on both sides, or all sides, of the argument.

But Apple always has been the salient exception to the "open and standards based" rule. In the past world, where Apple as a PC manufacturer and had three percent to four percent market share, that might not have mattered much. In today's world, where Apple emerged from nowhere to dominate the MP3 player market, then reshaped the mobile handset market and seems to be on the cusp of validating a new market for tablet devices, Apple's approach will be more important.

The iPad might be a new kind of PC, or might reshape existing devices; it is hard to tell at this point which future is more likely. But either way, Apple is creating what might be called "curated computing," where choice is deliberately limited to improve end user experience, says Forrester Research analyst  Sarah Rotman Epps.

Curated computing is perhaps a new mode of computing in which choice is constrained to deliver more relevant, less complex experiences, says Rotman Epps, in some ways resembling the old AOL approach, or even mobile service provider "walled garden" portals. You might argue that those approaches do not seem to have worked too well, but Apple always seems to be the exception to the rule.

It might be a bit of a stretch, but the analogy might be that a PC is a general-purpose computing platform, while an iPad is something more like an iPod. That is not to say iPad users cannot send and receive email and surf the Web, but simply that the principle is that "general purpose" computing is not the point.

Rather, users default to curated applications as the primary use mode, with Web surfing, email and other experiences being somewhat secondary. Put another way, where the Web is the default mode for most Internet-connected computing devices, the application is more the default mode for iPhones and iPads.

The broader question always seems to come back to the issue of how much choice users really want, and how much experience is enhanced when choices are limited. Apple always has delivered an enhanced end user experience precisely because its hardware choices were limited to "my way or the highway."

In all likelihood, should the tablet trend establish that there is a discrete new class of devices and behaviors suitable to less "general purpose" computing and more "content consumption," then curated experiences might be viable in a way that would defy the historical failures of walled garden approaches.

Should that prove to be the case, at least some in the mobile ecosystem might have to rethink the historic preference for open and standards-based development and "run time" environments.

Is Internet Access a Common Carrier Service?

On May 6th America’s Federal Communications Commission announced a plan to classify the last mile of Internet access as a “telecommunications service”; it is currently classified as an “information service."

That raises a thorny question: is Internet access really a utility, rather than an information service? In other words, is broadband access more like electricity than television or radio or publishing? It matters how the question is answered.

Since the 1930s providers of telecommunications services in America have been obliged to agree on rates with the FCC. They cannot discriminate among customers or traffic, and they have to contribute to a fund that subsidises rural connections. The new plan promises to refrain from any price regulation; the FCC wants to ensure primarily that packets pass from point to point without preferential treatment."

Economics focus: From ships to bits | The Economist

Cellphones Now Used Mostly for Data

Liza Colburn uses her cellphone constantly. She taps out her grocery lists, records voice memos, listens to music at the gym, tracks her caloric intake and posts frequent updates to her Twitter and Facebook accounts.

The one thing she doesn’t use her cellphone for? Making calls.

Cellphones Now Used More for Data Than for Calls - NYTimes.com:

No Skype for Microsoft 7

Microsoft has been having a tough time in the mobile market, it is safe to say, and now Skype says it will not develop a Skype client for Microsoft 7, says Dan Neary, Skype Asia Pacific VP.

Microsoft 7 is the successor to the Windows Mobile operating system.

Neary did not give a reason why Skype is taking that path, but Skype's demurral can hardly be good news for Microsoft.

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Mobile Agencies Look Beyond Apps

Advertising agencies say branded mobile apps aren't the be-all, end-all for mobile marketing, and will be challenged by mobile Web browser functionality, which will allow apps to run within the browser context.

Despite the hype surrounding the mobile application space thanks to app-centric devices such as Apple's iPhone and iPad devices, mobile agencies suggest new technologies like HTML5 and Apple's iAd product could help turn marketers' attention away from the crowded branded app space.

Mobile Agencies Look Beyond Apps as Market Evolves

Android 2.2 Runs 450% Faster than 2.1

The new Google Android version 2.2 appears to be as much as 450 percent faster than version 2.1, according to test run by Android Police. To the extent that faster processing means lower latency for any number of operations conducted on a mobile device, that should be a good thing.

Android Police tests suggest, for example, that the HTC Hero gets a test score of about 2 million floating-point operations per second, often called simply "FLOPs."

The Nexus One running Android 2.1 gets about 6.5 MFLOPS to 7 MFLOPS.

The Android version 2.2 operating system seems to run at 37.5 MFLOPS. One practical result is that Flash-authored video should run much better, as Flash puts strain on processors. Much-faster processors should mean much-better video performance.

While real-life applications will most certainly not be 450 percent faster across the board, but it stands to reason that it will help most applications run faster.

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Broadcasters Are Serving Up Lots of Web Video

Aside from YouTube, online video offered by broadcast TV networks and Web-only media brands, followed by magazine sites and music labels, seem to be getting the most traffic, a new study by Brightcove and Tubemogul suggests.

About 51.75 percent of viewers are navigating to video directly from the publisher’s main site. Google search drives 39 percent of viewing,  followed by Yahoo at 5.58 percent, Bing at two  percent and Facebook at 0.40 percent.

In the first quarter of 2010, the broadcast TV networks sampled in the study streamed 380 million videos, with Web media brands coming up close behind at 326 million video streams. However, the native Web brands, which include both video-only and general entertainment and news sites, saw 300 percent annual growth of video views in the first quarter, compared to 44 percent growth for the broadcast sites.

For all of 2009, Web media sites grew twice as fast as broadcast TV sites (165 percent compared to 74 percent). At this rate, they will overtake the broadcast sites in video views later this year, the study suggests.

In the first quarter of 2010, magazine-affiliated sites streamed 190 million videos, up 90 percent. In fact, magazine sites are streaming as many videos as music label sites, which came in at 191 million videos, up 60 percent.

Newspaper sites aren’t doing nearly so well, streaming 136 million videos in the quarter and growing five percent.  Newspaper sites are trying to catch up, though, and had two billion video player pageloads in the quarter (pages which loaded with a video player, but were not necessarily clicked on), compared to 1.2 billion for magazine sites, 760 million for Web-only media, and 670 million for broadcast TV sites.

But newspaper sites are having a real problem getting their audiences to watch videos, the study suggests.

For every two billion videos they throw in front of users, only 136 million get viewed (6.8 percent). Broadcast TV sites are getting 380 million views for every 670 million attempts (56.7 percent).
Even magazine sites are seeing a 12.7 percent hit rate.

But newspaper videos get viewed "to the end" more frequently than videos on other sites. The completion rates for videos on newspaper sites are 41 percent, versus 39 percent for magazine sites, 38 percent for broadcast sites, and 29 percent for music label sites.

Google Android Strategy is Working, Despite Nexus One

Google's strategy of seeding the market for its Android operating system, unlike its experiment with device retailing (NexusOne) seems to be succeeding.

The Android operating system "continued to shake up the U.S. mobile phone market in the first quarter of 2010," moving past Apple to take the number-two position among smartphone operating systems, according to The NPD Group.

Based on unit sales to consumers last quarter, the Android operating system moved into second position at 28 percent behind RIM’s operating system (36 percent) and ahead of Apple’s OS (21 percent).

Google's effort to retail unlocked, full-price handsets using a Web-site-only approach does not seem to be working out so well, as one might have predicted. Both Sprint and Verizon Wireless have declined to sell the Nexus One, though the logical explanation is that the HTC "Evo" at Sprint and "Incredible" at Verizon Wireless are functional equivalents, at the very least.

And it might just be the case that the battle between AT&T and Verizon Wireless accounts for the change, as iPhone sales in the United States are exclusive to AT&T, essentially limiting sales, while Android devices are pushed both by Verizon, T-Mobile USA and Sprint.

Verizon also has been aggressive about offering "two for the price of one" sales of Android devices.

Smartphone sales at AT&T comprised nearly a third of the entire smartphone market (32 percent), followed by Verizon Wireless (30 percent), T-Mobile (17 percent) and Sprint (15 percent).

Exclusivity on AT&T’s network obviously limits the potential sales for Apple to some extent. Verizon has more than 92.8 million subscribers, none of which can buy an iPhone for use on the network.

It isn't so clear whether the range of Android models or prices are a meaningful contributor to Android sales volume, but one has to think so.

The NPD Group cites an average smartphone price of $151 in the first quarter of 2010, roughly half of the $299 price tag for a top-shelf iPhone. Apple offers subsidized models at $99 and $199, but most subsidized Android phone prices top out at $199 and go down from there.

The Samsung Behold 2 running Android is currently free with a service plan at T-Mobile, for example. With so many choices, consumers can find Android units for well under $99 these days and can shop around in a greater range of price points.

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Verizon LTE Test Runs at 8.5 Mbps

In recent tests, Verizon Wireless has found that its new Long Term Evolution network runs at about 8.5 Mbps in the downstream direction in the real world.

Web Apps Will Catch Mobile Apps, Study Suggests

Count Global Intelligence Alliance as among the analysts who believe Web applications will be a viable competitor to app store programs over time, and that content distribution is likely to be a direct beneficiary of the trend towards using Web browsers to serve up mobile apps.

The same might be said for subscription-based mobile services such as news and weather as well.

Despite conventional wisdom, by 2013 HTML5 will enable Web-based apps to provide user experinces that rival that of mobile apps, GIA argues. But there are other reasons to believe Web-based apps will prove attractive. Web apps offer an architectural advantage, namely cross-device launches.  Mobile apps have to be adapted for each operating system, and often for discrete devices as well.

The Web also arguably is a better platform for subscription-basedservices such as communications, news, weather, financial services, retail and shopping, where user analytics are important. But GIA notes that smaller providers and pay-per-download services might well find the mobile apps route profitable, as such an approach can be directly tied to a clear revenue model.

But Web-based mobile apps will take a couple of years to develop. Right now, respondents surveyed by GIA say user adoption is about twice as high when using a mobile app approach. Some 47 percent of respondents reported that user adoption was higher when using a mobile app approach, compared to about 23 percent of respondents who said a Web approach produced higher end user adoption.

Web apps, on the other hand, are a bit more "sticky" than native apps, respondents report. About 27 percent of survey respondents said user activity peaked at initial download and then steadily declined. Only 15 percent of Web app developers said that was the case.

Likewise, about 23 percent of respondents indicated that user activity kept growing after download, compared to about 33 percent of Web apps users. Of course, that might be a statistical artifact produced by the different use cases.

To the extent that a mobile app provides access to "static" content, usage would decline over time, in much the same way that any user's viewing of a new movie will be highest at download and then drop off. Compare that to a cable TV subscription or news feed, that might be used on a continuing basis because the actual content is dynamic, rather than static.

The survey also found that end user session lengths tended to be longer for native apps, compared to Web apps. About half the respondents say native apps produce longer sessions. Only 20 percent of developers say Web apps produce long sessions. Of course, much depends on the type of application.

Many interactive or transactional apps will tend to last longer than many content delivery apps, if only because the transactional app will require time-consuming search and research. A user investigating air travel or lodging in a distant city might need to spend quite a bit of time conducting research, compared to a user playing a game or downloading a specific bit of content.

About 53 percent of native app developers reported that this approach cost more than creating a Web app, compared to 17 percent of respondents who said the Web app cost more than a native app to create.

About 43 percent of developers reported that maintenance and update of native apps cost more than a Web app approach.  About 24 percent of respondents indicated that a Web app approach was more costly to maintain and update.

About 60 percent of developers reported that a Web app approach was faster than a native app development approach.

Apple's iAd Shooting for the High End in More Ways than One

The conventional wisdom likely is that the new Apple iAd network is going to be positive for mobile advertising, showcasing what can be done with rich media on an easy-to-use device with a large screen.

But iAd might have another effect: driving up ad pricing double to triple current rates. That might be welcome for ad sellers, but not for buyers.

Since Apple never likes anything but the "premium" position in any market where it competes, that might not be too surprising.

According contentSutra, iAd cost per thousand impressions will be highly variable in terms of cost, but in some cases could wind up being triple what marketers are used to paying for banners, and double the price of a video ad on mobile (click on the image for a larger view).

In other cases, a very successful campaign that generates an unusual number of clicks could wind up being more than seven times what an advertiser had anticipated.

Keep in mind that Apple is setting the minimum annual spend at $1 million for brands to use its iAd platform. To put that in perspective, consider that Jaguar and Land Rover in 2009 spent about  $1.6 million in aggregate for mobile marketing.

Some advertisers might decide they like the iAd formats, and start shifting lots more money into mobile advertising. Others will push back against the price and take a wait-and-see attitude. Either way, iAd is going to have complex impact. It likely will spur larger mobile advertising commitments from some buyers more concerned with cutting edge than return on investment. Most will watch and see what happens, at least in terms of the high-end, showcase content Apple wants to show it can produce.

Clearwire Says It Has 3 Customer Segments

Clearwire says three customer segments already have emerged for the firm's fourth-generation wireless network. "A Clear customer is often a cord-cutter," says Clearwire CEO Bill Morrow. "This customer has a mobile phone, but no fixed line phone in the house." That customer fits the profile of an on-the-go user that wants broadband available outside the house.

"They also probably don't have cable TV service," he says, and tend to substitute Hulu, YouTube or other video sites for TV. It probably goes without saying that this sort of customer is single and younger, without children.

The "cable customer," on the other hand, "can't cut his Internet connection at home," says Morrow. That is because this second sort of customer has a family sharing a single at-home video entertainment connection, as well as a broadband Internet access connection.

In this segment, the 4G wireless service is part of a triple play package.

The third segment consists of mobile customers served by Sprint that wants to add a broadband access service for PCs and other devices, and for whom the convenience of having both mobile phone and broadband access services on the same bill, provided by one carrier, is valuable.

"When you go into the market you see all these different customer segments and it's easy to see that you can get more subscribers in total by marketing to different groups instead of just having one brand," says Morrow.

Clear customers do use much more bandwidth than the typical 3G user, though. "We're finding that customers are using on average 7 GBytes of data per month on our service," says Morrow. "The average amount of data a 3G subscriber uses a month is about 1 GByte to 2.5 GBytes a month.

It is not certain why this is the case. It could be that heavy users are attracted to the unlimited access, with no monthly caps. It could be that knowing there is no cap motivates usage, as broadband leads users to consumer more data than they do when on a dial-up service.

Why Wireless Might be the Best Way to Serve the "Unserved"

A new study produced by the Federal Communications Commission might be interpreted as arguing for a wireless approach to bringing broadband to many unserved locations, said by the FCC to number seven million homes, adequate for service at 4 Mbps downstream and 1 Mbps upstream.

The most rural 250,000 housing units account for $13.4 billion of the total $23.5 billion investment required. In fact, as cost varies inversely with density and distance from a central office or cable headend, the cost curve is a reverse Pareto distribution (a reverse "long tail").

The FCC says wireless, such as a fourth-generation wireless network, is the lowest-cost technology in 90 percent of cases. The point is that population density generally is inversely related to access cost.

Apps or Mobile Web? It is Going to be a Toss Up

Today most mobile applications for smartphones are downloaded from “app stores.” According to ABI Research data, in 2009 consumers downloaded some 2.4 billion applications from such stores, and the download rate will accelerate over the next few years until in 2013 smartphone downloads are expected to peak at just below seven billion.

So you might be wondering whether this implies a decline of interest in mobile apps. Not really. What the forecast implies is that there will be other ways to get and use applications, namely using a mobile Web browser.

After 2013, smartphone download rates from app stores will start a slow decline, although total downloads from all sources will probably continue to grow, ABI Research believes.

ABI argues that more and more people will start visiting mobile websites authored using HTML5, which will mean applications can be run natively from inside Web pages where today external apps might be required.

Moreover, handset makers and service providers will pre-install apps on their products, such as social networking apps and some mobile office suites, removing the need for downloading those kinds of applications.

“App stores aren’t going away," says ABI Research Senior Analyst Mark Beccue."Following the 2013 peak in demand, the number of downloads in 2015 will have decreased only seven or eight percent."

But users will be able to gain the value of apps using their browsers.

Also, it is conceivable that mobile network operators will host their own app stores. Many observers think such efforts will enjoy only modest success, but there is one notable area where huge success could be possible.

If operators concentrate on providing downloadable apps to feature phones, that could be a big factor in newer and developing markets where smartphone penetration is lower.

80% U.S. Smartphone Penetration by End of 2012?

Is it possible 80 percent of U.S. mobile phones in use by the end of 2012 could be smartphones? The answer is "yes."

To get there, one would only have to assume that current use rates of mobile browsers are a solid indication of current smartphone use, that current rates of usage will grow at current rates of nine percent every quarter through 2011, and then will increase one percentage point faster during each quarter of 2012.


U.S. mobile users increased their use of browsers, downloaded applications and social networking at about a nine percent rate each during the first quarter of 2010, according to comScore. At that rate, by the end of 2010, 39 percent of mobile subscribers will use browsers, 38 percent will be using downloaded applications and 25 percent will be using social media.

If that rate continues throughout 2011, by the end of that year 55 percent of mobile subscribers will be using browsers, 53 percent will be using downloaded applications and 35 percent will be using social networking.

In an average month during the January through March 2010 time period, 64 percent of U.S. mobile subscribers used text messaging on their mobile device, up 0.6 percentage points compared to the fourth quarter of 2009.

Browsers were used by 30 percent of U.S. mobile subscribers, up three percentage points over the fourth quarter of 2009. About 29 percent of mobile users downloaded applications, up three percent from the fourth quarter of 2009.

Some 19 percent of mobile users used social networking sites and blogs in the first quarter of 2010, up three percent over the fourth quarter of 2009.

So the issue is what would be different about your life or your business if 80 percent of mobile users are on smartphones by the end of 2012, and those smartphones can download at speeds between 3 Mbps and perhaps 12 Mbps, and can upload at speeds from 1 Mbps to perhaps 5 Mbps.

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Algorithmic Trading Broke, Then Fixed, the Market

Yesterday the stock market dropped almost 1,000 points intraday before rebounding almost as quickly. Algorithmic (computer-to-computer) trading is blamed, but it might be worth pointing out that algo trading also fixed the market, just about as fast as it "broke" the market in an anamoly.

Right now, securities exchanges are looking at particular equities that might have been affected by the abrupt drop and are going to cancel the trades. The other thing is that few actual human traders actually were able to react quickly enough, one way or ther other. It appears execution platforms became overloaded and wouldn't place buy or sell orders in any case.

There also were liquidity issues. For every seller, there must be a buyer. It appears that in many cases there were no buyers to be had, so abrupt was the plunge. Liquidity, in other words, evaporated.

But algo traders apparently were able both to execute "sell" and then "buy" orders fast enough to clear about 600 points of movement within about five minutes. The conventional wisdom was that a misplaced large order triggered the abrupt declines, which triggered the other trading algorithms.

It might also be fair to note that those same automated trade programs also erased the anamoly within 30 minutes, which shell-shocked humand mostly gaped in awe at something most likely had never seen.

The sheer snapback of the price in such a short amount of time was not driven by fundamental traders (humans) who all of a sudden found “value” in the market with a trailing P/E. The only sort of quick analysis that provides that kind of price action are done by non-humans at quantitative firms, and they saved the market from something much, much worse.

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Sprint HTC Evo on June 6?

The latest rumor about availability of the Sprint HTC Evo is "around June 6, 2010." Reportedly the device will reail for about $200 on a two-year contract, and as much as $600 if you want to buy it without a contract.

Some policy advocates think such contracts impair consumer welfare because they make it hard for consumers to switch whenever they feel like it. One simply should note that any consumer can buy a device at full retail price if that is what they prefer.

Most consumers keep demonstrating, though, that they prefer $200 devices and contracts, compared to $600 devices without contracts. If you don't want a contract, don't buy one. Most consumers can figure out that a $200 subsidized phone provides real value.

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What Gets Cannibalized by iPad and Other Tablets?

As you might have expected, though lots of people think the Apple iPad is a gorgeous device, lots of people also think it is a bit pricey.

So far, iPad buyers are heavily skewed to 30-somethings and 40-somethings who presumably are well along in their careers and have both the appetite and the means to splurge on one.


Some technology observers have been predicting the demise of the netbook for some months, and with the launch of the Apple iPad, we get our first chance to see whether cannibalization is happening.

The basic line of thinking is that netbooks get squeezed between more powerful smartphones and tablet devices such as the iPad.

A new study from Morgan Stanley concludes that tablets in general will be a big threat to netbooks, as some have suggested.

Netbook sales growth has been significantly flatter lately. Sales still are increasing, just not at the rate they were before. Last July, growth was at 641 percent. In December, growth was 179 percent, and in January it dropped to 68 percent.

According to Morgan Stanley/Alphawise, the biggest product category likely to be cannibalized by potential iPad customers is netbooks and laptops. About 44 percent of potential iPad customers say they'll get it instead of a notebook or, presumably, netbook.

About 27 percent said they'd buy an iPad over a desktop.

To be sure, netbook sales were slowing before the iPad launch, so the slowing netbook growth rate can't be blamed completely on the iPad.

Still, it seems inevitable that netbooks and other cheap ultraportables will face competition from the iPad.

Product cannibalization potential

In Case You Missed the Market Craziness Today

It was a crazy day today, with a violent, sudden drop in U.S. equities, a swift 700-point retrace, and worries that what is happening in Greece will be happening in the United States in the future.

Consumers Spent More on Consumer Electronics Over the Last Year

The average U.S. household spent $1,380 on consumer electronics products in the past 12 months, an increase of $151 from last year, according to a new study released by the Consumer Electronics Association.

The average household spent 12 percent more on consumer electronics devices in the past year, which might be especially surprising considering a dip in most other consumer spending over that same period. Of course, sales took a dip in 2008 as well.

Individual consumer spending, as opposed to household spending, also was up 10 percent from the previous 12 month period, CEA says. The average adult spent $794 on consumer electronics in the past 12 months, up from $725 in 2009.

Women spent more on consumer electronics products than they did the year before but still trail men in overall spending. Women spent, on average, $631 on consumer electronics, up $73 from 2009. Men report personally spending $969 in the past 12 months, up $67 from the year before. The average household reports owning 25 consumer electronics products, up from 23 products last year.

CEA’s study also shows that video products continue to be the top devices consumers own, with HDTV ownership continuing to increase. About 65 percent of U.S. homes now own at least one HDTV, an increase of 13 percentage points from last year, making it the top industry growth driver of the past 12 months.

Consumers also are buying HDTVs as secondary sets. The average household now owns 1.8 HDTVs, up from 1.5 in 2009. HDTVs also are also the top product consumers say they want to purchase. About 23 percent of households say they plan to buy a new high-definition set in the coming 12 months.

Ownership of computers also continues to increase. Currently, 86 percent of U.S. households own at least one computer, making it the third most owned CE product category behind televisions and DVD players.

The popularity of netbooks, owned by 12 percent of U.S. households, and laptops, now owned by most households (58 percent), is helping drive the computer category.

"Third Way?" Between Title I and Title II? Are you "Sorta Pregnant?"

One might argue that there's nothing wrong with the Federal Communications Commission trying to find some "middle way" or "third way" between common carrier and data services regulation. FCC Chairman Julius Genachowski, for example, notes that "heavy-handed prescriptive regulation can chill investment and innovation, and a do-nothing approach can leave consumers unprotected and competition unpromoted, which itself would ultimately lead to reduced investment and innovation."

Nor are many likely to disagree completely with the notion that "consumers do need basic protection against anticompetitive or otherwise unreasonable conduct by companies providing the broadband access service."

Likewise, most probably would agree that "FCC policies should not include regulating Internet content, constraining reasonable network management practices of broadband providers, or stifling new business models or managed services that are pro-consumer and foster innovation and competition."

But there is likely to be fierce disagreement about the proposal to regulate broadband access service as a common carrier offering governed by Title II regulations, even though the chairman says the FCC would "forebear" (not impose) all of the obligations and rules that cover Title II services.

The difference is that right now, the government "may not" regulate terms and conditions of service. Under the proposed rules, the government only says it "has the right to do so, but voluntarily agrees not to" impose such rules. There is a vast difference between those two approaches.

The first is a clear "thout shalt not" injunction; the new framework is only a "we promise not to" framework. The chairman argues that this new approach "would not give the FCC greater authority than
the Commission was understood to have" before the "Comcast v. FCC" case.

A reasonable person would find that hard to believe. Moving any service or application from Title I to Title II has unambiguous meaning. One can agree or disagree with the change. One can hardly call this a "reassertion of the status quo." Between Title I and Title II there is a gulf that would have to be crossed. Never before have any Internet services been considered "common carrier."

A mere promise not to act, after the change has been made, will hardly satisfy those who believe Title I is the better framework. Those who believe Title II is the better way to regulate likely will find the proposal satisfying. That would be reason enough to suggest it is not a "third way." There is in fact no third way, except for the Congress to direct the FCC to regulate broadband access as a Title II service.

The problem is that what the "service" is changes over time, making difficult the task of clearly separating what "access" is from what an enhanced feature is. Nor is it easy to differentiate between a "business" access and a "consumer" access. If business access is covered, is packet shaping still permissible? Are quality of service measures still permissible? Are virtual private networks still allowed?

Should consumer services acquire the richness of business services, or should business services be dumbed down to consumer grade? And who gets to decide? Even if one is willing to accept that an ISP cannot, on its own, provide any quality of service measures, can a customer request them? Can a customer demand them?

These are tough questions and there must be scores more people could ask. The problem is that the Title I and Title II frameworks are binary. We do have alternate models in Titles III and VI, as I recall, though I suppose both of those titles would provide more freedom, not less, and Title II is a move in the direction of less freedom.

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