Business Model Juxtaposition

There are multiple reports from Twitter users on T-Mobile networks that Twitter streams are being interrupted. Separately, photographer Lane Hartwell has taken 5,000 images formerly available on Flickr out of public view. What's the resemblence?

Hartwell objects to images being used on the Web without credit or compensation. "I don't want people just taking my stuff and saying, 'We're going to redistribute this to the masses," she says. She wants to protect her business model, in other words.

Assuming T-Mobile actually is blocking Twitter posts, one would assume there is a similar motivation: to protect the business model.

"It is stealing," Hartwell says of the unauthorized use of her photo in a YouTube video. "I'm not a charity. This is my living."

Likewise, T-Mobile seems to be taking the position that its "short code" service requires a commercial relationship with T-Mobile.

“Twitter is not an authorized third-party service provider, and some services are not available on third-party networks or while roaming," T-Mobile is reported to have replied to a complaint about the apparent Twitter blocking.

"We may impose credit, usage, or other limits to service, cancel or suspend service, or block certain types of calls, messages, or sessions (such as international, 900, or 976 calls) at our discretion,” T-Mobile reportedly has said.

The point is that use of some resources occasionally is a direct assault on some individual's, or some enterprises's, business model, and those entities sometimes take steps to protect their business models.

The observation is that as all content, communications and information moves to IP delivery, these sorts of disputes are bound to multiply.

Search Surges

U.S. users posted a new record for the number of search queries performed on the top engines in November, with over 8.1 billion discrete searches. That’s roughly 48 monthly searches per person on average and 12 more monthly searches than the 36 per month that Compete estimated for November 2006.

Personally, I think I do something more like 48 searches an hour!

Fair Use: Tragedy of the Commons

I might not be the most popular user in defending "fair use" policies, but I have to tell you there is such a thing as the "tragedy of the commons."

Without being overly literal about it, the "tragedy of the commons" is a way of describing how free access and unrestricted demand for a finite resource ultimately dooms the resource through over-exploitation.

This occurs because the benefits of exploitation accrue to individuals or groups, each of whom is motivated to maximize use of the resource, while the costs of the exploitation are distributed among all those to whom the resource is available.

As a westerner, I'll illustrate the problem by pointing to the history of conflict over grazing and water rights. Assume you are a cattle or sheep rancher, grazing those animals on open range that actually is owned by the U.S. government. Assume the market for livestock is good. Each rancher then has an incentive to add animals to the herd, increasing the intensity of grazing. At some point, there isn't enough grass to support all the animals.

Now Internet access is a shared resource, by definition. If you use a cable modem, the actual bandwidth is shared by a large number of end users. If you use Digital Subscriber Line, the sharing happens further up in the network, but the resource still is shared. "Oversubscribed," we like to say. One never provisions enough bandwidth to meet the full theoretical demand any single subscriber might use.

Basically, designers use statistics to provide enough bandwidth to meet average demand, at average times of day, and day of week, to meet the demand created by users who actually are online and using the resource at any given point.

But those statistics are based on "typical" demand. So what might be typical? For a consumer user, somewhere between one and three gigabytes of use in a month. My business use--and I am on the Web all day from roughly 6 a.m. to 8 or 9 p.m.--runs about 2.5 Gbytes a month, typically.

There always are a small number of users who "graze their cattle" vastly more extensively than the rest, creating something that might be less than a major "tragedy of the commons" problem, but clearly consuming enough bandwidth that user experience for all the other users paying the same amount of money is degraded.

"T'aint fair." There's a solution for very-high usage: buy a business plan that really offers "all you can eat" bandwidth at the level you require.

At Qwest Broadband, for example, the illustrative volume that really is excessive for a consumer user might be:
• 300,000-500,000 photo downloads in one month
• 40,000 to 80,000 typically sized MP3 music downloads in one month
• 15+ million unique e-mails each month
• Online TV video streaming of 1,000-3,000 30-minute shows each month
• 2-5 million Web page visits (approximately one every second, 24 hours per day)

Those of us who have jobs, spend time outdoors, play sports, garden, ski, raise children, go shopping, read books and so forth really don't have time to consume that much data in a month.

Some people might have to do those sorts of thing for work, but that's the point: buy business bandwidth that clearly is sold with the understanding that if you want to push the network that way, you pay more for the privilege.

So long as access bandwidth is a shared resource, there will be a "freeloading" or "tragedy of the commons" danger. Good citizenship, good manners and good neighborliness requires a little respect for other people here.

I fail to share the "outrage" of people who think they should be allowed to overgraze the commons. Nobody has a "right" to impose those costs on the rest of users who "play nice."

Windows Vs. BlackBerry in Enterprise?

A recent poll of enterprise wireless subscribers found 84 percent of respondents who do use smart phones, use a BlackBerry, according to InfoTech. Palm Treo and HTC devices trail and Microsoft OS devices, though growing fast, appear to fare no better than fourth.

But Windows Mobile finally is making inroads. "As such, the world essentially will come down to RIM vs. Microsoft in the enterprise market," says InfoTech.

More than 70 percent of respondents say email is the most important function of a smartphone, followed by Internet Wi-Fi access at 12 percent, the survey found.

More than 80 percent of respondents indicated they also use text messaging.

About 49 percent of survey respondents across all enterprise sizes said they were using wireless data card, with nearly 38 percent reporting a preference for the Verizon Wireless network.

Sprint the second-largest base at 24 percent. And speed apparently matters. Some 81 percent of respondents would switch operators to get faster speeds.

If Microsoft Had Designed GMail...

A funny spoof at http://blogoscoped.com/archive/2007-11-20-n35.html

SME VoIP Still a Challenge

Plenty of challenges continue to face successful providers of hosted or premises-based VoIP services. In its most recent survey of IP communications demand in the small and medium business market, Savatar Research found some “good and bad news and some that is disturbing,” says John Macario, Savatar president.

“We were expecting a bump in the market, based on the last three years of work, or at least a growth rate consistent with the past,” he says. “The bad news is that adoption is flat.” There’s not a lot of growth, he says. SME adoption is stalled at about 17 percent.

“There’s increasing frustration among SMEs,” who apparently haven’t yet gotten the message about benefits, which are clear enough based on feedback from executives who have purchased and use IP communications products and services.

It isn’t that SMEs are buying legacy phone systems. They just are not moving. They’re “just sitting on what they’ve got.” And that’s true both for premises phone systems and hosted offerings, Macario says.

All of which suggests many service providers who don’t know how to serve the market, he notes.

Macario says there is some evidence that buying might even have slowed over the last year. For those who have purchased IP communications products or services, “more than 70 percent purchased more than one year ago,” Macario says. “Only 12 percent have purchased between six months to a year ago.”

“About 15 percent have bought last six months,” he says.

The good news is that “the buyers are insanely happy,” Macario notes. About three quarters of respondents say they have gotten economic benefit while 75 percent say the systems are much easier to manage.

About 84 percent say the quality of their IP systems is as good or better than their old systems. The same percentage say the IP systems are as good or more reliable than the old systems.

As you would expect, 82 percent say the IP feature set is far better. Astoundingly, 95 percent say they would recommend or highly recommend the service or system they now use.

They “really are enthusiastic,” Macario says. Among the most-used IP features is the auto attendant capability. For many SMEs, this is the first system that allows them to do so. Half of respondents say they use it. About a third use group-oriented features or informal call center capabilities as well.

About a third use find me/follow me or simultaneous ring, he adds. About a quarter use click-to-dial and the ability to integrate with Microsoft Office applications. “People are starting to explore the feature set and figure out what else they can do,” says Macario.

But it is wireless services of various types that seem to be top of mind and growing in importance. Wireless related services also seem to have huge potential for inducing churn.

Of those who have deployed some sort of IP communications capability, about 71 percent are very or somewhat interested in FMC as a desktop replacement service, if the pricing is acceptable. About 83 percent would be interested in using it as an add-on or replacement for at least some desk devices.

Asked what else they would consider buying from the same vendor who sold the IP communications service or system, about 40 percent indicated wireless was on the list. About one third would buy Web collaboration tools like WebEx or Live Meeting services.

Demand seems to be just as high even for respondents who have not bought any IP communications service or capability. About 75 percent of those who haven’t yet bought are somewhat or very interested in fixed-mobile solutions.

Some 70 percent said somewhat or very likely to switch from their wireline service to an FMC offering and 70 percent said they would switch from their current mobile provider to get the capabilities.

About 71 percent of respondents who haven’t yet bought an IP solution would be interested in mobile desktop replacement as well.

Respondents say they would be willing to consider replacing at least some desktop phones if doing do saves about 20 percent from their total communications bill.

About 35 percent of respondents say they now pay for employee use of mobiles, picking up between 76 and 100 percent of the cost of the service.

Traditional telcos also are getting more traction and mindshare in the business VoIP space, it appears. For two years, traditional phone companies have got a really low share where it comes to SME executive perception about “who” provides business VoIP servicers, says Macario.

This year, telcos moved seven points higher. About 24 percent of respondents now view telcos as providers of business VoIP. Interestingly, 29 percent said cable companies come to mind as providers of business VoIP.

Non-traditional providers fare best at smaller firms. As firm size goes up, telcos do better. In the 50 to 99 employee segment, only 20 percent say non-traditional telcos are logical providers. And note: the cable gets 22 percent of the votes in that segment category.

That might be surprising for CLEC and other executives who think cable will not get traction in the SME space. “When a CLEC or a pureplay provider knocks at the door, they want to know who they are,” says Macario. “Cable has a brand. That helps.”

Cable already has surprising share at the lower end of the broadband access market. In the one-to-four-employees segment, “about half use cable modems,” says Macario.

“Once you get up to five to 19 employees, then 11 percent have T1s,” he notes. “DSL share is 47 percent, 25 percent T1 at slightly larger firms.”

Overall, says Macario, service providers, in a broad sense, aren’t doing a good job of communicating the benefit of making a switch to IP communications.

More Personalized Digital Media

U.S. consumers across all demographics and geographies appear to be adopting digital behavior that is far more personalized, distributed and niche oriented that executives at Avenue A/Razorfish previously had thought. In fact, a recent survey of 475 consumers found that the majority are personalizing their digital experiences and sampling a wide range of niche content.

Those behaviors span recommendation engines, blogs, customized start pages, video consumption, mobile behavior and use of social media. About 60 percent of respondents have customized their home pages, for example. And 82 percent use bookmarks “all” or “most” of the time.

But there is less use of more participatory features. About 18 percent subscribe to Really Simple Syndication feeds “all” or “most of the time.” About 39 percent read “most popular” or “most emailed” links “all” or “most” of the time.

Only about 12 percent use tag clouds “all” or “most” of the time.

According to the survey, nearly 70 percent of consumers read blogs on a routine
basis, and 41 percent have their own blog, or post frequently to blogs. In fact,
46 percent of consumers who responded to the survey read four or more blogs
on a regular basis. All of that blog activity is significantly cutting into the
reach of traditional media outlets, Avenue A/Razorfish notes.

Some 91 percent of consumers rely on the Web to get current news or information, vastly eclipsing more traditional outlets such as television, Avenue A/Razorfish says.

The growing use of niche content also can be seen in respondent consumption of music and video consumption as well. Some 67 percent of consumers watch videos on YouTube or similar sites on a regular basis and 42 percent purchase music online. Avenue A/Razorfish executives conclude that online video not only is becoming more pervasive but also is affecting offline consumption.

For example, 85 percent of consumers have watched a movie preview online before going to see the film at a theater. Some 58 percent of consumers have used a service to download (iTunes) or order (Netflix/Blockbuster) films online, and 71 percent have watched a TV show online.

Consumers also appear to react positively to recommendation engines and personalized services: 62 percent of respondents have made a purchase based on personalized recommendations (by retailers such as Amazon.com) while 72 percent find such services helpful.