More Price Regulation Coming?

Though European Union regulators are putting strong pressure on Europe's service providers to dramatically lower data and voice roaming costs, that isn't likely to happen anytime soon in Asian markets, says Rosemary Sinclair, International Telecommunications Users Group external relations officer, and reported by CommsDay.

“The significance to me of what has happened in the EU is that it indicates to us that the cost structure of delivering these calls is much, much lower than the retail prices,” Sinclair says. “The operators know exactly what the costs of services are,
but they are not prepared, without regulatory oversight, encouragement,
or if necessary, intervention, to do something about it."

"At the moment, as far as I can see, the only thing that would fix this is regulatory action," she says.

Service providers take notice: a re-regulatory wind is blowing around the world, though it isn't as windy everywhere. Telstra seems to be in a different situation than EU carriers. U.S. carriers have enjoyed a decade of less intense regulation. But there's one thing you can be sure of: it the telecom business, no set of rules, and no climate, lasts forever. The next swing will be back the other way.

Vonage Shifts Tactics

In its efforts to control marketing cost, Vonage has been targeting geographic regions where it has a greater chance of signing up customers with high need to call international destinations. For the most part that means urban areas with large immigrant populations.

So although Vonage's marketing up to this point has been able replacing other landline services, the new value pitch is more nearly the "cheaper long distance" segment whose buyers might otherwise be looking at calling cards, dial-around or other ways of calling globally for less money.

The move highlights a perhaps under-appreciated aspect of the voice communications business. Though most executives think "voice is a commodity," and are right in most respects, an argument can be made that voice is not actually a "commodity" in a classic set, but rather a set of "commodities," or perhaps not a classic commodity at all.

Sugar, salt and flour generally are classic commodities. But sugar is not a substitute for salt or flour. In that sense, mobile communications is not generally a substitute for landline voice, a business phone system, PC-to-PC communications or texting, though in some ways each of these modes is partially a substitute for each of the others.

Even email, surely something most people would say is a commodity, is not completely so. Mobile email is a different product than Gmail, or else everybody would be using mobile email. The point is that the mode of consumption, the cost of consumption, the places and time where consumption occurs, as well as the essential required features for successful use, are not so substitutable as to make all of them fully interchangeable commodities.

And the point of that observation is that industry proponents sometimes do not work hard enough at understanding the real differences that make each of these modes and use cases "different products." Which is to say, no commonly interchangeable commodities.

The point at hand is Vonage's new marketing pitch. True, for some users Vonage is a substitute for legacy wired voice service. For others, it is a substitute for long distance calling, calling cards, callback service or dial-around.

To say voice is a scale or volume business, a low-margin business or even a "bulk" business is one thing. To say it is a "commodity" business might be more correct within a single segment or use case. It is wildly incorrect across the full range of use cases that "voice" now represents.

Some might point out that short message service (text messaging) is a distinct business. Others will say it is part of the mobile voice business. Some might say it sometimes is part of the mobile business, and sometimes a "PC-initiated" and "mobile terminated" business.

If such opinions can exist, it is confirmation of the "non-commodity" (in the sense of non-interchangeability) nature of the business.

That isn't to say differentiate is easy. It is hard. But to argue it cannot be done, because voice is a commodity, is off the mark. That isn't to say it is easy to differentiate without obtaining scale. Providers might rationally choose not to differentiate. But that is different from arguing "they cannot."

Android, iPhone: Finding the New in the Old

Sometimes the insight that leads to an assault on a new market is to discover the new market hidden in the weeds of an older and established market. Incumbents in the mobile phone market have dismissed the Apple iPhone simply because the volumes of devices shipped by the leading players is so overwhelming.

Though it is less often said, the same sort of dismissal could be aimed at Android, the open-source operating system under development by Google and 30 or so other partners.

And it's hard to argue with that perspective. Unless you dig in the weeds and reimagine a market. If one looks at smart phone (perhaps more aptly described as mobile PC or mobile Web device)penetration, it is still quite low.

Looking just at smart phones, which have low penetration, the market volume to be shared by all players is still quite small, so the market share doesn't have nearly the same meaning it would in a large volume market.

"Smart phones" or "mobile Web" devices or "conference in a pocket phones" or "email in a pocket" phones remain a developing market, not a saturated market. So new players still have a shot of ultimately achieving significant influence and share, no matter how small their efforts might appear if the market is defined as "mobile phones."

Hughes de la Vergne, Gartner analyst, estimates that even powerful Symbian has just two to three percent share of the U.S. smart phone operating system market, for example.

But that's just the U.S. market. The numbers certainly look daunting just about everywhere else.

SMEs Ripe for IP Managed Services, Says Nortel

Fifty percent of SMBs surveyed have voice networks three or more years old, and despite the fact that nearly half characterize themselves as "early adopters" or "on the leading edge of new telecommunications technology," only 40 percent have actually implemented VoIP or any IP-based mobile convergence solution.

"The research clearly indicates a great opportunity for service providers to target SMEs," says Alf deCardenas, Nortel general manager.

The research conducted by Ronin Corporation involved surveys of some 900 SME and enterprise decision makers across the United States, France and the United Kingdom.

Among other findings, the research found that SMEs are more likely to go to service providers than resellers for voice hardware and Internet services. The ability to make phone calls over WiFi and cellular networks using a dual-mode phone is the service SMBs are most likely to consider for implementation, followed by Web services like click-to-connect and converged desktop applications that allow them to easily control calls from any cellular phone using a laptop application.

Slow Email? BlackBerry Outage

Research In Motion Ltd. says an outage left users in North America without access to their BlackBerry email service on Monday, beginning about 3:30 p.m. Eastern Standard time and lasting about three hours.

RIM says no messages were lost during the incident, which caused intermittent delivery delays. No explanation for the outage has been given.

Outages of this sort are the reason many of us are giving more thought to backup and redundancy strategies. On a recent business trip, for the first time in my life, I accidentally left my laptop at home, and was going to be gone for 14 days. True, I had the BlackBerry and another mobile as well.

But in my line of work access to the Web is arguably more important than either of those two sorts of devices, as important as they are. Because of Google Documents & Spreadsheets and Google Broswer Sync, I was able to keep working using public terminals and loaned machines, with access to Microsoft Office.

I also learned to live without access to Outlook for a bit. The BlackBerry helped, of course. The lasting change so far is that I have kept using Google Documents more than I have in the past. That's why sampling is so important. Behavior can change.

HD DVD War is Over

Consumers baffled by the competing high-definition digital video recorder standards soon will be able to go ahead and buy without concern they have backed the wrong horse in the race. Blu-ray has won.

One more sign: Netflix is going to stop carrying titles in the HD DVD format.
Netflix has stocked both Blu Ray and HD DVD titles since 2006. But all HD DVD discs will be cut from their inventory by the end of the year. Netflix also has stopped adding new HD DVD titles to its inventory.

Blockbuster last summer had made a similar decision.

The format victory is a surprisingly rare event for Sony, which developed and has pushed for Blu-ray. In prior format wars it has lost, fairly consistently. It backed Betamax, but lost to VHS.

So go ahead and buy a Blu-ray HD DVR. It's the winner.

Belgian Mobile Operator Wants to Kill Fixed Line

Belgian mobile operator Mobistar is intensifying its efforts to take market share from landline provider Belgacom by aggressively targeting its larger rival's fixed line subscribers. The Mobistar AtHome product allows users 40 hours of mobile calls from the home for 10 Euros a month.

About 35 percent of Belgian households no longer possess a fixed line telephone and another 28 percent are prepared to give theirs up if there is a good alternative, some researchers have found.