AT&T "Might" Target Ads in Future

Might AT&T monitor the Web-surfing habits of its customers to target advertising at them? Maybe, says Jeff Bounds, Dallas Business Journal staff writer. But not without giving customers control over their information, protecting their privacy, giving them value and ensuring “ransparency, AT&T says. Customers would have to opt in to the targeted ad program. 

AT&T made the remarks in a letter to the U.S. House Committee on Energy and Commerce, which is looking into Internet advertising tailored to the viewing habits of specific customers. The letter from AT&T executive Dorothy Attwood, dated Aug. 13, says the company does not currently monitor the surfing habits of its users. But the company says it is considering that option.

It is fairly clear that incentives will have to be offered to users to gain their consent to be tracked online. Opt-in programs typically do not get high penetration without inducements of some sort, and one tactic that typically works is providing some clear sort of financial inducement. Users might be offered "no additional cost" access to desired content that otherwise would be purchased. 

And behaviorally-targeted ads would fit with that scenario, as one complaint most users have is that advertising they see is not relevant. Behavioral targeting would increase the likelihood that delivered ads have more relevance, reducing the irritation factor. 

Nobody knows yet how big targeted advertising will become, but just about everybody thinks it has nowhere to go but up. Still, lots of privacy and "control of data" issues must be resolved beforehand. 

Mobile Versus Fixed WiMAX?

Nobody yet knows what percentage of WiMAX customers will use the access technology in fixed mode, compared to mobile mode. If Motorola is right, about equal numbers of each, with a smaller percentage, perhaps up to 20 percent, operating in both fixed and mobile mode. 

Globally, it seems likely that fixed access will be much of the demand. In the U.S. market, though virtually all current users are in fixed mode, the new Clearwire operation should result in a growing percentage of mobile users. 

$8 Billion Connected Games Market Demands Low Latency

In 2013, online content and services for Internet-connected game consoles will generate over $8 billion in global revenue for Microsoft, Sony, and Nintendo, the three console manufacturers, according to researchers at Parks Associates. For that to happen, users will rely on low-latency, high-bandwidth broadband connections. To sustain the low-latency response, it seems inevitable that some sort of packet prioritization will be necessary. 

No Slowdown in IT Spending: Gartner

Despite current economic concerns, worldwide IT spending will exceed $3.4 trillion in 2008, an increase of 8 percent from 2007 spending, according to Gartner researchers. But analysts also note that much of this growth is based on the decline in the U.S. dollar. The estimated worldwide IT spending growth expressed in constant currency is forecast to be approximately 4.5 percent.

“The U.S.-led economic downturn shows no sign of causing a recession in IT spending,” said Jim Tully, vice president and distinguished analyst at Gartner.

“Organisations are switching from company-owned hardware and software assets to per-use service-based models. This will impact the industry in various ways,” Mr. Tully said. “The projected shift to cloud computing, for example, will result in dramatic growth in IT products in some areas and in significant reductions in other areas.

Worldwide software spending is on pace for the strongest growth rate in 2008 at more than 10 percent. IT services spending ranks a close second with more than 9.4 percent growth.

“Most companies updated their software systems during the period 1997 through 2001, so we are in the middle of an upgrade cycle that should extend past the end of this decade,” says Joanne Correia, managing vice president at Gartner.

IT spending is dominated by services rather than products. Together, IT services and telecom services account for 70 percent of total IT market spending. Gartner analysts said the telecom sector has a major effect on overall IT market performance, accounting for almost $2 trillion in 2008. 

“Legacy telecom services have a dampening effect on sector growth, and therefore on the overall IT market,” said William Hahn, principal research analyst at Gartner. “The dominant size of the telecom services market guarantees that even with the forecast for relatively slow growth, it will still comprise over 44 percent of the IT market in five years time.”

The outlook for IT services market growth has improved despite macroeconomic uncertainty. “Spending in IT services is being supported by two main factors,” says Kathryn Hale, research vice president at Gartner. “Businesses are investing in improvements to internal processes aimed at reducing costs, while often maintaining some of the prior interest in innovation. The second factor is that globalization allows IT services providers to mitigate the risk of weakening demand by operating in more markets.”

The main area of hardware growth activity is PCs, which represents 60 percent of total hardware spending. Growth in PCs is stronger than previously expected, with no signs of a slowdown. The U.S. forecast has increased marginally while forecasts elsewhere, particularly Asia/Pacific and Western Europe, have increased significantly.

Behavior Targeting Is Not DPI

Targeting advertising is seen by U.S. cable operators as a way to grow advertising revenue from $5 billion annually to about $15 billion annually. Mobile operators also have high hopes for targeted, location-aware ad targeting for mobile users.

At least for the moment, though, behavioral targeting is under a bit of a cloud. In the midst of Congressional pressure to assure user privacy, service providers seem to have suspended deployment of behavior targeting systems that allow them to target ads to specific users, at least until privacy compliance issues can be cleared up. 

Charter Communications, Embarq, CenturyTel, Knology and Wide Open West are said to be among service providers that had been testing or deploying behavioral advertising technology from NebuAD, for example.

So it isn't surprising that providers of deep packet inspection systems are getting asked lots of questions about the possible impact on DPI technology and uses. On the contrary, says Cam Cullen, Allot Communications director, DPI technology is more importand in an environment where service providers might have to demonstrate they are complying with bandwidth management or privacy rules. Blocking of child pornography sites are another example of a legal requirement that requires DPI. 

"You now must demonstrate you are behaving fairly" and DPI records will substantiate compliance, says Cullen. At the same time, Allot is seeing greater demand for the ability to assure priority for video and voice applications. 

And since any ad targeting capability will require clear opt-in and opt-out policies, DPI will be essential in that regard as well. 

Also, usage-based pricing requires counting packets on a per-user basis. A service provider might offer an unlimited VoIP plan, for example, with a data usage quota of 100 Gbytes a month. To avoid potential user ire, the service provider might want to separate those bits into different buckets, so VoIP packets do not come out of the 100-Gbyte quota.

Ed Markey, chairman of the House Subcommittee on Telecommunications and the Internet, and other high-ranking Congressman have questioned whether ad targeting practices (without explicit and clear opt-in policies) run afoul of the US Communications Act of 1934, the Cable  Act of 1984, the Electronic Communications Privacy Act, and other wiretapping-related US statutes. 

Behavioral targeting has gotten lots of service provider and content provider attention because it provides the sort of end user activity that Google and Yahoo already largely have, says Yankee Group analyst Daniel Taylor, giving ISPs a shot at what some believe will be a $50 billion U.S. targeted advertising business. 

Behavioral targeting servers read the content of nearly every Web page that users visit, allowing unparalleled ability to discern user interests and activities. The problem is that targeting has generally has required an  "opt out" process (you get it unless you opt out) rather than an opt-in process (you are not targeted unless you agree). 

DPI, though, is not behavioral targeting. Behavioral targeting is used to analyze trends and identify Web page hits, site views and keywords. DPI is a tool used to provide granular inspection of IP packet headers and payloads for Layer 4 through Layer 7, destinations, application type and protocols, says Taylor.

DPI is a network monitoring and management tool that can be used to improve efficiency and provide quality of service.

DPI technologies can also be used in conjunction with advertising insertion servers, which is where the confusion between DPI and behavioral targeting occurs. In fact, Taylor thinks behavioral targeting raises so many issues it simply should be avoided, at least for the moment. 

U.S. Enterprise Ethernet Up 16% in 2008

U.S. business Ethernet ports in service grew more than 16 percent in the first six months of the year, according to Vertical Systems Group. 

AT&T accounted for 21 percent of total ports, followed by Verizon with 15 percent, TW Telecom with 13 percent and Cox with 10 percent.  Rounding out the top tier of Ethernet service providers with more than 5 percent share were Qwest (8 percent), Cogent (7 percent) and Time Warner Cable (6 percent).

XO, AboveNet, Level 3 and Reliance Globalcom (formerly Yipes) lead more than forty other companies delivering retail Ethernet services to business customers in the U.S.  Other Business Ethernet providers in alphabetical order include: American Fiber Systems, Alpheus Communications, American Telesis, Arialink, Balticore, Bright House Networks, Charter Business, CIFNet, Cincinnati Bell, Comcast Business, Embarq, Expedient, Exponential-e, Fibernet Telecom Group, FiberTower, Global Crossing, Integra, IP Networks, LS Networks, Masergy, Met-Net, Neopolitan Networks, NTELOS, NTT, One Communications, Optimum Lightpath, Orange Business, Paetec, RCN, Savvis, Spirit Telecom, Sprint, SuddenLink, Surewest, US Signal, Veroxity, Virtela, Windstream, and others.

Phweet Escalates Calls into Conferences

No one has measured the numbers of teams that work together virtually, but some estimate there are more than 1.89 billion workers worldwide. While Gartner Dataquest has claimed that almost 41 million employees worldwide will be teleworkers by the end of 2008 (working at least one day a week from home), Wainhouse Research believes that the numbers of distributed and mobile workers far exceed that number. Furthermore, the total number of distributed workers, including teleworkers, could reach as much as 100 million worldwide, Wainhouse suggests.

In principle, Phweet, a new application based on Twitter, might ulimately help all those distributed workers communicate. A Phweet begins as a person-to-person call, but Phweets are meant to be social and so any Phweet can be instantly transformed into a multi-party conference call.

When you Phweet someone, you can decide to make it “private” (sent with a Twitter “direct message”). In that case, you can still add people to the call, but only people you explicitly invite to the call can join in (and they must be following you on Twitter).

Otherwise, a Phweet is sent using the public twitter stream (with a message such as “@phweet http://phweet.com/Gyfc India PhweetUp at 3 pm today. Join by clicking url.”) and in this case anybody that sees that URL can click the link and request to join.

The “host” then can approve that user and let them into the Phweet. In other words, the Phweet URL can be sent to anyone, using any means available, it doesn’t have to be sent only via Twitter. Skype chat and RSS feeds can be the notification vehicles.

One objective of a Phweet is to make the path from tweeting to talking quick and easy.