IM Most Popular French Online Activity

French Internet users in February 2009 spent more time uisng instant messaging than any other application, including email. Instant messaging claimed the highest share of total time spent at 14.3 percent, followed by social networking at 5.7 percent, say comScofre.  In combination, the two categories accounted for one out of every five minutes spent online during the month. 

Online entertainment accounted for 8.6 percent of time spent and online gaming 2.9 percent share of total time spent online. 

http://www.comscore.com/press/release.asp?press=2763

Wireless "Net Neutrality" Will Lead to Higher Prices

There's a sort of inescapable logic to what wireless network access providers will do if or when mobile VoIP applications are freely enabled, as some policy proponents advocate. Since the entire business model rests on voice revenues, the loss of those revenues will be compensated for in the form of higher mobile broadband access prices.

Existing best-effort plans might be the baseline. But new plans optimized for voice, or conferencing, or other applications, might well emerge. Of course, optimizing might violate some notions of "net neutrality," unless optimizing is available to any provider of voice over a mobile IP network, in which case it might not be a neutrality violation.

But those optimizing services will be an add-on.

You might argue providers can create replacement revenues some other way: selling content or advertising, for example. But the numbers don't work. Build your own spreadsheet and you'll figure that out. There is no conceivable new revenue stream that replaces voice revenues "one for one."

After some years of watching what happens in a robust, mandatory wholesale environment, even European regulators are starting to see what happens. Service providers start spending their money outside the home market, where financial returns are higher.

Investors aren't dumb. Businesses with low growth and margin prospects get less investment than competing alternatives promising a higher return. The current capital stringency is bad enough. Wait until you see a capital strike.

http://www.eweek.com/c/a/Mobile-and-Wireless/Skypes-iPhone-App-May-Force-FCC-Hand-on-Wireless-Net-Neutrality-527564/?kc=rss

Enterprise Twitter is Coming, Gartner Says

Analysts at Gartner predict that micro-blogging tools such as Twitter will be widely available in enterprise versions, and will be used in four ways.

Firms will use Twitter as a marketing or public relations channel, using them as part of wider corporate communications strategies such as corporate blogs.

Firms will tweet about corporate accomplishments, provide links to press releases or promotional Web sites, and respond to other tweets about the brand. Inevitably, some firms will "overreach" and publish uninteresting or obviously self-serving tweets.

Employees also will use Twitter or other micro-blogging applications to enhance and extend their personal reputations, thereby enhancing the company's reputation, Gartner says. Employees will enhance their personal reputations by attracting followers who go on to read their blogs.

As people enhance their personal brands, some of this inevitably rubs off on their employers, says Gartner.

Employees use the platform to communicate about what they are doing, projects they are working on and ideas that occur to them, though Gartner does not recommend this, for security reasons.

Inbound signaling also will be a value for firms, which will find micro-blogging posts a rich source of information about what customers, competitors and others are saying about a company.

http://www.gartner.com/it/page.jsp?id=920813

Communications Still Trumps Entertainment

Getting ready for an upcoming presentation, I've been thinking about the relative value of entertainment services, as compared to voice and data applications.

As important as video is for a telecom provider's business case, as well as its foundational role for satellite and cable companies, my thinking has been that voice and data apps of various sorts have been, and likely will be, more important for firms with roots in the telecom business.

Part of the argument rests on profit margin. Cable and satellite providers can assume they will have high margins. Attackers tend to find more-modest margins, in part because of scale economies that favor providers with high penetration.

Telecom providers tend to see higher margins on voice and data services.

Revenue opportunity also plays a part. The voice and data business simply is far larger than the video entertainment business. Depending on how one categorizes the business, the voice and data service business is twice to three times bigger than video services business.

With the advent of Web and IP-based communications, including email, text messaging, instant messaging and "non-traditional" communication modes such as micro-blogging, blogging, I'd argue the centrality of "communications" has grown, even for activities that might arguably be considered "media" or "content."

Consider that social networking among U.S. broadband users has grown 93 percent since 2006, and has increased the amount of time people spend  communicating online 18 percent, to 32 percent of total online time, according to Netpop Research.

As online communications has increased, the time spent on traditional forms of online entertainment has declined 29 percent, and is now down to 19 percent of total online time.

Video is important; just not as important as voice and data. Communications remains more important than entertainment, at least for firms with a telecom rather than entertainment orientation.

http://www.marketingcharts.com/interactive/social-networking-grows-93-communication-becomes-entertainment-8576/netpop-social-networking-time-spent-communicating-entertainment-online-2009jpg/

Bandwidth is YouTube's Main Cost Driver

YouTube still hasn't figured out a sustainable business model. Ad revenue is the objective, but

most of YouTube's content remains outside the category of "inventory."  Credit Suisse analysts estimate that YouTube will bring in about $240 million in revenue in 2009, mostly provided by home page  placement ads and in-video overlays and adjacencies.

Credit Suisse estimates that YouTube generates approximately $86.7 million a year on homepage placement ads, or about $7 million per month.

In-video ads and banner adjancencies contribute another $87 million, according to the analyst estimates. Sponsored videos ($37.1 million) and sponsored links ($30.1 million) also contribute to YouTube's revenues.

On the cost side, Credit Suisse estimates that Google spends $711 million in operating expenses related to YouTube. Those costs include bandwidth, content acquisition, partner revenue shares, site overhead, and storage.

The biggest expense for YouTube is bandwidth, as you might guess, as YouTube streams about five million videos a month. That costs YouTube about  $360 million a year, or $1 million a day. Keep in mind that observers believe Google pays about half the the lowest "market" rate for

bandwidth.

And Google gradually is assuming some roles more analogous to a traditional network. Credit Suisse estimates that YouTube will pay $260 million in content acquisition costs in 2009.

And despite the estimation that YouTube buys its bandwidth at discounts as high as 50 percent of the lowest "market rates," bandwidth still is the biggest sunk cost.

General overhead represents about $24 million worth of 2009 cost. Storage costs $12.7 million a year.

http://seekingalpha.com/article/129505-google-may-lose-big-on-youtube-in-2009?source=feed

Media at the Tipping Point

IP doesn't just reshape the telecommunications, video entertainment and advertising businesses. It reshapes the rest of the media as well. This trend has been underway for decades, but the tipping point has been reached.

http://247wallst.com/2009/03/24/ten-major-newspapers-that-will-fold-or-go-digital-an-update/

Trade Show Blues

As somebody who spends lots of time at industry trade shows, I'd have to say the temporary economy-induced decline in attendance at virtually all major industry meetings is not the biggest problem. There's less real news or value at these venues than there used to be, in part because information moves with the speed of Twitter and the Web.

That doesn't mean these venues are not important for some attendees. They're still valuable for sales people meeting with prospects in suites, away from the sessions and exhibits. But trade shows now seem to be less mission critical for lots of participants in the ecosystem, if only because the industry is developing other ways of replicating the marketplace functions trade shows and industry media once were a larger part of.

Webinars, podcasts, Web conferences, user group meetings, channel partners, Google and Twitter, Real Simple Syndication, blogs, wikis, even email and YouTube, are rival conversation channels.

Attendance likely will pick up again once the recession is over. But I have greater doubts that the value and effectiveness of the bigger industry meetings will improve.

That doesn't mean all "live meetings" are in this bucket. The more-specialized meetings provide more value, at least from my perspective. A few new or emerging venues have "buzz." EComm stands out in that regard.

But it is the "user group" venues that have, over the last couple of years, started to assume more importance, at least from my perspective. The Voice Peering Forum and MetaSwitch Forum, for example, have been quite useful.

So I've been spending much more time at user group meetings. That's where service and application providers are most concentrated and most easy to engage in conversation. That, after all, is why many of us attend such meetings.

http://www.pcworld.com/article/162551/top_10_signs_of_the_economic_slump_at_ctia.html?tk=rss_main