California Wants $1 Billion in Broadband Stimulus Funds?

The good news is that 96 percent of California's households have access to a high-speed Internet connection, some note. The bad news is that 45 percent of Californians choose not to buy broadband.

Still, California officials are said to be contemplating asking for as much as $1 billion of the $7.2 billion in national broadband stimulus funding. For demand stimulation, possibly.

http://www.sacbee.com/politics/story/1833842.html?mi_rss=State%2520Politics

Everything's Amazing; Nobody's Happy

http://www.youtube.com/watch?v=jETv3NURwLc&feature=PlayList&p=6C3C7034BEA0AA1D&playnext=1&playnext_from=PL&index=7

U.S. Mobile Market Goes North in 4Q; Rest of World Goes South

The U.S. mobile market behaved differently from most of the rest of the world in the fourth quarter of 2008: most markets saw revenue declines; the United States did not..

Mobile end-user average revenue per user dropped between five percent and 15 percent globally in the fourth quarter of 2008, year-over-year, according to researchers at ABI Research. China, India, and a number of other Asian markets dropped more than 10 percent.

In Europe the ARPU contraction was in the range of five to eight percent.

But in North America, ARPU grew, on the strength of mobile data revenues. In South America, markets were more mixed with some markets deflating inline and others, like Brazil, managing to hold up ARPUs, says ABI Research.

To be sure, mobile data revenues are growing in virtually every market. Mobile data (messaging and mobile Internet) contributes 38 percent of Japanese ARPUs, and many European operators depend on mobile data for over 25 percent to 30 percent of their ARPU.

One can only speculate about why the U.S. market has behaved differently. Perhaps, despite the recession, consumers have more discretionary income. Perhaps pricing models are such that variable usage reductions are less attractive. Maybe there is something different about the demand curve for mobile Internet.

Whatever the reasons, the U.S. mobility business was somewhat atypical in the fourth quarter.

http://www.abiresearch.com/press/1421-Economic+Conditions+Reducing+Mobile+End-User+Spending+Up+to+15%25

Vonage Not a Telecommunications Service, Apppeals Court Says

The 8th U.S. Circuit Court of Appeals has upheld a lower court ruling that Vonage is not a telecommunications service provider, and is not required to contribute to the Nebraska Universal Service Fund.

The logic, of course, is that independent VoIP companies such as Vonage provide an “information service” rather than a “telecommunications” service. But the regulatory regime has to be considered unstable.

Cable companies do pay into the USF fund, for example. Also, the time is coming when lots of portals, Web sites and other providers will be offering such information services.

At some point, the typical regulator test--if it walks like a duck, and talks like a duck, it's a duck--will have to be addressed. The regulatory wall between "information services" and "communications services" is going to be hard to maintain, long term.

36% Mobile Marketing Growth in 2009

The U.S. market for mobile advertising will grow 36 percent, increasing from $169 million in 2008 to $229 million in 2009, according to a new forecast by Interpublic's Magna.

That's a downward revision from the company's previous forecast for mobile ad growth in 2009, primarily due to the brutal economy.

The sheer number of mobile devices in use, about 270 million at the end of 2008, according to the CTIA, is one driver. The  mobile Web is the other driver. In January, 22 million individuals accessed the mobile Web daily and 63 million monthly, up from 11 million and 37 million for each frequency during January 2008, Magna says.

The report found that smart phones are key to growth. About 32 percent of AT&T Wireless contract subscribers owning such a device at the end of the first quarter of 2009, more than double that of the previous year, for example.

78% of Small Firms Hold or Increase Online Spending

About 74 percent of small U.S. business-to-business advertisers are either increasing spending over 2008 or keeping it level, according to an Outsell survey of 1,019 U.S. and U.K. advertisers. About 26 percent of these smaller companies are reducing budgets, in contrast with the 40 percent of large B2B advertisers who forecast cuts.

But here's an interesting angle, something other surveys also are showing: small firms increasingly see spending on Web sites as "advertising" and Web site spending is the largest single category of online expense.

Spending on their own Web sites remains the largest item for B2B advertisers, at 59.1 percent and 51.1 percent of total online budgets for small and large firms, respectively.

Online marketing/ad spending is growing among U.S. B2B companies in general—up 8.2 percent from last year among smaller firms, and up 0.4 percent for larger ones.

Small U.S. B2B companies are also growing spending more than 10 percent each for keyword buys on search engine sites, e-mail marketing, industry-specific sites, and webinars.

http://www.outsellinc.com/press/press_releases/ad_mkting_study_highlights

What a Quantum Shift Looks Like

Inflection points--times when a rate of growth or decline shifts to a different trajectory are key business events. More startling by far as quantum shifts, where an entire business model either takes off or collapses.

The basic business lesson is to recognize that when whole new markets are growing, while legacy businesses are declining, one can go for longish periods of time where the change seems to be simply quantitative.

You see slightly more of the new stuff, slightly less of the old stuff, but within a business environment that seems stable.

Then the quantum shift occurs and something entirely new appears, as in a flash. That's pretty much what is happening now, in the print media space.

But lots of other businesses have some exposure to quantum shifts. Just about anything touched by Internet Protocol or bandwidth has at least some exposure to sudden quantum shifts.

To be honest, those of us who make forecasts always use linear thinking. Excel forces you to do that. Most of the time that works. Except when a quantum shift occurs. Then everything changes, very rapidly.

Sort of like water changing to ice, or water to steam: one minute you are dealing with one sort of element; the next moment, it is something else.

http://247wallst.com/2009/05/03/the-sun-sets-on-businessweek-forbes-and-fortune/