Back to the Future for Internet Apps?

Time spent on social network and blogging sites accounted for 17 percent of all time spent on the Internet in August 2009, nearly triple the percentage of time spent in 2008, says The Nielsen Company.

“This growth suggests a wholesale change in the way the Internet is used,” said Jon Gibs, vice president, media and agency insights, Nielsen’s online division. “While video and text content remain central to the Web experience, the desire of online consumers to connect, communicate and share is increasingly driving the medium’s growth.”

In some ways that is a "back to the future" move, as it was email that drove the dial-up Internet access business. After waves of growth driven by online commerce and then entertainment, it appears communication might again be moving to the forefront.

70% of Mobile Users Planned Mobile Spending Cuts. Have They?

An October 2008 survey by Getjar suggests users were planning significant changes in mobile consumption in response to the recession. It still isn't completely clear whether people actually followed through with action, what adjustments they might have made, or how how much less they might have spent.

About 70 percent of mobile phone users who partcipated in the survey suggested they planned to reduce the amount they spend on phone usage. So far, the revenue impact remains hard to quantify, though.

Water is the Issue in West, Solar No Exception

A National Park Service official has warned the Bureau of Land Management that approving dozens of solar power plants in southern Nevada could dramatically impact water supplies across the arid region, the New York Times reports.

An estimated 63 large-scale solar projects are proposed for BLM lands in the region, and the plants are expected to use a large amount of groundwater to cool and wash solar panels, according to the Feb. 5 memorandum sent by Jon Jarvis, director of the Park Service's Pacific West Region, to BLM's associate state director in Nevada.

Jarvis also wrote that the Park Service is concerned that the projects could produce air and light pollution, generate noise and destroy wildlife habitat near three NPS properties: the Devils Hole section of Death Valley National Park, the Lake Mead National Recreation Area and the Mojave National Preserve.

"In cases where plans of development have been submitted, the vast majority of these projects propose to use utility-scale, concentrating solar power technologies" that "can be expected to consume larger amounts of water" for cooling than other technologies, Jarvis wrote.

"In arid settings, the increased water demand from concentrating solar energy systems employing water-cooled technology could strain limited water resources already under development pressure from urbanization, irrigation expansion, commercial interests and mining," he wrote.

As such, the proposed solar plants "potentially face several water-rights related obstacles in obtaining the necessary water for their projects."

There always are trade offs in real life. Water-cooled solar farms are no exception.

Net Neutrality: Do You Want Random or Planned Blocking?

Strong forms of "network neutrality" that allow no prioritizing of Internet traffic pose clear issues for real-time services such as video and voice, at times of peak load. Since all real-time services are highly susceptible to congestion, peak hours may not be optimal times to use them. The problem is that "peak hours" are when users most want those services available.

So the issue is simply whether users prefer random disruptions of quality, or planned disruptions of the quality of some applications, in order to provider optimal performance for real-time services. Since no federal rules are going to abolish peak consumption hours, the only practical issue is what methods are used to limit network access at times of peak congestion.

One can specify that no packets are blocked or intentionally slowed. But that only shifts the congestion control mechanism. Users will find their voice and video sessions don't work that well, and will restrict their use of those services at times of peak congestion.

The other approach is to prioritize applications so the burden of congestion is shifted to lower-priority communications or applications; to users with demonstated "very-high usage" profiles; users who already have exceeded fair usage caps or users at congested cell towers.

Some service quality degradation, at peak hours, will happen. The only issue is how the congestion issues are distirbuted.

One might argue that congestion effects also could be distributed based on whether users have opted to buy "best effort" usage plans or "assured access" plans. But higher-quality, assured access is not possible when packets cannot be prioritized.

Congestion issues, despite network upgrades, always will be a fact of life for networks. The only practical issue is how network degradation is handled. It can be random, or it can be planned. How any new network neutrality rules are framed will determine whether planned mechanisms are allowable.

AT&T Launches Picture, Video Communication for iPhone Today

Apple iPhone users likely will be putting strain on the AT&T wireless network today, Sept. 25, 2009,. as multimedia messaging service, which allows iPhone users to send and receive pictures and video, is made available for the first time.

But the issue is going to grow in significance. Pyramid Research estimates mobile video usage will grow at a compound annual growth rate of 28 percent over the next five years. By 2014, more than 500 million users worldwide will subscribe to mobile video services, equal to 8.5 percent of all mobile subscription services.

That might not seem like much, but video requires about one to two orders of magnitude more bandwidth than voice (10 to 100 times).

YouTube says mobile uploads over the last six months have grown 1700 percent. and users have grown 70 percent.

MVNO Business to Grow Outside North America, Europe

The mobile virtual network operator business is headed for growth, and most will come from regions other than North America and Western Europe, says TeleGeography.

Globally, growth in wireless subscribers has been driven predominantly by explosive growth in a small number of developing countries, such as China, India, Russia, Brazil, Indonesia, Vietnam and Pakistan. These are countries in which MVNOs are either prohibited or at a nascent stage of development, so the ultimate impact on the MVNO market is not yet clear.

In 2003 MVNOs accounted for seven percent of subscribers in Western Europe and North America. At the end of June 2009 wireless subscribers had grown by almost 60 percent in these two regions to reach 800 million, and MVNOs’ share had increased to over nine percent.

In contrast, from 2003 to mid-2009 the number of wireless subscribers in regions other than Western Europe and North America more than quadrupled to reach some 3.5 billion. However, MVNOs have yet to make much impact in these higher growth markets: outside of Western Europe and North America, their share of the market remains less than 0.5 percent.

So while MVNOs have been growing strongly in Western Europe and North America, those two regions account for an ever-smaller portion of the world’s wireless subscriber base – it slipped from almost 40 percent to less than 20 percent. That suggests that future MVNO subscriber growth necessarily will come from other regions.

In 2003, Western Europe and North America accounted for well over 90 percent of all MVNO subscribers and, despite some growth elsewhere, these two regions still account for over 80 percent of the total.

TeleGeography’s latest research predicts that MVNO growth will gain momentum all around the world over the coming five years, as MVNOs are legalized in new countries where they are not allowed at present.

Will Net Neutrality Lead to Higher Prices?

One can make some reasonable guesses about likely outcomes as the Federal Communications Commission weighs new network neutrality rules.

If new proposed rules disallow traffic shaping measures such as slowing peer-to-peer or other traffic at times of peak congestion, the problem of alleviating peak-hour congestion will still have to be dealt with.

If the goal is to manage peak traffic load, and service providers cannot shape traffic by slowing some protocols, or slowing all traffic for users who have exceeded their usage caps, then other available mechanisms will be used.

And price is one of the most-likely tools.

Customers might not like it, but it always is possible to discourage usage by raising prices. And it always is possible to boost usage by lowering prices. And it is wireless plans where the price hikes--or user policing of usage--will be most felt.

If usage caps are tightened, consumers will have the option of spending more, or using less.

That doesn't mean "unlimited" service packages will disappear. Some customers will want to buy them. But the price of such packages likely is going to rise. For similar reasons, usage-based charging is likely to increase for most other plans as well. That will encourage users to monitor their usage and make choices that will alleviate peak hour strain on networks.

As a practical matter, wired network operators already refrain from blocking access to lawful applications, and traffic shaping rules already are tweaked so the policies do not constitute "blocking" or "slowing" of lawful traffic.

But wireline operators have more access bandwidth than wireless providers do. So Oppenheimer financial analyst Tim Horan suggests that wireless usage caps will become more stringent.

Among other possible strategies is structuring pricing to encourage more usage off-peak, as is the case for voice plans.

Application blocking is less an issue than most assume on wired networks, and is a relatively minor irritant for most wireless users, but a significnat irritant for some users on wireless networks.

The real trick is how service providers will handle peak hour loading under new conditions where traffic priorities cannot be applied, as typically is the case for many private enterprise networks.

One other observation also is in order. As was the case the last time a major change in communications regulation was made, with the Telecom Act of 1996, there will be a period of legal wrangling to test and flesh out the rules.

Though most within the communications business would vastly prefer more predictability of business environment, that is not what they are likely to get.