T-Mobile USA Has No Urge to Merge

Deutsche Telekom AG Chief Financial Officer Timotheus Hoettges says there’s no need for further consolidation of the U.S. mobile market, apparently squashing the notion that T-Mobile USA might try to buy Sprint Nextel.

“There are four national players in the U.S. market for 300 million households, while in Europe, where we have 350 million households, there are 50-70 operators,” Hoettges says, according to Bloomberg. “We believe in our chances of being the challenger.”

Getting its third generation network strategy into higher gear remaining a key challenge.

“There is no question that we lost customers because many of our customers couldn’t get 3G.,” Hoettges says. “We now have to make sure that we can capitalize on the network in the top-10 cities where we have invested.”

Deutsche Telekom gets 24 percent of its revenue from T- Mobile USA, which saw its revenue drop 2.3 percent in the most-recent quarter.

On top of that is what T-Mobile USA can do about fourth-generation network capacity, which will require additional spectrum or wholesale sourcing.

So far, T-Mobile USA hasn't ruled out wholesale sourcing or additional spectrum acquisition. Clearwire's 4G network is rumored to be a contender, if T-Mobile decides to source spectrum rather than acquire more spectrum.

Android: What's in it for Google

Why is Google so aggressive about giving away millions of copies of its royalty-free mobile operating system? It is expected to lead directly to mobile search revenue. Jeffries &Co. thinks Google mobile search revenue will cross the $500 million mark in 2011, up from roughly $180 million in 2009, for example.

Android devices will be available on all four leading U.S. mobile carriers in 2010, so the issue is how much penetration the Android operating system will be able to get.

Beyond what Android means for Google, the issue is what it means for the service providers selling devices powered by Android.

There is speculation that Verizon, for example, plans a major initiative centered around Android to battle the Apple iPhone. Verizon apparently has been mulling the value of getting the Apple iPhone, but might have decided to push Android devices and applications instead.

T-Mobile executives have to be wondering what they will do now that Verizon has positioned itself as a major proponent of Android, as T-Mobile had been touting Android early on as a differentiator.

But if all the top-four providers are selling Android devices, using the software to differentiate user experience might become key. Apple prefers to maintain a uniform interface. Android actually enables differentiated user interfaces. So the issue is whether Android supporters will be able to create end user experiences pitched to particular end user segments that are compelling enough to create viable device segments.

Twitter, social networking, Web browsing, email, voice and texting are examples of lead end user applications that have, or can be, the center of "application specific" device sales and usage modes.

Google expects to win by growing its ad business, no matter how many distinct new niches can be created.

4% of Users Account for 67% of Display Click Throughs

About eight percent of Internet users account for 85 percent of all clicks on Web ads, comScore reports. Just as significantly, just four percent of clickers account for 67 percent of all click through activity.

Predictably, there will be two major ways to look at the findings. The first is that online display ads "don't work." The second is that value is not captured by simple click through statistics.

The number of people who click on display ads in a month has fell from 32 percent of Internet users in July 2007 to16 percent in March 2009.

When first studied two years ago, about 3 percent of Internet users clicked on at least one display ad during the month. These clickers were segmented into heavy, moderate and light clicking segments.

In 2007 comScore, Starcom and Tacoda found that heavy clickers, representing six percent of U.S. Internet users, accounted for the top 50 percent of clicks. Moderate users, representing about 10 percent of Internet users, accounted for 30 percent of the clicks.

Light clickers, representing 20 percent of users, accounted for 16 percent of the clicks. By March 2009, those numbers had dropped substantially.

About four percent of Internet users in the most-recent survey would be considered "heavy" clickers. About four percent are moderate clickers. Some eight percent are light clickers.

The issue is what to make of the value of the 84 percent of Internet viewers who do not actually click on ads.

The results, comScore says, underscore the notion that, for most display ad campaigns, the click-through is not the most appropriate metric for evaluating campaign performance. Rather, advertisers should consider evaluating campaigns based on their view-through impact.

Other comScore research has shown that online display ads generate significant lift in trademark search, online and offline sales, and brand-site visitation across all verticals, among those internet users who were exposed to the online ad campaigns, whether they clicked on the ad or not.

“A click means nothing, earns no revenue and creates no brand equity," says John Lowell, Starcom USA SVP. “You want people to visit your website, seek more information, purchase a product, become a lead, keep your brand top of mind, learn something new, feel differently."

Regardless of whether the consumer clicked on an ad or not, the key is to determine how that ad unit influenced them to think, feel or do something they wouldn’t have done otherwise,” says Lowell.

Facebook, Twitter Growth Flattens

No tree grows to the sky, financial analysts are fond of saying, in predicting growth rates for popular new services, applications and device. Twitter and Facebook are no exceptions, it appears.

Somewhere in June 2009 Twitter stopped growing, according to data gathered by Compete. The same thing appears to have happened to Facebook at the same time.

The findings might be more significant for Twitter than Facebook, simply because Facebook has the larger user base, and therefore would have been expected to flatten out before Twitter. Twitter is several orders of magnitude smaller than Facebook.

In September, Twitter unique visitors fell by 0.17 percent, to 23,538,791, according to Compete. Facebook appears to gotten a bump in visits, but Twitter arguably dropped.

MySpace use dropped 11 percent while Bebo dropped 15 percent over the same peiod, so there possibly are some background changes. People might be switching social networks while others might be tiring of using them.

ShoZu Launches App Store

ShoZu Ltd has launched its App Store, where smartphone owners can purchase the ShoZu social media app for most major mobile operating systems. The store complements ShoZu’s availability at Apple’s App Store, Nokia’s OVI store and Research in Motion’s BlackBerry App World.

The ShoZu App Store currently offers the ShoZu app for BlackBerry, Windows Mobile and Nokia smartphones, as well as iPhones, with support for additional models and operating systems to be announced. The ShoZu App Store sells the app for the same price as the third-party app stores.

ShoZu describes itself as an intelligent social media hub allowing people to easily exchange video, pictures and commentary between mobile devices and favorite social networks, photo sharing sites and information resources.

The company’s technology provides fast, easy, one-click uploads of photos and video clips from the mobile to the Web, full-resolution photo and video delivery without compression. It also can push content to the phone and work in the background even if a connection is dropped.

Which User Segments are Most Likely to Switch to Prepaid?

Prepaid wireless has been on a tear of late, growing to 55 million U.S. users and about 17 percent of all U.S. wireless accounts in service. And though prepaid traditionally has been centered on "banking challenged," "low income" or "youth" market segments, that is starting to change as consumers from a wider range of segments seem to be opting for

Often thought of as a "consumer" option, one also has to wonder whether at least some business users might consider switching to prepaid, for at least some employee segments.

That, at least, is what Compass Intelligence thinks could be happening at smaller firms, for example. A recent change that could be driving such interest are new "unlimited" talk and texting plans from firms such as AT&T.

In a recent survey, Compass Intelligence found that a high percentage of respondents indicate plans to give new prepaid devices to one or more employees.

Another segment Compass Intelligence found was interested in prepaid plans are "larger families."  The larger the family, the more mobiles they currently use and the more likely they will replace postpaid wireless devices with prepaid options, Compass Intelligence says.

Users with multiple mobile devices also are more likely to indicate they plan to replace a postpaid wireless account with a prepaid option as compared to other segments.

About 11 percent of the respondents with three or more mobiles are willing to replace one or more of their postpaid mobiles with prepaid, while only three percent of the respondents with only one mobile device indicated plans to do so.

When adding a new device, 22 percent of respondents indicate they will add prepaid mobile.

The apparent relationship between prepaid demand and family size and number of devices is likely the result of U.S. consumers and businesses seeing wireless devices as "nice-to-have" items that are useful for more members of families and employees, along with the ability to limit financial exposure.

One of the advantages of prepaid service is that it can be terminated easily, allowing parents and business managers to quickly cut back on such service if necessary.

AT&T Launches New $60 Unlimited Prepay Plan

 AT&T has launched a new $60-a-month unlimited talk and text plan. AT&T's "Unlimited Talk and Text" plan for GoPhone is available October 12, 2009 and offers unlimited nationwide calling and unlimited texting to anyone in the United States, plus texting to Mexico, Canada and more than 100 other countries worldwide, for an additional fee.

“We recognize GoPhone customers have a need for unlimited calling or texting without the commitment of an annual contract,” says Judy Cavalieri, vice president of Prepaid Products for AT&T Mobility and Consumer Markets.

The prepaid offer comes without contract, and can be paid for completely "as you go" or as a monthly rate plan, without a contract, credit check or deposit.

The offer is evidence of a new level of competiton in the wireless prepaid business, which now is starting to compete more directly with postpaid offers. Handset limitations are emerging as the key difference between postpaid and prepaid offers, to an extent, not usage charges or even form of payment.