Recession Spurs SMB Shift to Conferencing, Away from Overseas Travel

The global recession seems to have spurred more thinking--and activity--by businesses large and small about the use of conferencing services and applications as a replacement for business travel.

A recent survey of U.K. users by Skype indicates that about a quarter of U.K. small and mid-sized businesses have started using conferencing and communications to displace international travel.

Although 24 percent of U.K. small business executives surveyed communicate with international colleagues on a daily basis, 54 percent say they have had to take unnecessary overseas trips when conferencing would work.

The emergence of more sophisticated technologies is having a clear impact on the way that businesses are opting to communicate and do business.

About 41 percent of respondents says they use instant messaging to avoid some travel. About 40 percent use Skype, while 34 percent use teleconferencing. About 28 percent say they use some form of video conferencing.

Video-based communication likely is the biggers winner as travel substitutes have been sought.

Significantly, almost half of SMEs in the United Kingdom (49 percent) are planning to increase the amount it is used for business and 59 percent indicate it will be a direct replacement for business travel.

That isn't to say other methods are ineffective. About 65 percent of respondents said email was effective. Voice was seen by 39 percent of respondents as effective. Video calls were seen by 36 percent of respondents as effective, compared with 29 percent citing Skype.

About 17 percent say instant messaging is effective. About nine percent say social networking is effective as well.

But 36 percent of respondents said they miss having a real picture of the person that they are dealing with. For videoconferencing as for entertainment television, the advantage of "realism," a greater sense of "being there," is what drives image or audio resolution, high-definition images and audio, bigger displays and ease of use.

“With the obvious cuts in business travel, companies need to find new ways to communicate, collaborate and compete,” says Stefan Oberg, Skype for Business VP.

“Without regular face to face meetings, tools that enable people to build and maintain trusted relationships are key," he says.

ComScore Hit for "Pay to Play" Plan

"Pay to play" business arrangements are unfortunately all too often a cost of doing business. Grocery retailers get stocking fees from suppliers who want better placement, or placement at all, on retail shelves.

Some industry awards essentially are sold. Firms win awards in some category of business excellence, but have to pay money to "announce" the awards. Other competitions require firms to pay money to apply to win.

Trade publishing often involves some explicit promise of coverage in return for advertising, or more commonly, just an implied obligation. Major conference sponsorships nearly always have some element of "taking care of sponsors."

You can make your own decision about whether this is simply a way of doing business, or something worse.

Now comScore is accused of promoting a version of pay-to-play with its Web traffic ratings by Henry Blodgett at Silicon Alley. He says the new policies are a form of blackmail.

http://www.businessinsider.com/henry-blodget-comscore-blackmail-pay-us-10000-or-well-keep-underreporting-your-traffic-numbers-2010-1?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+typepad/alleyinsider/silicon_alley_insider+(Silicon+Alley+Insider)&utm_content=Google+Reader

Android Downloads Explode, Apple Continues High Growth, BlackBerry Leads

Visits to Myxer’s mobile site from users on the Android operating system grew 350 percent in 2009, compared to iPhone, which grew 170 percent, Myxer says.. In total, Myxer delivered seven times more downloads to Android devices than iPhone devices in the fourth quarter of 2009.

Keep in mind that Android starts from zero share, so extremely-high rates of growth are not unexpected. The bigger news would have been Android downloads failing to gain traction.

The analysis was made on Myxer’s 30 million members and their behavior relating to mobile entertainment downloads.

In part, Android growth is driven by the increasing number of Android devices now available, as well as a huge marketing push by Verizon Wireless to support its Droid introduction.

In December 2008 only one handset, the HTC Dream/G1, was operating on Google’s open source Android operating system. By December 2009, Myxer had seen nine different handsets running the Android OS.

• The HTC Dream/G1 remained the leader throughout 2009 garnering 35 percent of the unique users completing downloads on Android handsets. That makes sense, as the Verizon Droid launch did not happen until December 2009. It would be shocking if the Droid did not appear at the top of lists by the end of 2010.

“While we’ve seen the Android OS emerge as a serious competitor in the operating system landscape, RIM’s operating system still dominates the smartphone market on Myxer’s mobile site, growing from 51 percent in 2008 to 67 percent in 2009,” saysMyk Willis, Myxer CEO.

According to research conducted in the fourth quarter of 2009, Android users download seven times as many ringtones, wallpapers, videos, applications, and games as iPhone users.

Still, Apple iPhone downloads also grew 170 percent.

On the other hand, it is worth noting that RIM’s Blackberry Curve remains the number one phone on Myxer’s mobile site for the second year in a row, garnering close to 10 percent of visits in both 2008 and 2009. The Blackberry Curve is just one of the 1,500 different handsets that Myxer delivered content to in 2009.

Windows Mobile and Palm both lost ground in 2009, combining to relinquish 24 percent of the smartphone traffic on Myxer’s mobile site and giving ground to the Android, iPhone, and RIM.

How Will Global Telecom Revenue Sources Change Over the Next Two Years?

Looking at global telecom revenue sources over the next couple of years, some basic trends can be seen (click image for larger view).

Fixed network services other than broadband continue to decline.

Wireless revenues continue to grow, as does broadband access revenue.
Dial-up access revenue continues to decline.

Keep in mind that these are global, aggregate numbers, buoyed by huge broadband and especially wireless growth in developing regions. The patterns can be quite distinct in specific national markets.

In the U.S. market, it is conceivable that video and content revenues could be a somewhat significant factor over a decade-long time frame. Wireless growth will be highly susceptible to broadband and data services growth, balanced by a certain amount of "harvesting" of mobile voice revenue, which will decline, relative to broadband, over the decade.

It is worth noting that voice revenue trends have been through two fundamental cycles, with a third on the way. At one time, international long distance was the highest-margin product, followed by domestic long distance. That changed fundamentally between 1997 and 2007. Over that 10-year period, long distance, which represented nearly half of all revenue, was displaced by mobile voice services.

Since about 2000, fixed voice lines and revenue have been steadily declining, at least in the telecom service provider segment, with the cable segment able to grow the role of voice in overall revenue.

In the third change, mobile voice will follow a trend similar to that of long distance.

In each of the shifts already occurring, several things happened. Prices and profit margins steadily were compressed. And new competitors picked up significant share of the remaining business. In each of the three periods, the product has changed.

Between about 1997 and 2007, "long distance" became loosely coupled with local calling and local access. Long distance increasingly could be consumed "over the top," using prepaid calling cards or separate providers for "long distance" on a local line, for example.

Between 2000 and 2009, it became possible to use mobile phones to similarly displace both local and long distance calling, as well as to substitute mobility for fixed voice, while both over-the-top and IP-based calling options became available.

Over the next 10 years, both voice itself and long distance calling in the mobile and fixed realms likewise will be increasingly disaggregated and amenable to "over the top" consumption.

At the same time, the number of settings where voice is used likewise will disaggregate. Voice will be used as an embedded feature of many types of applications and experiences, using many types of terminals and featuring multiple revenue models.

Cablevision and Scripps Networks; Fox and Time Warner Cable Deals Have Implications for Telcos and App Providers

Cablevision and Scripps Networks Interactive have reached an agreement that paves the way for the return of the Food Network and HGTV programming to the cable operator’s system. Inability to come to terms meant HGTV and Food Network disappeared from Cablevision after the old contract expired on Dec. 31, 2009 and the two sides could not agree on terms for a new contract.

Separately, News Corp and Time Warner Cable managed to agree on a new deal without a service interruption. That deal meant no service interruption for viewers of the Fox television stations, Fox, Fox Cable Networks and Fox’s Regional Sports Networks.

That deal also covers Bright House Networks sibscribers in Florida.

DirecTV and Versus have not come to terms and Versus has been dark on DirecTV since Nov. 11, 2009.

Contract disputes between programmers and cable operators are not new, and the precedent likely applies to telcos and their application providers and handset providers as well. Which is to say that although all the value chain or ecosystem partners rely on each other to create end user value, each participant has a specific role in the value chain and distinct financial interests that have to be accommodated.

The same sort of thing exists in the online video and music and e-book reader spaces as well. The point is that there is a temptation to see application providers and Internet access providers as enemies with little in common. In fact, applications make networks valuable, and without networks, the increasing number of valuable network-based services cannot work.

Of late there are signs some of the former tension between Google and some ISPs, for example, has melted. Google and Verizon are working together on creating applications and optimizing Android device operation on the Verizon network, for example.

That isn't to deny that some amount of tension always will exist between ISPs and application providers. As the cable, music (Apple and music companies) and online video examples illustrate, each participant always will seek to maximize their own value and revenue within the overall value chain and ecosystem.

Financial interests are distinct, not identical. Ultimately, though, a stable ecosystem producing end user value will benefit from some stable understanding that key value chain participants all must profit, if the widest use of new applications and maximum end user experience are to be supported.

It won't be easy. Skype is a contributor to the declining value of basic voice revenues, for example. App developers obviously want to secure a place in the revenue and value chains. ISPs want to continue restructuring their own revenue models away from voice and towards new services based on IP networks.

Over-the-top app providers often believe they "don't need the ISPs." But over time, as the cable example shows, and as music, video and print content value chain participants will have to continue to work out, the best outcome is a flourishing new value chain where the key participants all win. That's best for providers and best for end users. Though it certainly will not be easy, it is the best way forward.

More "Middle Mile" Projects Funded by NTIA

The Department of Commerce’s National Telecommunications and Information Administration has announced grants totaling $63 million to expand broadband access and adoption in Massachusetts, Michigan and North Carolina.

Most of that money went to build new "middle mile" regional networks in Michigan and North Carolina.

In Michigan, Merit Network got a $33.3 million infrastructure grant with an additional $8.3 million in matching funds to build a 955-mile advanced fiber-optic network through 32 counties in Michigan’s Lower Peninsula.

In North Carolina, MCNC: $28.2 million infrastructure grant with an additional $11.7 million in matching funds and in-kind contributions to build a 494-mile middle-mile broadband network passing almost half the population of North Carolina in 37 counties.

Consumer Centric Communications

Live blog of Pacific Telecommunications Council panel on "consumer-centric communications"

Consumer Centric Communications: I was looking forward to this panel, and my expectations were met and exceeded. There’s a lot of great work being done in areas of e-health and remote communications that the title doesn’t accurately speak to. However, e-health is a good representative area illustrating ways and players addressing global human needs, and the technology that supports it.

David  Sawcer: Pfizer model and tele-health used to analyze questions like why mobile has such a potential benefit but not so great adoption? My experience show that all aspects of successful remote collaborative care, remote monitoring and senseing, and remote access to data and resources. Collaborative care: in military, servicemen would get posted to remote locations with limited health care, generally necessary to evacuate them. We set up a satellite link to joint services hospital, we were able to provide interactions to store-forward info, or interact with local care providers. Was possible to provide diagnosis or treatment questions but had limitations.

Access to data and services: using remote PDAs, drug formulary and interactions database, and online diagnosis (e.g., Up To Date and paid service through university) – didn’t exist until a few years ago, now widely adopted.

Remote sensing/monitoring: in Africa, rural health care, congesitive cardiac care (can be fatal) is common. Is simple question to monitor at local level with bathroom scales (weigh patients), then text in for medical advice (take certain amount of medicines). Unfortunately the program failed when someone stole the bathroom scales. Colleague Elizabeth: when there isn’t a good substitute, alternatives come about organically. On interface part of equation: on patient side, great willingness to use mobile phones or devices (if easy). David: Services most useful when regularly updated with reliable information and was given away free. Technology has to fit the way we work. Costs haven’t been well calculated re: efficiencies, investment; no studies in this area. We talk to the carriers a lot as they’re looking for new areas, but it’s not on their horizon. Pediatric study at UC Irvine and UC San Francisco: got to refer patients on web, by form interface, to appropriate providers. 400 referrals over 4 years shows disparity in usefulness.

Ravi Sharma: Modeling digital flows in the eHealth Eco-system: Strategic implications for players. Example of community center, relatively bandwidth intensive. This market is multi-sided, there is a critical role for telecom network operators (what’s in it for them?). Research questions: 1. identify key stakeholders in this space, model the digital info flows among them. 2. Analyze the values created vs values-captured… Is an ecosystem that encompasses all key players, allows interoperability among them by providing a common platform for interfaces and transactions. Business models: e-commerce based, centrism-based (hospital or provider centric), and platform based (Google; proprietary vs open). Shift in focus from provider-centric to patient-centric models. Time is right to look at electronic personal health records (PHRs). Value of this ecosystem is a function of many components. (Diagram of digital info flow). (Here’s the PDF paper.) Game theory/analysis questions: does value captured justify value created for every player? Does a player stand to lose by opting out of this system? Future work: is a player better off in-system? corresponding value in quantitative terms? what characterizes a win-win business model that makes for a fair, efficient, and stable (sustainable) value network?

Audience discussion: Many efforts on grassroots level to standardize and discover information sharing practices. Singapore doctors training includes steps for diagnosis, shared records with patients. Also generational change brings updated attitudes and technology practices.

Eunice Hsiao-Hui Wang: User acceptance of 3.5G mobile broadband services: the early adopters’ scenario. Early adopters focus of studying user behaviors of 3.5G (HSDPA). Study’s objective: availability: affordabilitiy and adoption (continued subscription). More people like to access the Internet by mobile devices. In Taiwan, several mobile networks (GSM, GPRS, 3G, 3.5G), also wireless (WiFi, WiMax). 23M cell phones, 100% penetration rate, 13M Internet broadband subscribers, penetration rate 66% (Jan 2009). Among Internet broadband subscribers, only 7.7% adopting mobile broadband services and growing fast. Small business user market (3.5G subscription bundling with smart phones like Blackberry, PDAs – slow user growth), potential critical mass market (3.5G bundling with free NetPC and affordable flat monthly fee ($27US).

Survey: web-based on 255 Taiwanese 3.5G mobile broadband subscribers, where is critical mass (behavioral pattern)? Technology Acceptance Model: belief – attitudes – behavioral intention, leads to belief: perceived ease of use, perceived usefulness and perceived playfulness. (graphic of reserch framework) Sample demographics: 53% female, 23.5% age 21-25 and 25.5% 26-30 years old, 55% university level, mostly lower income brackets. Conclusions: perceptions not significantly related to behavioral intention. Most significant factor is attitude: positive attitude leads to greater possibility of continued use. Suggestions: easy, simple and user-friendly service is essential, enhanced convenience-driven interface design encourages subscription (gets jobs done efficiently).