"Video Will Replace Voice and Text" for Business Communications in 5 Years"

Video will become the new business norm for communication and collaboration over the next five
to 10 years, says Henry Dewing, Forrester Research analyst. In fact, says Dewing, "video will replace voice and text communications as the preferred method of communication in business and personal life."

Those of you accustomed to technology projections might agree that the direction is right, but the timing is probably wrong. Still, three years ago, most buyers and users perceived the predictions of impending video traffic as all hype, says Dewing. But a combination of technology maturity, end user demand and competitive pressures are driving interest.

As often is the case, the initial business case starts with saving money on travel costs. "Every business case for video starts with time and travel savings and describes the more effective communication possible with video, but the real value is in improving the way firms operate and conduct business with their clients to build competitive advantage without breaking the bank, says Dewing.

But if you are familiar with the business case for IP communications and IP telephony, it was the same there. People understood they could save money. But all the other advantages remain a bit unclear.

Hard dollar savings like travel costs are being used to pay the bills for all types of communications and collaboration solutions, he says. "Many businesses we speak with struggle to define the value of video beyond travel savings from implementing videoconferencing," he notes.  "The value of digital signage, video blogging, broadcast state-of-the-company speeches, and even video-enabledcollaboration is still fuzzy in the minds of IT planners today."

The hurdles might be even worse than that. Business owners might not be able to measure the "soft" advantages from collaboration very well, if at all, as generally is the case with IP communications, where, no matter what anybody tries to say, still is seen as a cost-reducing innovation.

Business video use will ramp steadily over the next five years as employees who experience video at home will demand it at work. After successful deployments at work, employees will demand more video solutions and make video a standard mode of communication, Dewing says. Follow-on deployments will occur rapidly when use is easier, when resolutions deliver more lifelike images, and when reliability makes video dependable.

"Go Screw Yourself, Apple" Flash Evangelist Says

Apple doesn't support "Flash"-authored applications, favoring HTML5, a move that obviously harms Adobe's efforts to maintain an "open" standard for authoring Web video. Apple prefers HTML5 at least in part for technical reasons: it makes easier the task of inserting video-based advertising into video content.

Lee Brimelow is a Platform Evangelist at Adobe focusing on the Flash, Flex, and AIR developer communities, and has a succinct comment on what he thinks of Apple's position: "Go screw yourself Apple."

That's one way of assessing the threat Apple's approach to video applications causes in some quarters.

"Any real developer would not in good conscience be able to support this," Brimelow argues, calling the Apple move "hostile and despicable."

A move like this clearly shows the difference between our two companies, he says. "All we want is to provide creative professionals an avenue to deploy their work to as many devices as possible," he says. "We are not looking to kill anything or anyone."

The clear implication is that Apple is trying to "kill" Adobe's Flash business.

"This is equivalent to me walking into Macy’s to buy a new wallet and the salesperson spits in my face," says Brimelow. "Chances are I won’t be buying my wallets at Macy’s anymore, no matter how much I like them."

Lee's post

U.S. Broadband by Satellite Fared "Relatively Well" During Recession

U.S. providers of broadband access by satellite services did roughly as well as fixed-line providers during the recent recession, Northern Sky Research says. "After a year of uncertainty, the majority of signs indicate the sector made it through the worst economic crisis since the Great Depression relatively well," researchers at NSR say.

"North America set a milestone by becoming the first region to top one million subscribers, and Western Europe will likely exceed 100,000 subscribers well before the end of 2010, says NSR.

According to Hughes Network Systems November 2009, the company was adding about 17,000 gross subscribers a month. Wildblue, now part of ViaSat, added roughly 8,333 new customers a month in 2008, for a total gain of 100,000, and about the same number, it appears, in 2009.

Satellite broadband access providers saw that few consumers and businesses were willing to give up their broadband service in difficult times, NSR also says, as was the case in the fixed-line market as well.

Satellite services tend to get brutal complaints about speed, cost and customer service on some discussion boards and forums, but for many consumers, satellite broadband might be the only current option. Faster speed services are coming, though, as a new generation of high throughput satellites will provide higher-speed connections.

It seems unlikely the faster speeds will silence all complaints, but should help.

Globally, NSR projects that broadband VSAT networking, satellite broadband access, and broadband trunking and backhaul services will generate nearly $8.8 billion by 2019, which is a 135 percent increase over 2009.

Global satellite broadband access will add the most new revenues, some $4.1 billion between 2009 and 2019, to become the leading market segment and bypass traditional broadband VSAT networking in revenue terms as of 2013. Traditionally, commercial customers ordering up private satellite networks have been the revenue driver, so the switch to consumer services is a big change.

Manassas Pulls Plug on "Broadband Over Powerline" Service

The Manassas City Council unanimously voted to discontinue offering its municipal broadband over Powerline access service. The Manassas service had been touted in the past as an example of how municipally-provided broadband service could succeed, as well as a proof of concept of the idea of using power lines as the access mechanism.

The shutfown affects about 520 residents and businesses who currently subscribe to the service, which will end in three months.

The council cited three reasons for the decision. First, customer penetration had been declining. Also, the service was costing more than it took in as revenue, and a determination that meter reading services do not require broadband access.

Observers note that the business case never proved as robust as expected. "It's costing a little more to maintain the system than we projected in the budget," Manassas Director of Utilities Michael Moon said. "The original projections were that the customer base would be double this."

The city has been running the service since the private operator, COMtek, found it also could not make a profit on the system.

In January 2009, there were 637 residential and 51 commercial BPL subscribers in Manassas. In February 2010, those numbers had shrunk to 457 residential and 50 commercial subscribers.

 The Utilities Commission said that the total revenue brought in by BPL for fiscal year 2010 was almost $186,000, but the expense of keeping up the City-owned system was costing the ratepayers a little more than $351,000, resulting in a net loss of almost $166,000.

"In October 2003, the Manassas City Council was told that it could expect as much as $4.5 million in revenue from awarding a 10-year BPL franchise," said American Radio Relay League CEO David Sumner. "Instead, six months later, BPL had turned into a money pit for the City of Manassas. Anyone thinking of investing in BPL would do well to learn from the Manassas experience."

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"Digital Divide" is Closing

Policy advocates and policymakers have worried about a "digital divide" in U.S. Internet usage, as much as global policymakers have worried about the difference between communications use in developed and developing regions.

But a new study by eMarketer suggests that the U.S. digital divide is closing fairly rapidly. By 2014, in four years, Internet usage rates by Americans of black ancestry will just about equal rates of U.S. "whites" today, while Hispanic American use of the Internet will rise to within six percentage points of the current U.S. average usage by "white" Americans.

That is not to say rates will be identical, but the point is that almost nobody thinks "white" Americans generally are victims of a "digital divide" today, though there are more issues in rural or isolated parts of the country. In fact, most of the non-adoption factors now are of a "demand" sort rather than a "supply" sort. In other words, most people who want broadband already buy it.

If by 2015 Americans of "black" or "Hispanic" heritage have those same rates, the significance of the "divide" should be largely moot. That is not to say the issue is completely moot, but closing the last percentage or two of gap in any endeavor always is a matter of effort and reward. And since the primary issue these days is demand, not supply, some circumspection might be in order, in terms of the amount of effort expended, compared to the potential benefits. The markets, and consumers, seem to be doing a relatively good job, unaided, in terms of closing the digital divide.

Apple iAd Wants to Change "Ads that Suck"

It isn't clear whether the typical mobile ad created for Apple's new iAd network will be as immersive and interactive as the example Apple CEO Steve Jobs shows here.

But the example suggests what Apple would like to see happen: ads that are closer to entertainment than anything we've seen so far, incorporating interactive and gaming experiences, for example. To use the obvious analogy, today's ads are outside the content; in the "Toy Story" example the ads are part of the content, essentially.

The issue will be how talented advertisers will be, not so much Apple. Unless firms are willing to allow Apple to produce the "creative," as well as handle the placement, it is doubtful most ads will be this well done.

Telcordia Warns of Mobile Operator Marginalization

Broadband access is becoming a commodity, even for mobile service providers, who must figure out what else they can offer consumers once basic mobile broadband connections have become a feature purchased by the majority of mobile phone users.

The good news for mobile operators in many regions around the globe, data average revenue per user (ARPU) has quadrupled over the past six years and now is nearly half of voice ARPU.

But that product will saturate, as has fixed broadband, leaving mobile providers to look for the next wave of services and applications to sell.

"The popularity of video and other third-party over-the-top services are breaking mobile broadband networks and business models because they siphon off revenue while adding to the network's workload," says Pat McCarthy, Telcordia VP.

Since Telcordia believes that effort must include measures to differentiate3 access services, it is obvious why extending "strong" versions of network neutrality to wireless networks is so dangerous: it would close off most of the ways such differentiated service can be provided.

McCarthy says operators must distinguish between different types of traffic and prioritize them. For example, personalized end user services that generate revenue for an operator and its business partners should enjoy priority access to network resources, while zero-revenue OTT content should be managed with a tiered bandwidth management solution, he says.

Most-if not all-service providers undoubtedly would agree, a fact that illustrates why network neutrality rules or even reregulating broadband access as a common carrier service would be so devastating.

"An operator's need to manage bandwidth is the first step toward realizing a profitable business, and they must build on that capability, forming active partnerships with end users and their choice of content providers, to get their fair share of the profits," says McCarthy.

Already, mobile broadband traffic continues to grow, but revenues aren’t keeping pace, McCarthy says.

Perhaps the biggest threat of all comes from over-the-top players, McCarthy notes.  Operators will be required to make all the investments in infrastructure and provide a reliable customer experience. And yet, if they aren’t careful, they will absorb the bulk of the costs, while allowing third-party content
providers to reap the biggest profits.

Print content and video content providers say they have learned the same lesson from the music industry's experience with online music. Telecom industry executives probably have to learn their own lessons from the experiences of the fixed-line broadband experience.

None of that will be easy, as application providers largely will resist. But revenue sharing across the ecosystem is the only stable way forward, where maximum innovation and network investment can occur.

"For a time, while the priority is building out the mobile broadband infrastructure, there may be a
competitive advantage in offering a better network," McCarthy says. "But soon enough, the pipe will become a commodity, and the long-term potential revenues will be in the delivery of services, applications, and other user-demanded content."

Ecosystem conflict is inevitable as the new value chains are constructed. But service providers can help themselves by figuring out ways to leverage assets they already have, and offerng them to business partners, for example. It won't be easy, but it is necessary.