Google Plans Battle for Tablet Dominance

To the extent that tablet devices are able to carve out a new consumer electronics niche, or perhaps even if all they do is create a new segment within the netbook or notebook product category, they also will create a new canvas for mobile advertisers.

If, as many expect, tablets emerge as content consumption devices, they will feature rich content. And rich content traditionally has meant new advertising venues.

For tablets, including the device Google and others are working on, that will mean a chance to grow a new rich media advertising venue. Historically, media and advertising have grown hand in hand.

It isn't so much the devices, though that is quite important for Apple. For many other contenders, it is the growth of a new advertising medium that likely is most significant about tablets.
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Best Buy Launches Video Service

Best Buy Co. has launched a new digital video service, called "CinemaNow,"  that will provide customers same-day access to new release movies and TV shows available on DVD.

The service will initially be accessible through select connected LG Electronics Blu-ray Disc players and HDTVs, and on most PCs at www.cinemanow.com. Samsung's Internet-connected home theater equipment and Insignia brands also will have the feature.

CinemaNow is also expected to launch on an array of other devices from various manufacturers, including Insignia, later this year.

The first update to the CinemaNow service is expected to release on select devices later this year and will include an advanced user interface and expanded video playback features aimed at further improving the video entertainment experience.

CinemaNow will have "first run" movies for sale as soon as they arrive on DVD, with rentals for $2.99  to $3.99 per movie and purchases at $9.99 to $19.99, including HD titles and some available in 1080p.

The company will be competing against other retail giants such as Walmart and Blockbuster, as well as Netflix and Hulu, among others.

There will be other changes as well, It might now happen for a couple year, but Best Buy has said it will phase out DVD sales as early as 2012.

http://www.bby.com/2010/05/18/best-buy-provides-customers-same-day-instant-access-to-new-release-movies-and-tv-shows-with-launch-of-cinemanow/

Droid Incredible..Is That...

Consumer Satisfaction With Video, Wireless Up, Sprint Gains Most

Customer satisfaction with cable and satellite TV rises to its highest level in 10 years, up five percent, with nearly all companies registering improvements, according to the American Customer Satisfaction Index.

Sprint Nextel seems to have made the largest gains over the last two years, jumping by double digits for each of the past two years. That's important as Sprint Nextel's customer service was widely seen as the cause of its high churn over the past several years. The improvement in customer satisfaction is mirrored by steadily better churn performance over the last couple of years.

Both Verizon’s FiOS and AT&T’s U-verse lead the way with scores of 73 and 72, respectively. Satellite TV still leads over traditional cable, with Dish Network soaring 11 percent to 71 to overtake rival DirecTV for the first time since 2005.

DirecTV fell four percent to 68 as aggressive pricing promotions by DISH, coupled with a price increase by DirecTV, has the two satellite TV providers moving in opposite directions.

All four of the largest cable providers show some improvement. Charter Communications makes the biggest leap, gaining 18 percent to 60. The company is now statistically tied with Comcast and Time Warner Cable, both up three percent to 61.  Cox Communications gained two percent to 67 to lead all traditional cable companies for a seventh straight year.

“Having enjoyed near-monopoly status in most areas for many years, cable companies had little incentive to provide quality services at a good price,” says Claes Fornell, founder of the ACSI.  “Now that satellite and fiber-optic TV providers have created a competitive challenge to cable, the cable companies have started to step up customer service and realize some gains in customer satisfaction, but they still remain far behind both satellite and fiber-optics.”  

Traditional local and long distance service improved four percent to 75, the highest level in more than a decade.  AT&T is on top after a six-percent surge to 75, followed closely by Cox Communications, unchanged at 74, and Verizon, up three percent to 73. CenturyLink and Comcast round out the bottom of the industry, with CenturyLink gaining three percent to 70 and Comcast rising two percent to 68.

Customer satisfaction with wireless telephone service set a new all-time high for the second consecutive year, rising four percent to 72.  T-Mobile gained three percent to 73, tying for the lead with Verizon Wireless, which declined one percent.

AT&T Mobility improved three percent to 69. Two years after the iPhone was introduced as an exclusive product, AT&T seems to have made strides to relieve some of the strains on its network caused by the rapid influx of iPhone customers.

Sprint Nextel had the largest improvement, gaining 11 percent to 70 a year after a similarly large 13 percent jump, pushing the wireless carrier from well below to very close to the industry average.

Perhaps the most-intriguing bit of commentary provided by ACSI was the brief note that "with wireless looking to be the future of telephone service, providers are ramping up efforts to provide new services, simplified usage plans, and better pricing." Note the language: "wrieless looking to be the future of telephone service."

Google Buys GIPS

Google is acquiring Global IP Solutions for about $68 million in an all-cash deal for the firm whose technology is used to reduce delay, jitter and echo in real-time audio and video on the Internet.

“The Web is evolving quickly as a development platform, and real-time video and audio communication over the Internet are becoming important new tools for users,” said Rian Liebenberg, Engineering Director at Google. “GIPS’s technology provides high quality, real-time audio and video over an IP network, and we’re looking forward to working with the GIPS team at Google to continue innovating for the Web platform.”

GIPS technology is widely used. In fact, Global IP Solutions bills itself as the world’s most widely deployed technology for processing real-time voice and video over IP networks, used by over 800 million end-points. As is always the case when a widely-used "original equipment manufacturer" is acquired, Google will have to balance use of the technology in a "captive" mode as well as supporting the product as an OEM offering for many third parties, some of whom may be Google competitors.

As well as providing technology that allows users of Yahoo Instant Messenger to make voice calls, GIPS technology also powers voice calls for Cisco’s WebEx system and voice and video technology for IBM’s Lotus Sametime, for example.

Google already has some voice services, including Google Talk, Google Voice, and video and voice chat on Gmail. It expanded these services last year with the acquisition of Gizmo5.  The GIPS acquisition will allow Google to create more powerful voice and video services, both for the consumer and enterprise.

Inevitably, the deal is going to raise more questions about whether Google plans to compete more directly and robustly with Skype and other IM-based services. At one point, telecom service providers might have taken the acquisition as a sign Google planned to compete more directly in the basic voice business. These days, most executives seem more resigned to changes in the voice market that are only indirectly related to "Google becoming a service provider."

The same GIPS technology that makes IP voice perform better also make IP video work better, and that may be the more-important part of Google's thinking.

South Korea to Cap Telecom' Marketing Costs - WSJ.com

Here's one way to boost profits for mobile service providers operating in intensely-competitive markets: forbid them from spending so much on marketing.

South Korea's telecommunications regulator will limit the amount telecom companies spend on marketing, in a move aimed at cooling intense competition and boosting profits in one of the world's most saturated telecom markets, the Wall Street Journal reports.

The Korea Communications Commission says that the country's major mobile operators—including KT Corp., SK Telecom Co., LG Telecom Co. and SK Broadband—shouldn't spend more than 22 percent of their respective revenues from fixed-line and wireless businesses on marketing.

The regulator said it expects the move, which take effect from May, to help lower total marketing costs to around 7.03 trillion won ($6.14 billion) in 2010, sharply down from the 8.02 trillion won spent last year.

It's hard to predict in advance how such restrictions will play out, but the limit obviously favors contestants with larger gross revenue, since the marketing cap is based on a percentage of revenue. Smaller providers might have benefited more if the restrictions were set at a flat amount per company, or some other formula that limits the ability of the larger carriers to outspend carriers with lower market share.

Phone.Com Launches Channel Program

There comes a point in a company's development when it makes sense to market to new customer segments. So it is that Phone.com is launching a channel partner program expected to extend the company's sales effort to businesses with five to 20 employees. Up to this point, Phone.com has sold directly and exclusively from its website, and many of its customers are small businesses that understand the value of a hosted business IP telephony service.

The new channel programis expected to be based on partners such as phone interconnect dealers, value-added resellers and other relatively technical firms that might normally sell premises-based phone systems, but find they are leaving business on the table because some firms cannot justify buying a new IP phone system, but might be amenable to buying a hosted equivalent.

"I have found that Phone.com's best channel partners are existing customers of ours," says Joel Malof, channel partner program manager. "Our target markets for channel partners are firms with two to 30 lines."

The ideal channel partners are firms that can provide first-level customer support, and typically will be more-technical firms such as phone interconnect dealers, for example.

Partners can earn a success fee for closing a new account, equivalent to a month's recurring revenue after a new customer has been on board for 90 days. Then there is a recurring revenue payment based on a percentage of revenue, and depending on volume of revenue.

The program starts at three percent and goes up to 10 percent, says Malof. "A $20 a month residual is not so interestingm, but at 100 of those, it is interesting," says Malof.

A customized web address is given to customers, with the agent's ID embedded in it," says Malof. "That's how we give them credit for the sale."

"We will have no direct sales force that agents are competing against," says Ari Rabban, Phone.com CEO.