After 2014, as emerging economies start to roll out LTE more widely, the EU percentage of the total market will fall, but its spending will continue to rise for the rest of the decade.
Wednesday, October 20, 2010
LTE Capex About to Take Off
Gary Kim has been a digital infra analyst and journalist for more than 30 years, covering the business impact of technology, pre- and post-internet. He sees a similar evolution coming with AI. General-purpose technologies do not come along very often, but when they do, they change life, economies and industries.
Future Business Models for Fiber-to-Home?
It's pretty easy for those of us who do not have to operate broadband access businesses and networks to give "helpful" advice about new revenues and businesses that can be created around fiber access networks.
Entertainment services will these days make sense to most service providers, since video entertainment is a substantial business with revenue that could easily amount to billions of dollars worth of annual revenue.
In general, we might agree with analysts at Yankee Group that enabling services, communications services, entertainment services and "communications-enabled applications" are fruitful avenues to explore.
The issue is that almost none of the advice anybody ever offers service providers fit into the category of a "killer app," and that is significant. The problem large companies have is that opportunities have to large to justify the investment of time to grow them.
When Cisco says it invests in opportunities, each of which can grow to be a $1 billion a year business, that illustrates the problem. What to do with fiber access networks is that sort of problem. It is hard to point to any discrete business opportunities that have that sort of potential, yet that is what is required to really move the needle in terms of service provider interest.
Yankee Group analyst Benoit Felton, in fact, does not consider "broadband in itself is not a service, since it has no intrinsic value to end-users. In a sense, one can agree with the notion that customer equipment, cables, power supplies, switches, routers and software needed to create networks are enablers of communication services.
Entertainment services will these days make sense to most service providers, since video entertainment is a substantial business with revenue that could easily amount to billions of dollars worth of annual revenue.
Applications that use communications might include home automation, health care or other forms of telemetry or monitoring. Development of such services almost necessarily involves working with other ecosystem partners.
The initiative recently announced by AT&T, Verizon Wireless and T-Mobile USA, working with Barclays and Discover Financial Services for mobile payments is one such example. That's the sort of new business that does have potential to generate "billions" worth of annual revenue, not a "millions."
That said, placing a huge big bets is inherently risky. The argument for placing lots of smaller bets is that the risk of failure is immensely reduced. Working actively with partners creating mobile apps is one way to sponsor lots of smaller initiatives, most of which will "fail to move the needle" in a direct revenue sense.
But that isn't the point. Hidden among those many experiments are a few that might someday become "$1 billion" sized applications and services.
Big, expensive bets, too far away from today's core, will be dangerous, as such moves have proven to be in the past. Carriers aren't terribly innovative, most will agree. Those who are stewards of those assets are right to be cautious, criticism notwithstanding.
But that doesn't mean nothing can be done. Lots of experimentation is possible in fostering the development of mobile-related apps, advertising and commerce. But there will be few such initiatives that can take the form of "big bets." Most will be small, "we can handle the failure" sort of ventures.
We still don't have evidence of large, substantial demand from consumers for many new communications-related apps that stray too far from basic access, voice, texting and video entertainment.
The problem is that many "killer apps" have difficult economics. Email was a killer app for dial-up Internet access, and has been an early killer app for mobile data. But email itself offers almost no significant revenue upside for an ISP. Lots of future opportunities might take that form.
The human needs and valued applications that drive use of communications might be difficult to monetize in a direct way. That won't be so important if indirect revenue models can be created. But its okay not to move too quickly or invest too much in lots of "futuristic" apps and services. The odds of failure are too great, the chances of success too slim.
When critics say ISPs mostly are "dumb pipes," there is some wisdom there. What ISPs can do to build on those pipes is the issue. But there are few "drop dead simple" answers, and stewards of service provider assets always are wise not to pay too much attention to the advice so liberally given them about what they "need" to do. In many cases, there is not much they really can, or should do.
That said, "doing nothing" makes no sense, either. The art of judo always uses an attacker's strength and power to advantage. It is hard to see how that will not be an important principle going forward: relative weakness in some ways can turn to strength by "going with the flow," rather than fighting it.
Partnerships with app providers that can make good use of communications, location, presence, billing relationships, promotion, branding, convenience, portability and stability will be fruitful in many cases.
"Dumb pipes" are a problem only if they are used in "low margin," limited revenue sorts of ways. A high-margin, high revenue pipe business is a great business. High-quality, application-aware and application-optimized pipes are a step in the right direction.
Gary Kim has been a digital infra analyst and journalist for more than 30 years, covering the business impact of technology, pre- and post-internet. He sees a similar evolution coming with AI. General-purpose technologies do not come along very often, but when they do, they change life, economies and industries.
Mobile Broadband Market Changing?
Up to this point, the "connected devices" market has been driven principally by mobile broadband access for PCs and notebooks. But a new wave of devices, especially tablet devices, seems to require less-expensive, contract-less service plans.
In part, the difference is the more-casual use mode for tablets, which often are not replacements for "work" devices such as notebooks or netbooks, and more content consumption devices that often will be used where Wi-Fi connections are available.
That means the usefulness of a 3G or 4G network connection is lower. Less value tends to imply lower prices, and less willingness to pay for two-year contracts.
In part, the difference is the more-casual use mode for tablets, which often are not replacements for "work" devices such as notebooks or netbooks, and more content consumption devices that often will be used where Wi-Fi connections are available.
That means the usefulness of a 3G or 4G network connection is lower. Less value tends to imply lower prices, and less willingness to pay for two-year contracts.
Gary Kim has been a digital infra analyst and journalist for more than 30 years, covering the business impact of technology, pre- and post-internet. He sees a similar evolution coming with AI. General-purpose technologies do not come along very often, but when they do, they change life, economies and industries.
63% of Mobile Consumers Want "Quality of Experience" Measures
The most-encountered problems were slow speeds (60 percent), poor network coverage (35 percent), inability to get connected (29 percent) and connection loss (29 percent).
About 63 percent of respondents say they support an active approach to maintaining quality of experience. That includes support for
optimization of data traffic and the differentiation of mobile broadband services. In other words, the very "packet discrimination" that network neutrality supporters say they want.
About 65 percent of those surveyed were unaware that in many networks just a small number of users generate over 80 percent of broadband traffic, causing slow download speeds and connection problems. When those surveyed were made aware of the issues surrounding the fair distribution of bandwidth, 63 percent responded positively to an active approach to fairness aimed at distributing bandwidth between as many people as possible to ease congestion to benefit all users.
Service providers call that traffic shaping. Net neutrality supporters call that "discrimination." It appears users agree with service providers, at least in this survey.
Between 30 percent and 63 percent of respondents even agreed they would be open to pay a small fee for carrier measures that meant a better broadband experience. Net neutrality supporters say they want to outlaw Internet access "fast lanes." It appears users want them.
The research also confirmed the popularity of video services, with almost half of consumers questioned (49 percent) accessing video sites using their mobile connection. As you might expect, 78 percent encountered QoE issues such as frequent pauses, and as many as 68 percent experienced these problems on a regular basis.
Fully 69 percent would accept an optimization policy that improves performance of a video service. For example, consumers were supportive of measures carriers could take to improve the quality of mobile video by decreasing video size to enable uninterrupted playback.
Consumers surveyed stated they would be willing to pay a small fee to receive services such as notifications when they have reached a certain spend limit on their mobile broadband service (48 percent), fair distribution of bandwidth between consumers (45 percent), personalization capabilities (46 percent), a bundle sharing plan (46 percent) and the ability to set spending limits on their mobile broadband account (42 percent).
read more here
At least according to this survey, mobile subscribers support traffic shaping and other optimization measures, including the opportunity to buy higher grades of service. As we have seen in recent days, consumers often do not want the policies and programs some elites think "are good for people."
Gary Kim has been a digital infra analyst and journalist for more than 30 years, covering the business impact of technology, pre- and post-internet. He sees a similar evolution coming with AI. General-purpose technologies do not come along very often, but when they do, they change life, economies and industries.
New $15 Verizon Smartphone Plan
Verizon Wireless is testing a new lower-cost smartphone data plan offering 150 megabytes of data each month for $15.
AT&T’s $15 plan includes 200 megabytes of data, and the carrier also sells 2 gigabytes of data for $25 a month. The 2 Gbyte plan is more than enough access for 98 percent of users, AT&T maintains. In fact, most users consumer a few hundred megabytes of data a month, not even a gigabyte.
AT&T’s $15 plan includes 200 megabytes of data, and the carrier also sells 2 gigabytes of data for $25 a month. The 2 Gbyte plan is more than enough access for 98 percent of users, AT&T maintains. In fact, most users consumer a few hundred megabytes of data a month, not even a gigabyte.
Gary Kim has been a digital infra analyst and journalist for more than 30 years, covering the business impact of technology, pre- and post-internet. He sees a similar evolution coming with AI. General-purpose technologies do not come along very often, but when they do, they change life, economies and industries.
Smartphones are taking over our lives - Oct. 19, 2010
Worldwide, 1 billion people will own smartphones in 2013, according to a forecast from Informa Telecoms & Media.
Gary Kim has been a digital infra analyst and journalist for more than 30 years, covering the business impact of technology, pre- and post-internet. He sees a similar evolution coming with AI. General-purpose technologies do not come along very often, but when they do, they change life, economies and industries.
"Advertised" U.S. Broadband Speeds and "Experienced" Speeds Quite Closely Related, Ookla Finds
Despite the general carping one often hears about how U.S. broadband access speeds are woefully out of touch with "advertised" speeds, Ookla, the Internet access measurement service considered by many to be the most accurate, finds that "advertised" and "experienced" speeds are very close, especially considering that some amount of signaling overhead (Ookla says 10 percent to 20 percent is typical) is necessary in all cases.
As of October 3, 2010, the Ookla worldwide 'Household Promise Index" shows that globally, providers are delivering 87.25 percent of promised service speeds, with the APEC (Russia, Canada, United States, Australia) at 85.67 percent, the European Union at 84.83 percent, the Organization for Economic Cooperation and Development at 83.24 percent and the G8 (France, Germany, Italy, Japan, United Kingdom, United States, Canada and Russia) at 80.28 percent.
In addition, the top five countries are Republic of Moldova (110.26 percent), Lithuania (99.13 percent), Russia (98.86 percent), Slovakia (98.74 percent) and Ukraine (97.80 percent), with the United States at number 11 (93.00 percent).
As of October 3, 2010, Ookla's "House Value Index" shows the global cost of broadband at $4.36 per Mbps, with the top five countries in terms of "Relative Cost of Broadband" being Luxembourg, United Kingdom, Sweden, Norway and Denmark — the United States ranked 12th (out of 26 countries) at 1.21 percent of gross domestic product per capita or $46.75/month.
Comparing several U.S. States shows South Dakota ranks first at $2.91 USD per Mbps, New York ($4.22) ranks 8th, Washington State ($5.44) ranks 15th and California ($5.80) ranks 19th, with Alaska ranked 51st at $16.77 per Mbps.
The United States ranks 20th in cost per Mbps (out of 26 countries total), but ranks 15th when taking into account gross domestic product per capita, Ookla says.
read more here
As of October 3, 2010, the Ookla worldwide 'Household Promise Index" shows that globally, providers are delivering 87.25 percent of promised service speeds, with the APEC (Russia, Canada, United States, Australia) at 85.67 percent, the European Union at 84.83 percent, the Organization for Economic Cooperation and Development at 83.24 percent and the G8 (France, Germany, Italy, Japan, United Kingdom, United States, Canada and Russia) at 80.28 percent.
In addition, the top five countries are Republic of Moldova (110.26 percent), Lithuania (99.13 percent), Russia (98.86 percent), Slovakia (98.74 percent) and Ukraine (97.80 percent), with the United States at number 11 (93.00 percent).
As of October 3, 2010, Ookla's "House Value Index" shows the global cost of broadband at $4.36 per Mbps, with the top five countries in terms of "Relative Cost of Broadband" being Luxembourg, United Kingdom, Sweden, Norway and Denmark — the United States ranked 12th (out of 26 countries) at 1.21 percent of gross domestic product per capita or $46.75/month.
Comparing several U.S. States shows South Dakota ranks first at $2.91 USD per Mbps, New York ($4.22) ranks 8th, Washington State ($5.44) ranks 15th and California ($5.80) ranks 19th, with Alaska ranked 51st at $16.77 per Mbps.
The United States ranks 20th in cost per Mbps (out of 26 countries total), but ranks 15th when taking into account gross domestic product per capita, Ookla says.
read more here
Gary Kim has been a digital infra analyst and journalist for more than 30 years, covering the business impact of technology, pre- and post-internet. He sees a similar evolution coming with AI. General-purpose technologies do not come along very often, but when they do, they change life, economies and industries.
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