Google has "Groupon" Options, Says Mayer

So long, broadband duopoly?

Analysts at the Federal Communications Commission appear to agree with forecasts that project 90 percent of the U.S. population is likely to have access to broadband networks capable of peak download speeds in excess of 50 Mbps as cable systems upgrade to DOCSIS 3.0. See http://www.broadband.gov/download-plan.

But FCC analysts also estimate that about 15 percent of the U.S. population is likely to be able to choose between two providers, both cable a telco. At first glance, this would seem to be a problem for most telcos other than Verizon.

If in fact a large percentage of the U.S. broadband customer base does decide to buy 50-Mbps services, or even faster services, many telcos are going to be at a huge disadvantage, if one assumes broadband access will be the foundation service for most telcos.

As necessity typically is the mother of invention, one wonders whether ways of using fiber-to-neighborhood networks will be capable of upgrading to speeds not possible so far, much as cable operators are working on new ways to boost their own broadband speeds. One should not discount the possibility, or the incentives for suppliers to come up with such solutions.

On the other hand, "headline" speeds, as important as they are for marketing purposes, might not necessarily correspond to consumer buying preferences in the near term, or even in the medium term. So far, few U.S. consumers have decided 50 Mbps access services were valuable enough to buy them, where such services are available.

If that remains the case, services offering 20 Mbps or 25 Mbps might be good enough, at least for the medium term, and urban fiber-to-neighborhood networks ought to be able to reach 40 Mbps, as Qwest already offers in Denver, for example.

Telcos with lower density serving areas and longer loop lengths will find it rather expensive to match that sort of speed using any hybrid network (fiber distribution, copper access). But much might hinge on the actual state of end user demand (willingness to pay).

Nor should observers think there is no more speed that can be wrung out of all-copper access networks. A reasonable way of putting matters is that additional copper pairs can be bonded to achieve higher speeds. There are technical issues, of course, ranging from availability of requisite pairs in existing cable, and interference issues within cables. But researchers already are working on ways to create higher-speed circuits by using more extensive bonding.

Oddly enough, the dwindling number of fixed-line voice circuits actually helps to some extent, as it frees up additional copper pairs, in some cases. It isn't easy, but sometimes extensive pair bonding will prove workable. Beyond that, the costs of fiber-to-customer infrastructure continue to improve, especially where either aerial plant or underground conduit are in place.

So it is not clear that cable's current advantages are of a permanent nature. That might be the case, in some areas and perhaps in many areas. But telco executives have powerful incentives not to concede the long-term future.

And since all observers now agree that the goal of 100 Mbps, within a decade, is the aspirational target the market likely will support, technologists and business planners will be looking at any number of solutions. At one level, the issue is technological: how can it be done? At an equally important level, the issue is how to match investment to expected revenues.

One might argue that with multiple 4G wireless networks and growing use of mobile devices, actual end user demand at fixed locations might not grow as rapidly as some forecast. A large number of fast, but not super-fast connections--both mobile and fixed--might well prove quite workable.

That doesn't mean telco planners can avoid the work of figuring how to pay for and build networks running up to 100 Mbps at some medium term point in the future. But the scaling might wind up being more graceful than people sometimes assume.

So long, broadband duopoly?

Does Anyone Want Super Fast Wireless Service? - 24/7 Wall St.

Lost in the excitement about 4G is whether anyone will want to use it, says Douglas McIntyre, 27/7wallst.com analyst.

Consumers will have to buy a new handset in most cases to use the new networks, and there are few 4G handsets to choose from, at the moment. That is one reason why mobile broadband for PCs typically is a lead application for new 4G networks.

If 4G adoption is anything like 3G adoption, it might take a while before people figure out how and why to use it. For the moment, wireless service providers have other motivations, such as lowering the cost to deliver mobile broadband to end users. For the moment, that will be enough.

There's plenty of time to figure out what new "killer" apps will drive 4G adoption.

Does Anyone Want Super Fast Wireless Service? - 24/7 Wall St.

28 Percent of Cable Subscribers Might Switch to Web Video

JP Morgan equity analyst Imran Khan says a recent survey he conducted suggests that 28 percent of people would consider "cutting the cord" and substituting broadband-Internet-delivered entertainment video in place of their current multichannel video service.

Perhaps significantly, those who report they might consider such a change include at least some potential switchers from the 16 percent of people who report they are not unhappy with their current video provider.

The data is another example of the consumer marketing dilemmas service providers face. You would not be surprised if people who are unhappy with their service say they might switch. But even "satisfied" customers seem to be willing to consider a switch.

In some ways, of course, the survey doesn't indicate as much real churn potential, in the near term, as you would think. The questions do not actually test for the attributes an over-the-top substitute would have to feature, ranging from content choices to price and whether the video can be watched on one or more in-home TVs.

It is easy to say one might "consider switching." It is quite another thing to "consider switching" at high prices, or for services that are not equivalent to current offerings in meaningful ways. Most consumers do not watch more than seven to a dozen channels. If those 12 are among the sources a consumer could get "over the top," at a perceived reasonable price, then switching behavior is much more likely to occur.

At some combination of value, price and ease of use, switching will happen.

28 Percent of Cable Subscribers Might Switch to Web Video - Survey

Sprint Declines Increased Clearwire Investment

Sprint Nextel let a Jan. 2, 2011 deadline pass without exercising its right to buy $760 million of Clearwire Corp convertible debt, ruling out that source of funding for Clearwire. It's a bit hard to tell what the decision means, beyond the obvious unwillingness on the part of Sprint to put more money into a venture that has become a source of tension.

Sprint already owns about 56 percent of Clearwire and uses its network to offer 4G services. Some might interpret the decision as a sign Sprint is not interested in buying the remainder of Clearwire. That might not necessarily be the case, though. If Sprint believes Clearwire will encounter difficulty, Sprint might be able to buy the remaining portions of the company for less money.

On the other hand, Sprint might have other ideas about where to deploy additional capital to support its 4G efforts. If Clearwire proceeds with its plans to sell off excess wireless spectrum, Sprint could purchase that spectrum and build its own LTE network.

http://www.reuters.com/article/idUSN0317604520110103

Apple Dominates Holiday Mobile App Installs

Apple had 61.5 percent of the mobile app downloads, Android had 30.1 percent, according to Flixter. About 7.9 percent of app downloads over the holidays went to RIM devices and Windows Phone had 0.5 percent. The percentages were from 1,027,000 downloads over the holiday week.

Flixter Tells How Mobile App Installs Went Over The Holidays. | VOIP IP Telephony

Best Buy to Launch "Buy Back" Program?

Best Buy is reported to be planning a new "buy back" program aimed at keeping users who constantly upgrade their smartphones off-cycle, and who buy from Best Buy Mobile. The program reportedly will cost $59.99 at the time of handset purchase. Between months one and six of handset ownership, users can then trade-in their device to Best Buy Mobile for 50 percent of the phones full retail value.

Between months six and 12 the device can be turned in for 40 percent of its original value. Between months 19 to 25, users can get back 20 percent of the original retail value.

The offering likely will appeal to users who purchase new smartphones long before their two-year commitments have expired.

read more here