Projecting iPhone's Effect on Verizon's 2011 Wireless Revenues - Seeking Alpha

By one survey conducted by Compete, about 8.7 percent of Verizon Wireless customers are waiting for a specific phone model before upgrading to a smartphone, and most assume that means the Apple iPhone.

According to Verizon’s third-quarter 2010 financial statement, only 23 percent of Verizon’s 82 million post-paid subscribers currently had a smartphone. This means that there is a potential pool of some 63 million post-paid cellphone owners that Verizon can convert to the iPhone, without stealing away a single new net add.

If the 8.7 percent of existing Verizon's customers who are waiting for a specific phone choose to upgrade to an iPhone, Verizon could enjoy a spike of more than 5.4 million new iPhone customers in 2011.

Even if just three million existing non-smartphone Verizon Wireless subscribers upgrade to the iPhone, Verizon Wireless could earn more than a billion dollars in additional data revenue over a two-year period, assuming new monthly data plan revenues of $15 a month and two-year contract lengths.

That does not even account for net customer gains Verizon might pick up as customers from AT&T and other service providers move over to Verizon Wireless to use the iPhone on the Verizon network.

Projecting iPhone's Effect on Verizon's 2011 Wireless Revenues - Seeking Alpha

U.S. Game Revenue Flat in 2010

Total U.S. consumer spend on gaming content in all forms, including new physical video and PC games, used games, game rentals, subscriptions, digital full-game downloads, social network games, downloadable content, and mobile game apps, is between $15.4 to $15.6 billion. That's a range that would make 2010 activity about the same as 2009, or just slightly less, according to NPD Group.

Spending on new physical content at retail continues to account for the majority of the total consumer spend on games content. U.S. retail sales of new physical video game content, which includes portable, console and PC game software, generated revenues of $10.1 billion, a 5 percent decline over the $10.6 billion generated in 2009.

2010 TOTAL CONSUMER SPEND ON ALL GAMES CONTENT IN THE U.S. ESTIMATED BETWEEN $15.4 TO $15.6 BILLION

Shoppers Have More Information Than Store Associates, Motorola Says

The majority of surveyed retail associates surveyed by Motorola (55 percent) believe that 2010 holiday season’s shoppers were better connected to consumer information than in-store associates, particularly because consumers have online shopping tools and mobile phone applications that allow price comparisons, access to coupons and social-networking.

Motorola says that retailers that aren't investing in technology to stay ahead of increasingly tech-savvy shoppers are hurting their own bottom line. Nearly three in 10 (28 percent) store visits ended with an average of $132 unspent due to abandoned purchases driven by deal-habituated behavior, out-of-stocks, limited store associate assistance and long check-out processes, Motorola estimates.

On a positive note, the survey indicates that when surveyed shoppers received guidance from a retail associate armed with a handheld mobile computer, over four in ten (43 percent) reported the device improved their shopping experience. The survey also notes that an overwhelming majority of retailers - 87 percent - believe that shoppers can easily find a better deal so customer service - aided by access to real-time information -- is 'more important than ever.

Motorola Solutions Media Center - Press Releases - 55 Percent of Retailers Cite Shoppers as Better Connected To Information than Store Associates, According To Motorola Solutions Survey

Google Kills H.264 Video Codec Support: Why?

Google says it is removing Chrome support for the H.264 codec. It is the sort of decision that will not have totally-obvious implications for most relatively non-technical people. Google says it is supporting the WebM (VP8) and Theora video codecs, and will consider adding support for other high-quality open codecs in the future, rather than H.264.

'Though H.264 plays an important role in video, as our goal is to enable open innovation, support for the codec will be removed and our resources directed towards completely open codec technologies. A relatively straight discussion of the technology issues is here: http://news.cnet.com/8301-30685_3-20028196-264.html?tag=mncol;txt.

But there's also thinking that the codec decisions are part of developing conflict between Google and Apple. See http://www.digitalsociety.org/2011/01/google-is-killing-html5-to-harm-apple-ios/?utm_source=rss&utm_medium=rss&utm_campaign=google-is-killing-html5-to-harm-apple-ios

Apple made the decision to not allow Adobe Flash on iOS devices because they want to retain sole control over application distribution and design with their App Store, a technology decision with business implications.

The current near-universal delivery platform was Adobe Flash but that was losing steam because of its inability to reach Apple iOS.

By crippling HTML5 H.264 under the guise of supporting Google’s VP8 codec (which is a nonstarter because VP8 is inferior to H.264, carries potential patent infringement liabilities, and H.264 is entrenched in billions of hardware devices while VP8 has no current support), the only remaining viable option for most content producers is to continue delivering H.264 via the Adobe Flash platform or via Microsoft Silverlight like Netflix, says George Ou.

Larger content providers will be able to deliver H.264 compressed video on both Flash or Silverlight for most of the world and HTML5 just for Apple iOS devices, but it will remain difficult to reach Apple iOS devices. Google Android devices will be able to reach Flash websites like Windows or Mac Personal Computers which gives them a leg up on Apple, Ou argues.

Chromium Blog: HTML Video Codec Support in Chrome

LightSquared in Trouble?

Prominent hedge fund manager Phil Falcone's $7 billion Harbinger Capital Management has been hit by a series of high profile departures in the past few weeks, according to people familiar with the fund.

While some departures were voluntary, others were part of an effort to cut the fund's staff, as the firm's assets have shrunk from a peak of $26.5 billion in 2008, the sources said.

Those moves could have an impact on Harbinger's ability to secure additional funding for its satellite-plus-terrestrial Long Term Evolution wholesale network. About 40 percent of Harbinger's total capital is tied to LightSquared.

Whether the departures are related to perceptions about the chances of success, or not, LightSquared faced big challenges from the start. Mobile satellite networks have lost investors lots of money in the past.

Shrinking hedge fund Harbinger faces staff exits | Reuters

T-Mobile USA Mocks At&T, Verizon

There's "no competition" in the mobile business, some say. Sure, it's anecdotal, but advertising like this suggests there is quite a lot of competition.

Will Verizon iPhone Sales Change iPhone Demographics?

Irrespective of the ultimate changes in the smartphone and broader U.S. mobile business that might ultimately result from the new Verizon Wireless deal with Apple giving it the right to sell the iPhone, the iPhone user base looks like it will continue to be a choice target for brands looking to advertise.

Though change is likely as the iPhone user base moves from early adopter to mainstream users, the early demographics have been attractive for brands. Up to this point. iPhone users heavily over-index in some of the most attractive advertising segments, including 25 to 34 year olds (index of 175), 18 to 24 year olds (index of 141) and 35 to 44 year olds (index of 129) and are 22 percent more likely than an average mobile subscriber to be male.

Up to this point, iPhone users often also have represented higher income brackets, with 81 percent of users having a household income of at least $50,000 and 47 percent of users reporting a household income of at least $100,000. That demographic pattern, of course, will become less prominent as the iPhone continues to diffuse throughout the general population.

How the Verizon iPhone Announcement Could Influence the Mobile Market (comScore Voices)