What Happens When Tech Bubble Bursts?

There is some concern, not universally shared, that another "Internet technology bubble" is brewing. Some might argue the growing valuations of "revenue-free" Internet app startups are justified, because those companies might become platforms, as Facebook and Twitter have done.

You can see the logical flaw at work, whatever you think about valuations. In every bubble, it is possible that a few firms actually will become platforms. But most will not. Lots of firms will develop useful tools, but never become platforms. There's nothing wrong with that. But it is not a reason to give unrealistic valuations to "revenue-free" companies that might someday discover a revenue model.

That is not to minimize the legitimate new developments in Internet software. Collaboration, as it turns out, is a big deal, in fact far bigger than even suppliers of business collaboration tools might have suspected. A major shift in computing architecture to "cloud" mechanisms will lead to a whole new list of industry leaders. We just don't know who they are, just yet.

Still, failure rates are high in the venture business, high in the start-up business and won't be any different this time around.

The BBC struggles with concept of 'tech bubble' • The Register

How Low Can Voice Prices Go?

Comwave has launched thе "India 1000 Bundle," that, for $10 per month, gives callers 1,000 minutes per month οf overseas calling tο India frοm thеіr сhοісе οf landline οr mobile phone. If that seems unremarkable, consider that, in 2000, a call from the United States to India cost $1.36 a minute. http://www.dot.gov.in/osp/Brochure/Brochure.htm

Another anecdotal touch point is how much else has changed, where it comes to international long distance. In the early 1990s, I once conducted an analysis of the major cost inputs for long distance service, attempting to figure out the "absolute limit" to pricing of long distance. At the time, it appeared that the absolute lowest price was three cents a minute for domestic U.S. calling, for example, since that was the imputed cost of billing for the call.

Almost by definition, even those cost parameters now have been shattered. The investigation of cost inputs was part of a larger exercise looking at the concept of "near zero pricing" and what the implications might be, for telecommunications entities. Already, in the early 1990s, one could see technologies and other forces at work that would continue to put pressure on retail prices.

There were new technologies, including wireless, infrared transmission and optical fiber, Internet Protocol, the continued operation of Moore's Law. Globally, a wave of telecom deregulation was starting to materialize, with pricing competition one of the chief expected outcomes. Under such conditions, the logical question was "how far can prices fall?" and what strategies might be available to a business that was founded on voice pricing.

In retrospect, the obvious answer was that telecom companies would "not be in that business" in the same way, in the future. It isn't that voice is not mission critical, it is simply that voice does not drive revenues in a business that now is multi-product, not single product.

Of course, it also is possible to point out that the implied price of "one cent a minute" does not take into account other policies or behaviors that actually mean the price is higher than one cent a minute. Transaction fees, for example, dramatically affect the real cost of a minute of talking.

In other cases, users buy a bucket of minutes and don't use them all, meaning the actual cost of some minutes of use is not directly knowable, in many cases. In other cases, users buy a package of services, with no direct relationship between the "voice" parts of the package, compared to other components, such as video or broadband access.

Still, the notion of near zero pricing has proven to be the way the voice communications business actually operates.

Comwave’s India 1000 Bundle: Call to India for Just 1 Cent per Minute from Landline or Cell | Open Source IP PBX

LTE Impact Will Vary by Region

In the communications business, what is true of some regions often is not true of others. Consider Long Term Evolution. Some believe LTE will not contribute much revenue between now and 2015. "Only 11 percent of mobile broadband subscribers are going to be on LTE networks by 2015, and LTE may not generate revenue growth," said Matt Walker, Ovum principal analyst.

But there appears to be clear developing differences between regions. In Europe, spectrum auctions haven't even occurred, much less the construction of LTE networks. For those reasons, there will not be so much revenue opportunity in Europe. The United States is a different matter, though.

The Yankee Group, for example, predicts that the United States will lead the world in LTE service adoption, and over 20 percent of all U.S. mobile lines using LTE by 2014, far exceeding the global average of just 2.1 percent.

LTE Impact Will Vary by Region

Study Suggests Mobile Operators Have 'High Trust' Advantages in Mobile Advertising

A recent YouGov survey suggests that mobile operators have a position of trust in the mobile advertising area that could provide a pathway into the mobile advertising business.

The research results found that consumers have a high level of trust and purchasing confidence in mobile operators, compared to third-parties. More than half (52 percent) of consumers would trust their mobile phone company over a third-party retailer when redeeming a deal sent by text message, compared to just 8 percent of consumers who would trust a third-party retailer more than their mobile operator.

That suggests mobile advertising could be an area where mobile service providers have some significant degree of end user trust, and therefore business advantage. The YouGov study suggests mobile operators would have to be careful not to send messages too frequently, but also indicates that mobile operators have an opportunity, as a trusted provider.

Study Suggests Mobile Operators Have 'High Trust' Advantages in Mobile Advertising Arena

1/2 of All Local Searches are Conducted on Mobiles

http://socialmediagraphics.posterous.com/the-growth-of-mobile-marketing-and-tagging

Time Warner Cable Wants Court Ruling on its TWCableTV App

Time Warner Cable has filed a request for declaratory judgment relating to Viacom cable networks. The request asks the court to rule that Time Warner Cable’s rights under its carriage agreement allows it to deliver the programming of this company over its cable systems for viewing on devices of its video customers’ choosing, including iPads, in their homes. The case was filed in the United States District Court for the Southern District of New York.

“We have steadfastly maintained that we have the rights to allow our customers to view this programming in their homes, over our cable systems, without artificial limits on the screens they can use to do so, and we are asking the court to confirm our view," says Marc Lawrence-Apfelbaum, Time Warner Cable Executive Vice President and General Counsel.

Time Warner Cable says it has already logged 360,000 downloads of the "TWCableTV" app.

The app, which launched to customers on March 15, 2011, currently features 43 channels.

Time Warner Cable Seeks Declaratory Judgment on Rights for iPad

FCC mandates wireless data roaming

The Federal Communications Commission has voted to require "reasonable" data roaming between mobile networks. The measure is largely aimed at AT&T and Verizon Wireless, the two carriers with the biggest footprints.

As typically is the case in the communications business, smaller and rural carriers have pushed for the data roaming rules, because such interconnection rules, provided at reasonable rates, allow smaller carriers to provide service out of region using the other carrier networks.

Also as a rule, larger carriers oppose mandatory rules of this sort because they allow smaller carriers to compete without having to invest in actual infrastructure.

FCC mandates wireless data roaming | Reuters