Spanish Mobile Churn Hits Record Levels

Spanish mobile phone operators lost a record number of clients in April 2012, with some 70 percent of defections occurring at Telefonica and Vodafone, as they stopped subsiding smartphones for cash-strapped customers, CNBC reports. 


Observers will quickly speculate on why the historically-high rate of churn is happening. Some obvious explanations include the economic crisis, or perhaps the end of device subsidies, which might reduce demand for new phones. 


Around 380,000 customers ditched their mobile phone lines in April, marking the third straight month of decline in the overall customer base in austerity-crippled Spain, where one in four people is unemployed, the Spanish regulatory body says. 


"This crash for mobile phone operators has been especially notable in the prepay sector, which lost 297,984 clients," regulator Comision del Mercado de Telecomunicaciones says. 

Will U.S. Fixed Network Voice Connections Continue to Drop?

The latest report on U.S. fixed network voice connections by the Federal Communications Commission suggests that voice connections declined three percent between June 2010 and June 2011. That raises an obvious question: will number of fixed voice connections continue to drop, without end, to zero?


Some of us would argue that there is some stable number of connections, a non-zero number, that ultimately will be reached. How to encourage people to buy fixed network voice connections is the issue. "Value" is part of the equation. But some of us might argue that retail packaging is more important. 


Verizon Wireless "Share Everything" plans provide a key answer. Voice and text messaging are purchased as a basic part of the access service. No voice, no smart phone service. When you buy an automobile, you don't buy parts, you buy a car. Share Everything is the same sort of idea. 

How Much Better Can Telcos Do in IPTV Business?

For anybody who has followed the U.S. video entertainment market for some decades, that U.S. cable operator video penetration is as low as 44 percent of TV homes is a shocking statistic. There was a time when penetration was as high as 70 to 80 percent of homes in some areas.


Competition from satellite and telco competitors is the reason for the sharp reversal. So the question is how much more upside might exist in the IPTV business for telcos.  It isn't so easy to answer. 


In saturated markets with strong contenders, new accounts mostly come from defecting customers. And strong contenders don't give up customers very easily. 

What, How Big is Broadband Adoption in the United States?

There are some 93.3 million broadband subscriptions in service in the United States in the first quarter of 2012, according to the Broadband Forum. And it is possible those figures both overstate and understate actual broadband penetration. 


The "overstate" could occur if business accounts are included in the tallies. The "understate" would occur because those surveys do not seem to include mobile broadband, used by a significant and possibly growing number of households.


There are more people relying on mobile broadband as their primary form of Internet access and applications, these days. 

What Business Are AT&T and Verizon in, Really?

You might justifiably argue that the idea of “dumb pipe” scares telecom and cable TV executives, but not really for reasons often supposed. The notion implies, though it often is unstated, that dumb pipe means “low margin, commodity” access.


The problem is that the notion is partly true, and partly untrue. “Share Everything,” the new Verizon Wireless pricing policy, makes voice and text messaging a “flat-fee price of admission” to use the mobile network. Internet access, on the other hand, becomes a variable-fee feature based substantially on usage.


The point is that dumb pipe is a part of the business, not the whole business, nor is it the only business service providers already are in. But it is pointless to argue about whether dumb pipe is a business access providers must be in: they must, and will.


But that doesn't ever mean it is the only business they are in. Also, though there always is thinking and some action about access providers becoming app providers, historically, nearly all the money comes from apps that are closely tied to the core access function and network. That probably won't change. 

Verizon Wireless "Share Everything" Might be Controversial to Some, but is Indeed "Revolutionary"

Some don't think there is anything revolutionary about Verizon Wireless "Share Everything" plan. Some would disagree. Some might not remember, but there used to be a difference between a U.S. domestic mobile "long distance" call and a "local" call. There used to be a difference between a domestic U.S. landline call. 


But then AT&T introduced "Digital One Rate." Industry pricing changed dramatically. Keep in mind, there was skepticism about Digital One Rate when it was launched, as well.


Dan Hesse, Sprint Nextel CEO, was CEO of AT&T Wireless Services back in 1998, not many will recall. That was the month Hesse was able to act on a vision he had strenuously to sell to his superiors: that wireline minutes of use could be shifted to wireless, saving at&t money on access fees by doing so.

The Digital One Rate plan was not primarily aimed against other wireless carriers at all, but rather at reducing a significant cost of doing business on the AT&T long distance side of the house. 

At the time, Hesse pointed out that "we're taking a chunk out of revenue usually going to our competitors," meaning by that the Regional Bell Operating Companies that at&t had to pay access fees to.

The point is that major packaging initiatives can have unanticipated consequences. Digital One Rate was just a way to save AT&T long distance operations money on terminating traffic charges paid out to local carriers. 

But you might argue that Digital One Rate had more impact on the market, and consumer welfare, than did the Telecommunications Act of 1996, the first major revamp of U.S. telecommunications law since 1934. 

Something similar might  be said about the impact of family plans for voice and text messaging, which were adopted essentially for the purpose of turning teenagers into mobile users. It worked.

"Share Everything" might have similar unanticipated, and many expected, consequences. 

Poll Finds People are "Addicted" to Their Smart Phones

Nearly 60 percent of surveyed smart phone owners report they don’t go an hour without checking their phone, but you probably already knew that. 


Younger folks were the most "addicted," as  63 percent of women and 73 percent of men ages 18 to 34 say they don’t go an hour without checking their phones, a survey conducted  by Harris Interactive, and commissioned by Lookiout, has found.


Some 54 percent said they check their phones while lying in bed: before they go to sleep, after they wake up, even in the middle of the night. 


Some 30 percent of respondents admitted that they check their phones during a meal with others. About 24 percent said they check their phones while driving.