The House Energy and Commerce Subcommittee on Communications and Technology held a hearing on whether existing communication laws address the demands of new technology. Such hearings do not, in and of themselves, mean much. But it is just one more sign that pressure is building within the video ecosystem.
Many speakers noted that regulations currently in place are outdated and stem from a time when cable companies controlled a much larger portion of the subscription video market.
Thursday, June 28, 2012
House Hearing on Video Market Shows Growing Pressure within the Ecosystem
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.
Some Business Problems Cannot be Solved
Put yourself into the role of CEO at either Sprint or T-Mobile USA. What is the answer to the question of how you will catch up to Verizon Wireless and AT&T? And make us believe it.
It's tough. Tough, in fact, because there are some problems in business that are hard, perhaps impossible to fix. One of those intractable problems is market share structure in a well-developed industry.
Typically, a rule of thumb suggests, the market leader has twice the share of the number-two provider, which in turn has twice the share of number three, and then share falls off dramatically after that.
It might be more accurate to say that market share has a direct bearing on profit margins, as well.
The U.S. mobile market does not have precisely that classic stable distribution. Verizon, early in 2012, had about 32 percent share, AT&T about 26 percent.
Sprint had about 16 percent and T-Mobile USA had about 10 percent.
That suggests, to some of us, that the market remains unstable, and would be expected, over time to move in the direction of the "classic" structure. That doesn't mean real-world markets always assume the classic structure perfectly, only that the stable structure of a market will feature dramatic differences in both market share and profitability.
But regulators will have a say, having already firmly suggested that AT&T could not grow to 38 percent market share.
That suggests, over time, combinations of the smaller providers. The point is that one might argue there actually is little executives at firms such as T-Mobile USA and Sprint can do to fundamentally alter the direction of the market, no matter how talented they might be.
Typically, a rule of thumb suggests, the market leader has twice the share of the number-two provider, which in turn has twice the share of number three, and then share falls off dramatically after that.
It might be more accurate to say that market share has a direct bearing on profit margins, as well.
The U.S. mobile market does not have precisely that classic stable distribution. Verizon, early in 2012, had about 32 percent share, AT&T about 26 percent.
Sprint had about 16 percent and T-Mobile USA had about 10 percent.
That suggests, to some of us, that the market remains unstable, and would be expected, over time to move in the direction of the "classic" structure. That doesn't mean real-world markets always assume the classic structure perfectly, only that the stable structure of a market will feature dramatic differences in both market share and profitability.
But regulators will have a say, having already firmly suggested that AT&T could not grow to 38 percent market share.
That suggests, over time, combinations of the smaller providers. The point is that one might argue there actually is little executives at firms such as T-Mobile USA and Sprint can do to fundamentally alter the direction of the market, no matter how talented they might be.
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.
Google Isn't Making Any Profit From Sales Of The New Nexus 7 Tablet
Andy Rubin, Google's head of mobile, says Google is selling its new tablet "at cost" through Google's online store. "There's no margin," he said in the interview. "It just basically gets (sold) through."In fact, Rubin says the company is eating the marketing costs for the device. Like Amazon, at least for the moment, the device is seen as a platform for creating revenue streams other ways.
But that, in general, is probably the way Google approaches its entire set of efforts in consumer electronics: creating products that drive usage and then revenue from the software and content products it creates.
That is more the "Amazon" strategy than the "Apple" strategy.
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.
What Kind of Company is Google Becoming?
With the launch of its first tablet, a seven-inch device that seemingly is aimed more at Amazon than Apple, Google has added yet another device to the list of gadgets it now produces, ranging from smart phones to a new home entertainment system.
The new tablet, priced at $199, makes Google an even more complicated company. The $299 home-entertainment player called Nexus Q likewise further blurs Google's identity, you might argue.
Google always has said it is a software company. Its revenue comes mostly from advertising, especially from Google's search engine. That has made Google the paramount example of something we haven't seen before, namely a software company whose revenue comes from advertising, primarily.
Some of us would have said that Google might as well be called a media company, as well, with its YouTube operations and especially revenue model. What sort of company makes its money from advertising? Traditionally, only a "media" firm.
But now Google is becoming a supplier of consumer electronics as well. Ignoring for the moment all the other lines of business Google is experimenting with, it has become even harder to figure out what to "call" Google.
Google itself still says its mission is to organize all the world's information. But it also says it does "search" and products that "make the web better."
One has to conclude that Google simply is at a point where it is changing into "something else," and it is hard to describe what that "something else" actually might be.
The new tablet, priced at $199, makes Google an even more complicated company. The $299 home-entertainment player called Nexus Q likewise further blurs Google's identity, you might argue.
Google always has said it is a software company. Its revenue comes mostly from advertising, especially from Google's search engine. That has made Google the paramount example of something we haven't seen before, namely a software company whose revenue comes from advertising, primarily.
Some of us would have said that Google might as well be called a media company, as well, with its YouTube operations and especially revenue model. What sort of company makes its money from advertising? Traditionally, only a "media" firm.
But now Google is becoming a supplier of consumer electronics as well. Ignoring for the moment all the other lines of business Google is experimenting with, it has become even harder to figure out what to "call" Google.
Google itself still says its mission is to organize all the world's information. But it also says it does "search" and products that "make the web better."
One has to conclude that Google simply is at a point where it is changing into "something else," and it is hard to describe what that "something else" actually might be.
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.
Wednesday, June 27, 2012
Why Google has gone "Mobile First"
If you want some evidence about why Google has gone "mobile first" in its product strategy, a few key statistics Google announced tell the story well.
Google says it has 250 million total users, 150 million monthly users and 75 million daily users, with more usage from mobile than desktop TechCrunch says.
Google says it has 250 million total users, 150 million monthly users and 75 million daily users, with more usage from mobile than desktop TechCrunch says.
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.
Is Telecom Italia Going to Structurally Separate Itself?
A unit of Cassa Depositi & Prestiti may invest three billion euros in a partnership with Telecom Italia that would structurally separate the Telecom Italia network from the retail services unit. Since 2008, Telecom Italia has operated its network as a functionally separate entity with extensive wholesale operations.
The new rumor suggests that Telecom Italia is prepared to go the next step and fully separate the network operations part of its business, Bloomberg reports.
Telecom Italia's "Open Access" unit, which has the network infrastructure and employs a 19,000 people in maintenance and operations, might be in play, whether the recent report is true or not (Telecom Italia denies the rumor).
CDP also says it “isn’t aware” of the proposal. What might be more true is that Telecom Italia is seriously considering structurally separating its network assets business from its retail telecom services business.
Italy lags Europe in terms of broadband penetration with only 49 percent of households connected against a European average of 61 percent, according to Eurostat data.
Some observers in Europe believe competition will not be sufficient to create conditions for faster broadband investment. Carriers actually argue that current regulations actually discourage that investment.
The rumored Telecom Italia move might be a way that the telco could essentially give the problem to somebody else. Since 1995, Telecom Italia has operated only fixed networks, as its mobile operations were spun off into a separate company.
Debt reduction seems to be driving the thinking. Other European telcos are divesting assets as well, in order to trim debt and prepare for investments in mobile services.
The new rumor suggests that Telecom Italia is prepared to go the next step and fully separate the network operations part of its business, Bloomberg reports.
Telecom Italia's "Open Access" unit, which has the network infrastructure and employs a 19,000 people in maintenance and operations, might be in play, whether the recent report is true or not (Telecom Italia denies the rumor).
CDP also says it “isn’t aware” of the proposal. What might be more true is that Telecom Italia is seriously considering structurally separating its network assets business from its retail telecom services business.
Italy lags Europe in terms of broadband penetration with only 49 percent of households connected against a European average of 61 percent, according to Eurostat data.
Some observers in Europe believe competition will not be sufficient to create conditions for faster broadband investment. Carriers actually argue that current regulations actually discourage that investment.
The rumored Telecom Italia move might be a way that the telco could essentially give the problem to somebody else. Since 1995, Telecom Italia has operated only fixed networks, as its mobile operations were spun off into a separate company.
Debt reduction seems to be driving the thinking. Other European telcos are divesting assets as well, in order to trim debt and prepare for investments in mobile services.
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.
Automatic Mobile Phone Public Hotspot Access?
Some 37 communications companies around the world have signed up to test Hotspot 2 Wi-Fi roaming and billing.
Aircel, AT&T, Boingo Wireless, BT, BskyB (The Cloud), China Mobile, Deutsche Telekom, DOCOMO InterTouch, Everything Everywhere, FON Wireless, Gowex, Indosat M2, HK CSL, KDDI, iBAHN, KT Corporation, Meteor Network, NTT DOCOMO, Oi Wi-Fi, Orange, PCCW Mobile, Portugal Telecom TMN, SK Telecom, Shaw Communications, Smart Communications, Softbank Mobile, StarHub, Swisscom, Talk Talk, TeliaSonera, Telefonica, TIM Brasil, Time Warner Cable, Tomizone, True Corp., Trustive and TTNET are among the firms participating.
The Wireless Broadband Alliance says the trials of "Next Generation Hotspots" will test interoperability and performance of new gear that will give users easier access to a far greater number of public Wi-Fi access points around the world.
The trials will take place in the fourth quarter and employ the first generation of Wi-Fi "Passpoint" equipment which the Wi-Fi Alliance today announced it will start approving. The WBA expects the first NGH deployments to take place in H1 2013.
Next Generation Hotspots will allow users to gain access without the need for user names and passwords, while also allowing operators to establish relationships with each other so their users can access a wide variety of hotspots in their own country and around the world.
HotSpot 2 might also have the potential to be disruptive, though, some might argue.
It has been some time since anyone seriously argued that public Wi-Fi hotspots could be a viable alternative to mobile infrastructure. But at least to some extent, HotSpot 2 could create WiFi networks extensive enough, and easy enough to use, that some contestants could offer Internet access either as a non-mobile but outside the home service, or simply offload mobile traffic to the hotspots, as most of the mobile operators hope to do.
Aircel, AT&T, Boingo Wireless, BT, BskyB (The Cloud), China Mobile, Deutsche Telekom, DOCOMO InterTouch, Everything Everywhere, FON Wireless, Gowex, Indosat M2, HK CSL, KDDI, iBAHN, KT Corporation, Meteor Network, NTT DOCOMO, Oi Wi-Fi, Orange, PCCW Mobile, Portugal Telecom TMN, SK Telecom, Shaw Communications, Smart Communications, Softbank Mobile, StarHub, Swisscom, Talk Talk, TeliaSonera, Telefonica, TIM Brasil, Time Warner Cable, Tomizone, True Corp., Trustive and TTNET are among the firms participating.
The Wireless Broadband Alliance says the trials of "Next Generation Hotspots" will test interoperability and performance of new gear that will give users easier access to a far greater number of public Wi-Fi access points around the world.
The trials will take place in the fourth quarter and employ the first generation of Wi-Fi "Passpoint" equipment which the Wi-Fi Alliance today announced it will start approving. The WBA expects the first NGH deployments to take place in H1 2013.
Next Generation Hotspots will allow users to gain access without the need for user names and passwords, while also allowing operators to establish relationships with each other so their users can access a wide variety of hotspots in their own country and around the world.
HotSpot 2 might also have the potential to be disruptive, though, some might argue.
It has been some time since anyone seriously argued that public Wi-Fi hotspots could be a viable alternative to mobile infrastructure. But at least to some extent, HotSpot 2 could create WiFi networks extensive enough, and easy enough to use, that some contestants could offer Internet access either as a non-mobile but outside the home service, or simply offload mobile traffic to the hotspots, as most of the mobile operators hope to do.
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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