RIM Earns $4 Billion Annually in Service Provider Fees for Email Services; Carriers Want to Pay Less

Research in Motion executives say the company is "not in a death spiral," but pressure is growing. RIM earns $4.09 billion in annual revenue from mobile service providers who provide RIM device email services to consumers.

But AT&T, for one, wants to pay RIM less for the privilege.The fees account for more than a third of revenue at RIM, according to Bloomberg.

“There’s definitely negotiations going on right now to reduce” the fees, said Sameet Kanade, a technology analyst at Northern Securities.

Samba Mobile Launches Free Mobile Broadband Service in U.K.

Samba Mobile is going to test the notion that an ad-supported mobile broadband service can work. Apple iPad users buy a Samba SIM now for £2.99 plus some "packaging" costs and get free mobile broadband service. Other notebook or desktop PCs will require a Samba dongle. 


Samba Mobile will become the latest service provider to try and prove that an ad-supported mobile service can work, though all prior attempts have failed. 


Tablet owners need only the Samba Micro-SIM, though the service is only available on Apple iPads at this stage. Laptop and desktop users must purchase a Samba USB-Dongle and the SIM for £25. 

Samba surfing is compatible with Firefox and Google Chrome but members are forbidden from accessing pornography sites as well as material that breaches copyright or is deemed offensive. 

The company also says it may install cookies to collect information about your “general internet usage”.

One Reason Mobile Service Providers Think M2M Has a Future

The vending machine industry has been fcing declining revenue since 2007, and industry supporters think new machines, using more digital technology, can reverse the trend.

Those changes will require broadband access, many would argue, creating a new type of customer for mobile service connections.

Telefónica Sees Huge Upside in M2M, Carrier Billing

Telefónica might be a bit optimistic, but the firm believes it can generate annual revenues of €5 billion (US$6.2 billion) by 2015 from initiatives that leverage the carrier's billing and charging capabilities as well as machine-to-machine services.

Those are important assertions for one principal reason. When a tier-one service provider decides to target its human and financial resources to a new revenue growth initiative, scale matters. In other words, a large telco cannot afford to waste time chasing small revenue opportunities, but has to look for opportunities that make a difference.

The shorthand way you can think about it is that when a service provider earns scores of billions worth of revenue each year, small opportunities do not “move the revenue needle” enough to be worth pursuing. As a very-simple rule of thumb, a tier-one service provider has to look for opportunities that generate at least a billion dollars a year.

Telefónica Digital believes its new global "Direct to Bill" agreements with Facebook , Google , Microsoft Corp. and Research In Motion Ltd. will do so.

Those deals allowTelefónica customers to buy content and services from Facebook, Google, Microsoft and RIM application stores, for example, using their mobile accounts. The charges appear directly on the subscriber phone bills, and do not require use of credit cards.

The operator believes this could prove very popular in Latin America, where, according to Telefónica, "credit card penetration is low and 60 percent of the population do not have bank accounts."

Telefónica also has entered a strategic partnership with service provider Etisalat that extends Telefónica's M2M reach into 17 new countries (in Africa, Asia/Pacific and the Middle East). The two operators plan to "jointly develop business opportunities in Machine-to-Machine (M2M), financial services, cloud computing, eHealth, mobile advertising and over-the-top [OTT] communications."

A La Carte Video Would Destroy Most Channels, Study Suggests

If the U.S. government mandated that TV channels be sold individually, only five to 10 traditional TV networks would survive, destroying up to $300 billion of value, endangering some one million jobs and curtailing consumers' video choices, according to an analysis by Needham and Company.

According to Needham's analysis, with unbundling, TV subscription revenue would decline 15 percent to 20 percent and ad revenue would plummet 75 percent. Meanwhile, if content companies delivered content directly to consumers, they would incur customer service costs estimated at $50 per customer per year, or $5 billion nationally.

Little is 'Trivial' Where Mobile Payments are Concerned

Though some might scoff at the notion that applications, such as contactless payments in transportation or parking, or wallet applications such as “time to refill your prescription” notifications using text messaging that every mobile device can receive, are “trivial,” such applications are important, for a number of reasons, says Diarmuid Mallon, Sybase 365 head of product marketing.

For starters, applications that are not drop-dead simple, widely available and which do not provide “obvious” and immediate value will not be adopted quickly or broadly. Given growing fragmentation in both the mobile payments and mobile wallet spaces, that is an important issue.

But there is a reason apparently trivial applications are important. They often are the places where clear value is provided.

Can Carrier “App Stores” Beat Apple App Store or Google Play?

Carriers such as AT&T and Verizon may very well get into the app store space to compete with Apple and third-party app stores like Getjar, argues Infonetics Research analyst Shira Levine.

The carriers' differentiation would be the ability to offer Android and browser-based applications in a one-stop-shopping environment. "AT&T learned a valuable lesson with the iPhone," says Levine. "They’re not part of the revenue value chain."

As a result, she says, "[carriers] are envisioning OS-independent app stores, which consumers could access no matter what device you had and even do so across multiple devices."

That’s part of the thinking behind the Wholesale Applications Community. Will it work?