Atmel Emphasizes Internet of Things Ecosystem

Atmel Corporation, a leader in microcontroller and touch solutions, launched the Atmel Internet of Things (IoT) Cloud Ecosystem Partner Program.

The new program enables developers using Atmel “SMART MCU” and Atmel “SmartConnect” wireless solutions access to Atmel’s ecosystem partners for device management, data analytics, and visualization.

With the increasing need to collect, visualize and analyze data from IoT edge nodes and to manage the associated services, cloud connectivity is becoming an essential element for product development, Atmel argues.

Device management is also an important aspect of cloud services as more devices are performing functions through remote management, such as a connected thermostat that is programmed remotely and sends climate information back to the user’s remote device reducing overall power consumption while providing a better user experience.  

Sprint's "Debt Bomb"

Is Sprint facing a “Grexit” problem (unsustainable debt load) of its own? Some think so.

Ignore for the moment the statement by T-Mobile US owner Deutsche Telekom that T-Mobile US  is not sustainable as an independent firm with its current position in the market, Timotheus Höttges, Deutsche Telekom CEO has said.

Some now say Sprint’s position might well be unsustainable as well, given “severe financial distress,” according to MoffettNathanson principal Craig Moffett.

The upshot is that either a previously-unthinkable merger between Sprint and T-Mobile US a year ago could become a possibility. In order for that big a change in regulatory thinking to occur, Sprint would have to flirt with complete failure, however.

“If Sprint really is in severe financial distress, as we think they will be within a relatively short period of time, then it’s possible that the government would look at that deal differently,” said Moffett.

That is not to say Sprint’s operating performance is quite so challenged. Indeed, Sprint seems to be improving, operationally. Sprint says it stopped declines in its business in fourth quarter of 2014 (calendar first quarter of 2015). And Sprint added important postpaid accounts in the quarter, instead of declining.

CEO Marcelo Claure noted that Sprint retail net additions of 757,000 actually beat Verizon and AT&T.

In the year-ago same quarter, Sprint lost 1.1 million accounts. To be sure, Sprint postpaid net additions trailed it competitors, “but the gap to Verizon and AT&T is closing dramatically compared to the 800,000 difference a year ago, and we have closed the gap with T-Mobile by more than 40 percent,” said Claure.

The big problem is debt. In 2011 Sprint had less than $23 billion in debt. Today Sprint has more than $33 billion in debt, a 50-percent jump in just three years. Some argue Sprint does not have either the profitability or cash flow to pay down the debt.

Of course, a merger between Sprint and T-Mobile US is only one possibility.

Dish Network, Comcast or perhaps another firm might see a weakened and therefore “cheap to buy” Sprint as a strategic asset, given that both those firms intend to enter the U.S. mobile market.

What seems clear is that neither T-Mobile US nor Sprint are strategic buyers, but are strategic sellers. What is entirely unclear are the names of the eventual buyers.

If Sprint declines enough that antitrust authorities do not believe a merger with T-Mobile US is problematic, some other contender is likely to have moved first.

Packet Loss is Chief Experience Degrader on Mobile Networks

Traditional network “quality” metrics are based on throughput and latency. But according to a study by Kwicr, the chief source of mobile app quality problems now are packet loss and throughput variation.

Throughput and latency matter, but only to a lesser extent, in the mobile environment.

In part, that is because mobile video has emerged as a key app, and mobile video and mobile audio are affected by both packet loss and throughput variation.

But devices matter as well, in particular older devices with slower processors and less available memory. Additionally, older devices may only support more crowded 2.4GHz Wi-Fi bands, or not be enabled with the fastest cellular technologies such as LTE and LTE Advanced.

Both types of impairments result in stalls and lower quality streaming, even if there is ample bandwidth to service the customer.

Kwicr says content delivery networks are effective ways to improve app performance, particularly for apps with cacheable content such as streaming video, streaming audio, and static web page content.

That is a logical observation for a company that sells a mobile content delivery network.

The main point, Kwicr argues,  is that mobile Internet access networks are different from fixed Internet access networks.

TCP performs exceptionally well with wired networks, because packets are lost only when the network is congested, Kwicr says.

TCP is designed to work with wired networks and equitably split bandwidth across the applications that are utilizing the fixed sized links on these networks.

Mobile broadband is characterized by quickly varying available bandwidth, caused by impacted by endpoint motion, weather, topographic feature interference (mountains and buildings), the active or passive coordination between multiple access points or base stations, and contention for spectrum.

All that leads to a rapidly-changing bandwidth environment, something TCP was not designed to anticipate.

“Our data indicates that the throughput available to a mobile app for download and upload varies greatly during a single app session,” said Kwicr.

Wi-Fi and Long Term Evolution (4G) have the highest average throughput, but Wi-Fi has unusually high rates of packet loss events.

Comcast Stream, Otter Media Illustrate Tensions Over Linear Video

It is not unusual to note management issues when large enterprises and smaller firms partner or when larger firms acquire smaller firms.

Nor is it unusual to understand strategic issues and conflicts whenever a joint venture aims to create a big replacement business important to an enterprise, as any enterprise logically tries to maximize the value of its present business, even if it understands that business is shrinking and will be replaced in time.

Comcast’s new Stream service, for example, is available only to Comcast high speed access subscribers, although it importantly does not require buying Comcast linear video service.

The service features access to about a dozen major networks (four TV broadcasters, PBS, CW, and Spanish-language channels, HBO and a cloud DVR feature, that can be viewed on Web browsers, tablets and mobiles.

You see the hybrid approach: buyers must previously have chosen to buy, and keep buying, the Comcast high speed access product. The service offers a limited menu and works only on non-TV devices. But there is no requirement to buy the Comcast linear video service.

Those features make Stream a complement, not a substitute product. Critics might argue the limited channel line-up prevents Stream from becoming, in any substantial way, a substitute for the core linear video product.

That is the point.

The same dynamic might be at work with a CEO resignation at Otter Media, the streaming media joint venture between AT&T and the Chernin Group.

In principle, both firms might hope for serious market success that might be defined as creating a credible competitor to Netflix.

On the other hand, too much success might jeopardize the cash flow AT&T hopes to wring from its acquisition of DirecTV, a business that everyone agrees is imperiled by the rise of streaming alternatives.

Ultimately, one might argue, efforts to foster growth of a substitute new product, by a leader in that market, are difficult--and often impossible--to finesse.

The problem includes, but is not limited to the inherent tension between the legacy and replacement revenue units. Too much success by the innovation unit, too fast, directly reduces legacy business unit revenue.

So interests are in direct conflict. That rarely is a recipe for rapid progress. Indeed, one might argue precisely the opposite will happen: the innovator unit will be constrained to protect the legacy unit.

The problem is more than “bureaucracy.”

Any large enterprise, in any industry, will operate more “bureaucratically,” which is to say, with many more rules and structured processes.

Many would say such firms must do so, to maintain the organizational equivalent of rule of law.

As frustrating as working in a rules-driven organization might be, the alternative likely is worse: the danger of whimsical, conflicting, unsteady decision making.

Stresses arguably are even greater when a joint venture tries to navigate a complex and dangerous juncture between fundamental business models and technology platforms, and when one of the parties aims to be a disruptor, while the other is a leader in the legacy business.

That, in a nutshell, might well be the problem faced by Otter Media. Verizon Wireless might be taking the opposite approach, essentially harvesting its legacy business faster by building and promoting replacement services at a faster rate.

You might explain that attitude by structural realities. AT&T will be the biggest provider of linear video in the U.S. market if its acquisition of DirecTV is approved. Verizon is among the smaller providers. In other words, AT&T has far more revenue to lose.

As much as managers might want to be leaders in an emerging big new business, they also want to harvest and protect their existing business.

That forces innovation efforts to avoid actions that are viewed as negatively and directly reducing the magnitude of revenue streams from the legacy business.

It is a serious and perpetual problem, and more relevant for Comcast and AT&T, which are leaders in linear video, compared to Verizon, which has concluded it is not worth the effort to grab a bigger position in linear video.

IoT Value Clear for Insurance Industry

It is hoped--perhaps expected--that application and service providers will have a far easier time convincing potential buyers of the business value of Internet of Things features, compared to some other innovations of recent decades.

Unlike some earlier value propositions, which generally revolved around automation, and the cost side of any business, IoT value tends to come from the revenue and margin side of the business.

That tends to get a better reception from decision makers.

On the other hand, the Internet of Things should also blur industry boundaries, allowing new competitors--especially those not traditionally in the insurance industry--to create services that take market share.

Such porous industry boundaries typically happen when important new technology gets deployed, and virtually always when markets get deregulated.

source: AT Kearney

Consider the benefits for insurers. IoT devices that monitor actual user behavior will allow better predictive models, which in turn will allow insurers to better manage risk.

The IoT will change every part of the insurance value chain, including product design, pricing, underwriting, service and claims.

The value for policyholders is reduced premiums. For insurers, the value is reduced loss and lower overall costs.

Over time, insurance premiums will decrease proportionately to decreases in losses.

Auto insurers and health insurers provide clear examples. Simply, trucks equipped with monitoring capability have fewer accidents than trucks without monitoring.

Property insurance companies are increasingly using drones to assess damages after an incident has occurred. Consulting firm Cognizant estimates that drones will make insurance adjusters' work flow 40 percent to 50 percent more efficient.

Healthcare insurers are giving customers free fitness trackers and offering lower premiums or other benefits for meeting daily exercise goals, which in turn contribute to greater health and lower health intervention outlays.

Home insurance companies are incentivizing customers to install connected devices that warn of potential danger to properties. With the average claim for a residential fire

at more than $35,000, the opportunity for claims reduction can be significant.

IoT-based analytics can be used to predict future events, such as major weather patterns. This can help insurers better price policies and prepare customers for upcoming incidents, which should help reduce damages.

When Will HFC Reach Exhaust?

Though it likely was not so fully understood at the time, cable operators have been arguing for decades that the hybrid fiber coax network is more flexible than fiber to the home platforms, and can be upgraded at less cost.

We might be approaching a period where the statement starts to be qualified, though. Comcast, which is upgrading all of its locations to gigabit speeds using a modem upgrade (DOCSIS 3.0 to DOCSIS 3.1), also is switching to a fiber to home design for customers who want symmetrical 2 Gbps service.

To be sure, there is no immediate need for a full platform change. But eventually, it might happen that the HFC platform is scrapped for a fiber to home network.

That would represent a “final”  realization of the “technology hybrid” approach the U.S. cable TV industry has relied upon for several decades.

That strategy includes an understanding of how to manage a business when fundamental technology changes occur. The notion of a hybrid approach suggests industries often adopt a “use both” approach when in the midst of a technology change.

Doing so allows entities to take advantage of experience curves for the older technology, while gradually introducing the replacement technology.

Often, the next generation of technology might not have the full capability set, at production prices, to support immediate and complete replacement of the legacy approach.

Will there be yet another technology transition? Undoubtedly. The issue is what the shift will entail. Some might bet on untethered or mobile.

First Suddenlink Gigabit Markets Launched

Suddenlink says the first areas to receive its up to 1 gigabit per second Internet service are Bryan-College Station, Texas; Nixa, Mo.; and Greenville and Rocky Mount, N.C.

Suddenlink also announced that residential high-speed Internet customers in markets on two other speed tiers will get a free speed boost.

Customers buying those on the 75 Mbps service will now get 100 Mbps, while 100-Mbps customers will be upped to 200 Mbps.

That raises a packaging issue. Where four speeds are available (1 Gbps, 200 Mbps, 100 Mbps and 50 Mbps), Suddenlink will have to convince consumers that pricing across the tiers are commensurate and fair.

That can be an issue if the top speed (1 Gbps) offers so much more value, compared to its price, that the lower offers start to look unfair. That is, if any actual number of customers actually pay the posted stand-alone rates.

CenturyLink executives, facing a similar situation, say the availability of gigabit offers actually spurs adoption of new 20 Mbps and 40 Mbps services. So gigabit service availability drives upgrades and new accounts, but for lower-speed services, perhaps primarily.

With discounts available through new customer promotional offers, Internet access prices now range from $35 to around $100 per month. It just depends.

Over time, the pressure to normalize pricing across tiers, in terms of price per bit, will be significant. If one assumes prices are hard to adjust upwards, in light of gigabit service pricing, it will be necessary to limit price increases for the lower-speed tiers.

The launch of the new Gigabit service is part of Operation GigaSpeed, the company-wide plan announced last August 2014.  In contrast to companies like Google and AT&T, which are generally offering a Gigabit service only to a few neighborhoods in primarily urban markets, Suddenlink is making its service available to all households passed by the Suddenlink network.