3G iPhone Cannibalizing Fixed Broadband?

At least some of us believe that mobile broadband someday will be as prevalent as mobile voice now is. Where broadband once was a service delivered to "places," it will be delivered to "people."

The immediate issue, though, might be whether at least some users will decide to substitute mobile broadband for fixed broadband. 

That, at least, is a possibility as the number of lower-income 3G Apple iPhone users increases. 

Ownership of the 3G iPhone rose 48 percent from June 1 to the end of August among households earning between $25,000 and $50,000 a year, compared to 21 percent overall.

Since iPhone ownership disproportionately has been concentrated among higher-income households, the shift might suggest that users are making rational decisions about value and price.  If a 3G iPhone provides mobile music, voice, email and Internet access, then the cost of using it is balanced by cost savings from avoided landline voice and broadband spending.

Ultimately, personal broadband might mean some amount of cannibalization of fixed broadband. And we might be seeing just that at work, among 3G iPhone users.

Up to 33% of Mobile Broadband Buyers Have Gripes

More than 10 percent of mobile broadband users feel that they were mis-sold, according to a survey sponsored by U.K. mobile provider O2. Nearly a third complaining that the ongoing cost was higher than expected while 20 percent found they were unable to use mobile broadband where they wanted it despite being told by providers that there would be coverage.

Another 13 per cent were frustrated that there was no returns guarantee if the service wasn’t right for them and around half wanted inclusive Wi-Fi as a standard option.

In response, O2 is changing practices to address the complaints, including a price reduction on core mobile broadband tariffs, the launch of a new coverage checker and a 50-day "happiness guarantee."

International roaming has been a key element in "sticker shock," so that feature will not be automatically enabled for all new O2 Mobile Broadband customers. New customers will need to contact O2 Customer Service to have roaming activated so that O2 can explain the likely costs.

For heavy users, O2 is also introducing a new 10 GByte package for £30 per month on a two year tariff and is also the only provider to offer all its customers unlimited Wi-Fi through any of the 6,100 hotspots through an exclusive partnership with The Cloud.

In addition, O2 is reducing the price of its core Mobile Broadband tariffs, with 3GB packages costing just £15 per month. Customers purchasing an 18-month or 24-month contract will also receive a free USB modem (or £99.99 on a rolling monthly contract).

An improved coverage checker will provide what O2 calls "an honest assessment" of the likely coverage customers will receive at their home locations.

The 50-day guarantee allows users to terminate service without penalties and return adapters for a refund.

Internet Gains 23% as News Source

Many more Americans are turning to the Internet for campaign news this year as the web becomes a key source of election news, say researchers at the  Pew Research Center for the People & the Press. Television remains the dominant source, but the percent who say they get most of their campaign news from the Internet has tripled since October 2004, up from 10 percent then to 33 percent now.

While use of the Web has seen considerable growth, the percentage of Americans relying on TV and newspapers for campaign news has remained relatively flat since 2004. In March, 26 percent of survey respondents cited the internet as a main source for election news, while the percentages citing television and newspapers remain largely unchanged. 

Not surprisingly, the Internet is a considerably more popular source for campaign news among younger Americans than older ones. Nearly three times as many people ages 18 to 29 mention the internet than mention newspapers as a main source of election news (49 percent for younger respondents, 17 percent for older respondents). 

Nearly the opposite is true among those over age 50: some 22 percent rely on the Internet for election news while 39 percent look to newspapers. Compared with 2004, use of the Internet for election news has increased across all age groups. Among the youngest cohort (age 18 to 29), TV has lost significant ground to the Internet. 

European Mobile Behavior Might Shift, Temporarily

Forrester Research analyst Pete Nuthall does not think economic stringency will dent
European mobile penetration rate of 84 percent. But he does predict there will be some reduced usage and spending. Purchases of more advanced handsets and services also might dip.

Mobile providers are responding to the anticipated changes by de-emphasizing mobile data services and expanding the variety of SIM-only offers.

Send and Receive Text Messages from Google Chat

At least some Gmail Chat users now can send text messages to buddies on their mobile phones using Gmail Chat. Recipients also can respond to those text messages just like they would respond to messages sent directly from a mobile phone, as well. As is typical for new feature introductions, the feature is being rolled out in phases, so not every Google Chat user has access to the feature right now.

Google appears to enable that function by providing a virtual phone number. The feature also works for mobiles responding from outside the United States, but the operation isn't quite so automated.

The ability to send a text message from a PC is not new. The ability to receive text message replies to a PC is.

To send text messages, users enter a contact name in the "Search or invite friends" box in "Chat," and select "Send SMS" from the box of options. If a chat window already is open for that contact, users just click "Video & more," and select "Send SMS."

If your contact replies, the text message response will appear as a reply in "Chat." These conversations are stored in your Chat history just like regular chats.

Age a Factor in New App Adoption

Just to confirm what you already know, a new study by ABI Research shows that, when it comes to viewing TV and video, growth in consumer markets is more limited by consumers’ ability to create new habits than by technology availability or ease of use. 

“The willingness to adopt new forms of entertainment delivery is in many cases determined by the age of the consumer,” says Steve Wilson, ABI Research principal analyst.  “That means that market growth is simply a matter of time.”

Still, there are some new changes. Game console penetration in the 18-to-25 year old segment showed no gain over last year, whereas penetration in the 65-or-over segment grew more than 200 percent.    

DVR ownership likewise is up uniformly across all age groups. On the other hand, some 65 percent of the respondents over 65 have never used VOD, compared to 30 percent of those in the 25 to 29 age range. However, 40 to 50 percent of those who have tried it continue use it at least once a month regardless of age. 

Internet downloading likewise is only really popular with consumers under 30. 

Video cell phone usage: consumers in their 30s are four times more likely to have watched video on their handset than those in their 50s.  The wealthy, willing to pay the extra costs, are much more likely to watch video on their handsets than the less affluent. 

Cincinnati Bell Revenue: Only 14% Consumer Voice

In some ways, the big story out of Cincinnati Bell in the third quarter was the progress the independent local exchange carrier has had in diversifying its revenue streams. In the third quarter of 2008, just 14 percent of its revenue was generated by consumer voice.

About 20 percent of the carrier's revenue was earned providing technology solutions including data center and managed services.

Wireless service revenue in the quarter was $74 million, up $6 million or nine percent from a year ago. Cincinnati Bell had 567,000 wireless customers at the end of the quarter, which reflected year-over-year growth of six percent in its post-paid wireless customer base.

Post-paid quarterly average revenue per user was $48.82, an increase of $1.41 year-over-year and $1.46 sequentially. Pre-paid ARPU was $26.33, up 15 percent from the third quarter of 2007 while prepaid subscribers declined eight percent.

Technology Solutions quarterly revenue was $73 million, down $1 million, or one percent from a year ago. Technology Solutions segment operating income of $6 million was up two percent from the prior year quarter.

Data center and managed services revenue was up 39 percent from the third quarter of 2007. But lower-margin equipment revenue declined $10 million or 19 percent from the prior year.

Year-over-year DSL subscriber growth was six percent. At the end of the quarter, Cincinnati Bell had a total of 231,000 DSL subscribers.

Quarterly wireline revenue was $201 million, down $1 million or one percent from the third quarter of 2007. Increased revenue from data services, long distance and expansion markets partially offset lower voice revenue in Cincinnati Bell's traditional service area.

Year-over-year total access line loss in the third quarter was 6.8 percent, reflecting a decline in the company's in-territory consumer access lines. Business lines were even with a year ago while expansion market access lines increased 14 percent.