What Becomes of Microsoft?

Investors largely believe Microsoft will gradually become the equivalent of a technology utility, a boring but necessary provider of the software that runs the world's business community, says Henry Blodget. A smaller, more optimistic crowd is still arguing that, one day, Microsoft will be able to turn its fortunes around, and fight its way back into an industry leadership position.

Blodget suggests a much darker potential scenario, where difficulties in the company's core operating system and Office franchises simply become less important in the world which seems to be developing, Blodget argues.

The Internet has continued to free app-makers from dependency on Windows or any other desktop platform while Apple's iPhone has revolutionized the mobile business, unleashing a whole new wave of personal computing devices.

Apple's iPad seems on its way to supplanting the low-end PC business.

Importantly, none of these trends depend in any way on Microsoft's original monopoly and cash cow, Windows, Blodget says. "Microsoft is nowhere" in mobile or tablets, he says.

Google, meanwhile, is trying to do the same thing to Apple that Microsoft did to Apple 15 years ago: Separate software and hardware and create a ubiquitous software platform for the world's developers to build

To be sure, lots of smart people thought that was exactly what would have to Netflix, and the doomsday scenario has so far refused to play out. But analysts get paid to analyze and create scenarios. This scenario might seem far fetched as anything other than a scenario many analysts get paid to imagine.

But it does illustrate the dangers for any dominant franchise when computing models shift, as nearly everybody now believes is about to happen. Nor does history offer much optimism. Never in computing history has the leader in one computing era emerged as a leader in the new era.

That will not stop firms such as Microsoft, Cisco and Apple or Google from trying. But they will have to make history to emerge as leaders in the next era.

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Are Mobile Apps More Like Songs or Software?

Nobody knows yet how the mobile applications will develop, and how big a business it might become for various ecosystem participants. So far, the Apple App Store has sold about $1.4 billion in apps, of which developers keep about 70 percent.

Some developers can point to mobile apps as a significant revenue generator in its own right. Most cannot make that claim.  But some might suggest the developing business is quite a lot more like the "song" business than the software business, according to Getjar.

On average, it takes about the same time to write a mobile app as it does to compose a song, says Ilja Laurs, GetJar CEO. Both cost about the same to download, $1.90 on average.

Advertising and e-commerce will add some revenue on top of actual sales revenue. But at least so far, most "for-fee" mobile apps appear to sell like single songs, rather than productivity or other apps people use on their PCs.

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How iPad Changes Gmail Experience

One of the more interesting questions about the tablet device market, assuming it does develop as a new and discrete mobile device category, is how user experience and application design might change simply because of the new form factor and navigation method.

For Google, one of the changes it already has made is a redesign of the Gmail interface on the Apple iPad.

"When you write an email you’ll now get a big full screen compose window instead of splitting the screen between your inbox and the compose view," Google says. More text is visible at once and there are no more distractions with messages on the side.

As with adaptations made to format content and navigation for smartphone screens, it appears Google already has made adaptations of the email-compose layout specifically for the iPad form factor.

For application providers, all this suggests a possible need for a "third" way to format web sites and applications, including different rendering for large PC screens, small mobile phone screens and mid-size tablet form factors.

The Iterative Web App: New Compose Interface for Gmail on iPad - Official Google Mobile Blog

Online Video Consumption Catches Broadcast by 2020

By 2020 Internet video consumption will eclipse the consumption of broadcast TV programming, according to researchers at The Diffusion Group. Keep in mind that this is different from arguing the revenue earned by content or service providers will reach a cross-over point in 2020.

While the amount of time spent viewing TV has remained relatively stable, the amount of time consumers spent watching online video increased 84 percent between 2008 and 2009. When extrapolated across the entire TV-viewing population, the average time spent viewing online video in 2009 was 52 percent more than in 2008.

TDG expects that this rate of growth will actually increase during the next five to seven years due primarily to the increased use of the television as the platform of choice for in-home web video viewing.

According to Colin Dixon, senior partner and co-author of TDG’s new report, “The total amount of time spent watching video from all sources, including PayTV and Internet video, will hold constant during the next 10 years at around 32 hours a week. With online video usage accelerating we expect the amount of Internet video watched to eclipse the amount of live broadcast TV around 2020.”

The forecast may appear shocking to some, and will hinge on developments in broadband access pricing, bandwidth quality and deployment, both fixed and wireless. Wireless providers are unlikely to permit high video consumption on their networks without creation of new revenue models or a change in end user willingness to pay.

Fixed providers and content providers are unlikely to encourage online video consumption when it simply cannibalizes existing multi-channel video revenue and imposes higher network access costs.

“Keep in mind that during this period, Internet and broadcast delivery of video content will become blended in such a way that consumers will be unaware of which conduit serves which content," says Colin Dixon, TDG senior partner.

It is conceivable that today's multi-channel video providers, for example, will be able to shift in a relatively revenue-neutral way if "TV Everywhere" packages are accepted by end users on a wide scale. That doesn't speak to the issues of access providers who have to support the dramatically-increased infrastructure, though.

One suspects the revenue equivalent of this forecast would not show cross over in 2020 for a variety of compelling reasons, including a more-uncertain regulatory environment leading to less investor interest in access infrastructure, need to develop new business models and possible disincentives to consume online video, such as plan overages.

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LTE of 100 Mbps at 75 Km

Telstra and Nokia Siemens Networks have conducted groundbreaking trials of Long Term Evolution networks in Australia, successfully achieving peak speeds of 100 Mbps download and 31 Mbps upload over a record-breaking distance of 75 kilometers in regional Victoria.

Performance of that sort helps explain why, after years of wrangling, Telstra has agree to essentially divest itself of its fixed-line network and become a wholesale buyer of capacity to support its fixed-line operations.

As has been the case elsewhere, incumbent carriers can be persuaded to trade away an access near-monopoly for something else of tangible value. For some, it is the ability to expand in non-traditional markets outside the existing footprint. For others it is a chance to invest in higher-growth or higher-margin businesses.

For Telstra, the LTE carrot is more appetizing than the structural separation stick.

IT-Online - LTE world-first trial achieves 100Mbps at 75km

TD-LTE A "Poor Man's" LTE?

Interest in TD-LTE is driven by one compelling reality. Because it can use unpaired spectrum, emerging and developing market operators could get lots more capacity into service at much-lower cost.

Since a single chipset apparently allows roaming between LTE FDD and TD-LTE networks, TD-LTE offers a more-affordable way to launch and operate a Long Term Evolution mobile network, while still offering roaming access to frequency-division LTE networks as well.

ZUMBEEL | Why The Sudden Interest In TD-LTE?

Netflix Faces Stiffer VODCompetition

Netflix faces competition in digital video-on-demand and pay-per-view offerings from players like Comcast, Time Warner Cable, DirecTV and Dish Network, according to analysts at Trefis. The reason is a
recent Federal Communications Commission decision allowing new films to be made available on-demand before such films are available on DVDs.

The FCC generally prohibits the use of so-called "selectable output control" technology, which encodes video programming with a signal to remotely disable set-top box output connections. But the FCC granted a waiver from those rules for Motion Picture Association of America members who want to protect copying of content if a new digital release window is created.

Allowing movie studios to temporarily prevent recording from TVs could pave the way for movies to be released to homes sooner than they are today. The FCC said the waiver is therefore in the public interest, because the studios are unlikely to offer new movies so soon after their theatrical release without such controls.

The FCC decision allows movie studios (like Paramount, 20th Century Fox, Disney Studios) to block analog signals on TVs and video recorders when consumers purchase their latest on-demand movies.

This decision was pushed for by Disney, Time Warner and Viacom to reduce the likelihood of content piracy, especially for new films where instances of piracy tend to be high. While this move gives movie studios more control over their content offering, it also gives a boost to cable providers that compete with Netflix to deliver the latest films to consumers, Trefis argues.