Verizon Strikes Spectrum, Resale Deal with Cox Communications

Verizon Wireless and Cox Communications have agreed to a deal that would give Verizon Wireless all of Cox’s advanced wireless spectrum in exchange for $315 million and an agreement to sell each other’s services.

Verizon Wireless will get a 20MHz block of wireless spectrum from Cox, while Verizon Wireless and Cox will resell each others residential and commercial services. The deal is similar in scope to one Verizon Spectrum Co., owned by Comcast, Time Warner Cable, and Bright House Networks.

The deal is said to be very similar to one that Verizon struck with Comcast, Time Warner Cable and Bright House networks in early December 2011. Verizon, Cox in spectrum, resale deal

Aside from the other potential ramifications, such as a bigger move by those cable operators into the wireless services market, the deal essentially changes the strategic landscape which since 1994 or so has had Sprint aligned most closely among the mobile companies with leading cable operators.

The deals also would seem to remove the leading U.S. cable companies from the list of potential investors or buyers of assets including Sprint and Clearwire, as well as from the ranks of potential wholesale customers of LightSquared, Sprint or Clearwire.

The deal also means a significant strategic change for the leading cable companies, which since 1994 have worked with Sprint as a wireless partner. The deal seems to signal that the leading cable firms are "changing horses" for reasons that have to be related to both long-term strategic concerns and evaluations of the respective strengths of potential partners.

At a fundamental level, the deals seem to signal a belief by U.S. cable executives that it simply is too late, too hard, too unrewarding to create a "cable-owned" wireless company. The way the deals appear to be structured also imply that cable companies will simply resell Verizon Wireless for a period of years before considering any further retail branding under their own brand names, if indeed that ever is seen as the better and more logical approach to the market.

For Verizon Wireless, the deals also seem to signal a willingness to use the cable partnerships to create new quad-play services "out of fixed network region," to the extent that Verizon Wireless would have the right to bundle cable partner video, fixed broadband or fixed network voice in areas where Verizon does not operate its own fixed networks.

UK Consumers Not Buying "Super-Fast" Broadband

There are two distinct, and different "problems" nations and policymakers face when promoting use of very-fast broadband access. First, the physical capabilities must be put into place.

But an equally-important issue is consumer demand for such services, especially when high-speed services already are widely available.

In the United Kingdom, for example, the government is pushing new fiber-to-cabinet networks supporting speeds roughly defined as access at 24 Mbps or so.  U.K. Super-Fast Broadband

However, just four percent of U.K. households subscribed to superfast services in June 2011, compared with 40 per cent in Japan and 10 per cent in the United States, although higher than in Germany (three percent), Italy (1.5 percent) and Spain (2.2 percent). Lagging adoption

To be fair, the networks still are under construction, so not every potential consumer is able to buy such services.


But 25Mbps or faster services already are available to the 48 percent of UK households passed by Virgin Media's cable service and about 20 percent of premises passed by BT's fiber to the cabinet superfast services.

Overall availability of high-speed fixed-line broadband networks in the United Kingdom does compare favorably to other European countries, though, so mere ability to buy is not the issue. By June 2011, 59 per cent of households had access to Virgin Media or BT’s superfast services. Ofcom: UK consumers not buying super-fast broadband

10 Key Mobile Trends of 2011

One of the big trends of 2011 was “more powerful devices,” such as the HTC Edge, the first quad-core mobile phone with a quad-core 1.5GHz processor, says Josh Lovison,  a digital strategy consultant.

That, in turn, is leading to the leading edge of the “docking” trend, where smart phones will be able to use various peripherals that make smart phones usable in some of the ways notebook PCs are used. Motorola’s Atrix phone is an example.

ASUS also has designed a keyboard dock for its upcoming tablet, the Transformer Prime, which allows it to operate much like a laptop in both form and function.

Changes in data plans and the advent of Long Term Evolution, as well as patent wars and Android’s rise, are other notable developments.

Mobile apps being rendered dynamically also was a new trend. Facebook, for example, made a recent update that retains some static user interface elements are native code specific to a device, but almost all of the dynamic content displayed is a rendered page of its website, within the app. It's a hybrid between "app" and "web app."

Mobiles also are displacing dedicated gaming devices as the preferred way to engage with gaming content and games.

According to stats from Flurry, 2011 will be the first year that gaming revenues on mobile devices (iOS and Android) exceed revenues from specialized gaming handhelds such as Nintendo's 3DS or Sony's PSP.

Voice search, which got attention because of Apple’s “Siri,” has been available on Android devices for nearly two years as well, and represents an advance for ease of use on mobiles when searching. Easier search will mean “more search.”

Near field communications remains a buzzword and hype generator, but it will take some time to become a useful mainstream capability for payments and other mobile apps. Key mobile trends

Free Gaming Explodes

New data released by Pando Networks, a leading game delivery network for free-to play mobile games, indicates a huge increase in the number of people downloading free-to-play game games, growing 450 percent from 2009 to 2011.

More than 38 million people will download an online game using Pando services in 2011, and more than 70 million people have done so since 2009.

The increase in people downloading games is being driven by several industry factors including the transition from a “paid” to a “free-to-play” business model. Free gaming explodes

LTE Prices Will Drop 60%

Mobile broadband services using Long Term Evolution will experience a substantial 60-percent decline in retail prices between now and 2016, according to Tariff Consultancy, on the way to gaining 250 million users worldwide by the end of 2016.

LTE Mobile Broadband Pricing 2012 evaluates pricing from around 30 fourth-generation LTE mobile broadband providers which are mainly located in Europe, North America and the Asia-Pacific regions of the world.



LTE is currently promoted as a premium product, with an average theoretical download access speed across all LTE providers is in excess of 80 Mbps, with the most common download speed cited being 100 Mbps.



Average monthly user data allowances for LTE Mobile Broadband services are currently 22 GBytes per month, but can be as high as 80 GBytes per month, with allowances for LTE operators in North America being typically far lower.

Alastair Brydon says the most expensive LTE tariffs are between EUR39 and EUR67 in numerous European markets. These services provide download speeds up to 50 Mbps to 80 Mbps, with a 30GB monthly data allowance. While these prices are higher than equivalent so-called ‘superfast’ fiber-to-the-cabinet (FTTC) fixed broadband services, there is not a huge price premium. LTE pricing


These tariffs correspond to a minimum price per gigabyte that varies between EUR1.78 (in Denmark for a 30GB data allowance) and EUR2.67 (in Germany for a 15GB data allowance).



The price per GB is generally lower than most HSPA mobile broadband services, where operators provide significantly lower monthly allowances in general. For example, in the UK, where mobile network operators are facing significant capacity challenges, O2 now offers just a single HSPA mobile broadband service, with a 1GB monthly allowance for £10.21, which corresponds to a price per GB of EUR11.49. This is around five times greater than the price per GByte of these LTE services.



TCL research finds that the average price worldwide for a top of the range LTE Mobile Broadband service is currently 50 Euro per month, typically based on a post-paid, 24-month contract term.



The study shows that the average LTE Mobile Broadband price in Euro per gigabyte ranges from 0.5 Euro (Tele2 Sweden) up to 9.9 Euro (Omnitel Lithuania) per GB of data mobile user allowance.



But already there is evidence of price erosion from selected LTE Mobile Broadband providers. Telstra (Australia) currently offers its BigPond USB 4G Mobile Broadband product with an 8 GByte  monthly data user allowance for the equivalent of 30 Euro per month, against 38 Euro for a 4 GB monthly data user allowance reported at the time of launch.



And in Singapore M1 (Mobile One) is offering its Next Generation Mobile Network equivalent LTE service to existing M1 customers with a 40% discount off the monthly list price.



Tariff Consultancy anticipates that LTE mobile broadband pricing will decline as more operators worldwide adopt the technology worldwide. LTE prices will respond to competition


That might be consistent with pricing trends for broadband access generally, in virtually all markets. But the local patterns might vary, one could argue. In the U.S. market, buckets of usage and typical speeds are relatively limited, compared to what seems to be offered elsewhere. 


That creates at least some possibility that pricing could increase, for some packages, in the U.S. market, particularly as family mobile data plans are introduced, or as some providers upgrade from “pre-LTE” networks to more fully-compliant LTE networks.

Can Google Make Money selling Broadband Access?

Google says its objective in building a symmetrical 1-Gbps fiber to home network in Kansas City, Kan., and then Kansas City, Mo. is a serious business initiative, “not a charity," says Kevin Lo, Google Access general manager.

"It’s not a nonprofit. It’s not a dot.org initiative,” said Lo. “We expect to make money at it. It’s a business we expect to be in.” Google’s high-speed gamble in KC


Perhaps the U.S. company whose commercial activities are most similar to Google Access is Sonic.net, an ISP that over time has concentrated mostly on broadband access as its business, though it now also sells voice services. Sonic 1-Gbps network

6 Million Homes Now Use Wireless As Only Broadband Service

By the end of 2011, six million U.S. households will depend on a wireless or mobile platform (including 3G or 4G) as their only means of accessing the Internet, according to Strategy Analytics.

That means seven percent of U.S. homes are wireless-only for broadband, up about 430,000 homes over 2010 levels.

These “mobile-only” customers typically connect to broadband using 3G or 4G-enabled smartphones or PC dongles, and are unable or unwilling to use a wired broadband service such as cable, DSL or fiber, Strategy Analytics says.

The firm says there are two primary markets for such consumers. First, there are users in remote or underserved areas where dependable fixed broadband is unavailable. Secondly, there are cost-conscious casual users who use relatively small amounts of data, and for whom mobile data rates are ‘good enough.

Strategy Analytics forecasts that cable operators will claim a bit more than 50 percent of U.S. household broadband connections over the next five years, while telco-provided Digital Subscriber Line subscriptions will gradually decline in favor of fiber to home and mobile-only connections. 6 Million Homes Now Using Wireless As Only Broadband Service