Memory and Voice Costs Declined 3 Orders of Magnitude Since 1993?

The retail cost of memory, like the retail cost of texting, calling or messaging, is a fundamental reality for nearly any business or industry where product creation distribution and consumption has significant "information" content. 

The price of a product (a gigabyte of storage) falls from $9,327 to $2.48, a decline of three orders of magnitude over two decades. 

Nothing that dramatic has occurred for most carrier-provided voice calls. From 1965 to 1985, for example, U.S. originated international call prices dropped by about half, or about one order of magnitude ($10 for a three-minute call to $5 for a three-minute call). 

Between 1993 and 2013, the cost of a mobile-initiated voice call in the U.S. market dropped about one order of magnitude. 

Of course, it is hard to compare carrier voice with the cost of Skype-to-Skype calls or instant messaging services, which might have "zero incremental cost." 

But it would not be hard to attribute a three ordes of magnitude effective price decline, if one used an attributed cost model, where some percentage of the cost of Internet access was used as the indicator of incremental cost of usage. 

 

Asia Pacific Mobile Devices Will Consume 2.2 GB per Device by 2019

In the Asia Pacific region, mobile data traffic will grow 10-fold from 2014 to 2019, a compound annual growth rate of 58 percent, according to the Cisco Mobile Visual Networking Index.

In 2014 there were 2.2 billion mobile users in 2014, representing 56 percent of Asia Pacific's population.

By 2019 there will be 2.8 billion mobile users representing 69 percent of Asia Pacific's population.

In Asia Pacific, mobile data traffic will reach an annual run rate of 114 Exabytes by 2019, up from 11.7 Exabytes in 2014, growing three times faster than Asia Pacific fixed IP traffic from 2014 to 2019.

In Asia Pacific, mobile data traffic will account for 17 percent of Asia Pacific fixed and mobile data traffic by 2019, up from four percent in 2014, while 53 percent of mobile connections will be “smart” connections by 2019, up from 24 percent in 2014.

In Asia Pacific, mobile traffic per mobile-connected end-user device will reach 2.2 GB per month by 2019, up from 273 megabytes per month in 2014, a compound annual growth rate of 51 percent.

Trends are similar in many countries. In Indonesia, there were 155.1 million mobile users in 2014, representing 61 percent of Indonesia's population. By 2019 73 percent of Indonesia’s population, some 195.3 million people will be using mobile devices, according to the Cisco Mobile Visual Networking Index.

Perhaps significantly, mobile data traffic will grow an order of magnitude (10 times)  from 2014 to 2019, a compound annual growth rate of 59 percent.

Mobile data traffic will account for 41 percent of Indonesian data traffic by 2019, up from 17 percent  in 2014.

By 2019, 46 percent of mobile connections will be “smart,” up from 14 percent in 2014.

In Indonesia, mobile traffic per mobile-connected end-user device will reach 1.7 GB per month by 2019, up from 185 megabytes per month in 2014, a CAGR of 55 percent.

Mobile Data Traffic Will Grow 10X from 2014 to 2019

In Indonesia, there were 155.1 million mobile users in 2014, representing 61 percent of Indonesia's population. By 2019 73 percent of Indonesia’s population, some 195.3 million people will be using mobile devices, according to the Cisco Mobile Visual Networking Index.

Perhaps significantly, mobile data traffic will grow an order of magnitude (10 times)  from 2014 to 2019, a compound annual growth rate of 59 percent.

Mobile data traffic will account for 41 percent of Indonesian data traffic by 2019, up from 17 percent  in 2014.

By 2019, 46 percent of mobile connections will be “smart,” up from 14 percent in 2014.

In Indonesia, mobile traffic per mobile-connected end-user device will reach 1.7 GB per month by 2019, up from 185 megabytes per month in 2014, a CAGR of 55 percent.

Will Google Project Loon Launch Internet Access Service in 2016?

Mesh networks might be a significant new factor in the Internet access business across much of the Global South.

By linking it “Project Loon” balloons together in a mesh network, where ground signals can be relayed directly between balloons, Google can now provide coverage for an entire region such as  West Africa using only about eight ground stations, according to Bloomberg.

In the past, Project Loon balloons used for delivering Internet access had to have a direct link to a mobile cell tower on the ground. Given Project Loon’s objective of providing service to “hard to reach areas” where such towers are in short supply, that was a constraint.

Now traffic can be relayed from balloon to balloon, allowing any single balloon to remain connected with any single cell tower 400 kilometers to 800 kilometers distant.

Other new contestants in the Internet access and transport business, including LeoSat, plan to use a mesh network as well, and for similar reasons, allowing a single uplink and downlink for traffic, no matter how far it has to travel across the face of the earth.

The new mesh configuration solves an existing problem, namely the fact that single balloons, communicating with single base stations, can provide only intermittent service.

Project Loon is conducting trials in Australia, Chile, New Zealand, Brazil, and other countries,

But it is conceivable Project Loon will be able to provide commercial service by the end of 2016, in Africa, Latin America, and Southeast Asia.

The other noteworthy angle is that use of cell towers makes some mobile service providers potential partners for Project Loon, in either a wholesale or retail capacity.

Zero Rating: Philippines and Pakistan Say "Yes," India Might Say "No"

The controversy over zero rating in India might also be affecting Google, in the sense of raising potential hostility neither Facebook nor Google wants to incur.

Google has a similar zero rating initiative called Google Free Zone that has been offered in a handful of countries like Kenya, Sri Lanka, Thailand and the Philippines.

Especially after positive results in the Philippines, it would have been logical for Google to introduce the concept in India.

But some reports suggest the controversy, which also has seen app providers in India pull back from participation in Internet.org, a zero rating program for India, is causing Google to wait, as well.

Separately, Telenor Pakistan has launched Internet.org in Pakistan, making available to Telenor Pakistan's customers free access to 17 basic online services including Accuweather, BBC, BabyCenter &MAMA, Malaria No More, UNICEF Facts for Life, Bing.com, ESPN Cricinfo, Mustakbil, ilmkidunya, Telenor News, Urdupoint Cooking, OLX, Facebook, Messenger, Wikipedia and Telenor WAP MobilePortal, using either the 2G or 3G platforms.

Consumers can use Internet.org aps directly from Internet.org or by downloading the Android app.

Internet.org is a Facebook-led initiative bringing together technology leaders, nonprofits and local communities with the goal of making internet access available and affordable to the two-thirds of the world that is not yet connected and bringing the same opportunities to everyone that the connected world has today.

Internet.org was first launched in July 2014 in Zambia and in less than a year it made valuable online services accessible without data charges for millions of people in Tanzania, Kenya, Colombia, Ghana, India, Philippines, Guatemala, Indonesia, Bangladesh, Malawi and now in Pakistan.

The M Hotel Singapore  |  10-11 September 2015

India possibly says no, Philippines and Pakistan say yes. What is the right way to view zero rating and sponsored data? What is the impact on rapidly growing Internet access? REGISTER NOW Spectrum Futures 2015 will examine zero rating, sponsored access and other ways of rapidly increasing Internet use by billions in South Asia and Southeast Asia. Spectrum Futures 2015 will bring together regulators and service providers from throughout the Asia-Pacific region to allow the exchange of ideas about key policies to help emerging markets like India, the Phillippines, Thailand, Indonesia, Cambodia and Myanmar connect to their populations to the Internet within the next decade. Join the conversation at Spectrum Futures 2015.

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Smart in Philippines Launching Sponsored Data Program

PLDT,through its mobile subsidiary Smart Communications, is launching a sponsored data service initially available to subscribers of Talk ‘N Text, the value brand of Smart, as well as Sun Cellular, a wireless unit of PLDT. Smart is the Philippines' leading wireless services provider with 54 million subscribers.

It is possible that the Philippines and India could be moving in opposite directions where it comes to zero rating and sponsored data. Philippines mobile operators already have proff that zero rating lifts use of mobile Internet.

In India, regulators might bar the practice, despite its apparent usefulness.

PLDT saw  mobile Internet revenues increase 19 percent year-over-year in the to P2.2 first quarter of 2015, based on free access programs.

“The uplift of our mobile Internet revenues underscores the success of our Free Internet offer,” said PLDT and Smart president and chief executive officer Napoleon L. Nazareno.

From September 2014 to February 2015, Smart ran a “Free Internet” promotion giving Smart, Sun Cellular, and Talk ‘N Text subscribers 30 MB of free data per day.

Over six million mobile phone subscribers of Smart, Sun, and Talk ‘N Text signed up for the promo, 70 percent of whom were first-time mobile Internet users.

Mobile data usage in the Smart network surged by 188 percent in the first quarter of 2015.

Subscribers now get 30 MB of free Internet access per day whenever they buy prepaid packages for voice and text messaging.

The sponsored data service is powered by Aquto, which supplies a platform for giving mobile consumers  free access to mobile data whose usage is sponsored by third-party app publishers, advertisers and marketers.  

PLDT is Aquto’s first customer in Asia and also is used by AT&T, Verizon Wireless and Vodafone.  

The M Hotel Singapore  |  10-11 September 2015

"Zero rating" and "sponsored data" have boosted Internet use in the Philippines. But some want to ban its use. Is that a good idea? REGISTER NOW Spectrum Futures 2015 will examine zero rating, sponsored data, business models and other accelerators or roadblocks standing in the way of connecting billions of new cusotmers to the Internet in 10 years. Spectrum Futures 2015will bring together regulators and service providers from throughout the Asia-Pacific region to allow the exchange of ideas about key policies to help emerging markets like India, the Phillipines, Thailand, Indonesia, Cambodia and Myanmar connect to their populations to the Internet within the next decade. Join the conversation at Spectrum Futures 2015.

VISIT THE SPECTRUM FUTURES WEBSITE FOLLOW US ON

914 Coolidge Street | Honolulu, HI 96826-3085 | +1.808.941.3789 | spectrumfutures.org |spectrumfutures@ptc.org

Would a "Level Playing Field" Save Voice?

Former Vodafone India CEO and Managing Director Martin Pieters says over-the-top apps could be “fatal,” noting that 85 percent of mobile operator revenue is earned from voice services at risk from OTT alternatives.

On the other hand, there is a solution: data and other revenue sources. That will happen, according to the Cisco Visual Networking Index.

IP traffic in India will grow 400 percent from 2014 to 2019, a compound annual growth of 33 percent.

More to the point, smartphones will account for 40 percent (651.4 million) of all networked devices in 2019, compared to 13 percent (139.8 million) in 2014, representing a 36 percent compound annual growth rate.

The point is that, in India, as elsewhere, mobile Internet services will replace voice revenues.

“We are not denying the new reality but we are just saying give us some more time to adjust,” he said.

That, in essence, is the framework for the current debate in India about whether OTT voice apps should be subject to the same rules as carrier voice faces.

However the matter is resolved, the basic issue is a common one in the communications business. Whenever incumbents have faced new competition, or a major new replacement industry, such regulatory conflicts have developed.

That now is true of TV broadcasting and linear TV, which will necessarily spar over rules related to online video. Broadcasters fought to make use of videotape recorders and cloud storage devices illegal.

Huge fights over the regulatory treatment of VoIP services were fought in the 1990s.

As difficult as it seems, Indian mobile operators will simply have to move faster to create new revenue streams from mobile data and other sources. That is the strategic direction happening everywhere in the mobile business.

It will not be a comfortable transition. But there is no other strategic choice. So far, the history of attempts to outlaw OTT apps, when consumers want to use them, has broken down, in the end.

But Pieters is right about one thing: where regulatory treatment of carrier voice and VoIP has been more equivalent, the transition has arguably been more gradual. But nothing has prevented the cost of using any form of voice gone any direction but down, anywhere.

Voice in India is not going to be saved by “leveling the regulatory playing field.”

The M Hotel Singapore  |  10-11 September 2015

In India, as Elsewhere, Only Mobile Internet Access Can Replace Lost Voice Revenue REGISTER NOW Getting billions of new consumers connected to the Internet is not just the right thing to do: it is necessary. Near term, mobile Internet revenue and high speed access generally is the only way service providers will replace lost voice revenue. Spectrum Futures 2015 will bring together regulators and service providers from throughout the Asia-Pacific region to allow the exchange of ideas about key policies to help emerging markets like India, the Phillipines, Thailand, Indonesia, Cambodia and Myanmar connect to their populations to the Internet within the next decade. Join the conversation at Spectrum Futures 2015.

VISIT THE SPECTRUM FUTURES WEBSITE FOLLOW US ON

914 Coolidge Street | Honolulu, HI 96826-3085 | +1.808.941.3789 | spectrumfutures.org |spectrumfutures@ptc.org