Latency Becoming a Bigger Issue than Speed

Despite the fact that consumer Internet access speeds have increased about two orders of magnitude over the last 15 years or so, how much bandwidth any single user “needs” is less clear, with some studies suggesting that, beyond about 10 Mbps to 15 Mbps, users get negligible incremental value.

Eventually that will change as apps are crafted to take advantage of nearly-universal higher speeds. Still, for the moment, gigabit really is about marketing, not end user requirements.

There is one clear exception: multiple users at a single location. As always has been clear for business Internet access connections, the number of users at any single location makes a huge difference, as it is not the amount of typical bandwidth, but the amount of bandwidth per user, on average, that is key.

Some might still argue that advertised headline speeds are a chimera, but studies by the Federal Communications Commission find claims and peak hour speeds are highly correlated, reaching about 97 percent of advertised speeds during peak hours.

The point is that “gigabit” Internet access is, at the moment, more about marketing than it is actual end user requirements. In fact, end user usage limits might now start to be the key issue, not access speed, for many users.

For many other users, latency likely now is becoming the key issue for gaming, 3D video and even web surfing.

Cablevision Launching 200 Mbps, 300 Mbps Internet Access Services?

Despite the big push to launch gigabit Internet access services in the U.S. market, that is only part of the story. Just as important is the boost in speeds at levels below 1,000 Mbps, at price points that many consumers will find compelling, compared to a gigabit offer.

The “101-Mbps” tier presently costs $55 a month, down from about $100 a month in 2009.

Cablevision, for example, appears to be launching new consumer Internet access tiers at 200 Mbps and 300 Mbps, up from the 100-Mbps tier it already offers. Services for business will be launched at 250 Mbps and 350 Mbps.

Optimum Online Ultra 60	$4.95
Optimum Online Ultra 75	$20.00
Optimum Online Ultra 101	$55.00

source: Cablevision

source: DSL Reports

Will U.S. Linear Video Accounts Grow in 2017?

Though customer losses get the headlines, it is net gains or losses for any legacy service that matter, not just the number of customers who drop service.

The reason: though churn matters for any legacy service in a zero-sum market, net account gains or losses matter more.

Consider a recent forecast by cg42 that perhaps 800,000 U.S. customers will drop linear video subscriptions over the next year.

What that same study also suggests is that six percent of survey respondents who never have bought linear video said they are “very or extremely likely” to subscribe to cable in the next 12 months.

If there are about 16.9 million “cord-never” households, that could represent a gain of perhaps one million households. If 800,000 accounts are lost (and not not switched to another provider), it is conceivable that there could be a net gain of about 200,000 accounts.

Linear TV might be a mature product, but its decline remains very slow, with year-over-year account loss of less than one percent, on a net basis.

Spectrum Value Declining?

As essential as licensed spectrum might be for mobile operators, price and quantity still matter, as does the existing amount of spectrum any contestant already has in its possession. In addition, the strategic context also matters.

At least in some markets, planned releases of huge amounts of new spectrum, plus possible sales of surplus spectrum, and use of unlicensed spectrum, now are viewed as viable alternatives--longer term--to acquiring new licensed spectrum at current prices.

In other words, many competitors, in some markets, now might be less willing to pay high prices for 4G or 5G spectrum.

Consider a recent Egyptian government offer to license 4G spectrum available in 2.5-MHz and 5-MHz blocks.

None of the three other Egyptian mobile operators placed a bid, suggesting both that the price was too high, and the amount of spectrum too low.

Vodafone Egypt Telecommunications, Orange Egypt and Etisalat Misr all have twice declined to submit bids.

Only Telecom Egypt, the state-run fixed-line monopoly, did buy a 4G license, purchased to allow it to enter the mobile market for the first time. As a challenger, Telecom Egypt arguably was willing to pay more than the other leading carriers, for a smaller spectrum allocation than would be needed if it is successful, for several reasons.

First, without spectrum it could not enter the market as a facilities-based provider. Also, if Telecom Egypt believes it will have a smaller customer base, then the smaller spectrum allocation might work, for a time.

The GSMA has called for boosting the amount of spectrum available, arguing that the total amount of spectrum assigned to each operator for 4G needs to be in the range of 2x30MHz to 2x60MHz, across a range of coverage and capacity bands, with a minimum contiguous bandwidth of 2x10MHz in each band.

In contrast, only 2×2.5MHz to 2x5MHz were proposed to mobile operators by the Egyptian authorities.

GSMA also argues that the proposed prices were too high as well.

The National Telecom Regulatory Authority now says it will consider options for offering the new licenses to new international operators.

Mediacom Goes Hybrid for HFC Network

In a real sense, a “hybrid” strategy that bridges present and future technologies, business models and services is an effort to harvest a legacy business while laying the foundation for the next business model.

And even when cable TV executives remain confident about scaling their hybrid fiber coax networks to multi-gigabit bandwidth, they also are starting to deploy fiber-to-premises networks to serve business customers.

Mediacom, for example, plans to install gigabit per second Internet access for its consumer customers over the next three years. But Mediacom is using a hybrid physical media strategy.

“We’re actually doing dual cables where we are running both both fiber and coax,” said Dan Templin, Mediacom VP of business services.

The dual fiber and coax drop includes a four-pair fiber and coax in single sheath to address various service configurations that might be required by business customers.

By doing so, Mediacom creates an upgrade path for fiber to customer that does not require additional construction.

Car Makers, Suppliers Form 5G Auto Association

source: Analysys Mason

Audi, BMW Group, Daimler AG, Ericsson, Huawei, Intel, Nokia and Qualcomm have formed the 5G Automotive Association to develop, test and promote communications solutions for connected vehicles, smart cities and intelligent transportation.

Christoph Voigt, BMW Group SVP, is board chairperson and Dino Flore is director general of the association.

source: Business Insider

By 2020, BI Intelligence estimates that 75 percent of cars shipped globally will be built with the necessary hardware to allow people to stream music, look up movie times, be alerted of traffic and weather conditions, and even power driving-assistance services such as self-parking.

Almost by definition, the connectivity of choice will be mobile networks.

Rogers, Shaw Shut Down Streaming Service

Rogers and Shaw Communications have decided to shut down their streaming video service “shomi,” illustrating once again the importance of scale for over-the-top voice, messaging or video services. As has often been the case, services launched by just one operator fail to gain enough scale to compete.

Over the top voice services run by mobile service providers or telcos have had modest success, and much the same is true for carrier messaging services.

The need for scale is one reason some observers believe it is inevitable that Comcast and Charter Communications will look seriously at acquisitions in the U.S. mobile operator market. Neither firm, by itself, has network assets reaching as much as 30 percent of U.S. households.

That implies that national reach, which some would argue now is required for leaders in the mobile market, must be created, one way or the other.

source: Ovum