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Vista Launches January 29, 2007

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Show us your

Vista launches. looking forward to trying it out .. though am afraid will require a closet-full of memory to have the desired performance.

Verizon’s Numbers

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VZ reported strong numbers though for the first time in many quarters, Cingular surged ahead with most number of Net adds. However, Cingular’s net adds have a good percentage of pay as you go subs while Verizon’s were mostly post paid. Highlights:

Cingular, IDC, GigaOM et al .. January 25, 2007

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Cingular made a rebound in 4Q with some good numbers. We will have more coverage on the overall industry and 2006 year as whole next month. Some of our comments were picked up at GigaOM.

Earlier this week, IDC reported

There are more than 229 million U.S. wireless subscribers who are spending an average of $6.00 per month on data services according to the latest IDC research. Customer spending on data services contributed a total of $4.1 billion in revenue for 3Q06. IDC says messaging contributed nearly half the data revenue, while business- and consumer-oriented services and content constituted about 40%, and content and simple application downloads came to about 12%. Of the top ten wireless carriers, IDC research indicates that Verizon prevails as the new leader on data spending-per-customer basis.

We reported this back last year - one quarter ahead before mainstream analysts/media pick it up.

iPhone - the saga continues January 19, 2007

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Talked at length with Phil Keys from Nikkei Electronics about iPhone and its impact on the industry. I will cover more on iPhone and handsets a bit later.

Have a good weekend.

India’s wireless market January 17, 2007

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Given the recent worldwide frenzy to get a piece of action of the Indian wireless market, it is no surprise that the heavyweights are finally taking notice of the opportunity. India added over 72M subs in 06. In our report back in May 2006, we reached two conclusions (amongst many)

We noted in our research that by end of 06, India will easily start surpassing China in net-adds (we were probably the first analyst to call that out). During the last four-five months, India has whizzed past China in net-adds. Though India’s 150 odd subs is no comparison for the massive half a billion subs in China, it is the growth opportunity that attracts investment. Another conclusion was that India will surpass US as the second biggest wireless market by 2008 (again, probably one of the first analyst to call that out explicitly). India is well on its way to make this happen next year. Though the opportunity is tremendous, there are significant challenges and risks in the market as well. The market is clearly not for the faint-hearted. Unless you are well prepared, you will chewed and thrown out of the market in no time. Even the giants realize that and have done better home work this time around (In the early days, Vodafone, and others rushed to the market and tried to change the market but retreated in haste due significant failures that had more do with management than anything else).

How India tackles and promotes rural infrastructure and service expansion will define its growth over the next two years. Communications Minister Maran has done good to the industry. Let’s see if govt can play an active part in the tremendous opportunity in opening the markets further.

We will be closely watching (and reporting).

Biggest news out of CES was …. January 12, 2007

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No points for guessing ..

yes, iSteve’s introduction of iPhone, name of which might get decided in iCourt.

Other than that “connected universe” and 3 figure plasma sets were the highlights.

Have a great weekend.

Ways to avoid "risks of mobile advertising" January 10, 2007

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Eli from Israel responded to my post on risks of mobile advertising

Our small start-up company has toyed with the issues, particularly the annoyance factor expected by recipients of Mobile advertisement.We came up with a concept called “Pull before Push”; I’m not sure we are the first ones to consider such an idea and therefore I wouldn’t rush to trademark this concept. This concept can mitigate consumer’s natural tendency to receive “un-invited” messages clogging his mobile units with SPAM (essentially). Our basic technology is a wireless platform that offers the consumer the opportunity to tell the Mobile what it is looking for, and restricts the time and space allocated for the interest this consumer is focused on. (The consumer may re-define his interest any time, of course).

Our platform can take over from this point in time and automatically select the advertisements to be “pushed” to the mobile, based purely on the item of interest expressed by the consumer, time and location that the mobile is at. In other words, only items of interest to the consumer at the time and space of his choosing, will be delivered to the consumer. (The resolution of such a request is on a minute-by-minute basis. i.e. we know every minute who is where and what “landmarks” (stores, shopping malls, hotels, etc.) are located relative to the consumer at the time and space when consumer has expressed an interest-this is a Personalized advertisement fitting the consumer wishes, as well as sponsoring sellers.

This is exactly what’s need and this is how it will be in a few years. I first wrote about using this architecture back in 2000 (Chapter 8 of my first book - Wireless Internet Enterprise Applications). Question is who gets their first, what the experience is like, and how well is that IP protected?

1TB

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With the purchase of 500GB storage device, i am officially connected to over 1TB of storage. Let’s see how soon will i run out of space.

iPhone - the day after

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Introducing iPhone

Apple loyalists, media, and the rest of the us are still recovering from the deluge of iPhone news stories. I can’t remember a day when there was such an onslaught of breaking news within a short period of time. Before, during, and after, the mainstream media, blogosphere, and the Tube media were all blazing with the performance of the year by King Jobs (if you missed the keynote, you can see the must-see event here). Microsoft must be scratching its head, closely followed by the device manufacturers, carriers, and rest of the ecosystem. So what does this mean to me, they must wonder? How do we respond?

Clearly, nobody beats Apple in high-tech buzz marketing and it is an enormous feat to keep the details of the project under covers though pieces of them have been trickling for the past few months. Time does a good story on the events leading up to the launch. NYT’s David Pogue does a good review (Sub required). The beauty of the device is in its simplicity which is to be expected from Apple. I wrote a vision paper for a client back in 2002 which talked about how difficult it is to use simple and generic features on wireless devices such as address book, SMS, voicemail, etc. If the ecosystem will just solve that problem, it will be a huge step before embarking deep into the data services marketplace. Clearly, Apple get simplicity. They don’t want to force the user to learn anything, just have an extremely intuitive design that people get on first glimpse. Visual voicemail is one example. Though i am not sure if they are the first ones to do it, i think there might be some prior art on this. But the multi-touch technology is clearly a break through. Browser experience on the device is unparallel, the ease of use to do voice and text functions were long over-due, handling for digital media is course trademark Apple.

When John Markoff of New York Times asked me last week about what iPhone will do to the industry, my response was, “it will raise the bar to simplify and make compelling user interfaces”. While Motorola has been focused on hardware aesthetics of RAZR (and the likes), RIM on email productivity, Palm and Microsoft on Smartphones (how about simplephones or easyphones), Nokia on a broad portfolio, no one has really focused on the UI. Each generation of the device gets more complex. 3G MVNOs did raise the bar for the industry in terms of UI but not high enough. iPhone clearly changes the game.

There are clear short-comings which will get resolved in the future versions of the phone in 2008 and beyond. Just to round-up - high price (provides no competition to low-medium-end devices), no GPS, no 3G (what’s up with that), low MP, no external memory slot, 1 carrier (that too locked), poor enterprise support, lack of OTA, OSX (yet another operating system to deal with for poor developers), no active screen or deeper personalization .. these will be taken care off in due course will probably give some time to the competition to bring competing products but they better pay attention to UI or else Apple’s marketshare will get into double figures real fast.

In terms of scale, Apple clearly has ways to go. To give you a sense, the number of iPODs sold todate are less than the number of devices Nokia sells in a quarter. Yes, it is a huge market and Apple’s disruption is great for our industry. There are several questions like will Apple work with only select large carriers, will carriers keep falling over to get their hands on the device, will the device be subsidized, will it be opened up at some point? etc ..

All-in-all, a great day for the industry and now we need to start searching for the next rumor-mill story. This one lasted 7-8 quarters, will the next one match up?

ps. Just in- Cisco filed suit against Apple on its “iPhone” trademark. Maybe Apple needs to jack-up the price to pay for the settlement.

iPhone is here … January 9, 2007

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this picture from Engadget says it all .. full coverage here.

Apple Cingular team up for launching the much-awaited phone

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While the phone itself was subject to much speculation for past couple of years, the partner and the nature of phone was quite obvious. To have the max reach, Apple had to choose a carrier, a GSM carrier with the most reach and the phone should not be bound by a carrier hence unlocked. Looks like that’s what is going to happen later today. Several sources are reporting the imminent release by King Jobs. Computerworld report here.

A Personal Computer to Carry in a Pocket - NY Times Article January 8, 2007

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This article appeared in the business section of NYT today. We provided the stats and some analysis for the same ..

A Personal Computer to Carry in a Pocket

By JOHN MARKOFF

Published: January 8, 2007

Oqo’s founders, from left, Jory Bell, Jonathan Betts-LaCroix, Bob Rosin and Nick Merz, in San Francisco.

 

The world of desktop computing is finally going mobile, and the shift can be seen in the explosive growth of wireless data for cellular carriers.

A new device is the Oqo Model 2 pocket-size computer, left, with a slide-out keyboard and Windows Vista selling for $1,499.

The New York Times

To handle functions from text and instant messaging to mobile MySpace and ESPN, computer users are increasingly turning to the cellphone.

“We are seeing the emergence of a fourth screen,” said Jerry Panagrossi, vice president for operations at Symbian, a developer of advanced cellphone operating systems, citing a historical progression of “movie, television, computer and now the smart-phone screen.”

The newest screen is evolving to adopt more and more characteristics of a personal computer. And many believe that the next big shift will be the convergence of many forms of communication encompassing voice, e-mail, instant messaging and video telephony.

That shift may well be underscored tomorrow when Steven P. Jobs, the chief executive of Apple Computer, is expected to unveil an Apple phone representing his company’s new mobile communications strategy — highlighted by a device that may include Jobsian refinements such as a sleek ceramic case and a transparent touch screen.

Industry executives and competitors believe that Apple has developed the first of a new generation of devices that are closer to personal computers in pocket form, meaning that they will easily handle music, entertainment, productivity tasks and communications on cellular and other wireless networks.

But while Apple was able to monopolize the music-player category quickly after it introduced the iPod in 2001, its challenge with a phone would be far more difficult.

While Apple was early to portable digital music, it would be distinctly late in entering the world of Internet-connected digital hand-helds. Arrayed against it are giants including Nokia, Motorola, Sony Ericsson and Microsoft, in addition to entrenched hand-held companies like Palm and Research in Motion.

Also waiting to enter the fray are powerful Internet companies like Google, who cannot afford to be cut off from users who now rely on them in the desktop computing world.

“Apple is about to touch off a nuclear war,” said Paul Mercer, a software designer and president of Iventor, a designer of software for hand-helds based in Palo Alto, Calif. “The Nokias and the Motorolas will have to respond.”

And the coming convergence — or possibly collision — between cellphones and desktop computers is also yielding new forms of hybrid devices. Nokia and Sony have recently introduced hand-helds with innovative physical designs and new combinations of communication features.

What they share is designs that make them more portable than laptop computers and screens that are more readable than those on cellphones.

Another entry is the Oqo Model 2, a hand-held computer being spotlighted this week at the Consumer Electronics Show in Las Vegas, including a mention in a keynote address by Bill Gates, the Microsoft chairman.

Developed in a San Francisco warehouse office by a small team of portable-computer designers who have previously worked for Apple and I.B.M., the device is a complete Windows Vista computer that fits comfortably in the palm of a hand.

With a slide-out keyboard as well as the ability to connect to both Wi-Fi networks and high-speed cellular service, its selling price will start at $1,499. Those who wish to use it as a phone can add a Bluetooth headset and use an Internet phone service like Skype.

“Our main goal is to reinvent the PC in a pocketable form,” said Jory Bell, a computer designer who is one of the Oqo’s founders.

What all of the hardware makers are hunting for is a way to capitalize on the cultural shift in mobile messaging and search that has finally led the United States to close the gap with Asia and Europe, which have in the past been far ahead in mobile data wireless applications.

The data revenue for American cellular carriers grew at an annual rate of more than 70 percent in the first half of last year. In the third quarter, Verizon Wireless, Cingular and Sprint each crossed $1 billion a quarter in data revenue for the first time. They were ranked fourth, fifth and seventh in the world in data revenue for the first nine months of the year.

“We’ve basically caught up with Europe,” said Roger Entner, a telecommunications industry analyst with Ovum Research.

Analysts say Japanese and Korean companies have moved almost 50 percent of their customers to the new generation of data-oriented wireless networks known as 3-G. But the United States is only about a year behind the Asian countries in that evolution, analysts said.

“This is happening because of a number of factors,” said Chetan Sharma, a telecommunications analyst based in Issaquah, Wash. “Some have to do with culture and the others are purely business-related. The carriers are now realizing that wireless data is a substantial part of the business.”

And not all of the traffic is being driven by messaging, as a remarkable variety of wireless data software applications is emerging.

When students at Montclair State University in New Jersey feel concerned for their safety at night, they can send a wireless digital alert from their cellphone, setting a timer in the campus security office. If they do not turn it off remotely at the specified time, officers are alerted to their location. The program was developed by Rave Wireless, a New York-based maker of cellphone software for academic customers.

For Apple, one advantage in entering the wireless data market may be that it can develop both the hardware and the software for its own phone. But it would still need to rely on the cellular carriers.

In the past Mr. Jobs has cited the carriers’ control of handsets in the United States as a reason he had not introduced an Apple phone. Now that has apparently changed, and Apple’s business strategy in offering an Apple phone will potentially be as intriguing as its industrial design.

Mr. Jobs has been rumored to have entered into an alliance with Cingular. That would suggest he has patched up a reported split in 2005 that came when Apple introduced its iPod Nano on the same day that Cingular and Motorola introduced the Rokr, an iPod-compatible phone.

Whatever his business strategy, Mr. Jobs is certain to have an impact. Recently, he told two associates, who asked not to be identified to avoid damaging their relationship with him, that he was more excited about his current project than he was about the Macintosh.

CES, MacWorld, AutoShow - bring it on January 7, 2007

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International CES

 
Starting tomorrow, the digital world will be inflicted with a slew of announcement, pitches, hypes, view of the future. It will be interesting to see that after spending a few hundred million who will be left standing. Covering such events requires an army - each show will try to out-do the other with celebrities and announcements. It will be fun to watch the coverage from the comfy confines of my office.
 
You can track events at NY Times Blog, CNET, GigaOM, CES and others. If you have a favorite site to fill you in, let me know.
 
Get ready for the ride.

My NYTimes Interview with John Markoff January 5, 2007

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New York Times

 

 

Talked to the legendary reporter John Markoff yesterday on US wireless related matters. We talked about growth factors in the market, differences in growth between various geographies, and of course the infamous iPhone from Apple.

The risks of mobile advertising January 4, 2007

Posted by chetan in : Mobile Advertising, Mobile Content, Mobile Entertainment , 1 comment so far

Yesterday, Ben Taylor of Enpresence commented

While mobile advertising has a great future, ensuring that the recipients of ads are not turned off by SPAM and irrelevant advertisements will be critical to its success. From what I have seen the market has a long way to go before it can seamlessly integrate with peoples mobile lives without driving them to want to turn their mobiles off.

From an advertiser perspective, the ability to reach the right audience through various targeting techniques will likely dominate early successes in the mobile space vs. broad spectrum spam due to the delivery costs, regulations, and mobile operator constraints. By leveraging mobile communities many of these short term hurdles may be overcome.

In the mean time, be sure to check out Enpresence as a potential platform for mobile advertising as it extends online communities to mobile devices.

Thanks for the article. I look forward to the conclusion in the March issue. I think your thoughts and observations are spot on.

Also, Forrester’s recent report on Mobile Marketing got wide coverage this week. The gist of the report was

The near ubiquity of mobile phones and accelerating consumer acceptance of applications other than voice make mobile a powerful new channel for marketers. When done right, mobile campaigns yield high response rates and increase consumer engagement. Still, 79% of consumers are annoyed by the idea of mobile marketing. To avoid consumer backlash against ads on their phones, marketers must adopt a mindset where value replaces interruption and campaigns are designed for an abbreviated and immediate mobile experience.

As I have discussed this many times (including the Sell Phone article) that consumer needs to be at the center of the mobile services esp. advertising .. with the small real estate, it is hard to ignore the advertising messages and if not done right, will start to annoy users and will hamper the growth. It is also important to distinguish between consumers who like advertising on the phone and the ones who don’t and prepare the marketing programs accordingly to move them from latter to the former.

Mobile Advertising January 3, 2007

Posted by chetan in : 3G, AORTA, ARPU, Carriers, Devices, European Wireless Market, Intellectual Property, Japan Wireless Market, MVNO, Messaging, Mobile Advertising, Mobile Applications, Mobile Content, Mobile Ecosystem, Mobile Entertainment, Mobile Gaming, Mobile Search, Mobile Usability, Strategy, US Wireless Market, Wireless Value Chain , 3 comments

I have been deeply entrenched in mobile advertising work for more than a year. It is fun watching/making concepts grow into reality. We did an extensive paper on the subject last year.

I am delighted to expand the paper and collaborate with Victor Melfi - Chief Strategy Officer and SVP of VoiceBox Technologies. He was previously CSO of Infospace and has had deep experience with technology and strategy of advertising. He provides some great insights in this piece.

 

Wireless World Magazine published first part of this expanded paper in their Jan-Feb 2007 issue. Second part will appear in March issue.

Mobile Advertising continues to be a hot topic into 2007. Verizon and Cingular both announced their initiatives in the space after Sprint’s launch with Enpocket last year. Since we are embedded in the space, will continue to discuss it here.

Wireless Data ARPU

Posted by chetan in : 3G, ARPU, BRIC, Carriers, Enterprise Mobility, European Wireless Market, Indian Wireless Market, Intellectual Property, Japan Wireless Market, Location Based Services, Mergers and Acquisitions, Messaging, Mobile Advertising, Mobile Applications, Mobile Content, Mobile Ecosystem, Mobile Entertainment, Mobile Search, Mobile Usability, Smart Phones, Strategy, US Wireless Market, Wireless Value Chain, Worldwide Wireless Market , 1 comment so far

Wireless World magazine published couple of my articles in their Jan-Feb 2007 issue. The first one deals with Wireless Data ARPU on a global basis. You might have read this during our release of ”Worldwide Wireless Data Trends: Mid Year Update 2006″

Mobile Content Interoperability

Posted by chetan in : 3G, AORTA, ARPU, Location Based Services, Messaging, Mobile Content, Mobile Ecosystem, Mobile Entertainment, Mobile Usability, US Wireless Market , add a comment

Earlier today, IDC announced their study identifying 10 emerging players to watch in 2007. The companies that IDC has chosen to highlight as emerging players to watch for 2007 are (in alphabetical order) Dexterra, Firethorn, GoGoMo, GrandCentral Communications, InnoPath, iSkoot, JumpTap, mFormation Technologies, Sonic Branding Solutions, and TeleNav. I have talked to many of them in the past and have also written about some.

Yesterday, I sat down with Jeff Davis, CEO and founder of GoGoMo to talk about Content Interoperability - a significant problem in the mobile content space that needs to be solved quickly. First, let’s address what “content interoperability” means. Currently, most operators operate in content silos, i.e. ringtones, graphics, video, songs, etc. this is how the industry evolved and people just slapped another storefront or database to sell the goods. Very little was done to cross link these databases or pieces of content. As such it has been quite difficult (and a missed opportunity really) to cross-promote, cross-refer across different types of content silos. This is when we are talking about the same carrier. What if, i want to send a ringtone that i like to my friend who happens to be on another carrier. Taking this further, what if i want to send a song that i just listened to on my phone to a friend who is on a laptop. How do you keep track of content across carriers, networks, devices, and channels without inflicting complexity on the user and honoring digital rights? I dealt with this issue quite a bit in my work in 2006. There are a number of approaches one can take to resolve the conflicts across different dimensions but really the solution needs to be agnostic of any variables and just worry about content. Several companies are also trying to address the superdistribution issue, a way to tie all applications and services so that i can share any piece of content with anyone across the board.

GoGoMo has been working on the content interoperability problem for past few months and they have a digital content registry system that allows for maintaining a tag in their meta-data framework that allows to track the lifecycle of the content piece for a given user(s).

 

(Source: GoGoMo)

Of course, it takes two (or more) to tango. The value of this registry depends on how many (heavy weights) use it. It is something that carriers need to promote and come to an agreement amongst themselves on format, standards, rules, etc. Instead of deploying point solutions, one needs to take a more holistic and long-term view of the problem or else, we would be designing the solution again in a few months.

Mobile Content Interoperability will be a key issue to resolve in 2007 and we will be tracking it closely.

EV-DO vs. WCDMA (US market) January 1, 2007

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This column of mine appeared on many blogs late last year. Reprinted .. We will continue to track 3G closely worldwide.

Broadband is in the air. It has been an evolving year for wireless broadband in the US. It moved from test-beds to real markets nationwide; both EV-DO and WCDMA have made progress, but which technology is likely to be more pervasive in the coming years?

There are 3 critical things that matter the most in the evolution cycle of any wireless technology, namely - the network coverage, the device choices, and the devices and the services cost to the consumer.

In terms of network coverage, even though Cingular (then AT&T Wireless) got a head start with its ceremonial UMTS deployment in four markets, Verizon and Sprint Nextel have jumped much further ahead in terms of national coverage. While Cingular has only covered 52 major markets in 28 states (just over 50% market) thus far, both Verizon and Sprint are nearing complete nation-wide coverage. T-Mobile won’t get into the picture until well into 2007. Alltel, the number 5 carrier in the US has been spreading its EV-DO coverage as well.

In the critical area of handsets, EV-DO is ahead by a mile. As of Sept 2006, there were 15 3G handsets available in the market (representing approximately 20% of the available handsets from big four), 14 EV-DO (10 from Verizon, 4 from Sprint Nextel) vs. 1 UMTS/HSDPA handset from Cingular.

Average Selling Price (ASP) is approximately $130 on the low-end phones and $250 on the high-end. To its credit, Cingular’s LG CU 500 is available at sub-$100 to make it attractive for mass-market; however, it needs much better market coverage and broad range of devices before it can start catching up with its CDMA buddies. The pricing for broadband-friendly services are still in a state of flux but becoming attractive by the day. Starting this Christmas season, we should expect the gap between the two technologies start to narrow as Cingular plays catch-up.

As of 2Q06, CDMA carriers had 93% of the 3G subscribers in the US with Verizon leading the pack with over 80% of the 3G subscribers. 2007 will see the introduction of HSDPA/HSUPA and the evolution is expected to continue with HSPA and LTE by 2009. On the CDMA track, Sprint Nextel and Verizon are already testing and introducing Rev A devices. EV-DO Rev B and Rev C are likely to be introduced in 2008 and 2009 respectively.

So, what can we expect in the next few years? In a way, this match of EV-DO vs. HSDPA in the US is akin to GSM vs. CDMA tussle 5-6 years ago. By the time, AT&T Wireless finally decided to abandon TDMA in favor of the GSM evolution, CDMA 1x RTT was well ahead of the game. EV-DO is clearly ahead in its 5 year maturation cycle in the US and will continue to enjoy a dominant market-share till at least 2010 (though WCDMA will completely dominate EV-DO worldwide). By that time, 3G penetration will reach over 50%.

Welcome 2007

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Hope you had a good celebration and stayed safe and healthy through the festivities. This year promises to be quite interesting for our industry on several fronts. Things to watch: