Showing posts from 2017

No Good Retail Pricing Options for One Small Telco

Ogden, Utah is a one-square-mile town with about 823 households, Ogden Telephone Company is the entity providing fixed network communications services to “over 1500 households and businesses” in Boone County, with internet access speeds up to 200 Mbps, costing between $30 a month for 3-Mbps service up to $330 a month for the 200 Mbps version.
Residential phone service retails for about $30, after the taxes and fees. The firm also provides video subscriptions, supplied over a fiber-to-home network. And there is no local cable TV operator competing for customer attention.
Apparently, customers not choosing a bundle including voice service now have to pay an $80 fee. Other telcos seem to “solve” their revenue problems in similar ways, charging more money per-unit for purchases of “naked internet service” without voice than for a bundle including two or three services.
Sometimes, especially on promotional plans, the cost of buying voice service is low enough to entice customers to buy a tr…

What Verizon's Pole Attachment Stance Tells You

For every public purpose there are corresponding private interests. Consider pole attachments.
Attackers generally support less-costly, simpler, faster processes for gaining the right to string communications cables on telephone and light poles. Incumbents generally oppose such moves, as faster, easier, cheaper pole attachments mean more potential competition, faster.
Of course, interests are not simple. Cable TV companies, which once were attackers, argued for simpler pole attachments, until they became incumbents. Now the tier-one cable companies oppose “one touch make ready” and other measures to ease the process of creating an access network.
But even in the tier-one incumbent arena, business interests vary. AT&T generally opposes such measures, while Verizon now supports easier pole attachments. There is a simple reason. AT&T has the largest fixed network footprint, and so is an incumbent in much of the United States.
Verizon, in contrast, serves a relatively small portio…

With 60-MHz Channels, Sprint Expects 3 Gbps to 6 Gbps Per Sector

Sprint plans to deploy Massive (multiple input, multiple output) MIMO radios with 128 antenna elements in its 2.5 GHz spectrum to increase capacity to reach 3 Gbps to 6 Gbps per sector on its 4G network, Sprint notes.
When deployed on the network, Massive MIMO can provide all mobile device users with performance improvements, and those with the latest generation of devices with the most antenna elements will see the best performance.
In recent field testing, Massive MIMO Samsung radios, equipped with vertical and horizontal beam-forming technology, reached peak speeds of 330 Mbps per channel using a 20 MHz channel of 2.5 GHz spectrum.
Capacity per channel increased about four times, cell edge performance increased three times, and overall coverage area improved as compared to current radios.

With 60-MHz channels, Sprint believes it will be able to boost capacity up to 6 Gbps per tower sector.

Millimeter Wave Moves to "Permissionless Innovation" Model

There are many ways spectrum use is moving away from command and control methods of allocation in the U.S. and other markets. As with Wi-Fi, spectrum users now are allowed rather wide flexibility of use case, devices and business models.
In other ways, spectrum sharing now contributes to that trend. The Citizens Broadband Radio Service allows blocks of spectrum to be shared between primary license holders and commercial secondary users, plus tertiary users who have best effort access on the Wi-Fi model.
TV white spaces systems use databases to allocate users and avoid interference, without fixed rules about who may use specific blocks of spectrum, and when.
As millimeter wave spectrum is released for commercial use, the Federal Communications Commission will issue flexible-use licenses as well as release huge amounts of unlicensed spectrum.
Flexible-use licenses will allow licensees to continue to innovate. Without the requirement to use particular technologies or supply particular app…

Disruption Takes Scale

Sometimes markets work. As unhappy as U.S. consumers seem always to have been with linear video services, the advent of the over the top framework is going to solve the “choice” problem. Some (industry suppliers, for example) might argue there is not a problem, given the historically high buy rates, which approached 90 percent of all homes at product peak.
At the same time, even as they bought the product at very-high rates, virtually all surveys suggested that consumers were dissatisfied. They bought, but seemed to dislike buying.
The explanation is that they had no real choice. True, they could switch from cable to satellite to telco, but the basic offers were quite similar, and there has not been too much price differentiation. Programming contracts account for much of the sameness, while “cost of goods” accounts for the roughly uniform pricing.
OTT video now offers significant choice, and more is coming. In fact, even some providers of linear TV now say the product cannot be sold …

Thailand to Provide 10 Mbps Village Internet Access for $1.47 a Month

Thailand will connect 3,920 border villages across 62 provinces by mid-2018, providing the core network as well as one or more Wi-Fi distribution points in those villages offering end users 10 Mbps internet access service starting at 50 baht (US$1.47) per month, with unlimited data usage.

source: NBTC

Yes, Video Entertainment Revenue Easily Could Drop by Half

With the caveat that much could, and will, happen as the subscription video business switches to an over the top model, it already is possible to predict that as much as half of current subscription revenues could be lost over a decade.
Already, consumers can spend 40 percent less, using a bundle of OTT services, compared to a standard linear video subscription, according to Federal Communications Commission data.
Those fees likely do not include the add ons (taxes, fees, box rentals, outlet charges) that increase an average bill closer to $103 a month.
Indeed, much of the total cost of a video subscription comes from regulatory fees, taxes and rental charges for equipment a consumer does not need when using a streaming, over the top approach. All of that can easily add up to as much as 30 percent of the total monthly bill, beyond the advertised subscription cost.
OTT streaming does not require rental of one or more cable TV decoders ($10 each, per month), additional outlets ($10 each,…

Cisco Incorporates Machine Learning (Artificial Intelligence) in New Network

Machine learning (artificial intelligence) continues to be deployed in practical ways, including by Cisco routers and networks.
Cisco calls this intent-based networking and it incorporates machine learning to “create an intuitive system that anticipates actions, stops security threats in their tracks, and continues to evolve and learn.”
At least in part, the new network is built for pervasive computing, supporting enormous scale in terms of devices. “The new network provides machine-learning at scale,” Cisco says.
“We must move to a place where we build technology that is intuitive from the start and continues to evolve and learn over time,” says Cisco CEO Chuck Robbins.
“The new network delivers a world where you can connect billions of devices, identify them almost instantly, know what’s trustworthy and what isn’t, and draw exponential value from the connections – and you can do it in hours instead of weeks and months,” Cisco says.
Intent-based networking supports “a network with a p…

Will Microsoft Catch AWS in 2018?

Amazon Web Services leads the infrastructure as a service market, a finding virtually nobody would challenge, at least for the moment. For the moment, the  issue is Microsoft’s role in IaaS, as it is, according to Gartner, the leader in best position, at the moment, to challenge AWS.
“AWS remains the dominant market leader, not only in IaaS, but also in integrated IaaS+PaaS, with an end-of-2016 revenue run rate of more than $14 billion,” Gartner says. “It continues to be the thought leader and the reference point for all competitors.”
By way of comparison, Microsoft Azure is second in market share, with revenue run rate of about $3 million. That suggests annual revenues higher than $12 million.
source: Gartner

What Will Drive Future Telco Revenue?

Internet access is the anchor service for both fixed and mobile service providers, if only because those two services generate the bulk of service provider revenue in many markets, and because video depends on high-capacity internet access.
AT&T’s first quarter 2017 financial results hint at the contribution made by video services, which drove 32 percent of total revenues. For Comcast, the cable communications business that corresponds to AT&T’s business had 45 percent of revenue driven by video, while 27 percent was driven by internet access.
It remains to be seen whether internet access revenue contribution will be greater than content revenues, in most markets, eventually. It is virtually certain that voice, no matter how important, is destined to shrink, as a revenue driver.
What is happening is that all legacy services are mature, or maturing. That suggests, eventually, that some new revenue contributor will emerge.
source: Comcast

What Will Video ARPU Be, in the Future?

Only a few telecom products ever have been universally adopted by consumers. Voice, messaging, mobility, internet access and video entertainment are those products. Everything else is a niche. The paucity of universally-demanded services illustrates the problem of new service creation. It never has been easy, and will not be easy.
At the same time, it is easy to illustrate the new range of universally-demanded services, such as social networking, search and shopping, supplied as apps accessible “over the top,” and not intrinsically bundled with an access service.
Given the historic high demand for network-delivered content (video, especially), it comes as no surprise that OTT entertainment video services are so popular. As was the case for use of voice, new forms of highly-popular services (mobile voice rather than fixed) have much-higher value for consumers.
A majority of U.S. online consumers, for example,  now subscribe to at least one paid OTT video service, according to researcher…

"Like and Dislike" Often Tell Us Nothing About Future Behavior

Consumer research always is difficult, but it is more difficult when questions about “value” are asked independently of price and other attributes. Consider the oft-noted observation that people hate ads.  In the abstract, and all other things being equal, that seems true enough.
But “liking or tolerating ads” is something different, if the issue is free content or “free functionality” in exchange for the ads, then people, even when not fond of ads, will tolerate them, within some reasonable bounds.
So people may not like ads, but will tolerate them so long as they see tangible benefits in exchange. That noted, there is a value-price relationship that content providers and advertisers have to be aware of.
Consumers will not tolerate  “excessive” amounts of advertising, or “highly intrusive” forms of advertising, repeated too often.
The point is that asking consumers what they like, and do not like, in the absence of value and cost considerations, will nearly always fail to capture or …

Will Azure Catch Amazon?

With the caveat that comparing Amazon Web Services and Microsoft’s Azure is a bit of an “apples compared to oranges” situation, Azure seems to be emerging as the key challenger to AWS.
AWS revenue grew 43 percent year-over-year to $3.7 billion (a run rate of about $14 billion annual), in the first quarter of 2017.
Azure reported a 93 percent increase in sales for the same period. Azure includes the Microsoft cloud application businesses The “Intelligent Cloud” business unit grew sales growth of 11 percent year-over-year to $6.8 billion.
Synergy Research Group data suggests that Amazon Web Services (AWS) is maintaining its dominant share of the public cloud services market at over 40 percent, while the three main chasing cloud providers--Microsoft, Google and IBM--are gaining ground but at the expense of smaller players in the market.
In aggregate the three have increased their worldwide market share by almost five percentage points over the last year and together now account for 23 pe…

Mobility Will Have New Meaning in Connected Vehicle Era

With the rise of connected cars and autonomous vehicles, we will have to learn to use the term “mobility” in a new way, as in “transportation,” not “phones.”
A study by Strategy Analytics, sponsored by Intel, predicts a new “passenger economy” generating as much as $7 trillion in annual revenues by 2050.
Consumer use of a range of mobility-as-a-service (MaaS) offerings will account for US$3.7 trillion, nearly 55 percent of all revenues. The evolution and mass adoption of MaaS by  consumers is central to the emergence of the Passenger Economy. Consumers will continue to forgo ownership as they seek out economical, self-directed personal mobility.
Revenue models might include on-demand transportation, commuter ride-sharing, mobility as a service, fleet operations, event transportation or amenity transportation, according to the report. source: Intel

A fundamental assumption is that consumer and business users will be able to “order” transportation whenever needed, including for such routin…