Archive for May, 2008

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May 25th, 2008

Leopard Sharks: Why I need 5MP, 8GB, and Cark Zeiss Optics in my Cell Phone

I reluctantly went swimming with a friend this morning at Aquatic Park in San Francisco. “Reluctant” is the word I use because the water is about 55 degrees Fahrenheit, and it’s hard to see anything when you’re swimming. In fact, it’s hard to even see your outstretched hand.

There were about 100 swimmers when we showed up this morning. We were only in the water about 15 minutes when everyone cleared out because a shark was sighted. They told us it wasn’t a dangerous shark, but given the events on the West coast this year involving sharks, we thought, “why risk it?”

I jogged back to my car and got my cell phone.

I was able to post the footage of the shark that I captured almost immediately. Was using a Nokia phone and their Ovi service.

Each time I have an experience like this – I see something I’d like to capture on video and show my mom, but the only camera I have is my cell phone.

Here’s the link.

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May 23rd, 2008

TV: Do Consumers Want it in Their Cars?

Seems to be a hot topic this week that my colleague Michael Gartenberg and I are discussing.

Whether or not consumers want TV in their cars is a good starting point for a discussion of in-vehicle entertainment, but the other looming question is …is it technically feasible? let alone can anyone make money?

A taxi driver I met in Cleveland, OH had TV in his car. See this blog post from a few years ago. “Mobile Video – Midwest Reality Check”

What is in the news today is UIEvolution’s announcement with MobiTV. MediaFLO made their own announcement back in April at NAB.

What entertainment consumers want in their vehicles is an interesting question – one that I’m not going to answer. They do already have a radio. Those with music collections are taking them with them in the car with their iPods. Anyone can find a list of announcements made by Apple on integration of the iPod into the car on their press pages. Audio is a no-brainer. Video is tough for obvious reasons as it’s not allowed to distract a driver.

One interesting thing I find around these announcements is that they are simply announced plans to “think” about the possibility of putting broadcast video into cars or to “collaborate” or to show that it can be done. We haven’t seen announcements (at least that I’ve read) that speak to OEM interest or consumer interest.

In any case, there are a long list of challenges. Here are a few:

  • Many of the broadcast and 3G networks used to deliver this service do not blanket the country. They are in urban areas or those of high population density. MobiTV doesn’t require 3G, but I’m sure most experiences would be better with more bandwidth.
  • Back seat entertainment likely requires 6-8″ screens (or something like this). My iPhone is awesome when I hold it, and it’s great for watching video when I’m traveling. If you’re going to put the screen 2, 3 or 4 feet from a young child in the back seat, you need a bigger screen – more fps, pixels, etc. will make this a better picture. Noise, slow fps, low resolution, etc. is hidden better on a small screen.
  • Product development time for a car …. long – not in comparison to a new luxury jet plane, but compared to cell phones and consumer electronics, yes. And, then, it’s not going to come standard in a vehicle – consumers will have to raise their hands and be willing to pay hundreds or thousands of dollars. It’s also like buying a PC with built-in cellular connectivity – you have to choose a provider with the hardware. Auto OEM’s subsidize cars, but typically with their own financing arms. They don’t subsidize entertainment systems that don’t provide a payback to them like Telematics services do.
  • Services … selling services to people in cars is hard – ask the Telematics providers or look at the 10K’s of XM or Sirius from a few years ago before they moved into CE devices. You can put it in the car and give consumers free service for a while, but then you need to convert those sales. Also, lots of leased vehicles here in the States – the added challenge is when the vehicle is returned to the dealer or sold after a few years. How to find and see to these used car owners?
  • How many subscriptions for video content can consumers stomach? I think the answer will converge close to one unless some real added value can be provided – e.g., portable – getting it off my TiVo to another device or onto my iPhone. You’d have to assume if the carriers sell the service, that you’d get it on cell phones, at home (if you subscribe to Verizon or AT&T’s video service), cars, computer, etc.
  • DVR capabilities … can I save shows / pre-record shows for my kids to watch? Do I give them a remote to change channels? How do I control what they watch from the front seat?
  • Cellular networks are capacity constrained.

Every carrier continues to add bandwidth, but it’s not THAT big of a pipe when we start talking about entertainment and media.

This isn’t a complete list, but there are really a lot of challenges associated with these propositions. I’d like to see the revenue side of the equation.

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May 23rd, 2008

AT&T and American Idol Set SMS Voting Record

The season is over, and this is my first blog on Wireless and American Idol. It shouldn’t be though as there was a lot of good stuff in this season’s show.

Here’s the press release.

Highlight: 78 million text votes compared with 64.5 million last year.

An excerpt from a survey they did:

This season, AT&T conducted an informal poll on its Web site to get a sense from customers about the role text messaging has played. Poll results are based on the 416 responses submitted March 7 to May 5, 2008.

Fifty-one percent said they tend to text more frequently during the “American Idol” season than other times of the year.

Forty-three percent said they discuss “American Idol” with others via text messaging while watching the show.

Twenty-two percent said they first learned to text message by voting for their favorite Idol contestant.

By texting their votes this season, AT&T’s wireless customers helped crown a new “American Idol” champion, David Cook, and made it possible for AT&T to capture a new text messaging milestone for television’s No. 1 show.

A new element for this year’s show (and, yes, I do watch it) was AT&T relationship with Apple and the iPhone. iTunes has been in place before – promoted on the iTunes site, limited time offers on American Idol recordings, etc. The contestants all seemed to have iPhones this year – lots of screen shots of the contestants listening to music on their phones. Really well done.

Finale was filmed at the Nokia theater. As I watched the finale, I was being to think that the judges and Ryan Seacrest were getting paid for each mention of Nokia … or they had some quota to fill.

In any case, there are few examples out there of three screen marketing – TV, cellphones and the PC – this one was well done in that it drove consumers to all three medium with purpose.

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May 20th, 2008

Good Uses of SMS in Presidential Campaigns

I wrote an article for RCR last summer on how Presidential Candidates were using SMS and blogged. See posts.

Overview

Barack

Poor Execution (post)

Interestingly enough, the two candidates utlizing SMS are still in the race. (Ok, they likely also raised the most money and had the bandwidth, staff, and organization necessary to use SMS)

So, their use of SMS has become more sophisticated. Frequency is down – perhaps driven by the fact that there are fewer debates. Nice relief from receiving multiple messages per day from a single candidate. They are now on to “breaking news” which is a good use of SMS.

Here are a few I’ve received lately:

“After tonight’s tremendous victory in West Virginia, this race is far from over. Keep the momentum going at www.hillaryclinton.com. Thanks for everything.”

Not viral, but succinct.

Breaking: John Edwards just endorsed Barack Obama. Spread the word & ask 5 friends to join our movement for change by texting HOPE to 62262. Forward this msg!

Typical Obama messaging – viral + breaking news. Different style from Hillary and more appropriate than a URL jammed into an SMS message. Hillary … few cell phone users browse on their cell phones … and I haven’t looked it up, but have you registered with dot Mobi?

And from Hillary this evening …

Tonight we won Kentucky and once again, we showed America what we’re made of. Thank you so much. Keep the momentum going at www.hillaryclinton.com – Hillary

Consistent messaging. Same feedback.

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May 15th, 2008

Another Mobile TV Standard … ?

MocoNews had a small write-up on this LG / Samsung initiative. VuNet had this piece.

This was at the tail end of the story:

A study commissioned by the National Association of Broadcasters suggested that the adoption of a single mobile digital TV standard would drive the sale of 130 million mobile digital TV phones by the end of 2012.

This piece was interesting to me for a couple of reasons. First, I do believe that local news whether in video format or otherwise will be interesting to consumers on cell phones. I don’t believe that a single standard for broadcast TV is what is standing between the millions (single digit) that are using mobile TV today on cell phones and 130M others using it. I was surprised there wasn’t more about planned handset capabilities such as storage, playback, etc. that would facilitate the time-shifting and place-shifting to which consumers have grown accustomed. Business model? Ads? Content selection? Technology doesn’t tend to be the inhibitor or high on the list for consumers. A single standard may help to bring costs down, but that alone won’t get us to 130M either.

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May 6th, 2008

WiMax Whispers … Sprint Lines up Partners to Invest and ?

MocoNews reported this afternoon that the WSJ is reporting that Sprint Nextel and Clearwire are about to announce a new JV that includes a bunch of other partners – and their capital. So far, not a lot of surprises. There has been talk and reporting for months now that Sprint was seeking partners to share both the cost and the risk of deploying a nationwide WiMax network in the U.S.

The announced partners (the ones I’ve seen so far) are logical.

  • Clearwire – It’s a scale business – makes sense for Clearwire to join in let alone that they can add some of the expertise they’ve developed over the past couple of years.
  • Intel – already invested millions (if not more) to develop their WiMax chipsets and to move them into PC platforms. No network = no demand for their chipsets. Moreover, they practically built the Wi-Fi market by spending upwards of $350M (at least the public number, but could be higher) promoting Centrino/Wi-Fi and educating consumers.
  • Cable companies … logical, but still challenges ahead. Some of them (if not all soon) just threw in the towel on Pivot Wireless – their answer to AT&T’s and Verizon’s bundled offerings. WiMax is meant to be a data network. Interest in broadband wireless connectivity outside the home is high. Demand is moderate, but willingness to pay is still low today. We expect it to grow over time.
  • Best Buy – could never figure this one out. Let’s hope to not see the mistakes of past be repeated with non-telecom entities wanting to run wireless service operations or networks. (Search MVNO for all the blog postings I’ve written). Building networks and acquiring customers is really, really hard … and then you have to collect money from them.
  • Google – They’ve been seeking more open access to a wireless broadband network for years. There was the Earthlink Muni Wi-Fi deal in San Francisco that fell through. There is the constant petitioning of the FCC. There was the original agreement struck with Clearwire and Sprint. What has characterized these deals, however, has been lack of control – at least Google’s control over the execution. I’ll wait to see the announcement to see how much money they are going to commit ($500M is a lot of money, but very affordable to Google – see the cash on their balance sheet) The question will be … what can one buy for $500M? or a $1B investment?

What control does one get?

Intel needs people to buy chips in laptops and handhelds. Cable companies want triple/quad plays. For these partners, the investment looks to be more table stakes for their future strategies / return on investments to date to compete with AT&T and Verizon who are rolling out video offerings faster than the cable companies are rolling out wireless voice.

Google makes money from advertising – so more inventory at higher rates serves them well. Higher rates are plausible – if you add context (e.g., location) to search terms, you can charge more. Leading someone into the nearby auto dealership to buy a car is worth more than driving web traffic to gm.com. How much inventory can benefit from context including location? That’s an unknown, but likely a question Google can answer. It’s a fair expectation in any case, that more “access” will be wireless going forward than wired in terms of new devices added. We also know that people do more browsing on larger devices (e.g., portable media players) that can benefit from broadband than cell phones.

(see the Admob data in our report)

And, the CTR’s seem to be higher. A lot of this browsing is also done off carriers’ networks on Wi-Fi.

Someone asked me what this means for AT&T and Verizon?

My first reaction is that I don’t believe they’ll feel threatened. The investments will certainly give Sprint a boost and make the likelihood of this network being built out higher. AT&T and Verizon are the market leaders in wireless as measured by number of subscribers – they are by definition less likely to take risks. Besides, they already have home (wired) + wireless plays. Verizon can be confident they’ll benefit from the scale of LTE as it’s the natural evolution of GSM – the mostly widely adopted standard worldwide. They also have a head start with quad-play offerings. Interesting, most consumers don’t buy wireless (at least voice) based on their ability to bundle / save money – it’s still about the network so WiMax won’t likely provide that advantage. Ubiquitous, wireless broadband access with a single bill not tied to location or a single device is still anyone’s territory to claim.

Challenges that lie ahead …

Scale – is there enough in WiMax with all the global deployments to make it cost competitive? Is there a business case that makes sense? Like Public Wi-Fi, it will likely require many sources/streams. Can WiMax avoid some of the early difficulties that Wi-Fi experienced – difficult set up, poor interoperability among vendor products, interference or slow speeds due to competing user needs – if it is truly a wide open network that doesn’t moderate any one individual’s use in order to benefit all on the network. How well aligned are the partners’ interests? Will consumers pay for devices? Will they pay for WiMax when Wi-Fi is so ubiquitous and inexpensive? Will we see some free, ad-sponsored access at the lower tier speeds? That would compete head on with Sprint and the cable companies offerings to some extent.

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