Carl Ford
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The 4GWE Newsletter will come out today: Me vs. GigaOM?
July 15, 2009
I hope you are a subscriber...Turns out I have taken a contrarian view from our friend's at Gigaom. The second paragraph in particular is mind boggling to me.
The App Store is just the latest game changer to come out of Apple's Cupertino labs, and it has been a smashing success. The company today announced that 1.5 billion applications have been downloaded, with the latest 500 million downloads coming since just April. Approximately 65,000 apps are available for more than 40 million App Store-capable devices (the various forms of the iPhone and iPod Touch), and 98 percent of iPhone users have downloaded at least one app. AdMob founder Omar Hamoui thinks the App Store will be a $5 billion business in two years, though it looks like a relatively small number of apps will capture the lion's share of that revenue -- of course, like any consumer industry, advertising helps (subscription required). Some even think the iPhone is the hottest gaming platform out there; the rate at which downloads are growing would excite any investor:
This is just so much KewlAid, I dont know where to start.
First of all, lets segment this a bit better. I would say the story here is not the store but the device. After a lunch meeting a friend ask me the advice of should he buy and Iphone or and ITouch. I told the the Itouch was the answer.
Apple has made the best handheld game on the market, and if you have to you can justify having it by buying it as a phone. A pansy way out of having spending the big bucks on a pocketgame.
But when you go the app store what you discover is that of the 65,000 apps the long tail is very long and the good stuff that takes real advantage of the game function is less than 2% (Anyone want to help really quantify this?).
I have called the rest technocrud, but candidly that is giving crud a bad name.
Opportunistic applications are better equated to viruses. And let me tell you some of them are really annoying.
So if the AppStore turns into a $5Billion dollar business, I will be looking at the Jim Carrey Riddler role in Batman 2 as prophetic.
If you have the ability to deliver things on the Internet why in the world would you allow yourself to be constrained by an app store.
I do give Josh credit for his predictive powers Two years ago, I predicted Apple would be bigger than Google.
The App Store is just the latest game changer to come out of Apple's Cupertino labs, and it has been a smashing success. The company today announced that 1.5 billion applications have been downloaded, with the latest 500 million downloads coming since just April. Approximately 65,000 apps are available for more than 40 million App Store-capable devices (the various forms of the iPhone and iPod Touch), and 98 percent of iPhone users have downloaded at least one app. AdMob founder Omar Hamoui thinks the App Store will be a $5 billion business in two years, though it looks like a relatively small number of apps will capture the lion's share of that revenue -- of course, like any consumer industry, advertising helps (subscription required). Some even think the iPhone is the hottest gaming platform out there; the rate at which downloads are growing would excite any investor:
This is just so much KewlAid, I dont know where to start.
First of all, lets segment this a bit better. I would say the story here is not the store but the device. After a lunch meeting a friend ask me the advice of should he buy and Iphone or and ITouch. I told the the Itouch was the answer.
Apple has made the best handheld game on the market, and if you have to you can justify having it by buying it as a phone. A pansy way out of having spending the big bucks on a pocketgame.
But when you go the app store what you discover is that of the 65,000 apps the long tail is very long and the good stuff that takes real advantage of the game function is less than 2% (Anyone want to help really quantify this?).
I have called the rest technocrud, but candidly that is giving crud a bad name.
Opportunistic applications are better equated to viruses. And let me tell you some of them are really annoying.
So if the AppStore turns into a $5Billion dollar business, I will be looking at the Jim Carrey Riddler role in Batman 2 as prophetic.
If you have the ability to deliver things on the Internet why in the world would you allow yourself to be constrained by an app store.
I do give Josh credit for his predictive powers Two years ago, I predicted Apple would be bigger than Google.
Ericsson Do You know What You Got? Sprint!
July 10, 2009
As usual, I have to start by admitting that I am a Dan Hesse fan and my bell head nature feels for the team at Sprint.
The people who made this deal viable are long gone. When the taffy pull of Sprint and Embarq first occurred Dan went with Embarq. While I have no first hand insight, I remember my divestiture experience and all my ATT friends looking forward to being free of that local loop.
Sprint's network since the split has been an interesting mix of fixed line, Internet and Wireless. In theory it had the efficiency of the network behind it to make the company a lean mean fighting machine, but as my Dad used to say you think your are breaking up and in reality its a Taffy Pull.
Sprint and Embarq had OSS overlap and the company suffering from the digestion of Nextel could not find a strategy that equated to customer service.
Now we are going to see Ericsson manage the network, but the real question is what is the migration plan? I would assume iDEN is out for sure and the relationship with Clearwire should make for even more interesting navigation for Ericsson.
If Ericsson pulls this off it may also indicate some opportunities beyond the US market. Ericsson has been a lead integrator for Telefonica / 02 and it may be the Sprint asset gains some new relationships that way.
However the market has been hard on Ericsson, it used to be you could go into the executive offices of most Latin American PTTs and find swedish being spoken, thats how embedded Ericsson was. Today the question will be how does the commitment to 4G impact the Ericsson / Sprint network plans.
We are lucky to have keynotes at 4GWE from both Clearwire and Sprint that can hopefully give us the insight we need as we watch the rollout continue.
The people who made this deal viable are long gone. When the taffy pull of Sprint and Embarq first occurred Dan went with Embarq. While I have no first hand insight, I remember my divestiture experience and all my ATT friends looking forward to being free of that local loop.
Sprint's network since the split has been an interesting mix of fixed line, Internet and Wireless. In theory it had the efficiency of the network behind it to make the company a lean mean fighting machine, but as my Dad used to say you think your are breaking up and in reality its a Taffy Pull.
Sprint and Embarq had OSS overlap and the company suffering from the digestion of Nextel could not find a strategy that equated to customer service.
Now we are going to see Ericsson manage the network, but the real question is what is the migration plan? I would assume iDEN is out for sure and the relationship with Clearwire should make for even more interesting navigation for Ericsson.
If Ericsson pulls this off it may also indicate some opportunities beyond the US market. Ericsson has been a lead integrator for Telefonica / 02 and it may be the Sprint asset gains some new relationships that way.
However the market has been hard on Ericsson, it used to be you could go into the executive offices of most Latin American PTTs and find swedish being spoken, thats how embedded Ericsson was. Today the question will be how does the commitment to 4G impact the Ericsson / Sprint network plans.
We are lucky to have keynotes at 4GWE from both Clearwire and Sprint that can hopefully give us the insight we need as we watch the rollout continue.
Scenario Planning; If You Build It Will They Come?
July 6, 2009
"A sales guy is usually the last guy to call a downturn", is the quote from Dave Vellequette of JDS Uniphase in today's Journal as they discuss the value of scenario planning in a recession.
I think all the carriers are busy doing their own efforts nows. With over 5 Million additional subscribers to ATT as a result of the Iphone here are some scenarios I will be thinking of at 4GWE. Verizon is certainly wishing it had better understood the impact of the exclusivity on their bottom line, and the desire to partner with Apple with LTE is a big part of the aggressiveness implementation.
1) Best Case for T! Nothing changes for Apple and ATT but the widgets start to add value to a general marketplace. I am still not sure I can make the distinction between a widget and an application, but as Google's Android and Palm advocate widgets I think the scenario will be slower growth. Its still the coolest phone in town, but its limitations are easy to exploit. Multiprocessing and more web friendly strategies all work for me.
2. Retail WiMAX! So what? Clearwire has been agressive with its build outs, but the WiMAX certification process is going to yield some products that are going to be looking for a general consumer spend. What is the scenario that impacts the planning? What should be the competitive analysis that drives the discussion.
3. Price Floors! We have bundled pricing as our strategies, when a competitor starts to impact you what can you do to stop the bleeding. Ericsson / Sony, HTC, LG, Nokia, RIM, and Samsung are all great at making the same phone (only different) for various partnerships. However, Apple, Google and Palm are doing exclusive deals (We may have to think about Google differently then all of them going forward). So how do you fight the coolest release. The reaction to the Apple/ATT launch was very weak by T-Mobile, Sprint and Verizon. What should be the next strategy. Apple certainly knew how to steal the thunder from the Palm Pre launch. Other than price what works? What holds the customer in place?
4. MID way! The case can be made that the device of future is not a phone, I am now starting to watch how many people are in keyboard mode rather than in voice mode. I have even seen someone trying to text while the speakerphone of the cell was on (does this work on your device?). If you look at Intel / Nokia and a few others they will tell you the story is not about a phone but a computer, (Hence the session at 4GWE) I am not sure when this move happens. Samsung has a WIMAX netbook, but everything else is still adjuct with a USB. I think there is a price point that will hit the market right for this and then comes the most interesting question. Will the carriers enable VoIP?
All of these are game changers that can have a huge impact on the bottom line and all of them require contingencies. I have also left out the possibilities of major mergers, and the world wide impact.
I think all the carriers are busy doing their own efforts nows. With over 5 Million additional subscribers to ATT as a result of the Iphone here are some scenarios I will be thinking of at 4GWE. Verizon is certainly wishing it had better understood the impact of the exclusivity on their bottom line, and the desire to partner with Apple with LTE is a big part of the aggressiveness implementation.
1) Best Case for T! Nothing changes for Apple and ATT but the widgets start to add value to a general marketplace. I am still not sure I can make the distinction between a widget and an application, but as Google's Android and Palm advocate widgets I think the scenario will be slower growth. Its still the coolest phone in town, but its limitations are easy to exploit. Multiprocessing and more web friendly strategies all work for me.
2. Retail WiMAX! So what? Clearwire has been agressive with its build outs, but the WiMAX certification process is going to yield some products that are going to be looking for a general consumer spend. What is the scenario that impacts the planning? What should be the competitive analysis that drives the discussion.
3. Price Floors! We have bundled pricing as our strategies, when a competitor starts to impact you what can you do to stop the bleeding. Ericsson / Sony, HTC, LG, Nokia, RIM, and Samsung are all great at making the same phone (only different) for various partnerships. However, Apple, Google and Palm are doing exclusive deals (We may have to think about Google differently then all of them going forward). So how do you fight the coolest release. The reaction to the Apple/ATT launch was very weak by T-Mobile, Sprint and Verizon. What should be the next strategy. Apple certainly knew how to steal the thunder from the Palm Pre launch. Other than price what works? What holds the customer in place?
4. MID way! The case can be made that the device of future is not a phone, I am now starting to watch how many people are in keyboard mode rather than in voice mode. I have even seen someone trying to text while the speakerphone of the cell was on (does this work on your device?). If you look at Intel / Nokia and a few others they will tell you the story is not about a phone but a computer, (Hence the session at 4GWE) I am not sure when this move happens. Samsung has a WIMAX netbook, but everything else is still adjuct with a USB. I think there is a price point that will hit the market right for this and then comes the most interesting question. Will the carriers enable VoIP?
All of these are game changers that can have a huge impact on the bottom line and all of them require contingencies. I have also left out the possibilities of major mergers, and the world wide impact.
Wireless Termination: Neutral Tandem
July 2, 2009
Investor's Daily did talked about Neutral Tandem today.
The article was interesting because their biggest customers are the wireless carriers that are not affiliated with the ILEC (is that term getting old and I should just say ATT & Verizon?).
So T-Mobile and Sprint/Nextel are using them as place to interconnect. One to the biggest values is the way the tandem configuration works. We can make the case that Neutral Tandem is a virtualization service to reach the most of the jurisdictions.
Friends are at Neutral Tandem who use to work with me and they have gained some of the brillant people formerly at Vonage, Comcast and Nominum.
TNDM is the ticker and if you are into this kind of thing, IBD likes them as a stock. They compare them to Neustar which is interesting. The general view is that cable operators may prefer this methodology of interconnection going forward, and who knows combined with the wireless operators may find a way to cease paying the incumbents for termination.
The article was interesting because their biggest customers are the wireless carriers that are not affiliated with the ILEC (is that term getting old and I should just say ATT & Verizon?).
So T-Mobile and Sprint/Nextel are using them as place to interconnect. One to the biggest values is the way the tandem configuration works. We can make the case that Neutral Tandem is a virtualization service to reach the most of the jurisdictions.
Friends are at Neutral Tandem who use to work with me and they have gained some of the brillant people formerly at Vonage, Comcast and Nominum.
TNDM is the ticker and if you are into this kind of thing, IBD likes them as a stock. They compare them to Neustar which is interesting. The general view is that cable operators may prefer this methodology of interconnection going forward, and who knows combined with the wireless operators may find a way to cease paying the incumbents for termination.
EU Price Rationalization
July 2, 2009If all politics is local this one indicates the issues local to Europe. Europe is about to go on holiday. As a matter of fact for the northern climates July is the month, the southern go in August. So the law to reduce the cost of roaming for both SMS and Voice will be loved by all starting now. Which is why it went into effect yesterday.
Charges for roaming in Europe have been high regardless of whether you are roaming on the service provider that you already have in your home country. O2/Telefonica, Orange, T-Mobile and Vodafone are brands that span across Europe but, charges when you leave your own country do not take into account your affiliation. I feel for the EU dealing with providing legislative advice to their member countries. Its not like the US where the EU has any ability to mandate local law. The EU has allowed the mergers and acquistions by o2/Telifonica, Vodafone, Orange, DT, etc of the Eastern bloc carriers without making these kind of demands initially. Then again the #1 tax payer in the new members is telecom so maybe their just was not enough clout.
Viviane Reding at the ECC has been a long time advocate about the high prices of carriers, and is very Skype friendly as she as held them up to make her points about the traditional carriers.
The biggest change will be the way that consumers see their bills because the prices are rounded up to minutes but on seconds. The large carriers say they have already complied with the law but the commission says it intend to continue the analysis and may add future guidelines next year.
Of course the issue right now may not be SMS or Voice but the web, and with revenues in decline the migration to LTE for many of the carriers may face some financial challenges.
Wireless Backhaul is Fiber?
June 26, 2009Our pal Gary Kim highlighted up the In-Stat report on Wireless Backhaul.
Its an interesting report and helps to show some segmentation in the marketplace. For Verizon the LTE build out has them moving as much as possible to fiber and MetroEthernet.
Outside of majority the base stations are taking advantage of the Microwave which means Fixed WiMAX is a winner for a lot of implementations.
MetroEthernet is going to claim about half of the market place according to In-Stat because the migration to support data means circuit switch trunking is no longer viable, and the equivalent costs associated with Special Access is becoming a bone of contention in Washington.
As the network data traffic grows the relevance of the circuit switched models using T-1s is reduced. Mind you the commitment to bring voice on to the data side is limited at best.
A very real benefit of MetroEthernet to the links between the RAN and the core network is the ability to have better distributed redundancy and QoS for traffic shaping.
Best Buy Gets Smart about Mobile
June 25, 2009
Yesterday, Scott and I were busy traveling to meetings in the city with companies in three separate sections of town. At one point we past the Best Buy Mobile store at Union Square. I wanted to jump in, but we were in a time crunch.
If you read the press release of the Best Buys earnings you discover that smart phones are pretty profitable for the retailer. So much so they intend to add another fifteen stores under the Best Buy Mobile broad.
And its not just smart phones they want to display there but netbooks as well.
At the retail level the term Mobile Internet Device [MID] seems to be missing.
It maybe that with the advent of certified WiMAX rolling out this fall, the term MID starts to catch on. Talking to Ari Zoldan yesterday, I was impressed with some of the devices solutions he was offering that was carrier independent.
I don't think this is the place where Best Buy makes its margins, I think they are somewhat carrier dependent for the margins on the smart phones. So it will be interesting to see what kind of bundles start to happen with the netbooks.
I purchased a netbook separately from the Verizon MiFi from Novatel. But and the HP Verizon bundle may have value to others.
Bottom line though is the Wireless Internet market is about to explode and it should be fun to watch.
If you read the press release of the Best Buys earnings you discover that smart phones are pretty profitable for the retailer. So much so they intend to add another fifteen stores under the Best Buy Mobile broad.
And its not just smart phones they want to display there but netbooks as well.
At the retail level the term Mobile Internet Device [MID] seems to be missing.
It maybe that with the advent of certified WiMAX rolling out this fall, the term MID starts to catch on. Talking to Ari Zoldan yesterday, I was impressed with some of the devices solutions he was offering that was carrier independent.
I don't think this is the place where Best Buy makes its margins, I think they are somewhat carrier dependent for the margins on the smart phones. So it will be interesting to see what kind of bundles start to happen with the netbooks.
I purchased a netbook separately from the Verizon MiFi from Novatel. But and the HP Verizon bundle may have value to others.
Bottom line though is the Wireless Internet market is about to explode and it should be fun to watch.
Alvarion Scores $100 M WiMax Deal With Open Range
June 17, 2009
The press release just hit the Internets -- Alvarion's mysterious $100 million WiMax gear deal is with planned rural WiMax provider Open Range Communications, and not Clearwire as previously rumored.
According to Ashish Sharma, Alvarion vice president for corporate market development (and apparently handler of all late-night phone calls), the deal could eventually be in excess of the stated $100 million total over its planned five-year length -- but even at the stated $100 million, it's a big win for Alvarion, which just posted $68 million in revenues for its latest quarter. Though Open Range was all over government funding before anyone even dreamed of big telecom stimulus bucks, there are still a lot of questions in the industry whether Open Range is all hat, no cattle as they sometimes say out West.
While Open Range's promises and strange makeup -- government funding and a non-standard deal to obtain spectrum -- have made for a lot of industry head-scratching, the Alvarion deal (which calls for radio equipment, customer premise gear and systems integration) seems to put some meat on the Open Range skeleton, so to speak.
As we said earlier, any $100 million deal is a good one for the WiMax industry, no matter which provider is paying the bills. But until and unless Open Range actually starts delivering on its rural broadband promise (Sharma said services are supposed to be available before the end of the year) this one is still probably better marked as incomplete.
According to Ashish Sharma, Alvarion vice president for corporate market development (and apparently handler of all late-night phone calls), the deal could eventually be in excess of the stated $100 million total over its planned five-year length -- but even at the stated $100 million, it's a big win for Alvarion, which just posted $68 million in revenues for its latest quarter. Though Open Range was all over government funding before anyone even dreamed of big telecom stimulus bucks, there are still a lot of questions in the industry whether Open Range is all hat, no cattle as they sometimes say out West.
While Open Range's promises and strange makeup -- government funding and a non-standard deal to obtain spectrum -- have made for a lot of industry head-scratching, the Alvarion deal (which calls for radio equipment, customer premise gear and systems integration) seems to put some meat on the Open Range skeleton, so to speak.
As we said earlier, any $100 million deal is a good one for the WiMax industry, no matter which provider is paying the bills. But until and unless Open Range actually starts delivering on its rural broadband promise (Sharma said services are supposed to be available before the end of the year) this one is still probably better marked as incomplete.
Introducing the 'Clearwire NTK' Research Series -- Deep Insight for Less Than $5
June 13, 2009
Welcome to the June, 2009 installment of our "Clearwire Need To Know," or Clearwire NTK, Research Series. The NTK Series provides quarterly updates on all things related to Clearwire Corp.'s nascent WiMax services, including market launches, pricing schemes, WiMax device availability and recent business deals from the company building a nationwide WiMax network. The Clearwire NTK reports are designed to give anyone interested in Clearwire the most thorough and up-to-date package of news, analysis and short-term outlooks available, in a format designed for easy reading.
Much more comprehensive than short blog posts -- and much more timely and economic than thousand-dollar traditional analyst reports -- our Clearwire NTK reports are "right-sized research" for busy professionals who want to stay as current as possible on all things Clearwire. If you are interested in Clearwire, here is everything you NEED TO KNOW, ready for you to order and download directly from our site.
Topping out at just over 3,000 words -- like those good old feature stories that most tech publishers don't have the space or author experience to provide any more, each of our Clearwire NTK reports are available in form factors designed for your convenience, from PDF downloads for your desktop, laptop or netbook, or in formats suitable for reading on your Kindle bookreader or iPhone.
Much more comprehensive than short blog posts -- and much more timely and economic than thousand-dollar traditional analyst reports -- our Clearwire NTK reports are "right-sized research" for busy professionals who want to stay as current as possible on all things Clearwire. If you are interested in Clearwire, here is everything you NEED TO KNOW, ready for you to order and download directly from our site.
Topping out at just over 3,000 words -- like those good old feature stories that most tech publishers don't have the space or author experience to provide any more, each of our Clearwire NTK reports are available in form factors designed for your convenience, from PDF downloads for your desktop, laptop or netbook, or in formats suitable for reading on your Kindle bookreader or iPhone.
Cisco Delivers WiMAX Wake-Up Call With Clearwire Deal
May 14, 2009
After Cisco bought WiMax radio supplier Navini in October 2007, industry watchers have waited and wondered why the biggest networking vendor wasn't doing more with WiMax in the U.S. market. Now after Wednesday's announcement of a multi-year deal between Cisco and Clearwire, the waiting is over -- and you have to think Cisco just delivered a big wake-up call about WiMax to Silicon Valley and Wall Street in one big move.
What really made the deal big news was the inclusion of Cisco's pledge to ship a mobile WiMax end-user device before year's end. The other part of the deal, which involves Clearwire using Cisco gear in its core IP network, isn't so surprising -- in any IP network of Clearwire's size, you might be more surprised not to find Cisco gear in the wiring closets.
But by pledging to develop end-user devices, Cisco is signaling to the rest of the industry (and investors, if they are listening) that WiMax is more than a curiousity.
What really made the deal big news was the inclusion of Cisco's pledge to ship a mobile WiMax end-user device before year's end. The other part of the deal, which involves Clearwire using Cisco gear in its core IP network, isn't so surprising -- in any IP network of Clearwire's size, you might be more surprised not to find Cisco gear in the wiring closets.
But by pledging to develop end-user devices, Cisco is signaling to the rest of the industry (and investors, if they are listening) that WiMax is more than a curiousity.
