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GENBAND Perspectives 2013 Live Blog

2013-04-30T13:06:04Z

Check out What's on Tap for the GENBAND Perspectives Summit? by TMCnet's Rich Steeves

See me live at 2:00 pm today here at GENBAND Perspectives 2013 where I speak on a panel "Harnessing the Power of Social Networking" in the Grand Cypress Ballroom here at the Hyatt Regecy Grand Cypress.

I am in Orlando for GENBAND Perspectives 2013 and the show is about to begin. last night there was a poolside reception which was rained out - but the venue was able to move about 1,000 people quickly indoors where the reception continued without a hitch. OK, a few of us had some wet clothes but other than that things have gone well so far.

Drummers kick off event

GENBAND Chairman David Walsh takes the stage. "Digital life is interactive. We are constantly interacting with it. None of it can happen without secure digital networks." Will companies, lead, follow or get run over? They have to decide he said.

General discussion about how many new domain names are registered... How many emails are sent - how much of it is spam (hint: almost all), how many people are on the Internet, etc.

He segued into a discussion of OpenTable and Uber - apps which don't use people but they facilitate transactions between buyers and sellers for restaurants and car services. 1 in 8 married couples met online he continued.

He made a funny telecom joke - if you got hear early, you could use SinglesAroundMe to find a date and then use Uber to get a car and OpenTable for a restaurant location - this is the new triple play.

He also discussed WhatsApp and Viber - he uses and loves both. He mentioned these OTT services are great but not ubiquitous. GENBAND is developing tech to allow these services to be federated.

Discussion moved to WiFi - he discussed the law of wireless gravity - bits will find their way to lowest cost infrastructure as fast as possible. "Spectrum is constrained and expensive. We can use math and science to make it more efficient but it isnt as effective as fiber which you can deploy more of to add capacity."

New York will become a carrier by converting phone booths to wireless hotspots - they will be able to become an ad agency and deliver content to various geographies and generate revenue. Hotels are also telecom carriers because networks are built where people gather and vice versa.

Discussion of how much heat is generated by data centers - they are power an water hogs (for cooling). Intertech is their partner and they provide more efficient cooling solutions.

We are beginning to see the start of cyber-warfare they also have an investment in Mandiant - the company finds and remediates problems. Also they are working with ISC8 to help find faults before they happen because quite often you find a threat 40 months after the intruder got into your network.

Devices are more valuable than ever. We want to help you [carriers] become a vital part of this evolution.

Charlie Vogt President and CEO takes stage

Discussion of the pace of change, GENBAND success - growth, speed of growth and forecasts of future growth. 80 of top 100 service providers are their customers. They are a hug part of Verizon FiOS, BT, Shaw, NTT, Telus and a number of other carriers. At CIBC and University of Texas at Austin - they are providing significant telecom infrastructure.

We are watching a video about how GENBAND empowers service providers and enterprises - by boosting scalability, efficiency and profitability - "Making Networks Smarter."

$100M annually in R&D is invested by the company. Small cells, WebRTC and cloud are a few areas of these investments.

Verizon CTO Tony Melone takes stage starts off - tech can build a better future... Together with partners we will take on societal challenges, healthcare, public safety, education, etc. Gave example of a wireless telepresence robot to allow remote students to learn. Also, "Make the world more sustainable and improve healthcare and remake entertainment with state of the art infrastructure which delivers superior experience consumers want."

Apps have to run on secure, reliable, available infrastructure - this is the vision at Verizon. We strive to deliver this day in and day out. 4 platforms.

4G/LTE - largest footprint in US and world... We achieve speeds faster than advertised today. US is ahead of world in 4G - thanks to our competitors trying to catch us.

IP - important in everything we do

FiOS - our Quntum services offers 300 mbps to consumers - soon we will offer 1 gbps if they need it. Reminds us we constantly underestimate tech needs/growth.

Cloud: Terremark: this is an important part of our portfolio.

We built 4G on 700 mhz spectrum and will put AWS to use soon. We need more spectrum and will go out an get it as needed. He doesn't understand why some want to limit telco access to spectrum.Explained the company is using the spectrum it acquires - it doesn't shelve it. It is investing billions in spectrum build-out in-fact. Won't launch before it is ready- it is not trivial to build a nationwide VoLTE/wireless VoIP network.

Video is 50% of global traffic on backbone some estimate as high as 90% in not too distant future.

Gave shout out to GENBAND, Ericsson, Alcatel-Lucent and others who allow them to provide more cost-effective services.

Moved to smart-home discusion - FiOS - PON - 18M homes, mid-30% penetration roughly. 150 HD channels and reminded us up to 300 mbps to the home. They will migrate the backbone from 2.5 Gbps to 40 gbps and when this happens, they can provide 1 gbps to home.

In their broadband home router - they want to add intelligence so new devices can connect quickly and then connect to the cloud without user set up. They want to mak it easier for consumers to get access to the latest technology.

They see FiOS more as a business play - allows them to enhance their investment in the asset. They are being aggressive in moving from copper to fiber. Will accelerate this move based on what they learned in Hurricane Sandy.

"Cloud is real and growth continues... Means different things to different people." They focus on enterprises - secure connections to cloud with a breadth of services. Managed apps and services...

Thinks their platform will be ideal for partners to build upon. This is how they want to help solve the challenges in the world.

He then showed a video - some of it is below:

We enable so much of what is possible with innovation - we shouldn't forget how important we are - we need to continue building trust with customers - provide reliable networks etc.

M2M 40% growth - 50B devices by 2020 to be connected - partnership with QUALCOMM, Mphase - make it easy to take non-traditional devices - connect to Verizon Wireless network.

How can we make tech make the lives of our customers better and improve societal issues like healthcare.

Tim Wagner of Samsung takes the stage to discuss the company's transformation of the last three years - how the company has become a smartphone leader from a feature phone leader... Said no other company has done this. Largest electronics company in world... $200B organization. Selling 1,500 devices per minute.

Talked about how their commercials made their competition seem like the device was for old people - basically talking about Apple and the ads where Samsung users wet to the lines where Apple customers were waiting to buy.

Now discussed how much their social media presence has grown. Also - discussed hoe 500+ customers launched the Galaxy S4 phone at once. Around 120-125M Galaxy devices have been deployed. This doesn't count TVs appliances, feature-phones and other devices.

Discussed Samsung SAFE for enterprise - connects device to MS Exchange and ActiveSync, on device encryption, VPN support, MDM support from AirWatch etc.

Says they have systematically defragmented Android - makes the devices consistent across carriers and form factors and price points. IT manager can test one device and add SAFE - not each device.

26 devices run SAFE today.

Gave case study examples of successes.

AA has 16,800 Galaxy Note devices - allows American Airlines to provide same level of service to top First or Business Class. Their business is transformed - no more manuals or paper tickets.

Helping customers with tech implants - heart issues - allows them to know if they have heart problems through app on phone. First tablet approved for cockpits in US. DISH Networks - reducing four-hour window, use Galaxy Note to track installers and reroute them based on success at install. Allows them to check reception from top of ladder - don't need to go back down to test repeatedly. Can upsell and gt an electronic signature. Takes a four-hour window to potentially a 90-minute window - changes their business.

65,000 unit Galaxy win at HP.

Moved to discuss Samsung Knox - starts from metal of device to software... Allows work/life balance - keeps you from losing personal photos when enterprise wipes your device.

When turned on - looks for Samsung OS - if it doesn't find one, it will not boot up. Worked with NSA on this - security enhanced Android. Any unapproved apps are deleted/killed. General Dynamics is selling these to the government. They decided to focus on Government realizing that other regulated industries will follow.

Also have a container for business and personal use.

We have the most number of smart devices that are out there he said.
education, healthcare, manufacturing, hospitality and other vertical solutions are their focus going forward.

Samsung and GENBAND collaboration - enhance productivity, anytime, anywhere access to data - creating "Smarter Office." Discussed better business value.

He gave an example of allowing you to tap a phone to a tablet and being able to transfer a all from your office to your mobile device so you can listen to your conference call on the way home and spend more time with your family. Then explained they think GENBAND is the ideal partner to help them provide all this value to the market.

Samsung has an Oprah Moment - everyone in the audience gets a Samsung Galaxy Note 2 - now that is amazing!

This concludes the live blog for now - I am about to prepare for my talk in a few hours - right after the lunch break.

Has the SEC killed the Press Release?

2013-04-04T20:17:55Z

Has the SEC just signed the death warrant for the press release market? Possibly. Standard operating procedure today is to distribute press releases through established services like Business Wire and PR Newswire but thanks to the SEC, you can post your news on social sites – as long as users are told where to look.

Reed Hastings accelerated this move by posting materially important information about his company to his Facebook page. This set off a fire storm regarding whether this action was proper or not based on current investment rules. It seems the SEC does think the behavior was OK as he is not being prosecuted.

This gets us to the news made today by Business Wire in the form of, you guessed it – a press release, where they explain social can be one form of full and fair disclosure and offers but “Business Wire believes that a broadly disseminated news release -- distributed simultaneously and in real-time via a legitimate news wire service -- is still the most effective way to maximize investor outreach, and to inclusively serve the needs of all market participants.”

The release goes on to explain how it is a more suitable platform than social because it protects its clients security and also ensures there is an audit trail in the case of a regulatory investigation.

Here is the reality… Companies can easily host their news on their own sites and tweet it, use Google+ or whichever services they desire. Yes, press release distribution is important but it is less so as search engines have lessened their importance in results.

I do see this move by the SEC as a major blow to Business Wire and the whole industry – that is exactly why they put out the release… To counteract the damage.

The winner here is all the social platforms you know and love and Bloomberg for its part has announced tweets will now be integrated into its terminals.

“When important news is shared on Twitter, traders and investors need to be able to access it, and validate its importance in order to incorporate that information into their decision making process,” said Jean-Paul Zammitt, head of sales and product development for the Bloomberg Professional service. “Bloomberg’s platform now provides this ability, along with the high-quality news, data and analytics our users need and have come to expect from us.”

NICE Systems at MWC2013

2013-02-28T16:39:42Z

At Mobile World Congress 2013 in Barcelona NICE had a very compelling story regarding its multiple product lines which are generally analytics, security, financial and the contact center. In a conversation with Yaniv Zukerman and Eyal Kirshner I learned the company will be focusing more on its multi-channel analytics solutions across its product lines. Moreover, we will see more cloud solutions from them as well - including in the anti-fraud space. This technology will be rolled out across product lines - and used to allow for CFPB compliance. The solution tells agents what they can and can't say including disclaimers. In fact the company showed this product at the show - complete with providing an activity trail which can be provided to regulators in case of an audit. Speaking of the back office, Zukerman tells me there are increasing threats in this area and the company's anti-fraud technology tracks patterns and can help determine malicious activity and fraudsters.

Yaniv Zukerman and Eyal Kirshner of NICE at Mobile World Congress 2013 in Barcelona

In addition, the company's Voice of the Customer solution allows an innovative way of using text messaging to allow free-form survey responses via text post interaction which can be live, via phone, visit to website etc. Again, this is free-form text messaging allowing a customer to respond however they want and the analytics kicks in to respond accordingly. They could say for example, I really think the agent I just spoke with, "Jim Smith" is atrocious.The information supplied by the customer is then used to alter training of the particular agent if needed. It can further be used to modify products or product training. The idea is acting in real-time to business challenges. In one example a survey after a flight allowed the crew manager to get the results immediately and then call a meeting to adjust before the next flight took off.

The product also is able to determine which interactions could be used as an upsell opportunity. Speaking of which, the company's Service-to-Sales solution in conjunction with IBM the uses analytics to determine if an upsell opportunity exists on a service call. At this point, the agent is guided through the process of selling the customer in a seamless manner which Zukerman tells me shortens the sales cycle.

The company also discussed its Mobile Network Optimization solution designed to help wireless carriers see a 3D view of a city's wireless coverage based upon its deployment of base stations, small cells and femtocells. The system does its best to approximate what real-world coverage will be indoors where most of large-city traffic emanates from.

NICE also showed a real-time-authentication solution using voice-biometrics. It auto-enrolls customers based on past conversations and shows the agent if the person is verified or not. If there is a doubt about the caller's identity, an authentication process can be launched.

Another product designed to lubricate the sales and service process is Mobile Reach which the company tells me integrates with mobile apps and allows a user to instantly connect with a call center if there is a problem with a transaction. At this point the agent is able to follow the exact context of what the user is doing and they can subsequently push information back and forth. For example an agent can push the specifics of a special plan the prospect could be eligible for and the caller could send a photo of their ID to prove who they are.

Its interesting to see the numerous product lines NICE has - they seem to overlap more and more as time progresses. For example, security which once was needed primarily in financial services is now needed more broadly as threats have become more common. Biometrics - once used primarily by the military is being rolled out to call centers across all sorts of companies looking to reduce the amount of time agents spend on the phone and to improve customer service and retention.

The silos which once existed seem to be eroding and as this continues, it seem NICE is well-positioned to provide solutions across a wide range of markets.

Mobidia Tackles Bill Shock at MWC2013

2013-02-27T15:45:23Z

Chris Hill (pictured) the VP of Marketing at Mobidia was euphoric in telling me about the growth of the company's new app My Data Manager which has had 3.5 million downloads in the past 12 months. As bill shock becomes a larger problem which is amplified by the speed of 4G networks, users - especially when roaming, are literally a movie away from being hundreds of dollars above their typical monthly costs if they aren't careful.

The app runs in the background on iOS and Android and monitors app usage and cellular usage anonymously sending data back to the company if the user agrees to it. To date, over one million people have signed up to allow their data to be tracked meaning Mobidia has some incredible information about mobile use trends. For example, eBay and Amazon were way ahead of the next ecommerce site on Black Friday.

Another tidbit of information is messaging and voip apps seem to have dominant players which are different in each country. Skype of course is a constant and Facebook Messenger is growing rapidly but other players seem to have regional strength.

The company monetizes the app via this data - selling it to investors, and even a VoIP company buys the data to compare themselves to others in the market. Carriers too have become customers and can use the data to target specific plans. For example, heavy Pandora users can be given special offers to use a Spotify plan.

Hill tells me a new frontier is mobile advertising and they are looking for ways to use their data in this space as well.

We often see fremium apps do well as some users become paid over time and ad-supported apps do well as advertisers pay the bills. Mobidia may be one of the few new companies using big data and the subsequent analytics they imply to generate a nice living from giving away an app to the masses.

Thoughts on Alcatel-Lucent

2013-02-08T19:42:16Z

One of the greatest challenges incumbent companies face is the ambivalence and corporate politics incumbency breeds and it only gets worse in what we call the age of acceleration where competitors arise faster and technologies shift more quickly than ever. Nortel, NSN and Alcatel-Lucent are all companies who enjoyed decades of leadership in the carrier market and in the process decided to provide generous benefits for their workers which would eventually help make them uncompetitive.

There is more to it - in the late nineties, Lucent acquired companies so quickly that its workers didn't know exactly who did what. Nortel too made a great deal of acquisitions. The challenge for both companies was they didn't integrate their new assets into their companies effectively.

Cisco on the other hand was a master of buying companies with good technology and rapidly rolling the products out to its global salesforce allowing sales of the acquired companys' products to accelerate rapidly. To some degree they play an arbitrage game of taking a good local technology and providing it globally with a solid salesforce.

Few other companies have mastered the art of the acquisition like Cisco.

When Alcatel decided to Merge with Lucent Technologies the competition told me privately that the merger would take a few years to integrate well and then the new entity would be a force to reckon with. There was certainly much to look forward to - the merger of the best of US and french technology. In reality - the way things have been going lately, some have said the Franco-American company with power bases in New Jersey and France resembles the offspring of Snooki and Pepe Le Pew.

Of course this is why Alcatel-Lucent recently announced that CEO Ben Verwaayen will be stepping down.

On the financial front, ALU just reported a net loss of $1.85 billion for 2012. The explanation was that it has been suffering from lower than expected sales in Europe and China and it took a write-down in its wireless and optics businesses.

Highlights from the earnings release:

Sales fell 5.7 percent to $19.3 billion in 2012.
Adjusted operating profit was $156.6 million.
Margin of 2.9 percent was below the 5-9 percent Verwaayen had promised.
Cash was depleted $908.6 million in 2012.
Fourth quarter sales fell 1.3 percent from a year earlier as only the U.S. market was strong

The net loss stemmed largely from a write-down of $1.9 billion, which the company said was "related to the depreciation of goodwill and fixed assets, and the corresponding impact on deferred tax," which CFO Paul Tufano said was linked to the lower value of ALU's wireless and optical assets.

Like Nortel, Lucent had a number of problems this past decade and also had to deal with numerous acquisitions made at inflated telecom and dotcom bubble valuations. Moreover, Asian competitors have been ferocious and are taking the company on in ways it frankly can't compete with.

Last week at ITEXPO in Miami I had a chance to speak with Payam Maveddat of Taqua about telecom competition from Asia - this is before the Alcatel-Lucent news even broke. I reached out to him to get his precise words:

As I travel internationally to promote our US-based technology overseas, it has become evident to me that the holistic approach of the Chinese government of combining infrastructure financing and development, including roads, railroads, refineries, power generation, farming, and telecom does not allow for other companies to be able to compete on the same playing field in these developing markets and I am not surprised that Alcatel-Lucent is struggling to survive in this environment.

Of course there is more to it - Alcatel-Lucent is losing business in its own backyard as it hasn't innovated fast enough, some say it didn't cut deeply enough and its R&D investments are smaller than those of Huawei, a company with a smaller product line and access to cheaper labor.

Moreover, the company has (or had anyway) a strong enterprise PBX line of products but they are hardly heard about anymore - at least in the US. Of course the spin-off of Genesys makes little sense if you truly value your enterprise business. But the company has decided the carrier space will get the majority of its attention based on its outbound comunications with media and analysts.

Another area for expansion is the cloud where the company could have come up with many more services for resale by carriers, VARs and MSPs.

Having said that - the company's expansive line of business is bewildering and Oracle's acquisition of Acme Packet could signal yet another ferocius competitor - Oracle knows how to integrate and grow acquired businesses and if they pick up GENBAND things get a lot more interesting in the market as they can compete across a much broader product line.

TMC's Peter Bernstein had this to say about this news:

I’m on record as saying that the next 12-18 months will be a tipping point in the ICT industries, and what happens in this time period will dictate industry structure for years to come. This includes the telecom equipment sector, service provider as well as enterprise, where the accommodation of change and moving quickly are not historic attributes. In that respect, Verwaayen may turn out to be prescient about his successor needing to be focused like a laser on execution.

And he is right. So much can happen over the course of the next few years which will determine the future for years to come in the telecom and datacom markets.

Finally, we can't expect European and American leaders to get their act together in a manner which allows them to compete with China Inc. in developing markets. This means players like Alcatel-Lucent will have to have better products at better prices to become more competitive than Huawei, ZTE and a host of ther new entrants. Sadly this isn't likely but the positive news is the company is still a leader in advanced technologies like optical and wireless as evidenced by its announcement of a 400G/s optical connection spanning 275 miles in France.

See Payam Maveddat of Taqua's keynote from ITEXPO Miami last week - "Federation as a Service"

See GENBAND President and CEO Charlie Vogt be interviewed by me at ITEXPO Miami last week

Sheldon Adelson Continues to Give Back

2013-02-08T14:50:06Z

Sheldon Adelson was the founder of the COMDEX trade show and early in my career his team was gracious enough to work with me to promote the first magazine I published named CTI. I have always been impressed by his business skills – he ran the largest show in the US and when he sold it and stopped his involvement it went downhill fairly quickly and eventually collapsed.

At the peak of the show in the late nineties in Atlanta, GA, TMC gave away well over 10,000 magazines from a 20x30 booth – there are few other shows – even today where you could achieve such a feat. As I recall, we probably could have given out even more but we ran out!

After he sold COMDEX, he then went on to run a string of global casinos – very successfully. He seems to turn everything he touches into gold. Moreover he has been a great philanthropist having founded a school in his local community which I hear firsthand is quite good. He has now donated an additional $50M to The Adelson Educational Campus allowing it to expand and improve the education of students in the Las Vegas area.

The media seems to be obsessed with talking about tech’s latest movers and shakers like Mark Zuckerberg but its worth pointing out that events like COMDEX were in-part responsible for laying the foundation for everything we experience in tech today. Moreover, yesterday’s tech leaders like Adelson are still actively giving back to the world in many positive ways.

Video is the Recurring Star

2013-01-30T00:11:15Z

There is an insatiable demand for content of the video variety. It is so great in fact that sports networks like ESPN are getting an outsized portion of your cable bill. The network in fact gets more than $5 per subscriber per month regardless of whether you ever watch their networks. Cable and IPTV companies for their part are in quite a pickle as more subscribers drop their service altogether for OTT competition. The solution to the problem is painful for many but will eventually be taking sports programming and breaking it out into tiers according to Gary Kim who writes on TMCnet. He explains the first step these companies are taking is adding a $3 fee for local sports programming. At some point ESPN will have to be dealt with it seems.

We have all heard content is king and - remember that until recently Netflix took a massive hit to its earnings due to its lack of leverage in negotiating with content providers. The solution? Develop more of your own content. Exactly what the company is going to do with some of the $400 million in debt it just raised.

TMC’s Erik Linask had this to say about the news: “Companies like Netflix and Hulu are proving that the longstanding dominance of mainstream networks may be in jeopardy. The combination of a modern business model, high-quality programming, and multi-device capabilities, present a compelling case for today's connected viewer, potentially disrupting the competitive landscape to the benefit of the consumer.”

To summarize: content is still king but consumers will soon have the ability to pick from infinite monarchs.

And as more of this content is streamed to various devices, networks have become more clogged than ever. The good news is the emerging H.265 standard which was just approved by ITU is twice as efficient as the current H.264 standard deployed on most tablets and smartphones and data centers pumping the content out.

Amazon today deployed news which is wonderful for the video market with the launch of Amazon Web Services Launches Amazon Elastic Transcoder a solution which leverages the company’s cloud to obsolete the entire market of small transcoding companies playing in the video space. Of course your definition of “wonderful” will vary based on where you sit in the food chain.

Can we make a prediction about the future of video? It seems we are taking baby steps to a la carte programming or at least packages which give consumers some additional choices when it comes to sports and other areas. Investors believe there is money to be made in content production which means the Netflix deal may spawn others. Content will still be king but it gets tougher to stand out when there seems to be endless consumer choice in programming. We have seen Yahoo try the video production game on and off without a great deal of success – perhaps they just did a poor job of it or maybe times have changed. One thing in favor of all these video production entrants is the new connected TVs and cheap consumer electronic devices allowing TV sets to easily display video from the Internet.

In 1979 the Buggles launched the hit song Video Killed the Radio Star which at the time seemed to make sense with the advent of MTV which chose this song as its very first video to play. But over the years it seems radio too has evolved being transmitted from space and traveling over the Internet for example. So radio actually never died. Let me clear up the confusion from my younger readers - MTV was a network which at one time actually played music television. But I digress – I wonder if the title of the song should have been “Video is the Recurring Star.”

Belkin Buys Linksys from Cisco

2013-01-25T01:08:52Z

In a continuation of Cisco exiting the consumer market, the networking giant has announced it has sold this division to competitor Belkin for an undisclosed amount. Belkin will continue to honor all valid warranties and will now own about 30% of the U.S. retail home and small business networking market.

Cisco has had many failures in the consumer market for an obvious reason. They are in the business of selling expensive products to IT managers in large, medium and small companies where the margins are far better than they are in the consumer electronics space.

A past example of failure is the Cius tablet which was discontinued. Before I even saw it I said the following:

The downside risk is fairly obvious though and that is that software is cheaper than hardware and most anything the Cius can do, an iPad or other Android tablet can as well.
And then there is the consumer electronics angle - Cisco purchased Flip and shut it down a few years later because the company isn't very good at competing in the consumer space where margins are razor-thin. Obviously the growth of smartphones helped kill the pocket-sized video camcorder market as well.

Then there was Umi telepresence which I predicted would fail as soon as I heard about it.

Cisco has gotten its mojo back lately and even though its having problems in its video business, it seems to be on solid footing as competitors like HP and Dell are strugging. Of course IBM is doing great and Huawei and ZTE still are formidable.

So the news here for consumers is great as Linksys is back in the hands of a company that gets consumers. Subsequently Cisco has more time to focus on acquiring and/or developing new products for the enterprise and carrier networks.

How Mobile Will Destroy Retail Margins

2012-12-21T22:45:17Z

Some of the news of the week has to do with eBay deciding mobile advertising doesn’t work for them as it clutters small screens and doesn’t provide that much revenue. This seems to make sense but if you think this in any way is going to change the impact of mobile advertising and commerce you are dead wrong.

Logic and rumors tell us Amazon will be releasing a telephone soon and the reasoning for them to do so goes far beyond expanding its ecosystem and pushing people to download apps and watch videos online.

Location based advertising is where everything is going.

We all know about the potential to flash an ad for a company when the customer is nearby and this will no doubt be an effective strategy to boost sales and traffic. Especially for restaurants who want all their tables filled.

The real power of mobile ads however comes into play when customers aren’t near the company’s retail location. Imagine you go to a car dealer and its competitor across town flashes an ad on the spot with a $1,500 rebate on any car in their lot and maybe offers to buy you lunch as well. You may not get up and go to the other dealer but you’d be a fool to not show the salesperson your cellphone in order to get a better price.

Think of all those purchases you have made over the years on your supermarket loyalty card and imagine if your supermarket had an opportunity to flash ads at you for the items you’ve previously purchased when you are at a rival grocer or at a pharmacy which now stocks almost everything the grocery store does.

And so it begins.

Sure, many savvy customers currently collect coupons and look for numerous retailers before going on a shopping expedition but the sheer ease of discovering competitive pricing will mean everyone will have access to the best prices at all times.

And retailers will have to price match or risk watching customers turn their cars around before they even park their cars in front of the store!

This is why the Amazon Kindle Phone has to happen. This is why Google purchased Motorola and is working on a killer “X Phone” to rival Apple and Samsung.

Moreover, this is why mobile devices will get cheaper as commerce will continue to subsidize them. Amazon and Google will no doubt want to get these devices into as many hands as possible – even if it involves losing (more) money on each one sold. Apple and Samsung will have to find ways to get a piece of this market and may have to partner or acquire. Suddenly Groupon has become more valuable. Suddenly, eBay has a chance to proactively sell you used products when you are in a retail store looking for something new.

Today, Amazon will sell you a Kindle Fire for $159 if you don’t mind the ads or $174 if want an advertising-free experience. In other words it is worth at least $15 to Amazon to show you ads on a tablet. Over time, if Amazon is successful with this dual-pricing strategy we can imagine it lowering the price of the subsidized model even more. A phone with permission to show you ads would be even more valuable than a tablet as you take it everywhere. Certainly Google can’t wait to bring its massive ad network into play in new ways. It certainly shows location-based ads today – but on a less proactive basis.

The takeaways are as follows:

Mobile devices will increasingly be subsidized
Google and Amazon have to have the best devices possible in order to compel users into their mobile commerce ecosystem
Apple, Samsung, HTC, Microsoft, Nokia and RIM have to come up with a strategy to compete in mobile advertising, commerce and location-based services
Retail margins for electronics and many other items have already taken a massive hit as a result of the Internet and mobile – but we haven’t seen anything yet
There is the potential for consumer backlash as they deal with ad overload
Apple will likely come out with an ecosystem for commerce and shopping – let’s call it iShop where it will handle flashing the offers while taking a cut of the sale
They may even (gasp!) charge less for a device which shows ads just like Amazon
Samsung may do the same
Carriers have an amazing opportunity in this space they will likely squander over the next few years
Consumers will win

Important Tech News of the Day Dec 14, 2012

2012-12-14T20:34:59Z

Amazon Prime Instant Video app for iOS is out
Alcatel Lucent says providing video to devices is a great new revenue opportunity for carriers
Google Just Settled a Six-Year Dispute with Belgian Publishers
IT spending will pick up in 2013
Mobile data growth is booming
Apple lost patent litigation to MobileMedia
Easilydo is an app which aims to become a personal assistant
There are some good apps to help manage your holiday shopping
A win for the free market in the EU
There’s an app to measure skin health
Social is playing a major role in news dissemination in tragedies as
Sprint’s Clearwire bid will help it deliver true unlimited and unthrottled data plans
Small business hopes for better 2013
Cities are cutting out ISPs
We are actively trading privacy for security
But at least the government wants to make it tougher for apps to share our private location data
Comcast now allows video downloads
Social media has destroyed the web
If mobile payments are booming why is Verifone telling us it is an unprofitable market?
China will be less restrictive with their Internet censorship

Amazon Prime Instant Video app for iOS is out and in my testing on a 4^th generation iPad it worked well. Some complaints remain that for non-Prime users the experience isn’t that great. I for one would like to be able to download video on the app – there is a download area but no instructions as to what is downloadable or how to download.

Alcatel Lucent says providing video to devices is a great new revenue opportunity for carriers. According to Marcus Weldon, chief technology officer, “Left unmanaged, the rapid growth in video traffic can turn into a deluge and spell disaster. It is important to look at where service providers’ investments can have the most impact, and this research makes clear that the IP edge of both wireline and wireless networks – which are increasingly becoming one and the same - offers the greatest opportunity to improve network performance.”

It is undeniable that video streaming will grow in popularity – the war between cable providers and companies working with Roku, Apple TV, Google and others will only continue with the goal being to keep the viewer watching as much content as possible on your service(s).

Google Just Settled a Six-Year Dispute with Belgian Publishers and must pay them for their legal fees and in the form of advertising in the newspapers whose content was used by the search giant. Some say the settlement totals $6M. Moreover, there will be an ongoing advertising partnership between the news outlets and Google. The challenge for the search leader who profits handsomely from content on the web is if this case could set a precedent allowing many other companies to sue for damages because their content too is being used without permission.

IT spending will pick up in 2013 which is great news for the tech market which has had to deal with numerous ups and downs since the dotcom bubble burst over a decade ago. Gartner recently noted that “most enterprises have already significantly cut discretionary IT spending growth over the past several years,” and that “they have little room to reduce IT spending further over the long run.”

Mobile data growth is booming and has seen a compound annual growth rate of 25.4% between 2006 and 2011. Interestingly only in United States, Japan and Australia does mobile data revenue exceed fixed broadband revenues. No surprise here but voice revenue is declining in the United Kingdom, France, Germany, Italy, the United States, Canada, Japan, Australia, Spain, the Netherlands, Sweden, Ireland, Poland, Brazil, Russia, India and China in 2011 according to Ofcom.

Apple lost patent litigation to MobileMedia and this is the danger of the patent wars – even if you were smart enough to invent lots of cool new ideas, there will always be some people somewhere who thought of some things before you did. This is why the tech patent wars may on the surface seem like a smart way for a company to protect their intellectual property but in reality, when defending your inventions in every country you are bound to lose sometimes.

All of this litigation hurts consumers at the end of the day.

Of course I am referring primarily to Apple and Samsung, in the case of MobileMedia, they are a patent troll (but owned by Nokia, Sony and MPEG LA) so there isn’t much of a defense when you lose. Moreover, you are generally a sitting duck, waiting for these companies to come after you. Especially when you become successful in the market.

Easilydo is an app which aims to become a personal assistant of sorts by managing friend’s birthdays, your schedule and more. It offers you time to leave alerts based on your schedule, can track packages and more. It can notify you of based weather the night before and can jump into conference calls for you three minutes before they start. I just downloaded it on iOS and will post further if it is as great as it seems. I set it to remind me of free songs to download each week and to remind me once-a-month which apps are accessing my personal info.

There are some good apps to help manage your holiday shopping and TMC’s Brooke Neuman details them for you. Gilte Groupe and others make the list.

A win for the free market in the EU as Apple and four other publishers have made an offer to ease price restrictions against Amazon in the book market as a response to an anti-trust investigation.

There’s an app to measure skin health – just take well-lit pictures of yourself and receive a personal beauty number which the company, Own says is 95% accurate.

Social is playing a major role in news dissemination in tragedies as the dreadful Newtown Sandy Hook, CT Elementary School shootings remind us. Trending topics on Twitter include #Connecticut, #Newtown, #PrayForNewtown, 27 Dead and Sandy Hook.

Sprint’s Clearwire bid will help it deliver true unlimited and unthrottled data plans, especially to its iPhone customers according to TMC’s Senior Editor, Tony Rizzo.

Small business hopes for better 2013 but don’t expect them to hire more according to a study by IP communications, data and cloud provider Cbeyond. Other important parts from the survery: 83 percent of cloud users said it made them "more flexible," 78 percent said it made them "more productive," and 71 percent said it was actually saving them money to use the cloud that they wouldn't have saved without.

Cities are cutting out ISPs to get high-speed networks to their citizens and Seattle is the latest city to do so.

We are actively trading privacy for security in the US and terrorism has definitely eroded many of our freedoms. A sense that citizens are presumed innocent seems to be slowly eroding.

But at least the government wants to make it tougher for apps to share our private location data. A new bill would require companies to get a customer's consent before collecting or sharing mobile location data. It would also ban mobile applications that secretly monitor the user's location — a feature that Senator Al Franken said allows for stalking and enables domestic violence.

Comcast now allows video downloads – this may mark the first time a cable company is doing so and is a great help to people who don’t always have fast and cheap broadband access. Airline passengers are an obvious beneficiary.

Social media has destroyed the web – it’s brought in hundreds of millions of new users but has locked us in, taken over our online identities and made it more difficult to share our information from one service to the next.

If mobile payments are booming why is Verifone telling us it is an unprofitable market? Moreover, why is it pulling out?

China will be less restrictive with their Internet censorship and has already ublocked searches for the names of many top political leaders in a possible sign of looser controls a month after new senior officials were named to head the ruling party.

Avaya and Mitel Cross at Canadian Border

2012-11-16T18:59:51Z

New Jersey-based Avaya, spun out of Lucent and previously AT&T has a decades-long history of providing business communications solutions. With its purchase of Nortel’s business communications assets a few years back it picked up even more knowledge, know-how and relationships. Mitel, the Kanata, Ontario-based global business communications company cofounded in 1973 by Sir Terry Matthews is known for delivering superior technology. More recently Mitel has become publicly traded and acts sort of as a partner to the dozens of Sir Terry Matthews’s companies under the Wesley Clover Brand.

Avaya and Mitel do compete to some degree but Mitel is known more for small to medium systems while Avaya is known as the big-leagues supplier. Cisco has been a major competitor taking share from Avaya this past decade while ShoreTel has done the same to Mitel.

Now these two iconic brands are crossing the border in opposite directions. Mitel has announced a deal with Tech Data to target the US SMB market. Avaya will be launching its GrowRight channel program which includes a deal registration bonus in Canada. The program pays solutions providers 20% back per quarter on new and strategic product sales including RADvision and IP Office products.

The potential here is obviously bigger for Mitel as the US is a much larger market than Canada. You may remember, some years back, Mitel purchased Inter-Tel in-part to grow its sales in the US SMB market. The problem is the very solid Inter-Tel brand was killed in the process and Mitel didn’t brand themselves much in the US, post-acquisition. The result? Over $723M down the drain.

But Mitel is a new company as they have great virtualization technology and new management. Will SMBs buy from Mitel because they have a virtualization edge? Probably not, because if they aren’t current customers, they may not be familiar enough with Mitel to pull the trigger. The only way the Tech Data deal works for the Canadian company is if they began to brand themselves properly in the US or the Tech Data channel is very strong in telecom and decides to actively push Mitel products. In my experience however, resellers aren’t huge fans of promoting products which get customers responding “You want me to buy from who?”

Avaya for its part may make some progress selling its recently acquired RADvision products in the Great White North. I don’t expect the sales to be huge as the market isn’t so big but Canada seems to be one of the few countries with a stable economy these days which makes it a great location for an organization in search of sales growth.

Hurricane Sandy: All Electronic Trading Likely to Cease Tomorrow

2012-10-29T02:09:31Z

I have it on good authority that all US markets will be shut down as a result of hurricane Sandy. This includes electronic trading which is a new addition - earlier you may have heard human trading was to be shut down. Exchanges affected according to sources are NASDAQ, BATS Direct Edge, NYSE CME and CBOE.
This will definitely happen unless Mary Shapiro, chairman of the SEC overrules the decision.
Moreover a shutdown like this as a result of weather is very rare.
I wish you all a safe and secure week.

Update: All cash markets and options markets will be closed on Monday and Tuesday.

Banks, The Latest Threat to Groupon and LivingSocial

2012-10-18T16:08:20Z

If there is one constant these days it is that your competitors tomorrow are going to come from the most unlikely of places. Apple came from nowhere to unseat RIM and Nokia in mobile phones, Amazon is becoming a major force in tablets, Google’s Chrome and Android products have made it a major force in software and operating systems.

But the examples above are technology-based so they shouldn’t be too surprising as we have come to expect tech companies to be quick to enter new markets. What could portend a future trend however is Bank of America’s move into the deals business. The feds have passed laws to limit how banks can generate revenue from consumers through fees so they are scrambling to make money in new ways.

Earlier this year the company announced it was going to launch BankAmeriDeals which would allow customers to get additional cash back on a monthly basis depending on where they shopped. The interesting thing is the bank doesn’t make money from these transactions – they do on the increased credit card processing of course. The idea here is to boost credit card usage by taking share from other banks and cards like American Express.

Some of the companies involved in the program currently are FedEx Office, redbox, ADT, HSN and Burger King?

American Express for its part already has merchants it works with on a customer cash-back basis so BoFA isn’t necessarily breaking new ground.

What may be new however is the television ad campaign the bank is running. In this economic environment, everyone is looking to save and if the company can position itself as a solid choice for customers seeking deals, it may become a magnet for vendors looking for more customers.

This could end up hurting Groupon, LivingSocial and others and it reminds us competition can come from anywhere.

I reached out to David Godsman, the bank's online and mobile solutions executive and didn’t immediately hear back on how large the ad campaign is but if I do I will update this post.

Microsoft, SNL, Sprint and Softbank News for Monday October 15, 2012

2012-10-15T11:08:44Z

Microsoft is jumping into the music business and this is perhaps the biggest news of the day and possibly the week. Redmond is now offering ad supported music streaming and going up against Sirius XM, Pandora and Apple’s iTunes all at once. Boasting a 30-million strong library of songs, users can listen to playlists for free or download to own music across their TV, computers and smartphones. The ad-free version is $9.99 per month and includes access to music videos as well.

SNL was actually funny for once. If you tuned into SNL this past weekend and were expecting to be disappointed as it continues to struggle to be funny, you would have been surprised. Many of us tuned in to hear them make fun of the recent bizarre VP debates where the world witnessed Vice President Biden laughing in an uncontrollable fashion. Thing is, the original was funnier than the imitation. The good news is, later in the program the show aired a segment pitting iPhone 5 reviewers and their silly minor grievances against factory workers in China who build the devices. As a techie, I loved this segment and laughed out loud. Remember, I have written about over-picky iPhone 5 reviewers myself.

Apple is sprinting away from Samsung as you might imagine. These once great partners are parting as Apple is looking to punish the Korean conglomerate for infringing its patents and becoming perhaps the strongest hardware competitor to the iOS line of devices. The company will likely lose the A7 chip contract or maintain it in a limited way as alternative supplier TSMC may not be able to keep up with demand.

Softbank and Sprint deal ink a deal as 70% of the US phone carrier will go to the Japan-based company for $20B and in the process Sprint will have the deep pockets needed to compete head-to-head against Verizon and AT&T.

Microsoft says Google and Motorola are infringing its mapping patent which means Redmond seems to want an active role in the latest round of patent wars hitting the tech market.

ZTE’s biggest problem is a quarterly loss of $300M and you thought the US Congress was the company’s biggest headwind. Shares dropped 16% today on the news.

KidsCash launches in Beta allowing parent to help kids manage their money and shopping. In an age where US-based adults compete with their government to see who can spend money they don’t have at a faster pace, using tech to teach the next generation how to budget and manage money more effectively seems to be a great idea.

In Israel, Venture Capital Gets Disrupted

2012-10-11T20:47:32Z

Israel is legendary as a tech powerhouse – the entire IP communications market owes its success to engineers from this middle-eastern country where compulsory army training has a side benefit of immersing the population in engineering specifically applicable to communications.

I remember fondly over the years attending SuperComm, VON, Computer Telephony Expo, Communications Solutions and ITEXPO and always seeing new and innovative startups from this land of milk, honey and falafel.

Sadly, over the years, things have changed – over a decade earlier, investors were making such large amounts of money from IPOs and acquisitions that it made lots of sense to reinvest much of it back into new companies.

Many things have changed over the years – IPOs are a much trickier proposition thanks to Zynga, Facebook and more jittery investors as a result of the dotcom and communications crash from early last decade. The cloud has made it easier to invest in companies which don’t need much capital to get going. Cisco was an acquisition machine and so were Lucent and Nortel but things have changed dramatically over the years. In fact Alcatel-Lucent spun Genesys off to raise cash so an acquisition strategy seems to be the opposite direction of where they are currently headed.

The end result is that while the US seems to have no shortage of startup investment, in Israel the situation is different. In fact instead of massive investments from VCs, startups have to rely on incubators and accelerators who reduce the overhead needed to launch a new company.

The good news is Israel is on track to see 600 new companies started in 2012 or about the same number as 1999 and 2000. The biggest challenge many of these companies may face is getting the credibility associated with American investors. Read more at JTA.