Recently in cellular Category

There are a bunch of debates raging over the telecommunications infrastructure. 

Congress has looked at Open Access bills for cellular networks. By this we mean that a consumer can use any available handset or device on any cell network. This is kind of the Carterphone concept for cellular.

The 700 MHz auction had open access provisions built right in, so VZW's 4G/LTE network will need to incorporate Open Access.

Spectrum is a finite resource. TV, radio, public safety and the cell companies all share access to various licensed spectrums. Other companies, like oil companies to communicate with rigs and ships, have purchased spectrum licenses. There is also the unlicensed bands like 900 MHz, 2.4 GHz, and 3650 MHz that are shared by any and all. We are seeing in the 2.4 GHz band that too much usage causes crowding and in some cases makes the spectrum useless. (Your little blue Linksys wireless AP's use 2.4 GHz, as does quite a few cordless phones and other consumer products). As more and more products and consumers go cordless and wireless, this resource will be used up. It must be allocated better. 

(An aside: Open Access has one advantage: less handsets in the landfill.)

Net Neutrality is based on network management. Both cable and DSL have bottleneck issues in your community. To manage those issues, the service provider uses tools, hardware and software, to prioritize traffic. This same set of tools can be used to degrade Vonage while prioritizing the ISP's VoIP service offering. These same tools can be used for DPI (deep packet inspection) to read every unencrypted packet that passes through the box. This same tool can be used to police the network (or Internet) of child porn, illegal downloads, and the like. Do we really want that kind of Big Brother action? 

At the heart of the NN debate is the fact that a few ISP's have degraded VoIP packets and legitimate P2P (peer-to-peer file-sharing) traffic. As networks go all IP, there needs to be a set of guidelines for peering traffic and network management. I don't think the FCC or Congress should be the ones making these rules. Any rules they come up with will be a compromise that will ultimately solve nothing, but create new problems.

The final debate in DC is about Fair Competitive Access to the telco infrastructure. After court rulings and Forbearance petitions in 2004-06, CLEC's and ISP's have been losing ground in the ability to get access to telco network elements to provide service to customers at a fair and competitive price. In so many cases, the CLEC "wholesale" rate is higher than retail. Make sense? Docket 05-25 at the FCC is the Notice of Proposed Rulemaking on Special Access Rates. 

While they may seem similar in that they are all about access to the network, they all are about different aspects of the network access. In the end, Open Access Rules and Net Neutrality guideleines will define how we use the networks for innovation, collaboration and communication.

American Tower is buying 196 Towers from Cincinnati Bell (CellNews)-- Outsourcing of Network Infrastructure continues.

Mobile Backhaul Equipment Market to Jump 60% in 2009 to $5.9 Billion (CellNews) Qwest and cable companies are all over fiber backhaul from cell towers. More smartphones means more bandwidth needed from each cell site - and NxT1 won't cut it. Using wireless backhaul won't either as the big boys don't want to use Unlicensed nor use up their precious paid-for spectrum on backhaul.

Pay As You Go Mobile Broadband Overtakes Contract Deals, according to CellNews. Boost Mobile all-you-can-eat-text-web-talk-for-$50 is not good for T-Mobile or VZW. Ma Bell still leaning heavily on iPhone. When exclusivity ends, they will be in big trouble if they don't fix things now - and suing VZW over ads isn't going to help fix what ails you, especially when you lose the first court battle. No injunction granted, because "ATT doesn't argue that the maps are incorrect in terms of showing its 3G coverage. But it says that Verizon is misleading customers by implying that they cannot use their phones or access the mobile Web when they aren't in 3G coverage areas. The reality is that customers can make phone calls and access the Internet from their phones using the company's slower EDGE or GPR networks."

Key investor is opposed to Sprint purchasing the thorn in the side affiliate, iPCS.

Unions push to organize T-Mobile USA employees, according to FierceWireless. That's funny because the old SNET company union workers can't get Ma Bell execs to talk to them. And this isn't a time in American economic history to be a worker looking to unionize. You should be helping your company stay afloat so you still have a job -- and your pensions aren't wiped out when your former company files Bankruptcy. Foolish greed.

I'm in Atlanta speaking at the Microcorp One-on-One event about Trends in 2010. The three trends that I see for agents are the following: Applications, Quality of Service (QOS), and Mobile Broadband (MBB). But they are kind of inter-dependent. Ubiquious broadband leads to innovative uses and applications. Applications like on smartphones lead to a greater need for mobile broadband networks.

Mobile Broadband is growing. Smartphones are replacing cellular handsets. Social networks are moving to mobile devices so people can Facebook and Tweet. RIM's Blackberry brought us mobile email, but it is a standard on many phones now. Netbooks and data cards are presenting the US cellular companies with some fits. They like the additional revenue, but have to keep dropping billions on the network backhaul and capacity upgrades. (And another $45B+ on the upgrade to LTE/4G).

All this means that there are new uses for the mobile broadband, like the Kindle. Sprint's Wispernet allows Amazon to instantly download books, magazines, newspapers and blogs to Kindle devices. Machine-to-machine devices can utilize the cellular data network to provide connectivity for ATM machines, security cameras, and a host of other devices that need to communicate with a NOC or remote server.

All of this is a cycle of applications driving network usage. Ubiquious broadband driving more apps. It's one reason that the FCC needs to maintain open network and Net Neutrality guidelines in place.

Applications - like email, databases, office suites, CRM - are creating a demand for managed services, such as an outsourced IT department. In addition, businesses are looking at the Cloud - moving applications to a data center for redundancy, security, and availability - as a way to save money and stop worrying about the IT department. With applications being delivered in the Cloud or by way of SAAS or even Virtualization, Agents have a chance to offer more than just Internet Access or WAN circuits, like private line. Agents can sell Layer 2 to Layer 7 - pipe to apps. It's a way to get deeper into accounts. It's a way to offer a complete solution. It's a way to deliver on the label of Trusted Advisor.

Applications are driving sales. Voice and email are just the primary apps. Business critical data is also driving mobile broadband. Ubiquious broadband is allowing for innovative ways of accessing data. The problem becomes reliable access to the data. That's where Quality of Service comes in. QOS on the WAN is what is needed to access data reliably and quickly. The MPLS trigger is the Class of Service reliability and prioritization of data over the network. This is paramount for businesses running a truly converged network with video, database, VoIP, email and Internet riding the same pipes. WAN Optimization is selling due to the cost containment and the performance enhancement. Big bang for the buck.

So the agents can sell mobile broadband, applications via Virtualization or SAAS, and add QOS to the WAN to provide reliable access to these business critical data.

Master Agency Microcorp is holding its One-on-One Event for its agents in Atlanta next week. I will be moderating a session on Trends for 2010 & Beyond, where we will discuss the next series of services that Agents can create revenue streams from. 

You've heard the noise about Conferencing coming from the likes of Premiere and Inter-Call. With the Green movement and the economic realities of cutting down travel expenditures, video and web conferencing are selling. It's just a software application that can be sold as a service - (notice I mentioned app and SAAS there?). It creates a revenue stream for an Agent by cross-selling to your existing client base.

You can also offer Hosted Microsoft Exchange email and the Office Suite software. Alternatives to that would be Google Apps and now IBM LotusLive iNotes.

Managed Services is the new buzz word around the Industry. Outsourcing IT (computer support, server maintenance, software updating and backup) is a growing market segment as small businesses find it harder to keep IT staff in place (and trained). Also, IT is becoming mission critical -- well, access to data, email, voicemail is becoming business critical.

The panel will be with InContact, Sprint and New Edge Networks. We will be discussing 4G and M2M as a growth sector. Private Networking and QOS on the WAN for today's real-time traffic. And finally how apps like UC and Contact Center software can provide agents a renewed high margin business.

Please note I didn't mention Cloud or Virtualization.

Over at CNN, there's an article about the iPhone hurting AT&T's brand.

While a recent survey by the consulting firm CFI Group found that iPhone users are the most loyal smartphone users, with 90 percent saying they'd recommend the device to a friend, half of all iPhone owners surveyed said they would like to jump ship to another provider if given the chance.

The sarcastic part of me is that AT&T already has a reputation problem from the way they do business. The Say No First Attitude is more like the insurance industry than the telecom field. Everyone from Agents to Customers feel the pinch from AT&T. So big deal that iPhone users don't like the network -- as long as they keep paying the bill.

However, when exclusivity ends with iPhone, AT&T may lose as many subscribers as Sprint. (Makes me nauseous to think that VZW would win most of those subs).

Some interesting facts from the article:

During that year [2008], AT&T's annual report indicates it spent $20.1 billion on capital expenditures for its wireless and wireline networks. Still, $17 billion is nothing to sneeze at. .... Some of these improvements include deploying 850 MHz technology across AT&T's 3G markets to improve in-building coverage, adding nearly 2,000 new cell sites to improve overall coverage, and increasing capacity in thousands of cell sites with more backhaul infrastructure.

That's not all going to wireless though. AT&T reminds the media that iPhone users are the heaviest network users - it would tax any network. Maybe, but you spent $1B to re-brand everything as AT&T and now that brand is tarnished.

It's funny to watch Ma Bell fight Google, because Bell isn't used to fighting another company that also has billions of dollars - and millions of users. No CLEC was ever this big - nor cable company. And Google is kind of both -- or at least that is what Ma Bell is crying to the FCC about. 

Google has more video on YouTube than any DVR or cable company can match currently. Google Voice is the online VoIP service many people wish that an innovative telecommunications services company would have delivered years ago.  But Ma Bell isn't innovative. heck, they don't even own the Labs any more - that went out with Lucent.

PC World has some coverage of the fight. The LA Times and 399 other news sources wrote about the complaint. Many in the blogosphere think that this is just AT&T's way to deflect the FCC from pinning them to the ground and perhaps delay a Network Neutrality NOI.  

Google responded on their blog quickly. 

Note to Randall and Crazy Ivan:  Consumers just want you to be a fat pipe to the inter-webs. Not the Weight Watchers version you currently offer and over-charge for. A 10MB super-info-highway. Get out of the way! We want to choose our own content, apps, and Layer 7 providers.  You had your chance, but as always greed kept you from doing anything. Heck, you are closing the doors on CallVantage on Oct. 20. And that was such a great service. (Oops, did I just say that?) You could have givrn us Google Voice just like you could have given America fiber-to-the-home in 2000 when you promised many states you would if they would let you have a rate hike. 

Keep pouring those billions into TV and 4G. If Sprint and T-Mobile could get out of their own way, they would own your ass already.

The WSJ has an article titled, "AT&T, Verizon Still Pouring Billions Into Mobile Networks". It notes that cellcos have already spent billions upgrading their networks to 2.5G and 3G -- and now will spend billions more on 4G.

In addition, both companies are also dumping billions into International routes, domestic broadband networks, and their respective triple play networks, U-Verse and FiOS. 

On top of that, both companies have been acquiring companies, like Alltel and Centennial. Ummm, how are they not toppled over in debt? 

These companies have felt intense pricing pressure from cable companies as well as T-Mobile and Sprint. Customer Acquisition and Retention costs have to be high, even as ARPU remains about the same. Debt costs more right now. Wireline income has been declining for at least 4 years.

Where's the money coming from?

Engadget has a rumor that Deutsche Telekom is eyeing Sprint Nextel for acquisition. There are a number of issues here:

1. DT owns T-Mobile.
2. T-Mobile is GSM and Sprint is iDEN and CDMA. Not much value in mixing that many signaling protocols. No synergy.
3. FTC and DOJ may not like that much Public Safety being foreign owned.
4. The cost would be staggering.

By that I mean that DT isn't exactly experiencing huge growth to pay back a multi-billion dollar acquisition of a declining asset. And Sprint is declining. If DT did want to enter the US, it could have bought Virgin Mobile as a foothold. Or done a JV (joint venture) with SK Telecom. These would have been easier and cheaper acquisitions.

UPDATE: MarketWatch article about possible merger and Reuters notes the rise in Sprint's stock and bond prices on these rumors. From this you can almost feel that the bankers are floating a balloon to take advantage of the deltas.

I look at the new IP Phones and wonder: Are they morphing into a cell phone?

I like cordless handsets, mainly because I walk when I am talking. It helps me think and it sounds better for the caller. And I use a corded headset.

So when I look at the newest DECT phones like Aastra 600D series, Cisco WIP310, and others, they are so small, lightweight and are starting to resemble a cell phone. Right? A perfect example is the UniData Wi-Fi phones. These look just like a cell handset and come with video capabilities and cameras. No other handset has that yet.

Broadsoft extended Web 2.0 services to the mobile device. So has Mitel. Blackberry wants to mobilize your PBX - to make your cell phone an extension on the office PBX system. So does Mitel. So does Broadsoft. Oh, and so do the cell carriers because they want you to spend those minutes.

It looks like only difference between your IP phone and your cell phone will be signaling technology (Wi-Fi, CDMA, GSM, DECT). When we get a phone with half those chips in there, will the desktop phone become obsolete? Are we really that mobile? I sit at my desk at least 40 hours per week when I am in town. I can't see getting rid of my cell phone even with those home phone systems that jack into your cell phone. For me the call quality on the cell is inferior to either my VoIP line (most times) and my POTS line.

I think that battery life will always save the desktop phone. I wish it could do more: like updates and texts or IM or something. After all the desktop IP phone by Polycom or Aastra (the ones I am familiar with) are mini-computers. Broadsoft and Aastra have XML marketplaces for apps for them, but I have not heard (or seen) anyone taking advantage yet. (Anyone?)

As more minutes move away from the PSTN to VoIP Networks and Cellular systems, what happens to the PSTN? Where's the Tipping Point when the telcos can't or won't maintain it anymore?

There was a question on LinkedIn today about the MVNO model making a comeback. It seems that Sprint buying Virgin Mobile has sparked a slow news day. 

Let's not forget that SK Telecom dropped almost $300M on the Earthlink MVNO formerly known as Helio, which was given to Virgin Mobile last year. SKT was looking for a foot hold in the US market (just like every other international player). If SKT decided to sell its one stake, what chance does the MVNO model have?

As more minutes move to the cellular networks from the wireline network, how does that scale or make financial sense for a virtual operator? (Many analysts note that it hardly makes financial sense for the network operators).

I'm thinking that Sprint bought it to prop up some pre-paid revenue (short term). Or that Sprint needs to just embrace pre-paid altogether in which case they need to go buy some more players including Yak.