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October 31, 2011

Samsung’s stormer, Map Wars, Lumia Push and ‘Social TV’ - Telco 2.0 News Review

[Ed. It’s the EMEA Brainstorm in London next week (9th-10th November), and the key themes are: strategies for defending and extending voice, Customer Experience 2.0, M-Commerce 2.0, Cloud 2.0, M2M 2.0, CDNs, Payments 2.0 and dealing with the disruptors - Google, Apple, Facebook, Microsoft/Skype, and Amazon. We hope to see you there - the speaker line up is fantastic, and it promises to be an extremely stimulating couple of days.]

Samsung announced impressive Q3 results this week, showing strong profitability across its telecoms division in both devices and infrastructure. Unfortunately, they don’t provide a breakdown of device shipments by type, but Strategy Analytics reckons that they were the world No.1 smartphone vendor in Q3, pulling ahead of Apple, and in second place for handset shipments overall behind Nokia with a comfortable lead over LG. Horace Dediu (who’s covering ‘OS Wars’ next week) pieces together the data and reckons that they gained both in volume and in average selling price, and notes that Samsung is quite rapidly increasing the percentage of smartphones in its portfolio - but not as quickly as Sony Ericsson.

Samsung is also planning to launch something using its flexible screen technology next year.

AllThingsD covers HTC’s Q3s, which show an apparently impressive 68% rise in profits. However, it seems that HTC’s average selling price is flat, and the company’s growth is being driven by expansion into China, which suggests that they will struggle to raise their margins and will have to depend on volume. They predicted that Q4 would be tough and promised that they would hold the line above $100 as the entry-level smartphone price point.

The new Nokia Windows phone is here, and it’s very much the design that was repeatedly trailed over the summer and used for the N9. Nokia calls it the Lumia 800, with a slightly lower-spec version to follow as the 710. Nokia’s navigation app, rebranded Nokia Drive, ships with all the devices, as does a new iTunes-clone music player. There’s a highly enthusiastic review here.

Ars Technica reports on the massive channel marketing operation Nokia has prepared to support the new phones, and points out that no Microsoft mobile product has ever had anything similar. On the other hand, Orange UK is offering to give away Xboxes to new Nokia 800 subscribers. Ah, the sweet, sweet smell of vendor financing.

Ars also has some good interviews on why enterprise IT departments still love BlackBerrys. Meanwhile, RIM pushed back the PlayBook OS 2.0 to early next year in an effort to “get it right”.

And Motorola Mobility/Google Hardware is cutting 800 jobs.

We mentioned that Nokia is giving what used to be Nokia Maps, then Maps on Ovi, then Ovi Maps, and then Nokia Maps again a major push. This week, Google made a radical change to the iconic Google Maps API, the wedge of JavaScript that transformed how we work with maps, launched the very idea of mashups, created an entirely new user-interface pattern, and visualised a zillion data sets. From now on, once your app passes 25,000 requests a day or 2,500 for more complex “styled” maps, you’re going to be asked to fork out $4 per 1,000 calls. Alternatively, you can pay $10,000 for a premium licence and unlimited traffic.

As High Earth Orbit points out, not only has Google Maps been historically superb in terms of data quality, geocoding, and service reliability, it’s not as if Google hasn’t tried hard to monetise it with in-map ads. It is argued in comments that Google may be trying to push more app developers to monetise in general via AdSense.

Over at Apple, it looks like they’ve bought a Swedish defence industry spin-off that produces very high quality 3D mapping, and they’re also collecting traffic information - so it would seem quite probable that Apple is going to declare independence from Google Maps on iOS.

And Microsoft is planning to launch a commercial SDK for the Kinect controller very soon, good news for those of us who really want to point a laser at the TV.

Social-TV hype is building fast. Anthony Rose’s Zeebox, local to us in Silicon Roundabout, launched into beta this week. Their USP is that it’s social TV without the special TV - all the action happens on a mobile device or PC in parallel with the stuff on the telly.

Wired’s Tim Carmody tries to decipher the hype and buzz, and argues that TVs aren’t very much like smartphones, but shouldn’t just be big monitors either. His colleague Jon Phillips takes a tour of the new version of Google TV, which will be pushed out as an update to the (very few) Sony and Logitech devices that run it in the next few days.

AllThingsD’s Peter Kafka reports that Google has solved one of Google TV’s biggest problems - the embarrassing lack of content. It’s been reasonably well known that Google has been offering Hollywood producers financing for their new projects in return for the right to distribute them on YouTube, but this is the first time it’s gone official, with a launch expected some time this week.

Horace points out that hardly anyone is buying the TVs, and the people who do often don’t bother to hook them up to the Internet. He argues that the real problem is that TV programmes don’t make use of the additional capabilities of the smart TVs and therefore there’s not much point. Zeebox seems to be trying to address this by pulling in content from third parties, such as the Twitter firehose API and the broader Web.

Elsewhere in content, US cablecos seem to be holding up well against the Internet rivals and doing rather well as ISPs. Visa and MasterCard are thinking about using credit-card transactions to feed some sort of targeted ads play - now that’s going to be the mother of all privacy rows. Mobile advertising takes off - says mobile ads firm.

That all adds up to a lot of broadband. Broadband Trends has a detailed read-out of the FCC’s new Connect America Fund, the successor to the Universal Service Fund. This will be devoted to broadband deployment, and will be somewhat smaller than the USF. At the same time, US fixed intercarrier payments will start to transition from calling-party-pays to bill-and-keep over a period of nine years. There are complex changes to issues like CLI. Dave Burstein has a detailed discussion here - it may be a problem for services like Google Voice if they want to send their numbers as CLI rather than that of a mobile device.

The European Commission has come up with a proposal for harmonised LTE800 bands across Europe. In the UK, this BT R&D presentation suggests that the national carrier is only lukewarm about the technology and sees the TV white spaces as a more likely solution for rural broadband. On the other hand, last week’s rumour that Verizon would soon launch an LTE fixed-wireless service has been confirmed by their CFO. Tech discussion is at Burstein’s.

BT announced this week that it was a year ahead of schedule on its UK FTTC rollout (the paper linked above is interesting on their plans to up speeds on VDSL2). They’ve also recruited 520 more installers.

The Femto Forum appears to be working on a WLAN offload standard, which seems an odd thing for them to be doing until you find out the standard is about letting the mobile network decide when your phone uses the WLAN. Rethink Wireless reports, meanwhile, that AT&T is carrying much more traffic on its WLAN offload network.

Google Fibre may come to Europe. HSPA evolution has a long way to go, says the 3G & 4G Wireless Blog. Optical Ethernet vendor Brocade up for sale - again. The Internet is broken in Pakistan. 150 years of the transcontinental telegraph in the US.

Facebook’s better data centre club, the Open Compute Foundation, launches this week.

Running StackExchange’s fleet of giant question-and-answer sites is a major engineering challenge, and High Scalability reports on how they did it - specifically, they decided not to put anything in the cloud, and claim that running the company in Amazon Web Services would cost 4 times what they’ve spent on hardware.

Amazon reserved instances - they’re what you want if you’re concerned about a comet taking out your Amazon Availability Zone, apparently. For their part, AWS announced more IPv6 support this week. Apple’s iDatacentre may run on solar power. And RIM has integrated Microsoft Office 365 cloud services with BlackBerrys.

In voice news, the Freespee blog reports that you can now buy calls from Google AdWords like you can buy clicks, opening up a new source of advertising options and revenue. Google’s pricing suggests that a call is worth five times a click. There’s more at Search Engine Land, where the point is made that you have to use Google Voice Call Metrics to take part, and that the call-through rate will be used in Google’s ranking algorithms.

Is the new Skype API coming? Dan York thinks so, after Skype cleared the decks this week by rebranding the existing one as “Skype Desktop” rather than “Skype Public” and expanding its “Plugged into Skype” partner branding.

Users of Samsung’s hit Galaxy S II are displeased that it is impossible to turn off the Vlingo voice-command app without root access.

Freespee launched its latest version in a Thursday night deploy, giving it more features, notably the ability to have conditional rules in the dial plan. And Dean Bubley argues that Voice 2.0 needs a lobby of its own.

HP isn’t selling its PC unit any more and might even keep WebOS. Facebook users are mobile. Apple Macs infiltrate the enterprise. Tencent buys into Kaixin001.

Anonymous declares war on Mexican drug cartel. RIM lets the Indian police in. IMSI catchers of Scotland Yard. Loving the BBC Micro. When apps go bad - which should worry you about this Android-powered EPOS terminal. The war on bloggers. Mac GPU malware mines Bitcoins. China denies hacking satellite. A museum of Nokia. Eulogy for Steve Jobs.

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October 27, 2011

M-Commerce 2.0 update: Visa, Mastercard, Barclaycard, O2, Telefonica, Orange, Nielsen, Deutsche Telekom, Everything Everywhere and the Innovators…

A quick follow up to our recent post: We have a wonderful session brewing for the morning of M-Commerce 2.0 on 10th Nov: senior execs from Visa, O2, Telefonica, Orange Group, Placecast, Nielsen on the state-of-the-art today, then innovators MyDex, Qiy, Synergetics, Privowny on how new models of personal data will revolutionise advertising, marketing and e-commerce in general.

Presenters and panellists include:

Thumbnail image for Tim-Sefton.jpg

Tim Sefton
Director New Business
Telefonica O2 UK


Mary Carol Harris
Head of Mobile Market and Business Development,
Visa Europe

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Nicolas de Cordes
Vice President Marketing Vision
Orange France Telecom Group

David Gosen
European Managing Director
Telecom, Nielsen

You can see full agenda details here, register here or call +44 (0) 207 247 5003.

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October 24, 2011

Netflix’s horror show, Amazon’s profits slow, and could Verizon’s copper go? - Telco 2.0 News Review

[Ed. It’s now just two weeks to the London Brainstorm (9th-10th November). Key themes are: strategies for defending and extending voice, Customer Experience 2.0, M-Commerce 2.0, Cloud 2.0, M2M 2.0, CDNs, Payments 2.0 and dealing with the disruptors - Google, Apple, Facebook, Microsoft/Skype, and Amazon. We look forward to seeing some of our readers there!]

Netflix’s Q3 numbers are out, and we take a quick look below at just how bad a day it was for the US outfit. (NB We will shortly be publishing a detailed analysis of this business model change in new reseach, plus you can join us to discuss this at the EMEA Digital Entertainment 2.0 workshop at our London Brainstorm in a fortnight.) Netflix is also going to launch in the UK in 2012, but its going to stick to the streaming rather than diving into a head-to-head with Lovefilm.

So, after the results announcement on Monday, Netflix shareholders suffered another traumatic day with the share price down 35% to $77 from a peak of $305 in July - the stock has turned from ‘hero to zero’ in three horrible months. The problem is twofold: a 60% price rise has been met by cries of pain by users, some of whom have left the service in disgust; and international expansion plans in the New Year to UK & Ireland in 2012 will drive Netflix into red ink and losses. The reputation of the Netflix CEO, Reed Hastings, lies in tatters. The larger, rarely mentioned, problem is that the transition from an analogue (DVD-by-Mail) to digital (Streaming) business model appears to be destroying margins (we’ll examine this in detail in our analysis).

Netflix shares plummet

Meanwhile, over at Amazon, the future is a little cloudy - and we don’t just mean in the sense of services provided from huge data centres.

For sure, sales registered an extremely healthy 44% year-on-year growth to $10.88bn, but operating income is an anaemic $79m - or less than 1% of sales. Free Cash Flow also dropped 17% to US$1.5bn as Amazon continues to invest in new data centres and fulfilment centres to support the growth. The CEO, Jeff Bezos, as a former analyst must be aware that he is driving analysts mad with the lack of detail in the results, especially around the progress from the analogue (shipping physical products) world to the digital (Kindle, AWS) world.

Amazon share price

In other video news, Cisco made yet another acquisition, buying up BNI Video for $99 million as they prepare a full-service video delivery platform for the telco market. And a new player, Qwilt has closed $24m of VC funding for its media-service product.

All that video implies broadband, of course. Verizon announced respectable results for Q3, and promised that FiOS net adds would pick up sharply as a backlog from the CWU strike earlier this year was cleared. Telco 2.0’s Keith McMahon notes that they are cooperating with DirecTV to create a dual-mode, LTE and DTH customer device that would provide both wireless broadband and satellite TV. He wonders if the upshot of this is that VZ is thinking about giving up on the copper network entirely, using fixed-wireless LTE to deliver voice and Internet service and partnering with DirecTV to provide the TV element via satellite.

Interestingly, a study shows that wireless-only households are common in rural America. The moment when FCC chief Julius Genachowski hands down the decision on the future of the Universal Service Fund is approaching, and the role of wireless is going to be an important issue. As is the AT&T-T-Mobile merger, of course. AT&T has tried hard to present it as benefiting rural customers, and it looks like they overstepped the mark by pushing charities that receive donations from the AT&T Foundation to write to the FCC.

A group of congressmen, meanwhile, lobbied Genachowski to remind him of the National Broadband Plan’s commitment to getting gigabit and above service to “anchor institutions” like schools, libraries, and town halls.

Benoit Felten reports on Hyperoptic’s first 1Gbps subscribers going live, and points us to a new blog of note

Meanwhile, Telenor completes its HSPA+ rollout and saves 15GWh of electricity a year.

An unintended consequence of energy saving, meanwhile, from the 3G & 4G Wireless Blog - Elisa discovered that a major use case for femtocells is providing service inside Finland’s cosiest buildings. Where there’s an air path into the building there’s usually a radio path, and the key to green architecture is controlling the air flow. And the nano-tech coatings used on modern window glass (Pilkingtons of St. Helens aren’t some bunch of hamfisted northern lunks, you know) are killers for radio propagation (30 dB attenuation per layer - 90 dB for a tripleglazed unit). Oh, and modern wall insulation includes a nice layer of aluminium.

Unsurprisingly, they’re keen on WLAN offload. Isn’t everyone these days?

India’s rollout of GSM and its drive towards wireless broadband have largely been financed by outsourced tower-sharing companies. Third-party investors acquire the land, and multiple operators rent space on the towers. Or an operator builds them, and then sells them to a towerco, which then gets others to move in. However, the Times of India reports, investors are cooling on the business in the aftermath of the hugely overbid 3G auction and a range of operational problems, notably the old industry chestnut of people pinching the diesel from the generators.

But just be glad you’re not an Indian radio planner, as the Indian government has demanded that at least two mobile operators urgently roll out 3G into parts of India controlled by Maoist guerrillas as part of its counter-insurgency strategy. One of the two state operators, BSNL, has already refused this attractive business opportunity. What can possibly have put them off? Actually, it’s not the prospect of ending up as a hostage but rather, a regulatory issue. This is the telecoms industry after all.

BSNL executives continue to maintain that rolling out cellular networks in Maoist districts is not commercially viable for the cash-strapped telco without 100% central subsidy

Cut my head off if you like, but don’t take my universal service fund subsidy… Quote of the week, surely. Meanwhile, Reliance Comms sues in a bid to kill the “2G Scam” charges.

Tomi Ahonen argues that Apple is in line for a “stellar” Christmas, while Nokia’s surprisingly good Q3 (smartphone sales were just in positive territory) actually reveals underlying weakness, as margins and the percentage of the business made up of smartphones are falling. He argues that if the N9 is assumed to do as well everywhere as it does where it’s been released, Nokia could get back to profitability just by giving it a global launch.

As well as Ahonen, Telco 2.0 Associate Horace Dediu was also caught out by seasonal variation in iPhone sales. He offers that rare and valuable thing, a “I was wrong” post by an analyst. Well worth reading - and you can join Horace at our EMEA event in London in two weeks (9-10 Nov), where he’s presenting his perspective on the ‘OS Wars’ - Android / iOS / Windows etc.

Meanwhile, Dirk Schmidt looks at major tech companies’ CAPEX, and notes that HTC and Apple are both some of the heaviest spenders and also some of the most effective. Google and HP’s numbers are not strictly comparable (much of Google’s is related to the core search business, HP’s is equipment it leases to customers), and the only player that outspends Apple is Samsung. But Samsung doesn’t seem to get the same bang for the buck.

As you’ve probably heard, Steve Jobs vowed to “destroy Android”. On the other hand, Android is spreading in enterprises remarkably quickly.

Wonder why? Here’s the answer: developers, developers, developers, which is ironic as the developers in question mostly used to work on Microsoft Windows Mobile. A must-read, especially for this link to a prototype Android.

Further, here’s a richly detailed tour of the latest Android release, with an interview with Hiroshi Lockheimer, Google’s chief engineer for Android.

Mind you, fairly soon you might be able to run whatever mobile OS you like in a hypervisor.

RIM had its devcon this week and took the opportunity to launch its new OS, BBX, as well as a heavy round of updates for their developer tools. Interestingly, gaming seems to be the focus of the native element, while everything else is concentrating on HTML5/WebWorks.

But then, RIM’s developer offerings have always had a great feature list. Whether anybody cares is the big issue, and that’s up to Alec Saunders, whose presentation can be found here.

BlackBerry still really does command its users’ mindshare, though. After all, it looks like BlackBerryFail coincided with a significant drop in road accidents. But just think of the e-mail that went unanswered for as many as two days! Mind you, at least they still don’t give you cancer.

HTC’s Radar Winphone, reviewed.

Mobile payments and banking are a major Telco 2.0 theme. PayPal is seeing strong growth again, but they’re being very careful about NFC, Connected Planet reports. Meanwhile, the GSMA MMU Blog rounds up m-banking deployments in Latin America, and CGAP Technology Blog reports on a detailed study of MMT users in Tanzania.

Meet Google Trader, an SMS-based classified ads service that just launched in Ghana.

And Connected Planet points us to the latest IEEE newsletter, which argues strongly for M2M as an integral part of the smart grid.

Is Siri a useful product? Horace links to an interesting talk about the problems of voice-recognition and indeed product development in general. There’s a bit more from Rory Cellan-Jones.

Dan York has a rant about the WebRTC standardisation process, and worries that it’s becoming too closely coupled with the existing Internet telephony technology base. We recently spoke to a major voice technology vendor and they had the same concern. Telco 2.0’s Dean Bubley also has a rant about what he calls “RCS-z”. Click through to find out what the z stands for.

Does Facebook want to be an app store for HTML5? Whether it does or not, NSN wants Facebook to be part of your self-care system.

Here’s an interview with Casey Oppenheim, cofounder with a team of ex-Googlers of a startup that produces tools to let you control what Facebook knows about you. Hacking Skype address books - there’s a browser inside the new versions, you can style your status with HTML, so what happens if you add JavaScript code to your profile? Whoops. And The Register accidentally leaks 46,500 users’ e-mail addresses.

Apple poaches Scott Noteboom, Yahoo! datacentre guru. Early SQL Server 2012 on Amazon Web Services.

Meet the ARM Cortex A15 processor, in excessive detail, with bonus Steve Jobs anecdotes. A review of Ubuntu 11.10. Reviewing the original iPod 10 years on.

Microsoft’s YouTube channel gets hacked. Anonymous goes after child-porn host. Reporting back from the Guardian hackday. Mozilla ports Firefox for Android into native code. A successful public IT project!

The cheapest ways to get an iPhone 4S in the UK.

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October 21, 2011

Gartner’s Top 10 strategic technologies for 2012

As reported in Business Cloud News, Gartner announced its top ten strategic technology trends for 2012 this week. Interesting list. We’ll comment on this ongoing and at the Telco 2.0 event next month:

Media Tablets - The true rise of the mobile computing platform. As Gartner states, in 2012 “IT leaders will need a managed diversity program to address multiple form factors, as well as employees bringing their own smartphones and tablet devices into the workplace.”

Mobile-Centric Applications and Interfaces - User Interfaces (UI) with windows, icons, menus, and pointers will be replaced by mobile-centric interfaces emphasising touch, gesture, search, voice and video.

“Applications themselves are likely to shift to more focused and simple apps that can be assembled into more complex solutions. These changes will drive the need for new user interface design skills.”

Contextual and Social User Experience - “Context-aware computing” uses information about an end-user or objects environment, activities, connections and preferences to improve the quality of interaction with that end-user or object.

Context can be used to link mobile, social, location, payment and commerce. It can help build skills in augmented reality, model-driven security and ensemble applications.

Internet of Things - The Internet of Things (IoT) is a concept that describes how the Internet will expand as sensors and intelligence are added to physical items such as consumer devices or physical assets and these objects are connected to the Internet.

Gartner believe that by 2015 companies will need unified oversight of all of their Internet-connected technologies, but CIOs will need to orchestrate, not own, this data. For now, companies should get into a “what if” mindset, thinking about what the company can do with all the available data.

App Stores and Marketplaces - Gartner forecasts that by 2014, there will be more than 70 billion mobile application downloads from app stores every year. App Stores are expected to become a key component in line with the enterprise shift to SaaS and cloud computing.

Next-Generation Analytics - In 2012, analytics will increasingly focus on decisions and collaboration. The new step is to provide simulation, prediction, optimization and other analytics, not simply information, to empower even more decision flexibility at the time and place of every business process action.

Big Data - The big issue. As our increasing reliance on data grows, so does the problem of how to manage it. As Gartner states, “the size, complexity of formats and speed of delivery exceeds the capabilities of traditional data management technologies.”

“Analytics has become a major driving application for data warehousing, with the use of MapReduce outside and inside the DBMS, and the use of self-service data marts. One major implication of big data is that in the future users will not be able to put all useful information into a single data warehouse. Logical data warehouses bringing together information from multiple sources will replace the single data warehouse model. “

In-Memory Computing - Gartner sees huge use of flash memory in consumer devices, entertainment equipment and other embedded IT systems. In addition, it offers a new layer of the memory hierarchy in servers that has key advantages — space, heat, performance and ruggedness among them. Besides delivering a new storage tier, the availability of large amounts of memory is driving new application models.

Extreme Low-Energy Servers - Further projects to develop low-power servers in line with the increasing implementations of big data are expected in 2012. As environmental pressures continue to take hold, Gartner expects many top data centre providers to start delivering “radical new systems” to combat the issue of server energy output.

Cloud Computing - Last but not least…Cloud Computing is obviously a disruptive force, and its continuing implementation will lead to dramatic changes in IT infrastructure for many global enterprises. As Gartner puts it so well:

“While the market remains in its early stages in 2011, 2012 will see the full range of large enterprise providers fully engaged in delivering a range of offerings to build cloud environments and deliver cloud services”.

For further analysis of Gartner’s strategic technologies for 2012, visit www.gartner.com

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October 19, 2011

M-Commerce 2.0: a $1Trillion efficiency opportunity?

At our ‘M-Commerce 2.0’ event in New York this month - looking at how personal data could revolutionise payments, advertising and media experiences - an eminent MIT professor suggested that within five years most small purchases will be conducted using mobile phones. He also estimated that 50-60% of the U.S. economy could be made more efficient using the data captured by mobiles, potentially saving a trillion dollars. How can we understand and navigate the extraordinary opportunities created by the combination of m-commerce, personal data and analytics?

As regular readers will know, we’ve discussed on many occasions on this blog and in our research the emergence of ‘personal data’ - data generated about individuals in real-time as they go about their daily lives - as a new class of economic and social asset, and how this is being investigated and promoted by the World Economic Forum (WEF).

As this cartoon from Reputation.com’s recent M-Commerce 2.0 presentation elegantly shows, the use of personal data can also raise concerns.

lemonade cartoon 20 oct 2011 personal data.png

Combining the most useful outputs from senior executive summits conducted in the last two weeks (from our New York M-Commerce 2.0 Brainstorm and the WEF meeting in Abu Dhabi) the rest of this short article provides an quick, state-of-the-art ‘multimedia’ primer for our readers.

M-Commerce 2.0 and the WEF’s Global Agenda Meeting

Building on our relationship with the WEF and to help bring the concepts to life in some key verticals, we set up a research and events programme some months back called ‘M-Commerce 2.0’ (described here). Our next event on this topic is in London on the 10th November, where we’ll discuss latest thinking with senior execs from the telecoms, media, payments, online and advertising industries as well as key entrepreneurs in the space.

At the WEF’s Global Agenda meeting in Abu Dhabi last week - a high powered gathering of 700 leaders and experts from government, industry and academia to set the agenda for 70 global issues for Davos and beyond - it was instructive that the ICT Global Agenda Council chose to focus on ‘personal data’ as its key issue and that the other councils (not least financial services, advertising and media) found this topic highly relevant to their issues too.

Introduction - what is M-Commerce 2.0?

M-commerce (commerce enabled by mobile connectivity) now amounts to far more than purchasing ringtones and other digital content using a handset. So-called SoLoMo (Social, Local and Mobile) Internet services are using the huge volumes of personal data being captured by smartphones to engage with consumers in innovative and potentially compelling ways.

At the same time, new intermediaries are looking to give consumers greater control of their digital identities and personal data to help them realize the economic (and social) value of these latent assets, rather than let corporations exploit this data without their knowledge or consent (the default position today).

These trends, and the technological and commercial innovation associated with them, open up many new - and potentially disruptive - opportunities and threats across multiple sectors (retail, advertising, banking, telecoms, media and technology) and have significant policy implications for government, regulators and ‘civil society’ in general.

Data is becoming so important to social-economic development, it has even been described by some commentators “as the oil of the 21st Century.” We call the combination of m-commerce with user control of personal data and new forms of real-time analytics ‘M-Commerce 2.0’. The benefits are reduced friction and transaction costs in day-to-day ‘B2B2C’ commercial processes - the $1Trillion efficiency opportunity.

The Concerns - privacy and misuse

Concerns over the potential inappropriate use of personal data are summed up by this amusing video from the American Civil Liberties Association…

The Opportunity - getting it right

Four recent articles and two great blogs are worth reading to start to appreciate the opportunity and how it might work:

1. A high quality thought piece on Personal Data from Boston Consulting Group (who have been working with the WEF Re-thinking Personal Data project team).

2. A short article on The Privacy Bomb - How to Tame and Feed ‘Big Data’ by Dr. John Clippinger, another member of the WEF project team, previously Co-Director of the Law Lab, Berkman Center for Internet & Society at Harvard University, and now with MIT’s IDcubed lab.

3. A recent article by AdWeek covering some of the start-ups in the personal data space.

4. A summary in the Harvard Business Review blog of a high quality Forrester Research report released this month.

5. Great blogs from two of the most passionate and articulate companies operating in the personal data services space today: Personal.com and Reputation.com.

There’s a lot more to this topic of course, and the opportunities for telcos to play a key role are many - acting as trusted ‘custodians’ of personal data (providing locker services), identity and authentication providers, trusted brokers. Telefonica and AT&T have perhaps the most enlightened and complete picture of the opportunity among the big telcos today, but the topic needs a very delicate approach. Telefonica will be sharing their thoughts at our London event next month, and we’ll be sharing more analysis with our readers ongoing.

In the meantime, we’ll leave you with a graph of a vote conducted at our recent New York event about how quickly the principles described above could, for example, impact the advertising industry.

We discussed this with the Managing Director of the Worldwide Federation of Advertisers at the WEF’s Abu Dhabi meeting last week and he described it as ‘very interesting’ and refreshingly different from the normal talk of cookies and traditional online advertising models…

chart for NYC MC2 oct 2011.png
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Voice & Messaging 2.0: Vodafone and DTAG to discuss RCSe ‘OTT defence play’

Cenk Serdar, Data & Communications Services Director, Vodafone Group, and Dr Rainer Deutschmann, SVP Core Telco Products at Deutsche Telekom will bring to life the new RCSe voice/messaging ‘open platform’ by discussing different aspects and applications of it at our New Digital Economics event in London, on the 9-10 November. RCSe is in part a big industry play to defend against so-called ‘OTT’ players.

They will be joined on the Voice & Messaging 2.0 panel in the Telco 2.0 session by Morten Sorby (EVP Corporate Development, Telenor Group) and Andreas Bernstrom (CEO, Rebtel) to discuss and debate this topic within the context of a ‘logical framework’ that the Telco 2.0 team is currently preparing.

In the meantime, we recommend readers check out Etisalat’s new RCS-like service ePlus, launched last week at Gitex in Dubai. The Telco 2.0 team find this very interesting - it potentially takes RCSe to the next level. Etisalat’s senior executives will also be participating in our London event.

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October 17, 2011

BlackBerryFail explained + how iOS/OSX updates melted networks - Telco 2.0 News Review

[Ed. It’s now just three weeks to the London Brainstorm (9th-10th November). Key themes are: strategies for defending and extending voice, Customer Experience 2.0, M-Commerce 2.0, Cloud 2.0, M2M 2.0, CDNs, Payments 2.0 and dealing with the disruptors - Google, Apple, Facebook, Microsoft/Skype, and Amazon.]

This week saw a major technology disruption as RIM’s BlackBerry service network failed for days in Europe, the Middle East, and Asia. Repairs were repeatedly promised. Then the outages spread to the Americas. Not only did it fail, it kept failing. It couldn’t have come at a worse moment. RIM, under pressure, has recently rolled out some impressive new devices like the Bold 9900 and Torch 9810, come up with good ideas like music-sharing via BBM, and made a good decision like hiring Alec Saunders.

But this can only be very bad news. The Observer reports that major British banks are seriously considering abandoning the BlackBerry platform and transitioning their mobile device fleets to Apple iOS. It’s not the first time, of course, that RIM has had a continental-scale outage. In fact, the highly centralised network architecture almost seems to invite disaster. Most of the world’s BlackBerry traffic passes through two pairs of data centres, in Waterloo, Ontario and in Slough and Egham in the UK.

That includes not just e-mail and BBM messaging traffic, but also all Internet traffic to or from a BlackBerry device, as RIM uses a bank of accelerator proxies in the cloud in a similar fashion to Opera Mini or Amazon Silk. For much of its existence, this has been a major factor in the BlackBerry user experience - when mobile networks were seriously bandwidth-constrained, anything that tended to speed up load times was worth having. Unfortunately, it’s also a massive single point of failure, and losing the BlackBerry Network Operations Centre means knocking all the devices back to the status of a 1990s GSM phone. Even on-premises BlackBerry Enterprise Server installations can’t function without the RIM NOC.

It seems that the NOCs are organised in an active-passive mode, with each pair consisting of a primary and a hot standby. In the UK, the primary is Slough and the backup is Egham. However, reports suggest that the backup NOCs haven’t scaled up quickly enough to keep up with the surge in data usage, and that when a hardware failure took out the Slough NOC, the failover site couldn’t cope. Eventually, a major database became corrupted, necessitating a complex restoration from backups.

This Daily Telegraph story points the finger at a Cisco Ethernet switch and an Oracle database, but the really interesting bit is that apparently RIM first found out about the crisis when UK MNO engineers noticed that BlackBerry traffic over their radio networks had fallen to zero and called the RIM NOC, which suggests RIM’s own network instrumentation leaves something to be desired.

Data Center Knowledge rounds up the fallout, pointing out that RIM may decide to create more data centres and decentralise the network, but this may mean more pressure from various governments to spy on their traffic. Reuters calls on the Slough NOC and reports that BlackBerry users were openly insulting RIM employees outside the building.

As a peace offering, RIM is going to give away a selection of premium apps, while further offering its enterprise customers a month’s free technical support. Some might suggest that the customers might do better offering RIM tech support.

They also released two new gadgets, but this won’t be at the top of anyone’s mind.

In Apple news, Tim Berners-Lee appreciates Steve Jobs and relates how he very narrowly missed a live demo of the very first Web implementation at a NeXT developer conference in France. Meanwhile, Horace looks into the costs of Apple Stores, and puts together a must-read post arguing that Apple’s secret sauce is quite simply that it’s a hell of an industrial company and that it’s quietly been investing heavily in tools and infrastructure that (presumably) its contract manufacturers operate. This is Tim Cook’s Apple, of course - the relatively unglamorous but enormously important world of the global supply chain.

Asymco’s analysis of Apple’s investment in infrastructure
Source: Asymco

Stupid Apple Rumours does the math and attempts to work out which Apple news/fansites are actually worth reading and which should simply be filtered. They conclude that only AppleInsider is worth reading, but this is no great recommendation - its rumour hit-rate is in line with that of Apple rumours in general, while the other major Apple blogs are actually less accurate than a random sampling of rumours would be.

It seems that Samsung’s president and COO has been invited to Steve Jobs’ funeral, where he will have a quiet meeting with Tim Cook over the bitter lawsuits between the two companies. It sounds like something out of The Godfather - will there be a dynastic marriage to cement whatever settlement they reach, or will they go to the mattresses in a war to the knife?

The two men who found a prototype iPhone 4 in a bar and sold it have been sentenced to a small fine and probation.

Apple pushed out the iOS 5 update this week, via Akamai’s CDN. Even Akamai couldn’t prevent many users having to wait ages for their update to download. PlusNet’s blog reports on the massive traffic spike on their Akamai cluster, plus an associated surge in iTunes downloads, although apparently putting so many iDevices and Macs out of action made a big dent in the BBC iPlayer streaming traffic. RevK at A&AISP reports on their experience. It is noted in the comments that Mac OS X was also updated, while Ubuntu Linux had a major release and the Steam online gaming platform pushed out a large patch. No wonder it was a night to remember in the NOC.

For their part, the CDN market leader pre-announced a major upgrade ahead of their imminent Edge 2011 customer conference. It looks like Akamai’s platform is going to see major changes in the areas of IPTV, media services and analytics, mobility, and integration with cloud computing systems. IBM and Riverbend Technologies are key partners. Details are expected at the conference later this week.

Last week we published research on CDNs 2.0: should telcos compete with Akamai? just as KDDI became the latest operator to buy a content-delivery network, CDNetworks. Skyfire’s new video accelerator product, Rocket 2.0, is out and claiming to squeeze down video streams for mobile networks.

Hulu’s owners give up on selling the video-streaming player. Verizon FiOS has a unique approach to customer retention. Vodafone and Virgin Media partner to snag a major deal for Ethernet, mobility, and unified communications.

The Guardian’s technology blog weighs into the UK 4G spectrum debate. Renesys reports that Internet latency in the Middle East is coming down steadily as more local interconnection comes on stream, and predicts that a new cable is going to transform Lebanon’s telecoms market.

Sony Ericsson, meanwhile, reported quite respectable results. The really interesting detail, though, is that they are planning to drop all other products except for their Android-based smartphones. This makes SE the first established vendor to join Apple and HTC as an all-smartphone player.

Even Nokia may have a reasonable quarter, Economic Times reports, thanks to dual-SIM devices in India and an inventory restock in China.

If you found Siri, the iPhone 4S virtual assistant, impressive, here’s Speaktoit, an Android application that implements something similar. AppMobi launches a new developer kit for PhoneGap and HTML5 cross-platform mobile apps. Ericsson adds in-app carrier billing to its IPX product line.

However smart your phone may be, one in six of them is contaminated with faecal bacteria.

France Telecom, in the form of Orange Business Services, has reached the start line for real M2M roaming - they are going to launch SIM cards using the 901 MCC, reserved for special M2M tasks, so that their customers can be their own mobile network while using Orange’s roaming relationships. We know someone who’ll be pleased.

In other deeply Telco 2.0 news, O2 UK is trialling an app that lets their iOS users make high-definition voice calls over O2’s (and indeed any) WLAN networks as a way of outflanking the OTT players.

BlueVia publishes a helpful tutorial on how to build Python applications using the BlueVia API.

With the European Union apparently happy, the Microsoft-Skype deal closed this week. Another Tropo tutorial. Remembering the blue box and AT&T’s effort to suppress the Esquire article on it.

In sadder news, this week, a giant of computing left us. Dennis Ritchie, known as dmr from the Bell Labs e-mail address he used on newsgroups and lists all over the Internet, joined Bell Labs in 1967 to work on the massive Multics project to develop an advanced time-sharing operating system. Multics ran aground in what became known as the “software crisis”, the historic realisation that managing very large software projects is inherently complex and risky, and was abandoned.

Ritchie and Ken Thompson, however, decided to keep going, cutting down the bloated codebase to a bare minimum. They were aided in this by the fact Bell Labs managers didn’t think the project was worth supporting, and as a result the only computer available had only 16KB of RAM. The result, which started up in early 1970, was of course UNIX, the operating system that basically underlies almost everything in computing. Ironically, it was the system’s command-line text editing tools that really impressed the other Bell Labs programmers.

For his next trick, Ritchie decided that the new OS needed a new programming language to make it genuinely cross-platform. As far back as 1964, researchers at Cambridge University and Imperial College London had been trying to invent something like this, but their Combined Programming Language (CPL) also became a victim of the software crisis. One of its inventors, Martin Richards, then moved to MIT, where he created a simpler, cutdown version of CPL called Basic CPL or B for short. Ritchie was inspired and made a large number of improvements to B, calling the result C. UNIX was then re-implemented in C, creating a package of OS, programming language, and developer tools that would theoretically run on any machine. It was a world-changing achievement. Ritchie later wrote the classic textbook The C Programming Language and stayed at Bell Labs for his entire career.

In regulatory news, EverythingEverywhere’s effort to slow down the sale of some spectrum is confirmed. It’s possible that they may try an “insurgent” launch of LTE in the band. It was the week the UK didn’t actually deploy a national porn filter or indeed change anything much.

The Times of India reports that the Indian Department of Telecommunications is not happy about MNOs with national roaming arrangements. RCR Wireless covers the new Indian national telecoms policy in some detail. It looks like they really mean it about national vendors.

Should the EU provide more spectrum for mesh networks and unlicensed working? PLDT is willing to hand some back as part of a takeover deal. The FCC demands evidence that AT&T really will onshore 5,000 call centre jobs if it gets to buy T-Mobile.

Verizon has changed its terms of service to let it collect and use a wide range of customer data for commercial purposes. Everyone is opted in by default, although you can opt out through the Account Tools webpage. Safaricom is going to deploy IMSI catchers to stop Kenyan prisoners using M-PESA in jail. Analysis of the German government trojan. It’s OK to track cellphones without a warrant in the US. Here’s the EFF’s advice on phones at demonstrations.

A fascinating story about working on Google Wave. After this epic Googler rant about getting it wrong with platforms and how Amazon got it right, it seems that Google’s API design competence is concentrated in the Australian group it bought for the technology behind Maps and that also did Wave. Meanwhile, Google Buzz, Jaiku, and Code Search are shut down. There’s an interesting discussion of Dart, Google’s new web programming language, here. How Google hires. And Google’s old offices, 165 University Avenue, Palo Alto, are now home to Shazam. The landlord buys a few shares in each startup that passes through just in case.

Microsoft discovers the joy of open-source software! Hadoop, the Google-inspired big data analytics system, is going to be an integral part of future Windows cloud products. ReadWriteWeb interviews Hadoop’s inventor about the move.

Amazon Web Services adds more private cloud features. You can now set up a Virtual Private Cloud and fill it with dedicated EC2 Spot Instances.

Cisco’s new VXI collaboration product line.

Should Mozilla fund Diaspora? Trying to fix British government IT with agile development.

In Digital Entertainment 2.0 news, Spotify is growing, but it’s still losing money. Does it really reduce piracy, increase it, or just have no impact at all? Netflix walks back its split from the DVD rental business, and the crowd goes wild. We’ll be writing more on this shortly, and sharing more at our special EMEA Digital Entertainment 2.0 Workshop on Tuesday 8th November in London.

And finally…

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October 10, 2011

iPhone 4S take, Steve Jobs, US stats, new policy in India - Telco 2.0 News Review

Last week’s news was dominated by two big stories from Apple so we’ve published three separate news review posts this week: 1) this one with all the important non-Apple news; 2) iPhone 4S: a winner, if not a game-changer; and 3) Steve Jobs: where were you when you heard?

Ed. A quick reminder - it’s just one month to the London Brainstorm (9th-10th November) where we’ll share some findings from our new strategy report on ‘Dealing with the Disruptors’ - Google, Apple, Facebook, Microsoft/Skype, and Amazon’. Also, we’re just back from the Americas M-Commerce 2.0 Brainstorm in New York and working on the analysis of the intensive and highly productive brainstorm. The key theme of the event was how personal data will change M-Commerce (e.g. advertising, marketing, payments, etc.) - here’s a brief preview showing delegate views on how mobile marketing will change in the next two years to whet your appetite.
chart for NYC MC2 oct 2011.png

Back to the news beyond Apple, Horace Dediu reports that 75% of T-Mobile USA’s sales are now smartphones, and it’s not looking great for RIM in the US market, at least until the new round of BlackBerrys hit the streets. (They announced a WebOS-style devices-kiss-to-share function, and bought a social networking startup.) There are 150 million non-smartphone users left in the US, and the number is falling fast.

Elsewhere in the world, of course, there are many more. But the transition is racing up on us. Mobile data traffic has grown 60% since May in Brazil, and even though iOS and Android are leading the way, you can easily see the significance of this news item on Nokia.

It looks like the survivors of the Maemo Linux/MeeGo effort at Nokia are regrouping, in a skunkworks effort to create the long awaited successor to Nokia Series 40 using Linux. The codename is “Meltemi”, and it will supposedly target “rich featurephones” as opposed to “budget smartphones”, which will get Windows Phone 7.5. If you can tell the difference between a rich featurephone and a budget smartphone in today’s environment, good luck to you. Development will be centred at Nokia’s Ulm R&D centre in Germany.

Meanwhile, Microsoft has speeded up the roll-out of Windows Phone 7.5 updates to users after favourable responses to the early developer versions. Andy Lees, in charge of the mobile OS at Microsoft, promised AllThingsD that dual-core processors and LTE were both coming to the next lot of Winphones after they were spotted missing from this wave. Lees said that LTE hadn’t been included at this stage due to concerns about power consumption.

Qualcomm, meanwhile, announced details of the next lot of Snapdragon chips, the power behind many, many of the top smartphones. The MSM8960 chip set includes, for example, a dual-core applications processor and an LTE radio baseband, and supports 3D video capture with hardware acceleration.

In Sweden, Sony-Ericsson Androids are five of the top ten sellers, although of course the very top is an iPhone, and the Xperia Mini Pro X10 looks well set for the status of a minor classic. Sony was reported this week to be thinking about buying Ericsson out…

Google released Android into the wild like a mad scientist with an engineered virus. They may have thought they could keep control, but we’ve all seen the movie before. The latest step in Android’s escape from the lab this week - software house Myriad Group announced the latest version of its alternative implementation of Dalvik, the Google-made Java virtual machine that is the heart of an Android system. Alien Dalvik 2.0 will, among other things, let you emulate Android on iOS, should you so desire, as well as supposedly running faster and letting you replace burdensome patent obligations to Google with patent obligations to Myriad.

In the UK, OFCOM chose late on Friday afternoon to slip out the announcement that it’s essentially kicked the 4G auctions into touch, pushing out the consultation until the end of the year. The UK spectrum position is complex and the lobbying is intense, and we’ll have more on the issue on this blog.

BT’s wholesale division and EverythingEverywhere attempted to stake out a position in advance of any decision, turning up service on their trial 800MHz LTE network in Cornwall. BT also continued litigating against the Digital Economy Act.

FCC chairman Julius Genachowski gave a speech detailing his plans to reform the Universal Service Fund and implement the National Broadband Plan. This would progressively shift the USF from supporting telephony to supporting fixed and mobile broadband, but wouldn’t provide for further duplication of service or for competitive bids for the first phase of deployment. Cable operators hated it.

Connected Planet provides a sensible critique of Genachowski.

The Indian Government announced a new national telecoms policy this week, which will focus on getting universal service out into the countryside and on developing a homegrown network vendor market.

Benoit Felten is frustrated, and outlines a radical vision for FTTH deployment - forget the incumbents and focus on reducing the cost of facilities-based competition. Meanwhile, NBN Co chucks Emerson Power the contract to build its data centres.

Sprint-Nextel is deploying LTE, which of course has grim implications for Clearwire as its main wholesale launch customer is going to disappear and so is the funding for its own LTE rollout. The question is surely how Sprint will recover the vast spectrum holdings inside Clearwire. Clearwire makes the point.

There are some details here about the Sprint plans, and we note that managed WLAN offload is a big part of them.

WLAN wholesalers Boingo have contracted Towerstream to manage their network in Manhattan, which gives them access to many more rooftops and other antenna locations. As Phil Wolff points out, as Skype is a Boingo reseller, this means that Skype has just gained coverage over most of New York City. It looks like the EU is going to give Microsoft-Skype the green light without requiring much in the way of interoperability. Wolff isn’t exactly pleased.

In other voice news, people are still doing cunning things with international termination. Speech-to-text with Tropo. NoJitter.com relaunches.

Up in the cloud, Amazon Web Services S3 is now home to 566 billion data objects and is processing 370,000 requests a second at peak times. Meanwhile, Netcraft reports that the Web is still growing, and fast.

Larry Ellison boasts that nobody will be locked into the new Oracle Public Cloud, as it’s entirely standards based. Ars Technica takes a balanced look. Google has added a traditional SQL interface to App Engine. Getting it wrong at Etsy.

About 20% of IT managers are less likely to use the cloud after the AWS CloudFail, reports Data Center Knowledge.

US utilities are investing more in telecoms, but they would prefer to build their own networks, it seems. Here’s LightSquared hooking up with CareConnect, a health-focused M2M firm.

The Android patent lawsuit is coming to court, and the list of witnesses includes every marquee name tech CEO going - Ellison! Schmidt! Page! McNealy! - and quite a few other important figures besides. Meanwhile, ex-Microsoft man Nathan Myrhvold is suing Motorola over a patent from 2000 in which he claims to have patented software updates.

It looks like the uncertainty about the future of HP’s Personal Systems Group has crashed their channel to market for PCs, with sales in the UK dipping dramatically. Ars Technica’s Sean Gallagher reviews the options and concludes there’s not much point owning the biggest PC manufacturer in the world if you’re going to only come fifth for quality.

Elsewhere in the sprawling HP empire, the OpenStack cloud team announced this week that Ubuntu Linux would be the primary OS for the new standard.

The European Parliament is not happy about European telco vendors selling surveillance gear to dictatorships. Sonic.net refuses to hand over data on Wikileaks supporter. Anti-P2P technology that lets just anybody inject code into it.

For Ada Lovelace Day, ReadWriteWeb profiles 22 women who helped build Google +. Guy Kawasaki fights G+’s trolls. Spotify poaches a top Clear Channel exec to sign up major content and distribution deals in the US. Who are the most disruptive companies? - our take on this is here.

Porn? There’s an API for that (the API docs are here (surprisingly, SFW). ReadWriteWeb notes that the smut trade has been rather late to the party here and that its historic role as the launch customer for all sorts of Internet technologies has passed to games developers.

Ars Technica has a long piece on the history of WLAN. 404 satellite not found in northern Canada. Hating the #! Becoming a programmer. NFC on a MicroSD card. Alibaba CEO taps up Temasek Holdings in his bid for Yahoo! Koomey’s Law - computers get more energy efficient. Cool hardware lens attachment for iPhones. Windows virus invades killer drone command centre.

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Steve Jobs: where were you when you heard?

The untimely death of Steve Jobs was announced while half our team were in New York at the M-Commerce 2.0 brainstorm. It seemed strangely fitting that those of us there learned the news via an iPad2 belonging to one of our speaker’s wives. Later, we took this picture of the ticker tape in Times Square using an iPhone 4.

times square steve jobs oct 2011 crop.jpg

None of us knew Steve Jobs personally yet he has had a profound impact on our world, and we’re grateful for the colour and interest that this remarkable man added to our personal and professional lives. He is the first of the tech superstars to die, and perhaps the emotions surrounding his loss will confer even more strength to Apple’s already extraordinary brand. We hope that at least his family and close friends will find some comfort in the public appreciation of his achievements and character.

In the rest of this article we feature some of the excellent tributes in the media from his professional friends and foes alike. We’ve also just published our initial thoughts on the announcement of the iPhone 4s, and will be publishing our in-depth analysis of Apple’s business model and strategy shortly.

Perhaps the ultimate tribute came from Google which carried his dates, and a simple link back to Apple.com on the home page.

For us, another great tribute is all the additional backhaul fibre pulled out to mobile operators’ cell sites since 2007. When the iPhone launched, we were still wondering what would ever fill up the GPRS networks and use that horribly expensive spectrum. As it turned out, all the public needed was a device that was beautiful as well as technically impressive. And suddenly mobile apps overtake music as the biggest category of online goods.

Sergey Brin mourns via Google +. Mark Zuckerberg sends thanks. Barack Obama and arch-rival Bill Gates remember him. Apple insiders remember.

There’s a particularly significant remembrance of Jobs by his schoolfriend and partner in founding Apple, Steve Wozniak.

Wozniak introduced Jobs to phone phreaking, hacking the in-band signalling that controlled the phone networks before the shift to digital switching in the 1980s. Allegedly they once rang up Henry Kissinger, posing as Vatican diplomats to the State Department switchboard. Supposedly, it was Jobs who first suggested to Wozniak that they might be able to sell the blue boxes - essentially, a developer kit that produced the various signalling tones on command - they were making for actual money.

The Register combines a tabloid sensibility with the ability to produce really superb long-form writing on occasion and Jobs’ death inspires them to narrate a hacker’s childhood. The second part, covering Jobs’ return to Apple, is here. Another take on his exit from Apple, more here.

Wired recalls a list of Jobs’ 10 greatest achievements, while The Guardian does something similar. The Apple Mac, the musician’s computer. Nobody can build a shrine with quite the attention to detail geeks can. More, from AllThingsD. Steve Jobs, the salesman. Scott Fulton at ReadWriteWeb remembers. RWW reminds us that the original iPhone’s killer app was the Web, and Tim Berners-Lee developed the first Web server on one of Jobs’ NeXT machines. ATD’s commenters. My first Mac computer. BoingBoing redesigns as an old Mac OS desktop. Doc Searls remembers. Horace remembers.

Ars Technica remembers, and provides a list of the products Steve Jobs cancelled. A taste of the ruthless side. Ars appreciates the Apple II, the machine where it all began.

Remember when men said they read Playboy for the articles? They interviewed Steve Jobs in 1985, and looking back it’s a classic. Among much else, this quote stands out:

The developments will be in making the products more and more portable, networking them, getting out laser printers, getting out shared data bases, getting out more communications ability, maybe the merging of the telephone and the personal computer.

Mind you, he also said he expected AT&T to be a major competitor in a few years’ time as the brilliant research from Bell Labs began to be commercialised. It didn’t quite work out like that, but AT&T (although a very different AT&T) would be the launch customer for the, ah, merging of the telephone and the personal computer.

Unlike many other attempts at this, especially the ones launched by telephone companies, Steve Jobs’ effort didn’t stint on the personal computer side of the bargain. After all, if there was any one feature that marked out Jobs’ career, it was a fanatical, obsessive focus on the products. As the man himself said in July 1996, having just rejoined Apple, when asked what he thought was wrong with the company:

These products suck!

Felix Salmon points out that they were also very pricey indeed, and that part of Apple’s achievement since then was squeezing down its prices.

Here’s a French view from Le Monde.

Despite the ongoing legal squabble between Apple and Samsung, Samsung CEO Geesung Choi also had this to say:

“Chairman Steve Jobs introduced numerous revolutionary changes to the information technology industry and was a great entrepreneur. His innovative spirit and remarkable accomplishments will forever be remembered by people around the world.”

They also claim to have pushed back the launch of a new phone out of respect (although they didn’t slow down the litigation).

Here’s an apprciation of his successor, Tim Cook.

Finally, as if we needed proof that the world was not designed by Apple the people who protest the US’s war dead at their funerals because they might be gay have promised to picket Steve Jobs’ funeral, on their Twitter feed. Somewhat ironically, the message was posted from an iPhone.

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iPhone 4S: a winner, if not a game-changer

Apple’s much awaited announcement of the Apple iPhone 4S last week was accompanied by some disappointment in the media and analyst communities. Telco 2.0 thinks it will be a success, if not a game changer, and embodies some important strategic moves for Apple.

This post gives our outline views and a round-up of market commentary - you can find our in-depth strategic analysis on on Apple here and at our EMEA Brainstorm in London 9-10th November. Our reflections on Steve Jobs’ untimely death and remarkable career are here.

So, here’s what the iPhone 4S offers in summary.

  • The main similarity with past iPhones is that the iPhone 4’s industrial design and look-and-feel (a phrase we wouldn’t be using were it not for Steve Jobs) have been maintained.

  • The software, however, gets the new iCloud and wireless sync features Apple announced earlier this year, plus the Newsstand in the App Store.

  • There’s also been a deeper hardware refresh - the A5 applications processor is another of Apple’s homebrew (or rather, ex-PA Semiconductor) products, giving it two cores and more power, and the baseband processor and RF chain are coming from Qualcomm and will support dual-mode (i.e. GSM/UMTS and CDMA) operation.

  • There’s a better camera and some new prices across the range of iPhones on sale: 4S, 4 and 3GS.


As ever, the run-up to the launch was frothing with rumours, excitement and speculation growing among the circles of Apple lovers and Apple watchers who were wishing for the next spectacular Jobs-esque product announcement. In the event, the launch seemed something of a disappointment - there was no iPhone ‘5’ and no new form factor, so the most obvious and tangible signs of a revolution were missing, and expectations were seemingly dashed.

However, Telco 2.0 broadly agrees with the analysis of our new Associate Horace Dediu (who’ll be with us at the EMEA event in London), that the “lack” of the iPhone 5 will have no negative impact on sales, as most of the potential early-adopters are tied into contracts for their iPhone 4s. Instead, the iPhone 4S will flush many of the legacy fleet of 3GS and earlier devices, as these users are coming to the end of their contracts and the devices themselves are feeling the effects of hard service. Meanwhile, the run-on of new 3GS will serve to expand the total addressable market. Horace points out that Apple now has a line-up of iPhones for every pocket, and has a crack at estimating the ASP.

ReadWriteWeb accidentally confirms Horace’s analysis by polling its own staff, a select group of early adopters if ever such was assembled, and finding that they’re either all tied into iPhone 4s or else determined to stick with high-end Androids.

Disruptive Dean Bubley, also of Telco 2.0, theorises that Apple is carrying out a major review of its silicon strategy, possibly aiming at a new common platform for all its mobile devices and squeezing out the remaining Infineon and Intel chips from its product lines, and that as a result there is unlikely to be a major product launch until the new baseband SoC and its associated parts are ready.

After all, despite suggestions to the contrary, Apple is running on its down-ticket iProducts like the iPods and iPod Touches, which suggests both that nothing really unusual is in the pipeline and that they need a platform for multiple mobile device types.

The camera has had a lot of investment, and Ars Technica’s camera geeks have a detailed review. It’s an 8 megapixel unit and supports 1080p HD video recording, but the headline numbers don’t reflect some of the improvements in things like sensitivity, autostabilisation, and IR filtering.

Business Insider rounds up the bear case here, but it’s heavily dependent on the assumption that Apple “failed” to launch an iPhone 5 rather than, for example, not having had any intention of so doing. In fact, a cynic might suggest that Tim Cook would be basking in Jobsian adulation had he simply incremented the product designation to match the version number of the OS (it’s iOS 5) and the CPU (it’s the Apple A5). Even the Insider agrees that the iPhone 4S is likely to fly off the shelves.

Apple also announced pricing for the iPhone range. The new gadgets start at $199 for an 8GB version, ramping up to $399 for 64GB, while the current iPhone 4 is run on at $99 and the iPhone 3GS becomes free with an operator contract. Sprint Nextel is going to offer open slather data service with an iPhone 4S for $69.99 a month.

The biggest new thing in the 4S, though, is Apple’s first tentative reconnaissance of the undiscovered continent of voice. “Siri” is Apple’s voice-command application, or “personal assistant” - you ask it questions, it converts your voice to text, and runs it through a natural-language processing app to derive commands that it then executes.

It’s going to be fascinating to see how this pans out. Orange UK once upon a time had a personal secretary service, Orange Wildfire, which they shuttered in 2005 to the horror of a small but highly engaged and committed user base. More recently, Swisscom Mobile developed Me2Me. However, there’s always been some trouble in getting wider user buy-in - rather like Apple before the iPhone, come to think of it.

Voice recognition is computationally expensive, and also the sort of thing that benefits from huge web-scale databases of stuff. On the other hand, the telco options (which were network services) have suffered from the call setup time and the variable quality of the link. We don’t yet know what the balance between local and cloud processing is here - Apple typically inclines towards applications and data being resident on the device, and makes major efforts to provide enough power to make that happen. It will also be interesting to see what sort of developer API it provides and what the app developers come up with.

There’s a rundown of its features here. Ars Technica points out that if it works, it’s pointing straight at Google’s mobile search. Search Engine Land has a slightly fannish piece, but does unpack the cloud vs. local issue, and points out that Siri “sometimes” needs a WLAN connection. We wonder what Packetstan would make of that.

AllThingsD reports that AT&T has 200,000 pre-orders for the devices already.

Finally, over in the anti-iPhone 4S camp, Samsung is suing Apple to stop them shipping iPhone 4S devices, on the basis of some of their patents in the UMTS air interface. This is a tit-for-tat move after Apple’s legal action against the Samsung Galaxy S II.

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October 3, 2011

Amazon Kindle tablet-fest, Akamai update - Telco 2.0 News Review

[Ed. Many of us are in New York this week for the Americas Brainstorm, so we hope we’ll see you there or at the London Brainstorm (9th-10th November). Also, our Strategy report on ‘Dealing with the Disruptors’ - Google, Apple, Facebook, Microsoft/Skype, and Amazon will be out in the next couple of weeks - see here or email contact@telco2.net or call +44 (0) 207 247 5003 for more.]

Speaking of Amazon, its new Kindles were out this week, and everyone was fascinated by the Kindle Fire, a 7” tablet based on yet another fork of Android, designed specifically as a content-consumer device (not much local storage, no cameras). There was also a rumour about Amazon buying WebOS off HP, but as usual no substance to it as yet.

Amazon fire image oct 2011.jpg

iSuppli estimates that the devices cost $209 to make, and that therefore Amazon is selling them as a loss leader on the razor-and-blades model. The devices come with Amazon’s own web browser, Silk, which talks to an accelerator/prefetch reverse proxy in the cloud. If that sounds familiar it’s because it’s what Opera Mini has done for years.

Horace Dediu argues that subsidised devices eventually stagnate, but it’s worth pointing out that the Kindle line of devices, which will carry on, are designed for a specific purpose and don’t have any ambition to be PCs. The Monday Note discusses pricing and content rights.

Amazon Web Services, meanwhile, announced more features for CloudFormation (including the ability to reference other templates inside a CF template), and also deployed CloudFront CDN and Route 53 DNS servers in Brazil, opening their first location in Latin America. Reuters, meanwhile, reports on problems with Foxconn’s effort to build iPads in Brazil.

Up in the cloud, Oracle was having its annual OpenWorld and JavaOne shindigs this week and Larry Ellison took the opportunity to announce a new line of specialised servers dedicated to cloud-based data analytics. Some other businesses are also taking the opportunities the Oracle-fest provides.

Elsewhere, ReadWriteWeb has an interview with the founder of the OpenStack cloud OS about managing enormous open-source projects, which includes a link to this four-year struggle to fix a minor bug in Mozilla Firefox.

Google announced a commercial version of Google Analytics for enterprises, priced at $150,000 a year at a flat rate. They also announced a huge new data centre in Ireland. Data Centre Knowledge reports that telcos are buying data centres at a fierce pace.

And Google apparently intend to do more experiments on their users. There’s a reassuring statement for you.

Eric Schmidt, meanwhile, said that patents weren’t the main reason for the Motorola Mobility acquisition, but then spent the rest of his interview with Bloomberg talking about them. He also promised not to “play favourites” among the Android manufacturers.

The latest twist in the Yahoo! saga - Jack Ma of Alibaba.com has changed his mind. Rather than Yahoo! buying him out, he’s now considering buying Yahoo! Will any regulators be concerned about the thought of all Yahoo!’s data on its customers belonging to a Chinese company? For a while this week, DNS queries to the F root were passing through the Great Firewall from outside China after a BGP routing leak caused its Beijing anycast node to be announced to all Hurricane Electric’s peers - or in other words, the whole of the IPv6 Internet.

Meanwhile, the American Civil Liberties Union launched a coordinated campaign of requests under the Freedom of Information Act to determine exactly what mobile subscriber data was being kept by whom and who could read it. Interestingly, AT&T keeps the content of text messages for five years. And T-Mobile USA’s good reputation about these issues appears to hold up.

Oh dear: hackers discover a massive security fail in HTC Android devices. So HTC decided to implement its own logging feature on its devices, presumably in order to help debug its Sense UI. Unfortunately, it turns out that any app that has the Internet permission - i.e. anything that ever needs to go online for whatever reason - can read out the logged data, including the full Linux system logs, the metadata and content of SMS and MMS, user account status, the call log, recent locations, and an enormous quantity of app-level information that would probably permit a malicious app to get at, for example, e-mail. For example, an exploit of this vulnerability would have access to the e-mail sync log and also to the file system.

And, of course, if you have the Internet permission set you can go online, so they could send the collected data home, and receive data from elsewhere and insert it. Worse, HTC also helpfully shipped a VNC remote desktop server with the devices, which now looks like a gun waiting to go off. The best advice for those affected is either to get root access to the device and then delete the file /system/app/HtcLoggers.apk, or else to install an unofficial Android ROM like CyanogenMod over the original firmware.

That said, do you want to have an open mailbox on your phone for NFC devices to leave things in? Neither do we, but just in case, here’s a standard for so doing, from the NFC forum. If you feel like experimenting, Nokia will sell you a C6 phone and a variety of NFC devices for €180, or about half the price of the phone. In other Nokia news, Computer Weekly gives the E6 a mixed review and fears they won’t be around in 10 years. WinRumours has details of the first three Winokias and the Nokia Maps app for MS Windows Phone.

Wired fisks a piece by the author of a book called Buyology that claims to have identified the desire for iPhones on functional-MRI brain imaging scans. On the other hand, Horace compares the iProducts with Microsoft and points out that, well, they’re going places Redmond just isn’t. (Oh, and iTunes exists to sell hardware, but we knew that.) Also, IBM pulls ahead of Microsoft for the first time since 1996.

RIM cut the price of the PlayBook by 40% this week and vigorously denied that it was planning to scrap it. It would be tough, anyway, as the PlayBook has to struggle on at least until the first lot of QNX BlackBerry devices launch in order to support the OS and developer platform.

Speaking of RIM’s developer platform, it has a new boss, longstanding Telco 2.0 ally, Calliflower inventor, and voice-head Alec Saunders! He’s taking up a new role as VP of developer relations and ecosystem development, and he seems to be talking a lot about HTML5. Isn’t everyone these days?

Elsewhere, the Linux Foundation has basically killed off MeeGo, if it needed any more killing, in favour of a new project with Intel called Tizen, which focuses on supporting a common HTML5 app environment.

Dale Lane blogs about his first app with BlueVia. The experience was positive.

iDate reports that FTTH deployment rose 24% in Europe this year, with the leader being…Russia. You may not be allowed to do what you want on the Internet, but you can surely do it fast! Of course, this is explained by a combination of cheap labour, aerial plant, and starting from scratch.

Is Akamai under pressure? Dan Rayburn at Streamingmedia.com argues the CDN market leader is in trouble, pointing to increasingly successful competition in both the pure delivery and the media-services elements of the business, growing interest from telcos in creating their own CDNs, and the fact that it’s been a long time since Akamai’s last product iteration. Notably, their competitors seem to be making progress in mobile and in applications acceleration. [Ed. We’ve also just published new research on CDNs 2.0: should telcos compete with Akamai?.]

Microsoft’s Xbox 360 games consoles will soon be getting streaming TV, if you’re a Comcast or Verizon subscriber. It’s worth noting that these two operators have in common that they both control a fatter pipe than DSL - Comcast has DOCSIS cable and Verizon its GPON fibre network - and that TV is already a big line of business for them. That said, they’ll also need a more-than-decent CDN unless MS is thinking of doing something cunning with cable broadcast or RF-over-glass - which would require a significant hardware upgrade. So you might as well look out for a big CDN RFP coming up.

Swindon, meanwhile, is getting a 3.4GHz LTE network from UK Broadband. We’re not sure what for, but the council seems very keen. In France, the first 2.6GHz band auction raised a little under €1bn. Later this year, the second phase will sell the 800MHz band.

Brough Turner points out that only 192MHz of the 538 allocated for mobile service in the US is in use.

This is cunning - China Unicom has invented a sticker containing a chip that wraps round a SIM or Micro SIM card, intercepting device-SIM communication, so that the device uses their 3G network for data service but falls back to China Mobile’s GSM network for voice and messaging and for back-up. Users have to have their calls redirected to their China Unicom number to make sure they get through, and presumably to make sure Unicom doesn’t miss out on the termination money. Essentially, it’s a cunning way of making a 3G iPhone work properly in a market where the exclusive Apple partner doesn’t have a UMTS network any more. More here.

BitTorrent.com CEO Eric Klinker criticises the Australian rightsholder lobby for suing iiNet because they’re not Telstra. Or Vodafone-Hutchison. Or SingTel, or indeed any giant telco with hordes of lobbyists.

Here’s an M2M opportunity for British operators. The government wants to hugely increase the number of criminals sentenced to electronic tagging. Presumably they don’t want a repeat of the incident in 2004 where a young offender with a landline-dependent tag disabled the phone line, went out, and robbed a jeweller’s shop.

Voice-analytics team Freespee have signed up a web application provider for car dealers as a channel partner. Robert Scoble hits “like” on Google +, or shouldn’t that be “+1”? Vibe, the anonymous group messaging app and new street fighter’s favourite after the summer of BlackBerry Messenger-mediated rage. New MySpace owners to announce strategy beyond “sell shares to Justin Timberlake”. ADP, the dullest and most important cloud in the world.

And finally, is this the worst idea ever?

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