Ring! Ring! Hot News, 17th November 2008
In Today's Issue: Fibre from the home, says David Isenberg; DTAG humbled over VDSL rollout; Nortel reorgs yet again, keeps fibre unit; Telephony Online covers the backstabbing in real time; regional separatists rock the Telco USSR; cuts at Vodafone and BT, profits down at Telefonica; BT Vision gets ITV content; drive your Sky+ box from your iPhone; Mobilkom deploys femtocells; Hulu vs YouTube == sausage vs rose?; more MediaFLO; Qualcomm-powered netbooks will eat our cities; the standards wars are over; first GSM/WiMAX gadget; the emerging Adobe/ARM/Qualcomm mobile OS; app stores, competitive arena of tomorrow; O2 UK, T-Mobile USA fire up dev ecosystems; Facebook gets OTT messaging; Hutch adapts; Bubley the revolutionary! The first thing we do, let's kill all the vendors...
AT&T alumnus David Isenberg has an idea; if FTTH (fibre to the home) is difficult, then what about fibre from the home, with homeowners, developers or communities building their own fibre links out to the exchange? It's a micro version of a munifibre deployment, and you can see how it might play well with an incumbent determined not to go beyond fibre-to-the-cabinet/node/local exchange. (Naming no names.) He also has more here regarding the maths of fibre deployment.
After all, this makes a lot of sense; one of the main reasons we need fibre is that it provides ample uplink, which is the real long pole in the tent when it comes to user generated content, peer-to-peer distribution, and the like. Meanwhile, how are the mighty fallen! Time was when Deutsche Telekom wouldn't hear of letting competitors use its planned VDSL network; they lobbied the government, they hammered on the doors of the Berlaymont, they groaned and held up the deployment. Now things are looking very different indeed. First they offered to move towards open access, and now they are asking other carriers to "help" get the fibre out there.
Nortel Networks may have made its name producing optical Ethernet kit, but things are pretty grim there. First they announced they were planning to sell the fibre unit; then someone presumably grabbed the CEO's lapels and yelled "What were you thinking, man?" Not only would it be hard to sell the division, but it's the best business Nortel has... Now they're reorganising (again) and cutting jobs (again). Ed Gubbins at Telephony Online tracks the thuds and screams filtering out of Nortel HQ and makes the sad and telling points that most of the execs who have just been fired were hired within the last two years, and they were all brought in from outside, whereas their replacements are all internal promotions. Among other things, Nortel is now planning to do without a CTO, which is somewhat worrying for a company founded entirely on T.
In other bad news, the Telco USSR has lost a Soyuz. Or rather, as Telephony Online's Kevin Fitchard reports, the Illinois Supreme Court has ordered Sprint to shut down its iDEN network in the state, the week after general secretary of the Sprint Party Dan Hesse sent fraternal greetings to the downtrodden toiling masses of Nextel and Motorola and announced a new party line, under which the iDEN system's unique voice & messaging capabilities would take a leading role in their global strategy.
The problem appears to be one of the myriad disputes between mainline Sprint-Nextel, as the airline business would call it, and its many, many regional affiliates. The merger with Nextel triggered reams of litigation with these companies, which mostly ended with Sprint forking out the greenmail to make them go away. But they still aren't all resolved; Sprint is like the USSR in many ways, and these territorial conflicts bubbling under the surface are just another. Sprint is left with the unenviable choice of selling a lone iDEN network (to whom?) or shuttering it and bulk-transferring the subscribers to mainline Sprint PCS, which will in all probability mean kissing a lot of them goodbye, and also put a Chicago-shaped hole in their iDEN coverage.
It's all been a bit grim so far; but then, it has been a grim week. Vodafone is trying to slash £1bn off its cost base and crank higher margins out of the subscribers; BT announced 10,000 layoffs, or 7% of its global work force. Profits fell 50% at Telefonica, although this was partly because last year's figure was inflated by one-off items.
So here's some positive news. ITV signs up with BT to put its content on the BT Vision IPTV system, which makes the telco the first UK IPTV operator to carry all the main TV networks' stuff. It sounds like the on-demand bandwidth system Aepona presented at Telco 2.0 is going to be getting some work...meanwhile, fans of integrated video distribution might want to check out the iPhone app that controls your Sky+ box, and Mobilkom's femtocell deployment.
Relatedly, the FT wonders if Hulu will "catch YouTube". But do their businesses really intersect? Hulu is essentially a re-implementation of traditional broadcast TV, streaming TV studios' and Hollywood's content base on the Web. YouTube is a UGC aggregator that acts as a traffic-generating flywheel for Google's ad brokering core business.
Whilst we're on the topic of video distribution, MediaFLO is expanding into more markets. Its parent, Qualcomm, however, is very proud of its netbook built on mobile phone chips, and seems to be planning a major contest with Intel in the netbook/MID market. (Personally, I prefer to think of them as "cheaputers".) Part of the reason they are so proud is probably that their 4G technology, CDMA 1xEV-DO Rev.C aka UMB, is being given the humane killer. After Verizon Wireless went LTE and Sprint went WiMAX, there wasn't much hope for it; this just confirms it. Speaking of WiMAX, the first GSM/WiMAX dual mode gadget is here, and it's going to a greenfield carrier in Russia.
The standards wars are over. I repeat, the standards wars are over.
So Qualcomm is going to have to make a go of applications and central processors, which means competing directly Intel and either competition or cooptition with ARM. For this they have a strategy. ARM and Qualcomm have been working with Adobe to make their AIR development environment run directly on their chips, while Qualcomm has launched an SDK for BREW developers working in Flash rather than C. This implies that Qualcomm and Adobe are about to become yet another mobile platform.
The mobile OS wars are well and truly on. As are the app store wars; they are the new deck, it says here. In fact, carriers ought to hope they are nothing like the deck, which is a failed business model; app stores, so far, look a much better idea than the handset portal obsession of the early 2000s. This hasn't stopped carriers paying search engines for...something.
Meanwhile, O2 UK and T-Mobile USA are latest carriers to get an app store and a developer ecosystem. Note that Adobe pops up here, too, pushing the idea of open access to app stores. They are certainly confident they are right.
Voice and messaging 2.0 - Facebook just got its own over-the-top messaging network, in addition to its existing integration with SMS. Rather like the WiMAX handset above, this is an example of delayed innovation in the developed world; MXit and QQ were doing this sort of SMS/GPRS price arbitrage to their carriers years ago in South Africa and China. But beware -- it's coming to you. Improve your core voice and messaging before someone else does.
Like Hutchison, who are bundling various social networks and other apps (including Facebook) in a new device made by a low-cost ODM in China...note that it's using BREW and Adobe Flash. It sounds almost as if someone had a plan...
Finally, Dean Bubley calls for a mob of phone users with torches and pitchforks to force sense on the vendors and carriers.