Friday, 31 August 2012

What I've been reading this week

I’m of the belief that participants in the TMT industry need to read widely in order to understand the present and future dynamics of the market. To that end, this post is a collection of the articles that have caught my eye.

This week: football on Youtube, Amazon gets romantic, Ryan & Ferguson have their facts check, cyber-attacks up 1000% and Harvard makes bionic skin

Digital media

Prismatic is worth downloading – it’s a learning news aggregator app that uses your social network behaviour to recommend stories. It’s quite good too. http://gigaom.com/2012/08/23/prismatic-wants-to-conquer-the-new-frontier-mobile-news/

There’ll now be a “best of world football” channel on Youtube, the latest in a long line of premium content to come to the service, which is fast becoming a cornerstone of online monetisation strategies for premium content. http://advanced-television.com/index.php/2012/08/28/love-football-channel-on-youtube/

10% of magazine adverts now contain an action code, be it QR or AR. The proportion carrying action codes has doubled in a year, suggesting that advertisers are finding increasing benefit in using the mass market appeal of traditional print to drive direct responses on the Internet. http://www.nellymoser.com/news/q2_action_code_study

College students are supposed to hate TV and love online... except it turns out that 42% say that TV adverts are the most effective type of advertising, massively outstripping the next nearest format. TV. Definitely dead. http://bncollegemarketing.com/press/barnes-noble-releases-2012-college-marketing-report

Amazon seems set on becoming a publisher and has now added 1,000 titles from defunct publisher Dorchester to the 3,500 titles they acquired from Avalon earlier this year. This is an interesting development as the relationship between Amazon and publishers has been somewhat strained over the rise of the Kindle. Having its own content is one way Amazon will seek to hedge the risk of a rift developing, although in truth 5,000 titles is fairly meaningless and the publishers need Amazon’s channel as much as Amazon needs them. http://paidcontent.org/2012/08/30/amazon-publishing-buys-1000-titles-from-defunct-dorchester/

I’m a big believer in the use of digital tools in the workplace to create culture and instigate pseudo-democratic decision making that enables a crowd of experts to prioritise initiatives. This Fast Company article looks into the movers and shakers. Interestingly, I’m bearish about Yammer – it falls between too many stools and is therefore largely useless as a business tool. http://www.fastcompany.com/3000552/can-corporate-culture-be-built-digital-tools

Following Paul Ryan’s rather inaccurate address at the Republican Convention and Niall Ferguson’s equally error strewn rant about Obama’s record, there has been a run on fact checking emails and more calls for open journalism. The issue for me is that there are very few facts in the world and very many potential interpretations based on the available data. Therefore anyone can find an inaccuracy or inconsistency if they look hard enough. I worry that the core messages are obscured by pedantry. Facts are less interesting than opinions. http://gigaom.com/2012/08/30/fact-checking-politics-why-we-need-open-journalism-more-than-ever/
http://www.theatlantic.com/business/archive/2012/08/a-full-fact-check-of-niall-fergusons-very-bad-argument-against-obama/261306/

Business models

Now this is a fascinating business model and – I think – the first of many media companies to offer connection + content. The Wall Street Journal are offering free hotspot access for subscribers to their digital edition at a number of New York locations. I can see this coming to London soon. http://paidcontent.org/2012/08/24/wall-street-journal-offers-free-wifi-in-nyc-and-san-francisco/

With a new Director General in place, I expect to see lots of rumours about the future of various BBC services. In-house production is one of its crown jewels and although I can see it becoming more commercial a la ITV Studios, I can’t see the corporation going fully competitive. We see. http://www.telegraph.co.uk/finance/newsbysector/mediatechnologyandtelecoms/9501911/BBC-may-axe-in-house-production-and-open-up-to-competition.html

I’m not sure whether this super-hi-tech Brazilian bank actually offers the experience it promises, but I’d actually be keen to visit it... unlike the drab, 80’s Lloyds branch round the corner from our office. Their computers have CRT monitors. Retro, and not in a good way. In seriousness, perhaps Metro Bank and Virgin Bank could go the Brazilian way in the UK. It would certainly shake things up and bring the online and offline banking worlds closer together. http://www.fastcompany.com/3000889/robot-greeters-cardless-atms-and-touchscreen-transactions-are-so-money-bank-future

Google have released another wonderful free resource – an index of global broadband pricing covering many countries and thousands of data points. Brilliant stuff. http://policybythenumbers.blogspot.nl/2012/08/international-broadband-pricing-study.html

Emerging markets

Emerging markets may now support more rich people, but security remains an issue. Fortunately Bentley have the answer in their new armoured range. I’ll have two... Fulham is a dangerous place! http://www.guardian.co.uk/business/2012/aug/27/bentley-armoured-car-market?newsfeed=true

Cyber security

I said at the start of the year that cyber attacks and data loss stories would increase in frequency, and here’s the supporting evidence. Data breaches up 1,000% in 5 years. The major culprits? Government and local authorities. What a surprise. http://www.theregister.co.uk/2012/08/30/data_breach_increase/

Technology

Harvard researchers have created an artificial skin that’s compatible with our own. A truly groundbreaking technology, even if restrictive medical regulations will mean a decade of approvals before it can be used. http://news.harvard.edu/gazette/story/2012/08/merging-the-biological-electronic/

And, in another feat of bionics, Australian medical researchers have created a fully integrated bionic eye that interfaces with the brain. Startling technology. http://www.telegraph.co.uk/science/science-video/9508875/Bionic-eye-allows-blind-woman-to-see.html

The term “post-PC” is mindless jingoism. In this link, Michael Dell points out that since it was coined, PC sales have tripled. He also says some other interesting things about the future of personal computing. http://www.citeworld.com/consumerization/20627/michael-dell-vmworld-consumerization

It looks like the iPhone 5 will have NFC. I don’t expect this to have many implications as the technology offers relatively limited customer benefit, but stranger things have happened. Perhaps we’ll all ditch our plastic cards next year. http://www.pocket-lint.com/news/47093/apple-iphone-5-nfc-chip-part-leaked

Tuesday, 28 August 2012

TV: Why?

September is a busy month in UK TV, with the Media Guardian Edinburgh International TV Festival in late August, followed in close order by IBC in Amsterdam and the RTS annual conference at the end of the month.

TV remains the most influential media in the UK and in large parts of the rest of the world, so it deserves special attention. With apologies for the small advertising pitch, since I've had a (small) hand in the reports that Deloitte prepares for these important events, I thought I'd provide links to them as they're released.

First up, our annual Edinburgh Festival report, which answers questions such as "why we whinge about what's on TV and keep on watching" and "why a trillion TV ads matter". It's based on ongoing primary research into audience preferences and is definitely worth a read if you make TV, advertise on it or just want to know why you watch and whether you're typical.

Download it here.

What I've been reading this week

I’m of the belief that participants in the TMT industry need to read widely in order to understand the present and future dynamics of the market. To that end, this post is a collection of the articles that have caught my eye.

This week: I’m sad for Facebook and Onlive, Sony move mobile, Samsung launch dozens of products but lose out to Apple and retro nukes over Vegas

Digital media

I feel sorry for Onlive – the cloud-based console – in that they have great technology but have hit the market too soon to make much of an impact. Now Sony and Gaikai are together the writing is rather on the wall. To the detriment of early investors, such as HTC. http://www.zdnet.com/htc-loses-40m-in-onlive-restructuring-7000002856/

I also feel sorry for Facebook. Their earlier swagger is really being knocked out of them post-IPO. Here’s an article slating their Android app. http://www.businessinsider.com/facebook-android-app-employees-2012-8

2/3 of the top grossing mobile applications are free to download, generating their revenues through in-app purchases. Classic freemium and worth noting, particularly for all those content owners who’d like to monetise their archives with idevice products. http://www.businessinsider.com/chart-of-the-day-in-app-purchasing-is-driving-mobile-app-revenue-2012-8

Another story about smartphones as health and wellness devices. This will start to really take off in 2013, in my opinion. http://www.fastcodesign.com/1670506/heart-monitor-iphone-app-works-by-scanning-the-blood-in-your-face

Nook, the Kindle-aping Barnes and Noble ereader that has been so successful in the US is coming to the UK. Personally I’m doubtful it will be a big hit here. B&N have a great and popular retail estate in the US to sell it through, but the only option in the UK – Waterstones – are Kindle sellers and I’d be surprised if major electrical retailers would want to be exclusive to Nook. http://www.wired.co.uk/news/archive/2012-08/21/nook-in-the-uk

You’ll have to sign up for this report on trends in ad buying for luxury brands, but it’s probably worth it. The summary is that traditional ad spending on TV is switching to online video. My take on this is that luxury brands – like many of their customers – are pretty conservative consumers of media and therefore the shift in spending to digital has been delayed. http://www.martinimediainc.com/luxurystudy/

Technology

Sony Mobile are closing their Swedish headquarters and moving to the centre of excellence in mobile phone design. No wait, they’re actually moving to Tokyo to get closer to global handset success stories such as Sharp, NEC and Panasonic. Oh dear. http://thenextweb.com/asia/2012/08/23/sony-mobile-cut-1000-jobs-globally-move-headquarters-japan-restructuring-move/

Opera – the other mobile browser, once linked with Facebook (remember them?) – posted another round of strong quarterlies. It seems that contrary to my original belief there is some money in non-ecosystem browsers for semi-smart devices. http://techcrunch.com/2012/08/22/opera-q2-mobile-browse/

Samsung’s Galaxy Note 10.1 has just been released. Here’s an early review. It’s okay, but since it’s the same price as an iPad, you’d have to be certifiable to actually buy one with your own money. In my opinion. http://arstechnica.com/gadgets/2012/08/samsung-galaxy-note-10-1-hands-on-a-solid-tablet-with-big-shoes-to-fill/

Still, I have to question Samsung’s general product strategy. They’ve just launched a 5.8” tablet/ media player. Just in case the 5.5” Galaxy note or the 7” Galaxy Tab weren’t quite the right size. I’m sure it doesn’t cost too much more to make these extra formats, but it’s pretty confusing for buyers. http://www.slashgear.com/samsung-galaxy-player-5-8-ramps-ipod-rivalry-to-5-8-inches-27243954/

Business models

A talk by the founder of Whipcar, a UK service that lets people rent cars off each other. His talk is on collaborative consumption and really is rather good. http://mediaevolution.23video.com/video/6909179/vinay-gupta-access-over

Emerging markets

Africa’s top selling mobile handsets. Nokia still prominent... http://www.itnewsafrica.com/2012/08/africas-top-selling-mobile-handsets/

A great summary article on el-Reg about how the cybercrime industry in China has industrialised fraud to an unprecedented level, using public facing sites for communications and dropping into defined “value chain” roles. Very interesting. http://www.theregister.co.uk/2012/08/18/baidu_tencent_used_by_chinese_cyber_crims/

It seems that the cold war is starting up again, although this time the “iron curtain” is somewhere in the South China Sea. China is developing a new series of intercontinental missiles designed to penetrate US defences. The US is responding by reigniting missile defence programmes. In this light, the UK Strategic Defence Review looks short sighted. We live in dangerous times. http://online.wsj.com/article/SB10000872396390444812704577605591629039400.html

Snappify is the largest distributor of mobile content in emerging markets. An early example of African tech innovation taking on the world. http://www.itnewsafrica.com/2012/08/african-app-start-up-makes-global-impact/

A slightly unfortunate story for Orange – their cable laying ship “Chamarel” is aground and on fire off Namibia, where it was enroute to fix the SAT-3 cable. http://www.odin.tc/news/read.asp?articleID=1183

Superpower politics

Apple is now the most valuable company ever, but there’s more to come. I expect its valuation to have hit a trillion dollars by the end of 2015. http://www.telegraph.co.uk/technology/apple/9488458/Apple-the-most-valuable-company.html

Apple has also – very publicly – given Samsung a slapping over patent infringement. I have to admit that I’m siding with the former on this one. Samsung’s early designs are clearly iPhone-aping... their latest ones look more like HTCs. I await that lawsuit with interest. http://www.bbc.co.uk/news/technology-19377261

Despite their protests (and a rather pyrrhic victory in a Korean court) Samsung’s share price plummeted. Just shows the influence of the tech superpowers – cross them if you dare! http://edition.cnn.com/2012/08/27/business/south-korea-apple-samsung/index.html

Just for fun

Crazy how attitudes of changed. In the 1950’s it was accepted that atomic bombs could be detonated with gay abandon, even this close to major population centres. http://www.retronaut.co/2012/08/las-vegas-mushroom-cloud-1953/


Friday, 24 August 2012

How much did 3 pay for EE's spectrum?

Plenty has been written about Everything Everywhere selling 30MHz of 1,800Mhz spectrum to the UK's smallest operator 3 (including this, which is really good). Much of the aforementioned text is a bit sensationalist or misinformed, so I thought I'd summarise what's gone on and also attempt to answer the one thing that hasn't been covered: the price.

In summary:
  • Everything Everywhere (the result of the merger between Orange and T-Mobile in the UK, for those of you who haven't been keeping up :) ) were forced by the EU to sell a proportion of their collected spectrum in order that the market remained "fair"
  • The spectrum is at 1,800MHz ("1800") and was originally used for carrying 2G mobile signals
  • Although that frequency can be used for LTE, it isn't often. The more common bands are 800 and 2600, although others - including 2100 and 1800 - are sometimes used
  • In any case, the spectrum won't be fully released to 3 until September 2015, long after the long awaited "digital dividend" auctions have come and gone
  • Everything Everywhere have also obtained permission from Ofcom to deploy an LTE network on some of their remaining 1800 spectrum
  • LTE is roughly 4 times faster than the fastest 3G broadband and therefore theoretically enables operators using it to outcompete those who don't have it
  • Although EE's competitors are furious about this, in reality its effect on the market should be somewhat limited by device availability. 1800 is not supported by the only LTE device sold in the UK - the iPad HD - and it may not be supported by the next iPhone, the international varient of which is more likely to have 700, 800 & 2600 compatibility
  • That said, there are some LTE handsets - most notably the Samsung Galaxy S2 - that do support this type of LTE and there are also modem ("dongle") products available that would bring high speed wireless data to users acquiring one
  • Coverage could be quite reasonable to start with, since Huawei have been upgrading Everything Everywhere's 2G basestations to give them HSUPA (3G) and in future, LTE capability
  • In my mind there is a radio planning question that remains to be played out, in that the most valuable spectrum for LTE is at 800. This is because lower frequencies give better coverage due to their lower propensity to be attenuated by objects in the environment. 800 is worth about 4 times 1800 on a per-MHz basis
  • Anyone planning an LTE network would therefore be better off planning for 800, which won't necessarily create the best 1800 network
  • Ultimately, the effect on the UK market of both the EE LTE launch and 3 acquiring extra spectrum will be very small. In reality, getting 1800 outside of an auction enables 3 to obtain a lower price than they may have got in a competitive process for 2600 spectrum. They will still need 800 to be genuinely competitive
All this brings me to the sticky issue of price. Based on my international benchmark for spectrum price, I estimate that a "fair" price for 30MHz of 1800 would be £200Mn - £250Mn.

But I think 3 might have paid less than this. Firstly, the sale was effectively uncompetitive - no other operator could buy the spectrum because Vodafone and O2 are already too close to the limits on the amount they can own. Secondly, 2600, which is the more common high-frequency LTE frequency is worth about half as much as 1800 in an auction. As mentioned about, 1800 is also not a common LTE frequency. Thirdly, I understand that 3 are very happy with the price they paid - sounds like it was low.

So I'm going to revise my estimate down to £175Mn - £200Mn. Cheap, but not significant. I still expect 3 to be consolidated by another player soon after the auctions complete.

Wednesday, 22 August 2012

The screen size conundrum

It seems that the new iPhone is getting a larger screen - a bump in size from 3.7" to 4" to bring it a little closer to the mammoth devices being launched by Samsung, HTC et al. 4.8" is the norm for these manufacturers at the pinnacles of their phone ranges.

If the rumour mill is to be believed, then Apple will also launch a 7" version of the iPad to address an untapped market in (a) poorer people (!), (b) commuters & other mobile users.

So what I wonder is whether we've reached an apogee in phone screen size. As one of my colleagues likes to point out, you'd need giant hands to find a 4.8" screen device comfortable to use. And the benefits for media consumption are marginal when judged relative to even a 7" tablet.


Part of the reason why I'm more convinced than ever about 7" tablets is that people are becoming more comfortable with the benefits of the tablet for consumption (as opposed to creation). But the 10" tablet is still that bit too big, fragile and expensive to carry around. 7" is probably just right for reading books, digital newspapers or watching the odd TV episode. At £100-£150, they're also almost an expendable item.

If larger numbers of people start owning portable tablets (I think we could get to 35% - 40% penetration in the UK by 2015), then I question the need to have an expensive, cumbersome, large screen phone. I don't expect feature regression - browsing, email, IM and so on are now core functions - however I wonder whether screen size will regress to around 4" to 2015, with 5-6" being a small tablet format, rather than a super-size phone.

If that happens, I'll be interested to see what Samsung do to remain competitive, given that to date they've seemingly focused on a TV-style "more for the money" approach.

Incidentally, I also reckon there's a market for domestic 12" or 13" tablets to cater for the coffee table market. If I'm right and tablets are supplanting small TV sets for use in the kitchen or bedroom then that screen size would make sense provided weight could be controlled.

Tuesday, 21 August 2012

Online versus TV - still one sided

Comscore just released their latest numbers for European Internet usage. Two things stood out for me. First, the UK has maintained its position as the most online and the most engaged European country.

Despite the size of the base, the UK is also one of the fastest growing markets in terms of engagement. Of major developed countries only Sweden had a faster growth in engagement (14% YoY growth plays 9%); Russia and eastern European countries continue to grow strongly but from a very low base of online engagement.

The average online audience member in the UK now spends one and a quarter hours a day online, which brings me to my second point. Although viewing fell very slightly this year (pre-Olympics, it must be said), live TV occupies an average of 4 hours and 1 minute a day of everyone's time. And 90% of this content was consumed live, despite more than 50% of the population now owning a DVR.

So live TV, the medium that has been "dying" since the late '80's/ '90's/ 2000's (pick an inflection point) still dominates media consumption, even in the most advanced market in Europe.

My advice: don't put too much into that online media startup just yet...

Monday, 20 August 2012

What I've been reading this week

A short update this week as the weather’s been nice and the news slow! I’m of the belief that participants in the TMT industry need to read widely in order to understand the present and future dynamics of the market. To that end, this post is a collection of the articles that have caught my eye.

This week: place-based media is the new mobile/ social/ online media, Pearson University, 3D printed arms and the rise of the global Muslim consumer

Digital media

Wow! Three Youview boxes are on sale. Three different opportunities to have 2007’s vision for the future of TV in your living room. I’m sure people will be queuing round the block. http://decipherconsultancy.wordpress.com/2012/08/15/youview-boxes-are-like-london-buses/

Digital “place-based” media is the new mobile advertising is the new social media advertising... lots of agencies will persuade lots of clients to try it out. Then they’ll forget the whole thing and go back to broadcast. For branding, at least. http://www.dp-aa.org/newspress.php?newsid=156

This is a study about voters in the US, but what’s really interesting is the second paragraph, where the researchers state that live TV has marginally increased its share of TV viewing – 58% of US consumers say it’s their primary source of content vs. 57% in May 2011. Cord cutting. Another myth. http://www.marketingcharts.com/television/live-tv-viewing-holds-its-ground-among-likely-voters-22979/

New business models

Micro and community investment are flavour of the month. Now the porn barons have got in on the act, with a crowd funding service called Offbeatr. Whatever floats your (investment) boat, I suppose... http://www.techdigest.tv/2012/08/introducing_off.html

I’m surprised that more businesses haven’t gotten into this yet – Pearson have launched their own “university”, which aims to hand out degrees to 40 students a year. Given the parlous state of the (former) polytechnics’ education standards and the extreme cost of getting a degree in modern Britain, it probably makes sense for large employers to find a way to incent great graduates to join them and ensure their quality. http://www.bbc.co.uk/news/education-19245788

The rise of the global Muslim consumer, as forecasted (accurately, I suspect) by the BBC. My only add on to this is that some of the big London department stores are apparently set up for Chinese consumers, yet I’d imagine the UK gets many more Muslim visitors and has a substantial Muslim population. Targeting them with tailored offers seems to make good economic as well as social sense. http://www.bbc.co.uk/news/magazine-19295861

Technology

We’re on the cusp of smart devices being the centre of people’s health and wellness regime. At the moment the cost of entry is several hundred dollars for a Nike Fuelband or equivalent, but applications like cardiio, which uses a smart phone camera to measure pulse rate could well start to reduce barriers to entry. Now there just has to be demand. I worry whether people would rather not know about their fitness and activity than take simple steps to understand them and get fitter. http://techcrunch.com/2012/08/09/cardiio/

Tablet prices are dropping... hardly surprising news is it? I can’t think of many (any) technology products that haven’t exhibited this behaviour as they’ve gone mass market. Still, I expect by 2015 there’ll be 15m or more in UK homes (versus c.8m today). The effects won’t be revolutionary, but expect a downward pressure on small TV set sales and increasing size of share of ebooks and magazines versus print. http://www.businessinsider.com/chart-of-the-day-tablet-prices-2012-8

This is a great story – 3D printing used to create bionics for a child who can’t move her arms. It’s coming of age, I tell you . http://www.fastcodesign.com/1670482/3-d-printed-magic-arms-let-a-toddler-hug-and-play

NASA’s Curiosity rover has been getting all the headlines, but it’s predecessor – Opportunity – is still rolling around the Red Planet. http://www.latimes.com/news/science/la-sci-mars-rover-overshadowed-20120820,0,2746910.story

As electronic controls and actuators get ever smaller (thanks mobile phones!), new concepts can be developed in other areas. For example, this gym clothing incorporates haptic technology to tell you when you’re not executing your Yoga moves correctly. Not an application that I need, but still neat! http://www.electricfoxy.com/move/index.html

Monday, 13 August 2012

What I've been reading this week

I’m of the belief that participants in the TMT industry need to read widely in order to understand the present and future dynamics of the market. To that end, this post is a collection of the articles that have caught my eye.

This week: Russian maps Internet, games provide refuge, eBay delivers, BYOD turns nasty and Apple Fancies pinterest competitor

Digital media

Blippar is getting more mainstream. Following a tie up with London’s Stylist magazine, the company managed to persuade 7% of readers to augment the magazine content using the application. They do need to be more integrated to really succeed, however. http://www.mobile-ent.biz/news/read/seven-per-cent-of-stylist-readers-use-blippar-to-animate-mag

A new magazine for self-publishers launched last week. Ironically, it isn’t self-published, but seeing as the US s-p market was $20-$30Mn last year, it should tap into a growing based of aspiring, amateur writers. http://www.inpublishing.co.uk/news/articles/launch_ebook_world_imag.aspx

It wouldn’t be digital media news without a bit of bad news for Facebook, so here it is. An Australian court has ruled that Facebook brand pages are adverts and therefore governed by advertising standards. Another complexity for marketers to get around and another barrier to Facebook becoming an advertising powerhouse. http://www.businessinsider.com/court-ruling-could-chill-growth-of-facebooks-brand-pages-2012-8

“How to be a tech’ entrepreneur without knowing how to code”. How this cr@p is still being put out, I do not know. Worth a read for the comedy value alone. http://www.women2.com/how-to-be-a-tech-entrepreneur-without-knowing-how-to-program/

A marvellous article that explores the cues that make video games addictive. http://www.bitcreature.com/criticism/an-industry-of-refuge/

Business models

I sort of feel sorry for HMV shareholders, in that they’ve had totally the wrong management team in place for the last three years and has thereby turned a difficult situation into an irretrievable one. I stand by my previous thoughts on the issue – as clothing retailers have done, HMV need to remember how to merchandise and how to create a retail experience. Racks of semi-functional headphones ain’t that. http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/9455154/HMVs-finance-director-David-Wolffe-follows-chief-Simon-Fox-out-the-door.html

Google’s new London office opened its doors the other day. Looking inside, it’s easy to mock – as the article does – the expensive and unusual fittings, but that’s missing the point. Exciting, interesting office layouts are more stimulating for people to work in and doubtless help creativity. Mainstream corporations should take note. http://www.digitaltrends.com/lifestyle/new-google-london-office/photo/3/

eBay is testing a same-day delivery model in San Francisco. I can see this kind of model becoming common place as logistics systems become more enabled with mobile, GPS and distributed computing. I’ll have that DVD now, thanks, HMV. Oh... wait... http://allthingsd.com/20120805/ebay-quietly-tests-local-same-day-shipping-service-in-san-francisco/

Square is a really neat technology that allows any smartphone user to process credit card payments by using a small attachment. From later this year 7,000 US Starbuck restaurants will be using the technology to take payments from customers. What interests me most about this is that it might hasten the deployment of new payment concepts like contactless cards, which currently take time to deploy because of the replacement cycle for terminals. We shall see. http://techcrunch.com/2012/08/07/square-partnershi/

A superbly written article about the demise of 38 Studios, a state backed games developer in Rhode Island, which collapsed taking $75Mn of tax payer money with it. An interesting study in the psychology of corporate failure in the second dotcom boom. http://www.bostonmagazine.com/articles/2012/07/38-studios-end-game/print/

I debated whether to put this in, but have erred on the side of sharing. App.net claims to be the social sharing service that Twitter should have been. API driven and independent of advertisers it could enable information sharing unencumbered by news feeds and wall posts... except that the business model doesn’t stack up. No one would pay $50 a year for Twitter. http://www.wired.co.uk/news/archive/2012-08/08/appnet-connect-with-people

BYOD (bring your own device) is one of the buzzwords of 2012 tech’. This article shows the chaos that follows uninformed Managers’ decision to implement it. One company bought 14,000 tablets without any clear strategy. I’ve heard another one about an organisation that bought 1,000 Kobo ereaders, likewise, with no idea what to do with them. Paperweights? http://www.citeworld.com/consumerization/20599/consumerization-chaos-wrong-way-implement-mobile-strategy

Technology

This is a fun infographic that plots likely times at which new technologies will emerge. I’m sure it’s totally wrong, but it is entertaining, nonetheless. http://envisioningtech.com/envisioningtech.pdf

An article claiming that tablets will replace the smartphone. I think this is wrong, in that I don’t imagine phones will lose their current functionality. What I do think is that the current expansion in phone screen sizes will cease and then reverse as 7” tablets become more mainstream. There’s also the wonderous possibility of heads up display in the very near future, which renders screen size a somewhat moot point. http://gigaom.com/mobile/heres-why-tablets-yes-tablets-will-replace-the-smartphone/

Old news, but I just stumbled upon it. Back in February scientists at the University of New South Wales made a single atom transistor. One could see this as either the continuation or the end of Moore’s Law, but don’t get too excited – I’d suggest we’re 15 years away from seeing similar technology in even the mightiest of super-computers. http://www.sciencedaily.com/releases/2012/02/120219191244.htm

Until then, we’ll need to keep engineering for speed. This short and accessible article talks about the underpinnings of HTTP 2.0, which should start to speed up the web by introducing parallelism to previously serial processes. http://techcrunch.com/2012/08/06/http-20-spdy-and-friendly/

Voice over LTE is finally here. No surprises that South Korea (or “Good Korea” as my other half refers to them) are leading the way. Don’t expect to see it in the UK anytime soon – the standard for it is not yet ratified. http://www.rethink-wireless.com/2012/08/07/korea-worlds-volte-services.htm

Twheel is worth a download – it visualises Twitter data into a very mod circular format. Fun and informative. http://twheelapp.com/

And on the subject of virtualisation, here’s a giant map of the Internet. Cool. http://internet-map.net/

Emerging markets

A fascinating piece on the nature of information security in Africa. Everything will be hacked, so deal with it! http://blogs.hbr.org/cs/2012/08/corporate_information_security.html

Superpower politics

Interesting. Apple is supposedly considering a move for Pinterest competitor The Fancy. If so, this would mark their first step into mainstream retail enablement... or alternatively it’s a neat rumour that will drive increased sign up rates for The Fancy! http://www.appleinsider.com/articles/12/08/04/apple_reportedly_in_talks_to_buy_pinterest_competitor_the_fancy.html

Google’s well documented (tee hee) book scanning programme was aimed at keeping web searchers away from Amazon, it transpires. Smart. http://paidcontent.org/2012/08/06/google-records-show-book-scanning-was-aimed-at-amazon/

Wednesday, 8 August 2012

July 2012 Africa Investment Map - Welcome to the North

Despite the fact that half of the investor community are on vacation, July was a good month for African telecoms, with $2.5Bn of new infrastructure investments announced.

Two things stand out. Firstly, the reawakening of the north African telecoms sector in the wake of the Arab Spring. As stability returns to the major markets, investment is coming with it. In July, Vodafone committed $50Mn to core network upgrades in Egypt. In Algeria, Mobilis will invest $1.7Bn over five years to upgrade and extend their mobile network.

North Africa led investment in the continent up to the point that the revolutions started in early 2011. If they are to maintain competitiveness and exploit their geographic location then more investment will be required to enable ICT development and economic growth. I expect further big announcements before the year is out.

The second characteristic of July was the large volume of spats and court cases that broke in the month. In Swaziland, MTN demanded $100Mn from the incumbent telco in recompense for a failed mobile operation. In Zimbabwe, Econet claims to be owed $85Mn of interconnect fees by Telone and Netone. In Tanzania, Vodacom's local MD launched a scathing attack on the government over the cost of spectrum and the poor quality of national power and transport infrastructure.

With all the money in African telecoms and the comparative underdevelopment of governmental and civil systems, the reasons for repeated fallings out are obvious. But they can't be allowed to impede progress. Governments in particular need to understand the need to create a stable platform for their ICT infrastructure to develop on. If they don't, then their ability to compete with other developed and emerging nations will be ever-stiffled.

To that end, I'll end on positive news. This month, MTN in Nigeria signed a contract with Ericsson to deploy the continent's first all-IP cellular network core; a technology that will enable a new generation of services to be provided to citizens of the continent's most populous country.

Aside: later this month I hope to release my first telecoms investment map for Latin America, a market that is logically comparable but compellingly different to Africa. We shall see whether that task survives contact with my day job!

Tuesday, 7 August 2012

Chile's 4G spectrum goes quietly... and cheaply

In all the excitement about Ofcom's announcements regarding the UK's digital dividend auction, the mainstream press missed the latest country to auction off its spectral assets.

Although its only the continent's 6th most populous country, Chile is interesting as it is the most stable and prosperous large country in Latin America and therefore hints at the future direction of other markets on the continent. The results of their regulator, Subtel's auction for 2,600MHz spectrum, suitable for the high bandwidth component of LTE were released on July 31st.

Three operators acquired the spectrum: Claro - a subsidiary of America Movil, local telco Entel and Movistar, a subsidiary of Telefonica.

What interests me most is the low price this spectrum went for. Entel paid the most for their block - $8.84Mn - but even this is a sixth of the global average price for this spectrum in terms of MHz per capita. Market leader, Claro, paid only five percent of the average for their block.

As far as I can see, the reason for this was the lack of alternative bidders for the spectrum. The three winners were the only three bidders. Subtel will hope that this and the aggressive license terms - 98% population coverage in 2 years - will lead to economic benefits. They will also hope for a larger windfall from their more valuable digital divident spectrum at 800MHz.

Even so, the lesson for Ofcom here is that competition for licenses remains the best way of ensuring a good return on the assets. 4 bidders for 4 licenses is not the best outcome for the UK.

Saturday, 4 August 2012

What I've been reading this week

I’m of the belief that participants in the TMT industry need to read widely in order to understand the present and future dynamics of the market. To that end, this post is a collection of the articles that have caught my eye.

This week: opening ceremony boosts iPlayer, Twitter tries TV, Timeout goes free, Web goes federated and Google exposes Lords of War

Digital media

The estimable Mister Walk makes a good point. In switching their efforts from experience design to revenue model design Facebook and potentially now Twitter stand to lose their “cool brand” status. It’s very easy for users to walk away. I do requests... http://www.hunterwalk.com/2012/07/the-8-billion-elephant-in-room-how-to.html

Red Box is the US DVD loans company that was mainly responsible for the demise of Blockbuster. I take their continued growth as a sign that consumers often are more interested in convenience than format when it comes to incidental entertainment. Netflix beware. http://paidcontent.org/2012/07/26/kiosks-keep-rolling-redbox-reports-26-q2-revenue-increase/

Danny Boyle’s Olympic opening ceremony was spectacular. It also set a new record for iPlayer live streaming, with 1.7Mn people catching up last weekend. What we don’t know is how many of those were watching for a second time because they enjoyed the first so much. Me, I recorded it on Sky+ for later enjoyment. http://www.guardian.co.uk/media/2012/jul/30/olympics-opening-ceremony-views-iplayer

Twitter are following many other technology companies and are trying to become a media one by launching their own TV programming. Twitter is a great companion for TV content, but I doubt they have the budget or the reach to make money out of this venture. http://www.telegraph.co.uk/technology/twitter/9428914/Twitter-turns-TV-station.html

Timeout’s circulation has nose dived as free and cheap applications and widespread mobile Internet have hit London’s streets. I will follow their progress as a free sheet with interest. My concern is that it’s hard for a premium brand to sustain if the core product is free. http://paidcontent.org/2012/08/02/while-publishers-levy-digital-fees-time-out-goes-free-on-london-streets/

Artillery is a very well backed start up that intends to disrupt the traditional native games market on smart devices, PCs and consoles by enabling true browser-based gaming using HTML 5. Good luck to them – I think coding for specific hardware is always going to be faster, but what do I know? http://techcrunch.com/2012/08/03/html5-centric-artillery-raises-2-5m-to-make-the-browser-the-console

Newswhip Spike launched this week. It’s kind of a Flipboard for breaking news stories, aimed at journalists and could represent a great tool in the never ending battle for breaking news. Note that this is not digital disruption, this is digital enablement of news. No need to be afraid, journos! http://newswhip.com/Spike

Technology

This is a brilliant example of the use of data analytics. Google have created an interactive visualisation in the global trafficking of weapons. Disturbing to see its density and extent. http://workshop.chromeexperiments.com/projects/armsglobe/

Talk of a federated web is becoming more mainstream. This nicely research blog post at Techcrunch summarises why and how its developing. http://techcrunch.com/2012/08/03/the-federated-web-should-be-easier-than-it-sounds/

Emerging markets

As regular readers will know, I’m very sceptical about the Chinese economy. Here’s an FT story that shows why I might be right. They’re slowing – and that’s despite fiddling the numbers! http://www.ft.com/cms/s/0/55373578-d576-11e1-b306-00144feabdc0.html?ftcamp=published_links%2Frss%2Fcompanies_telecoms%2Ffeed%2F%2Fproduct&ftcamp=crm/email/2012730/nbe/Telecoms/product#axzz225hSqT5N

Still, the Chinese technology market continues to accelerate. They’re soon to launch their first genuinely premium brand Android handset, through start up Xiaomi. One to watch. http://thenextweb.com/asia/2012/08/04/xiaomi-chinas-rising-star-confirms-hotly-anticipated-new-smartphone-launching-august-16/

An article about how climate change would benefit crop producers in Tanzania. Tanzania is a beautiful country – perhaps I’ll end up living there! http://www.futurity.org/earth-environment/climate-woes-may-boost-tanzania-trade/

Responsive design is very a la mode in digital at the moment. Basically it just means tailoring a website to the device its being shown on in a clever way. This won’t, as the blog points out, work in Africa because the handsets in circulation don’t support the requisite technologies. A subtle, but important point if you’re designing worldwide products. http://blog.motribe.com/2012/07/31/why-responsive-design-is-a-poor-mobile-strategy-for-africa/

Apple struggles in emerging markets, says the FT. No sh*t, say I! Apple, if you talk to them, will tell you that they don’t care a jot if the mass market never gets their products. They like premium pricing. Look what being good in India and China did for Nokia... http://www.ft.com/cms/s/2/4072e1aa-d7d3-11e1-80a8-00144feabdc0.html#axzz22aHgDx7B

Superpower politics

Amazon’s problem is that it lacks a money-spinning primary business that’ll throw off enough cash to fund global expansion and multi-dimensional competition. Their US rivals have them here. http://paidcontent.org/2012/07/26/amazon-disappoints-investors-with-second-quarter-earnings-report/