Telecom Timeout

A blog

June 30, 2011  12:53 PM

Did another opportunity for location-based services just whiz by mobile operators?

Posted by: Jessica Scarpati
femtocells, location-based services, next-generation business models, next-generation services, service delivery, small cells, wifi, wireless services

A column in today’s Boston Globe highlights a new mobile app and service, Shopkick, which rewards consumers with points (or “kicks”) for entering, browsing or making purchases at retail stores that partner with Shopkick Inc. Consumers can eventually trade in their points for gift cards, movie tickets, designer jeans and even HDTVs.

Boston Globe tech guru Hiawatha Bray explains:

“One of Shopkick’s coolest features is based on some delightfully geeky technology. Drop in at Best Buy with the Shopkick app running on your phone. Walk through the door and wait for a few seconds. With a happy little jingle, the phone informs you that you’ve gotten 60 kicks just for crossing the threshold.

GPS signals usually won’t penetrate buildings, so how does it know where you are? Shopkick has persuaded Best Buy and other merchants to install a network of small speakers that broadcast high-frequency sound, the kind that’s too high-pitched for human ears. I don’t know whether dogs can hear it, but the microphone in a smartphone can pick it up. The sound tells the Shopkick app that you’re inside the local Best Buy, and so you get your reward. You can collect kicks this way once a day, so Shopkick gives users a reason for return visits.”

Shopkick, which is backed by Citigroup, is making deals left and right with not just big box retailers such as Target, Macy’s and Best Buy. But they’re also now offering free installation of their boxes to smaller local merchants, according to GigaOM.

No word on exactly how lucrative these deals with retailers are, but at the risk of sounding obnoxious: We told you so.

As we reported earlier this year, carriers could be delivering–and profiting from–these same kinds of location-based services using WiFi and small cells alongside partnerships with retailers and shopping mall owners.

Next-generation services are nothing without next-generation business models. What’s the hold up, telecom?

June 21, 2011  9:08 AM

Will anyone want NFC mobile wallet services besides teenage mallrats?

Posted by: Jessica Scarpati
google wallet, mobile wallet, NFC, wireless services

Contactless mobile wallet services based on near-field communications (NFC) has taken off in two types of geographies:

  • Densely-populated markets in Asia, such as Seoul and Tokyo, which benefit from seeing quick ROIs simply due to the sheer volume of transactions.
  • Emerging countries throughout Africa and the Middle East where wired infrastructure is scant, so it makes more sense for carriers to enable subscribers to use their smartphones to buy something at a fruit stand in the middle of nowhere than it does to trench fiber out there.

By contrast, service providers in North America have been much more skittish about launching NFC mobile wallet services. The big question mark has been less around the technology itself and more about how to monetize NFC mobile wallet services.

But there’s another unknown that North American carriers must confront: What’s the actual demand?

Well, according to one consumer survey, it’s not pretty.

Continued »

May 18, 2011  10:14 PM

AT&T to manage chaos on the horizon – if conditions are right

Posted by: KateGerwig
AT&T, cloud computing, FCC, LTE, T-Mobile, wireless broadband

AT&T Chairman and CEO Randall Stephenson was selling managed chaos theory in Dallas Wednesday in his keynote speech at the TIA’s “Inside the Network” conference. His kind of chaos theory has nothing to do with applied mathematics, unless it’s projecting wireless data growth in the next five years. And the numbers are big.

His message was that service providers won’t have time for traditional long-term planning and carefully controlled rollouts in the brave new world. So he advocated for the role of managed chaos provider. To back up the predictions, Stephenson cited 8,000% wireless growth since 2007 when the iPhone hit AT&T’s network. His conservative estimate of data traffic growth by 2015 is eight to 10 times what it is now.

To get to managed chaos, Stephenson linked a chain reaction of LTE network deployment to high-def video to tablet adoption to the cloud to cloud storage and finally to new services delivered to anyone just about anywhere. What’s coming at the industry in the next five years will be a different phenomenon than it has ever seen before, Stephenson said. “The next five years are not going to be planned and deliberate. The next five years will be characterized by chaos.”

So when it comes to handling this growth and the need for innovation, Stephenson’s message to the vendor and service provider audience was that he needs more spectrum now, and he needs a tax policy that offers the right incentives for investment in the AT&T and hopefully in the T-Mobile wireless networks, and oh, he needs an AT&T-friendly regulatory environment too.

Not that there’s anything wrong with that. He was among friends asking the equipment vendors for help, because if the chaos gets too chaotic, the whole telecom ecosystem will fail together – or something to that effect. And besides, many of those equipment vendors are extremely effective lobbyists when it comes to a having a Washington agenda. This is a time for friends.

Stephenson is pleased that Obama administration (along with the FCC) has identified more wireless broadband spectrum to be released in the future, but indicated that it would be much better if the future were now. With more spectrum, AT&T could better encourage innovation and work with developers who will come up with those unplanned services we can’t imagine yet.

AT&T has already pledged to invest billions in its broadband networks, but Stephenson is willing to throw another $8 billion into LTE networks if it acquires T-Mobile’s spectrum and licenses. It’s a simple request, really. All he needs is a little cooperation.

And so Stephenson laid his wireless “city on a hill” message at the telecom industry’s feet. “I think time will show that when we have large amounts of spectrum and an environment conducive to investment, every facet of the ecosystem will drive the demand for bandwidth in a 10 to 15-year cycle of investment. That’s what we’re in for if we get this environment right.”

We’re all in it together, right?

April 20, 2011  12:59 PM

Wi-Fi/femtocell mobile network offload now a legit operator move, study shows

Posted by: KateGerwig
femtocells, Infonetics Research, Juniper Research, mobile backhaul, mobile network offload, Wi-Fi

Only a year ago, mobile network offload solautions were pretty much considered the last resort of a wireless operator that couldn’t manage its bandwidth. Now using Wi-Fi and femtocells for mobile network offload is legit, acccording to a new study by UK-based Juniper Research. Juniper projects that by 2015, 63% of traffic generated by smartphones, tablets and other mobile devices will be offloaded to fixed networks via Wi-Fi and femtocells.

In terms of great big numbers, Juniper report author Nitin Bhas estimates that the annual mobile data traffic offloaded to operators’ fixed networks using Wi-Fi and femtocells will reach almost 9,000 petabytes by 2015, which is more or less equivalent to 11 billion movie downloads (give or take a million here or there). The total mobile data traffic generated by mobile devices is estimated to exceed 14,000 petabytes by 2015.

Wi-Fi currently accounts for more than 98% of offloaded traffic, but Juniper expects femtocell deployment to increase, particularly in NOrth America (which we’re sure makes the Femto Forum happy). Still, Juniper believes Wi-Fi traffic will account for almost 90% of total offloaded data.

Offload technologies will work largely because a high percentage of mobile data consumption occurs while indoors or in a fixed location like a home or or at a hotspot. The report suggests that operators look at offloading solutions as being complementary to their 3G/4G network investments to extend their reach and increase revenues.

In terms of a different kind of offload, Infonetics Research recently released a study that says IP and Ethernet connections will increasingly be deployed to lower the cost of mobile backhaul from cell towers to fixed networks. To that point, 89% of the money spent on mobile backhaul equipment last year was for IP/Ethernet gear.

Infonetics says that almost 1.5 billion mobile subscribers and 1.6 billion mobile broadband subscribers will be added by 2015, growth that will require more base stations, more cell site connections, higher backhaul capacity and new equipment for each cell site connection.

No point looking for the half-empty side in this slice of the market. Maybe take a moment to enjoy.

April 4, 2011  4:22 PM

What’s up with Google’s $900M dash for Nortel’s patents?

Posted by: Jessica Scarpati
google, Nortel, patents, telecom business issues

Just when you thought the buzzards had stopped circling around what’s left of Nortel’s remains, the bankrupt data networking and communications giant announced Monday that Google placed a “stalking horse” bid of $900 million for intellectual property rights to about 6,000 of Nortel’s patents.

Google’s top lawyer claims that Google made the bid for Nortel because it wants its corporate frenemies to stop suing it:

“Some of these lawsuits have been filed by people or companies that have never actually created anything; others are motivated by a desire to block competing products or profit from the success of a rival’s new technology,” wrote Google General Counsel Kent Walker in a blog post today. “But as things stand today, one of a company’s best defenses against this kind of litigation is (ironically) to have a formidable patent portfolio.”

Bloomberg News reminds us of some of the context:

Oracle filed a patent and copyright infringement lawsuit against Google last year over its mobile Android software, citing technology gained from the acquisition of Sun Microsystems Inc. Apple Inc. (AAPL) filed a complaint with the U.S. International Trade Commission last year against HTC Corp. (2498) for alleged patent infringement with its Android-based phones.’

Stalking horse indicates that this is the first of what will probably be many bids for Nortel’s treasure trove of patents, which BetaNews says includes everything “from integral 4G wireless technology to semiconductors, to search and social networking.” The blogosphere has suggested that Google will be up against Apple, Nokia, Huawei, ZTE and potentially even Microsoft.

What’s going on here? Is this just an expensive legal safety cushion for Android and Chrome development? Is it somehow related to Google’s fiber broadband project (for which Kansas City was just announced the first city for deployment)? Or does Google actually intend to start selling data networking gear? The latter is hard to imagine for a number of reasons–not least of which being its embarrassing Nexus One flop.

Chime in with your conspiracy theory in the comments section below or send us an email.

March 31, 2011  10:30 AM

BlackBerry PlayBook build up: 7-inch tablet targets ‘corridor warriors’

Posted by: KateGerwig
BlackBerry, enterprise IT, iPad, tablet devices, tablets

I’m not sure enterprise “corridor warriors” are going to camp outside Best Buy with their Herman Millers to get the first BlackBerry PlayBooks when they go on sale on April 19 — this isn’t a new iPad launch, after all. But the PlayBook tablet buzz is in full swing, and the critiques are piling up. And wireless operators selling them need to be clear on why the PlayBook might appeal to the enteprise buyer beyond traditional BlackBerry IT acceptance.

In short, the PlayBook will definitely not make your BlackBerry smartphone obsolete; you’ll need it for native email, calendar and contacts until a future software update extends those capabilities to the larger PlayBook. That’s vexing to many reviewers, even though the evolving smart device market indicates that having one device for everything is a concept that has gone by the wayside.

But for its particular business-oriented audience, it appears that RIM definitely got the size of the PlayBook right. If the PlayBook is to be used as a business tool (in addition to a personal entertainment device while not on the job), size definitely matters.

Enterprise uses for tablets are just beginning to develop, and will no doubt proliferate in the coming months. According to recent surveys, it is the form factor of the 7-inch PlayBook, not the 9.7-inch iPad, that appears to be perfect for tucking into a coat pocket, back pocket or some other kind of pocket.

Seven-inch tablets are for “corridor warriors,” which, as I understand, are roaming office workers without the wheels of a road warrior. CIMI President Tom Nolle, whom we have already deemed a mobile behaviorist when it comes to tablet use, says these corridor warrior types roam hallways, not highways.

According to Nolle’s enterprise surveys, collaborative processes slow if corridor warriors aren’t routinely at their desks. “It’s not a good assumption that people in the same office can get together, so a 7-inch tablet would give a worker the ability to read and approve a document,” he said.

But tablets may work best for people who are “approvers” rather than “producers,” because approvers have to look at documents, but not necessarily type in a lot of information. Soon we’ll see how the corridor wars play out with enterprise IT PlayBook support.

March 21, 2011  11:35 AM

AT&T prepares to buy T-Mobile for $39 billion, awkward marketing moments ensue

Posted by: Jessica Scarpati
4G, AT&T, M&A, mergers & acquisitions, T-Mobile, wireless broadband

It’ll be hard for any vendor or carrier at CTIA Wireless this week to trump the bombshell that AT&T and T-Mobile USA dropped on Sunday — that the No. 1 wireless carrier in the U.S. is acquiring the No. 4 carrier for $39 billion.

It seems that few industry pundits saw this coming, as much of the chatter over the past two weeks has been about a possible merger between T-Mobile and Sprint. But that oft-rumored relationship reportedly stalled over how much Sprint was willing to pay for T-Mobile, which was most likely between $15 and $20 billion, according to Bloomberg News. AT&T has at least doubled that with its bid. Roger Etner over at FierceWireless also raises an interesting point — that this was the merger hiding in plain sight, seeing as AT&T and T-Mobile share more technology genetics than Sprint and T-Mobile.

The deal sets up AT&T to add 46.5 million more subscribers to its existing 247.5 million. The two networks would make coverage available to 95% of the entire U.S. population, according to AT&T. Whew.

What about those digs T-Mobile has been aggressively taking at AT&T in its marketing for HSPA+? Particularly those highlighting its ability to do video conferencing over 4G (well, T-Mobile’s definition of 4G).

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OK, fine. This probably isn’t as serious of an issue as what regulatory hurdles this deal may bump into, what it means for T-Mobile customers and the implications for Sprint’s future. But that first board meeting? Awwwkward.

February 4, 2011  4:26 PM

What George Clooney and telecom security have in common

Posted by: Jessica Scarpati
ddos, managed services, Security, Telecom, telecom security

A hacker is no longer just a grungy guy in his mom’s basement who takes down websites to impress his friends. Cybercrime has become more like Ocean’s Eleven — organized, sophisticated and money-hungry crooks going after high-profile targets. They probably don’t all look like George Clooney and Brad Pitt, however, so be on the lookout for more than dashing good looks.

[kml_flashembed movie="" width="425" height="350" wmode="transparent" /]

These thugs aren’t so much after you as they are your customers. But because carriers operate data centers for managed hosting, cloud or other managed IT services, service providers are once again caught in the crossfire.

Continued »

January 31, 2011  9:00 AM

Are you planning your cloud Database as a Service strategy?

Posted by: KateGerwig

So much has been written about cloud technology, cloud servers, cloud hosting, cloud services, cloud architecture, cloud storage, cloud yoga, clouds on ice. But how much do we hear about cloud databases? Not enough. Yes, Amazon and Rackspace offer cloud database services, and some other cloud providers are jumping into the Database as a Service arena, but it’s a complicated business that takes most providers out of their comfort zones.

It’s time to change that, people, because what do cloud applications need to keep paying customers happy? That’s right…data. And data lives where? That’s right…in databases. Beyond the mundane trivialities like “applications need data,” something else will ignite cloud provider interest in DBMS capabilities and Database as a Service — they’re likely to become cloud differentiators this year as the cloud falls to earth and gets real.

No matter what kind of cloud service you’re offering now or plan to offer, you’re going to need a well-considered database strategy. And because we’re here merely to serve, our featured article this week is on growing your cloud services by planning your database strategy No no. You don’t have to thank us; we’re just trying to help.

January 28, 2011  12:58 PM

What Verizon’s acquisiton of Terremark says about its cloud strategy

Posted by: Jessica Scarpati
cloud, cloud computing, M&A, Verizon

I used to have an editor that often made this crackpot comparison of the news industry to dairy farming. People always need milk, he said. They could either buy the cows themselves, raise them, feed them and milk them every morning — which took more time and money but usually delivered a better product — or they could swing by 7-Eleven and pick up a half-gallon for a fraction of the time, energy and price (and quality, most likely). No matter how they got it, people needed milk. He felt this way about print and online journalism. I’m not sure the metaphor translated perfectly, but his point was that although our method of delivery might change, news would always be in demand.

I think Verizon just showed today that it’s going to 7-Eleven.

With the announcement of its pending acquisition of Terremark Worldwide Inc, a global managed IT service and cloud provider, Verizon signaled that its cloud strategy will be focused more on building services on top of the cloud than wasting time and money on building clouds themselves.

Verizon COO Lowell McAdam indicated as much on a conference call with analysts Friday morning, as reported by Steven Russolillo of Dow Jones Newswires:

Verizon said it sees a tremendous growth opportunity in Latin America, particularly in Brazil where Terremark already has a strong presence.

“This is a classic make or buy decision,” McAdam said. “By the time you build data centers and then outfit them… it takes time. And to be honest, that’s not our core competency,” which led to Verizon’s decision to pursue Terremark.

SearchTelecom site editor Kate Gerwig and I recently spoke with Verizon about its cloud strategy for 2011 (though now I wish we had waited a week). Patrick Verhoeven, manager of cloud services at Verizon Business, emphasized Verizon’s two decades of experience in the data center — but not from an infrastructure perspective. Telecom operators will differentiate and succeed in the cloud by adding value on top it, through products such as Verizon’s application and security management services, Verhoeven told us.

“Unlike some of the other pure-play cloud service providers out there, like Amazon and others, we view cloud as a means to an end. The end game is not cloud,” he said. “We own the network. We have one of the most robust security practices in the industry,  and now we have one of the most robust IT practices…. That’s what’s unique about the telcos.”

As we recently reported, telecom outsourcing for cloud infrastructure may also make sense for some operators, depending on whether their needs are greater in build-out or day-to-day management. But I think at least for now, the market’s eye is on which cloud provider is next to be gobbled up in, as Forbes’ Eric Savitz puts it, telecom’s data center feeding frenzy.

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