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Showing posts from June, 2008

C Titles Prefer Web

According to an online study from Forbes.com and Gartner, the Internet continues to be the most influential and important source of business information for C-Level executives around the world, at 67%.

This number has increased 37% since 2004. At the same time, C-Level executives, citing newspapers such as the Wall Street Journal as their main source of business information, has decreased 36% since 2004.

The number of C-Level executives who prefer the Internet first thing in the morning has increased 22% since 2004, while those who prefer to read the newspaper first thing in the morning has declined 11% over the same time  period, the survey suggests.

HTTP is the Long Term Issue, Not P2P

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Though it is peer to peer traffic that currently has network engineers concerned, HTTP traffic rapidly is surpassing P2P in volume, driven by the amount of video being viewed in a Web context.

Open Road for Open Source

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Open source now is mainstream in the enterprise environment and in the Web environment. So it is not too surprising that open source now is emerging in a big way in the mobile market.

It isn't simply Android or Linux. It also with a couple years will include Symbian.

If one is looking for innovation, the mobile market is among the best places to watch. No devices or experiences are as customizable as mobiles are. No devices get replaced quite so often. No devices are so well adapted to applications that are "always on."

A Dramatic Change in Core Functionality

What is the core value of enterprise application? What is the core value for any PC application used by consumers? In times past, one might have answered "productivity" for an enterprise. In the consumer space, entertainment probably rivals productivity.And though those might still be the right answers going forward, there's something new afoot. How are productivity and entertainment realized?
Increasingly by use of social and communications mechanisms, ranging from email, messaging, downloads, uploads, managed and hosted services, cloud computing and social networking.
Software increasingly works because it is connected to other software and other people. In some real sense, even when productivity or entertainment is the "value," value is realized only in the form of communications and connected computing.As Bill Gates steps from history's computing stage, that's the observation that occurs. Bill Gates deserves thanks for personifying the "PC era.&q…

Why People Miss 30-50% of Calls

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According to studies sponsored by Nokia, people who carry their mobile in their pockets sometimes or always miss 30 percent of inbound calls.

People who carry mobiles in their handbags sometimes or always miss half of all their inbound calls. That's reason enough for mobile providers and device manufacturers to investigate other ways of distributing the inbound call function.

It's hard enough to connect with a person when busy and unavailable to speak immediately. It's even harder now that so much voice traffic has shifted to mobile methods. Now, even when a person is available, calls are missed simply because the "alert" function has failed.

Some of us try to get around this problem by putting devices into "vibrate" mode. That works well enough until the phone is out of the pocket and sitting on a desk someplace. Then we forget that there won't be an audible tone--and we miss calls that way.

Three Screen Ads: Heat More than Light

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At least some tier one service providers have high hopes for advertising spend based on targeting techniques and availability on three screens (TV, PC, mobile).

You see huge numbers around online ad spending, mobile ad spending or targeted ad spending. Nobody knows what will happen, except that share will continue to shift from existing media to online and mobile.

It doesn't seem so clear to me that new ad revenues will be transforming for either cable or telco providers, though.

Cable has been at the ad game for quite some time, and the overwhelming amount of money made by ca cable operators comes from recurring services.

In fact, cable modem and voice services already surpass total ad revenues. As a new revenue stream, it's important, to be sure.

The issue is how significant targeted advertising can be, when location and other attributes are easy to assimilate as part of the placement decision. If history provides any guidance, the answer will be "far less than you think.&qu…

Cable TV Model for Some Parts of the Content Ecosystem

"An unconstrained profit-maximizing platform charges a positive fee to the other side of the market if and only if content providers value additional consumers higher than consumers value additional content providers."

In other words, platform and service providers have opportunity to earn revenue from content partners when new, emergine or highly-focused content partners want expedited carriage, placement or promotion on platform portals.

It's the same sort of thing the cable industry long has had as a business practice. Popular networks get paid, low-viewership networks often must pay to get carriage (shelf space). In a service provider context, the analogy is that promotion, targeting, location, billing and other features and services can be so useful a content partner might be willing to pay to obtain them.

If, on the other hand customers highly value a particular content provider, a rational platform simply will make sure the popular provider is well supported, and wil…

IP-Based VPNs to Surpass Frame Relay, ATM in 2009

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2009 should be the year the installed base of IP-based virtual private networks surpasses the installed base of frame relay and asynchronous transfer mode sites, Vertical Systems Group forecasts suggest.

The shift has been going on for years, but a crossover point would be significant, as it will be when the installed base of IP phone systems surpasses that of digital systems.

Adoption of the ascendant technology gets a boost when vendors begin to slow and end development of legacy applications and gear.

Sprint Wins with Instinct

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Sprint Nextel Corp. has broken company sales records with its new Samsung Instinct, leading to temporary shortages of the touch-screen phone in some stores, the company says. Despite placing what it calls the largest-ever initial order for a 3G handset, Sprint still underestimated demand, apparently.

E-mail access, Internet browsing, GPS navigation tools, interactive maps and one-touch click-to-call access have met "extremely heavy use," the company says.

The phone costs $129.99 with a two-year contract and a $100 mail-in rebate. The obvious observation: iPhone has had a transforming impact on handset design.

Intel Sees "No Compelling Case" for Vista

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New York Times staff reporter Steve Lohr says Intel has decided against upgrading the computers of its own 80,000 employees to Microsoft’s Vista operating system “This isn’t a matter of dissing Microsoft, but Intel information technology staff just found no compelling case for adopting Vista,” an Intel source says.To be sure, large enterprises have all sorts of applications that might have to be upgraded or modified when making a major operating system change. Consumers don't generally have those problems.
Still, it's a bit striking when a major Microsoft partner makes a decision like that. Chipmakers like it when new operating systems and apps require lots more powerful processors and lots more memory. Except when it's their money, apparently.

ICANN Changes Domain Name Scheme

The Internet Corporation for Assigned Names and Numbers has voted unanimously to relax rules "top-level" domain names, such as .com or .uk. by 2009.

The decision means that companies could turn brands into Web addresses, while individuals could use their names.

Domain names written in scripts, such as Asian and Arabic, also were approved.

At the moment, top-level domains are limited to individual countries, such as .uk (UK) or .it (Italy), as well as to commerce, .com, and to institutional organisations, such as .net, or .org.
BBC infographic showing domain name sales

Under the new plans, domain names can be based on any string of letters. Individuals will be able to register a domain based on their own name, for example, as long as they can show a "business plan and technical capacity".

Companies will be able to secure domain names based on their intellectual property, such as individual brand names.

Broadband "Over-supply" Problem

Cox Communications is doubling the download speed of its most popular residential Internet service (Preferred) in Northern Virginia and increasing the speed of its Premier service by thirty-three percent.

PowerBoost, which supplies temporary "burst" bandwidth for uploads, also has been added to the Preferred and Premier packages. PowerBoost for downloads has been available since 2007. This is the fifth consecutive year that Cox has enhanced the speed of its Internet services in northern Virginia (credit Verizon's FiOS service for that).

Verizon has boosted FiOS downstream speeds to 50 Mbps, with 20 Mbps upstream, for its top package, available everywhere FiOS is sold.

Cox customers will get the speed increases automatically in July, without need for a call or technician visit.

The PowerBoost feature means uses of the Preferred package will experience speeds up to 12.5 Mbps down/2.5 Mbps up. Premier customers can achieve 25 Mbps down/3.5 Mbps up.

Policy advocates often compla…

Compute Remotely, Assemble Locally

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There's an obvious relationship between cloud computing, "over the top" applications, open networks, open devices, importance of application program interfaces.

The ability to compute, store data and execute code remotely means it is more affordable than ever for small developers and individuals to create applications that are immediately available to users anywhere. The existence of those applications "on the Web" makes the Web a more-powerful platform for bringing applications of any sort to market. That puts business pressure on walled garden business models of all sorts.

The existence of cloud computing also means software is becoming unbundled from hardware to a large extent. Not completely unbundled; not unbundled for every application or service. In fact, some apps require tight integration to execute with the greatest elegance. But the direction is more in the direction of how people use PCs than how they consume cable television.

The application explosion…

Where is the Network API?

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At the recent "Rethinking Communications" conference, several panelists commented about the difficulty of creating anything like an application program interface to "the network." APIs are a common way to hide the details of any application or function from software developers. The idea is to compartmentalize functions enough that a developer doesn't have to know how everything works; only what is necessary to invoke some function or operation, or add some function.

Right now the problem is that the "network" is full of subsystems that aren't actually unified enough to present a single API to any third party developer. IP Multimedia Subsystem will help, and right now Session Initiation Protocol comes as close as anything to being an API, though the analogy is rough.

The other issue: programmers, almost by nature, will stress test the limits of any network demarcation a network wishes to expose. "Give them an inch; they'll take a mile,"…

Cox Ups Speed in Phoenix

Cox Communications is bumping up the speeds of its cable modem service in Phoenix. For customers with Cox's Preferred service, downloads will move from 7 Mbps per second to 9 Mbps, with upload speeds increasing from 512 kilobytes per second to 768 kbps.

For the Premier service, customers will get 15 Mbps with burst of up to 20 Mbps for download speeds with uploads starting at 1.5 Mbps and capable of bursts up to 2 Mbps.

The additional speed comes at no additional cost. Qwest Communications is upping its digital subscriber line service to 12 Mbps for its lower-cost service and 20 Mbps for its higher-cost service.

Still, there are some who argue the United States is "falling behind" other nations, suffering from inadequate supply, high prices, slow speeds, or all of the above. One can argue about that.

One cannot argue the problem is not being addressed. Speeds keep climbing, for the same amount of money, everyplace telcos and cable compete with each other.

iPod Still Top Seller, Store Personnel Report

In a recent Tickermine survey of stores selling MP3 players in June 2008, including Best Buy, Radio Shack and Circuit City, the iPod emerged as the best-selling MP3 player by 82 percent of those polled.

Microsoft's Zune 80 GB was said to be best selling by 12 percent of respondents.The SanDisk Sansa Clip 2GB was said to be the best seller by six percent of respondents.

Some 62 percent of respondents say a dedicated music player is a better choice than a music-capble phyone, but 38 percent reported they preferred music-capable mobile phones because it means one less item in your pocket to contend with.

Dell to Become a Managed Service Provider

Dell plans to launch a managed services initiative aimed at allowing channel partners and Dell itself to remotely maintain and troubleshoot small business networks, servers and desktops. Two recent Dell acquisitions -- Everdream and Silverback Technologies -- will provide the foundation for Dell's SaaS push, says Joe Panettieri is Editorial Director of Nine Lives Media.

The managed services push is supposed to happen late in 2008 or early in 2009. Dell intends to become a Master Managed Service Provider (Master MSP), which means IT consulting firms will be able to leverage Dell's own network operation centers (NOCs) to manage customer networks.

When even hardware manufacturers become service providers, how long can service providers wait to become data specialists, to a greater or lesser degree?

Android Phone from T-Mobile: 4th Quarter

When you finally can buy an Android phone, it first will be available from T-Mobile, in all likelihood. T-Mobile is said to want a device to sell in the fourth quarter.

T-Mobile Offers $10 a Month VoIP

T-Mobile @ Home is a new nationally available over-the-top consumer VoIP service pricied at $10 a month. There isn't much of a catch, aside from the fact that the service only is available to T-Mobile wireless customers on plans costing $40 a month or more.

It isn't so much that T-Mobile wants to be in the over-the-top VoIP business. It is that it needs something jazzy to keep its mobile customers loyal. The company hopes $10 a month home phone service is that sort of thing.

The new service is different from the Hotspot @ Home offering T-Mobile also has been testing. That is a dual-mode mobile service that allows some mobile phone models to connect to an in-home Wi-Fi router.

The real effort here is to insulate T-Mobile from churn. After all, it can't offer the iPhone or 3G service yet.

Charter Backs Away From Targeted Ads

Nothing in the targeted ad business is easy. Witness Charter Communications, which has backed off a plan to insert advertisements onto user Web pages because of objections from privacy advocates.

There's always something waiting to disrupt an Internet or communications business plan.

Twitter gets Jeff Bezos Investment

Valleywag says Twitter, has received an investment from Amazon founder and CEO Jeff Bezos as well as Bijan Sabet of Spark Capital. Did I run over120 characters?

IT Seen as Boring

More than 60 percent of college graduates with degrees in areas other than information technology think a job in IT would be "boring," despite its good career prospects, according to the Career Development Organisation, and reported by ComputerWeekly.com.

Of course, other organizations have issues of that sort, even within the software and computer science graduate pool. If one is a bright, ambitious programmer, would such a person prefer to work at a company like Google or a device manufacturer or network equipment firm? I think we can figure that one out without taking a survey.


Virgin Mobile to Acquire Helio, Says Financial Times

Virgin Mobile USA will acquire Helio, the mobile phone operation controlled by SK Telecom and originally launched as a joint venture between SK Telecom and Earthlink. What both brands have in common is a positioning in the "hipper" segment of the youth market, as well as struggling businesses.

Virgin Mobile has more than five million prepaid customers. Helio had a bit fewer than 200,000 postpaid customers at the beginning of 2008.

Mobility, just like wired voice and data, is a scale game. What the industry is seeing is consolidation in just about every segment of the market, in large part to achieve scale. In the global international voice business, margins keep dropping, forcing carriers to sell lots more volume to make up for skinnier margins.

Over time, even the largest global carriers will find they either must bulk up or outsource those operations to carriers that can achieve huge scale.

Android Learns What Others Have

According to Wall Street Journal reporters Jessica Vascellaro and Amol Sharma, the Android development effort is proving more protracted than originally expected. Nokia and other executives at mobile device firms using competing operating systems had suggested this would be the case.Google executives also indicate that custom applications some of the participaing mobile providers want to provide also are taking more time than expected, the Wall Street Journal reporters say.
Sprint, for example, wants its own branded services based on Android. Given the other issues Sprint is tackling, it isn't so surprising that development is taking longer than expected.Sprint is now considering scrapping plans for an Android phone for its current third-generation broadband network and developing one that will work on the faster "4G" network it is helping to fund along with several partners, including Google, the reporters say.To be fair, lots of other talented, well-endowed technology f…

Nokia Buys Symbian

One of the themes at the Voice Peering Forum meeting has been the absolutely central role applications now play in the whole communications business. So now comes word that mobile device giant Nokia will acquire the 52 percent of mobile software specialist Symbian that it does not already own.

As identified with Nokia and Symbian is, there are no strategic shifts here. Nokia simply owns outright its operating system. What is more important is what companion moves suggest.

Nokia and a number of other electronics makers are forming the Symbian Foundation to drive the development of Web applications for use by consumers on cell phones. Again, note the trend: application development fostered by handset manufacturers, matching the application development communications service providers know they also must foster.

The foundation plans to provide a unified platform that has a common user interface framework and that will be available for all foundation members under a royalty-free license, Nok…

Access, IP Transit: Where's the Rub?

So we've been kicking around lots of issues around telecom industry transformation at the Voice Peering Forum June 23 and 24, 2008. An attendee from Telecom New Zealand pointed out something interesting."In the U.S. market, contestants seem to spend a lot of time fighting over rights to use or lease the access network," he said. "That's not where the rub is, which is in IP transit."That might strike you as an incongruous statement. After all, isn't long-haul a fairly easy thing to build? Isn't there lots of fiber?Well, yes, there's a substantial amount of fiber, even though lots of it might not be in the right places, or lots of it concentrated inside the same cable sheaths, on the same routes. But there's another issue, not related to fiber but to IP transit costs. If a service provider owns its own facilities, there is not much of a problem on that score. No matter how much Internet bandwidth is required, the incremental cost of supplying …

Consumer Video Drives 1/2 of Bandwidth by 2012

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If Cisco is correct, and bandwidth keeps growing about 50 to 60 percent a year, and consumers keep adding video behaviors, then the easy extrapolation is that half of global bandwidth will be used for consumer video apps of one sort or another by 2012.

The challenge for wide area network and access providers is that video provides very-low revenue per bit, compared to any other service.

Lots more bandwidth, provided very economically, is going to be the business challenge.

Video on Every Display Surface?

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There isn't much doubt that video is going to drive the next wave of global bandwidth consumption. There are bigger questions about the business models underneath all that video, however.

Forrester Research analyst James L. McQuivey, for example, envisages consumers being confronted with “a dozen video platforms per day,” according to Seeking Alpha. But there's more to it than that.

Forrester thinks video will become so compelling that enterprises will “broadcast” video continuously from inside the enterprise. Companies have to have a strategy for communicating every message--internal or external--using video.

“Once video becomes this easy to produce, deliver, store, and share, every agent in society will not only want to participate but will have to participate in order to have a shot at reaching people with its products and services,” McQuivey contends.

Every video surface will become a marketing platform, he predicts. When nearly every surface in your environment can display vi…

Business FMC Still a No-No?

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Major mobile service providers--in general--seem to remain cautious about fixed-mobile convergence for business customers, mostly because of continuing uncertainty about the business model impact.In fact, many mobile executives continue to believe they stand to lose more revenue than gain if they get aggressive about allowing mobile handsets to communicate using fixed broadband facilities, say researchers at In-State."This is clearly the case in the United States, with the exception of T-Mobile, which has primarily been focused on the consumer market," says David Lemelin, In-Stat analyst.
In-Stat estimates that 20 percent of businesses with Wi-Fi use it to make voice calls, which is one reason mobile providers cannot be sure business users would not simply shift former mobile traffic back to the wired network if it is possible to do so. Most executives would agree that adding FMC can be a marketplace differentiator. Clearly T-Mobile hopes it will be. But there seem to be mo…

Do Browsers Matter? Revisiting an Old Thesis

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It has been quite some time since anybody seriously thought "control of the browser leads to control of the customer." But mobility and Web-based applications--especially on mobile devices--might be developing in a new way. In some cases, the browser could be the path to delivering applications to "locked" devices.

Consider the iPhone and Android and LiMo devices. The iPhone is now a true software platform with a rapidly growing installed base. But it isn't an "open" platform. There are things a developer cannot do, and users cannot access, for that reason.

As it turns out, though, the browser is the way around such closed or controlled environments. Web browsers from firms such as Mozilla and Opera obviously want to be available on every device, for example. And the browser, in a mobile environment, can create a different user interface and application experience.

Mozilla’s recently introduced Firefox 3.0 differs significantly in form and function from …

Jaduka: Measurable Progress in Voice Mashup Business

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Jaduka Voice Services, which provides Web-based voice services in mash-up mode, has surpassed four million minutes a month of end-user volume. That includes voice conferencing; Web-initiated phone calling; automated voice alerts and notifications; broadcast messaging; and VoIP-based PC-to-phone services.

That may not seem like much, but that's fair volume for voice mash-up applications with a commercial model.

Separately, Jaduka's transaction services initiative supports creation of 28 million new user accounts a day, processing of 300 million database queries a day, and processing 1,285 account transactions per second.

Additionally, Jaduka is interconnected with major global Point of Sale Activation (POSA) networks with connections to over 506,000 retail locations. If you are thinking stored value cards, you have it right.

Peering Potrential

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In principle, most international voice traffic is amenable to interconnection using some type of neutral peering federation.

The reason is that it is expensive and time-consuming to negotiate separate bilateral interconnection agreements with the ever-growing number of carriers.

If all one wanted to do was pass traffic back and forth between mobile networks, a company might have to negotiate more than 300 separate agreements.

The advantage peering federations provide is a simpler, faster way to create those business and technology agreements by joining a federated interconnection provider's community, much as Internet service providers peer with each other.

In principle, much interconnection now handled by bilateral agreements could shift, not to mention wholesale traffic, which generally isn't exchanged using a bilateral agreement because the cost of doing so is prohibitive.

Win Some, Lose Some for AT&T, Verizon, Qwest

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Verizon grew consumer average revenue per unit by 9.6 percent during the quarter; AT&T grew ARPU 5.4 percent and Qwest grew ARPU 7.8 percent.

But there were gains and losses: video and fiber-based broadband were bright spots. Voice lines were not.

The former RBOCs added 2.3 million RGUs during the first quarter, helped by wireless.

During the first quarter of 2008, AT&T, Verizon and Qwest also lost lost 2.237 million access lines, though. So far, the tier-one telcos basically continue to trade market share with cable, gaining on the wireless front but not keeping up in wired services.

The quarter was by no means a disaster. But neither have the former RBOCs yet stabilized the market share battle on the wired services front.

33% Broadband Penetration at 10 Mbps = Half of Global Electricity

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If a third of global citizens ever do wind up with some form of broadband access running at 10 Mbps, and current core network technology does not change, about half of all global electricity supplies will be consumed just for the transport and access of that bandwidth.

Obviously this doesn't scale. Among the solutions is use of more photonic techniques in the core and access networks.

Executives at ADVA Optical Networking argue it is better to use layer 2 rather than layer 3, and optical transport instead of layer 2, where possible.

High-density routers and switches in data centers also will help. In the access network, optical rather than electrical technology is preferable, especially passive optical networks.

What Video Does to Bandwidth Demand

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When Facebook added video streaming features, there was a sharp spike in bandwidth consumed by Facebook users. That's one reason Cisco is so confident about its expectations for continued growth of global IP traffic. Video is coming, and video drives lots of bandwidth consumption.

There also seems to be a high degree of consensus that IP bandwidth demand is growing between 50 and 60 percent overall. Access and wide area network operators are reporting annual growth of about that amount on a fairly wide basis.

Downhill Slide for Yahoo?

Things seem to be going from bad to worse at Yahoo. First the controversial spurning of Microsoft's acquisition offer. And now news of major executive departures. The list includes Jeff Weiner, EVP, SVP Vish Makhijani and Brad Garlinghouse, SVP.

Some 50 top Yahoo executives have left the company since January 2007.

Observers and its own executives seem to have lost confidence in Yahoo top management, to say the least.

Cox, Qwest Ranked Highest for Data Communications Services

Cox Communications ranks highest in data service satisfaction among small and medium business customers while Qwest Communications ranks highest among large enterprise business customers in the same category.

Cox Communications leads the small and mid-size business segment, performing particularly well in five of six factors: performance and reliability; sales representatives/account executives; billing; cost of service; and customer service. Verizon follows Cox Communications in the segment rankings.

In the large enterprise business segment, Qwest ranks highest in customer satisfaction, receiving highest ratings from customers in five of six factors: performance and reliability; sales representatives/account executive; billing; cost of service; and offerings and promotions. Verizon also follows Qwest in the segment rankings.

Firefox 3 is Available, Seems Faster

The FireFox 3 beta does seem to execute faster, which is what Mozilla promises. Still some incompatibilities with apps such as Google Gears and Google Browser Sync, though. That's what happens in beta.

Mozilla says eight million copies have been downloaded in 24 hours. Mozilla also seems to be up past 12.5 million downloads in just a bit less than 24 hours.

Heavy Enterprise Web, Video Collaboration

In the UK, nine out of 10 large companies are using some form of virtual collaboration solution to enhance the quality of their communications, both within and beyond thebusinessn say researchers at Vanson Bourne .

Nearly two thirds have incorporated an element of video or Web collaboration, in addition to audio conferencing.

The survey of UK manufacturing and service businesses also found 90 percent of businesses employing 1,000 or more people have adopted a conferencing/collaboration tool as part of their communications strategy.

For businesses with 3,000 or more employees, 96 percent have done so. About 74 percent use integrated multimedia conferencing tools to some degree, with only 26 percent exclusively using audio conferencing solutions.

This pattern is especially strong in manufacturing businesses, with 81 percent of respondents using multimedia tools.

Companies are also using virtual collaboration tools more frequently. Some 29 percent of respondents are using conferencing …

New Role for In-Home Networks

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“By 2012, over 33 million U.S. households will have connections of 10 Mbps or more," says Parks Associates analyst Kurt Scherf. Broadband penetration exceeds 50 percent of homes.

And with household digital camera penetration at 67 percent, MP3 player penetration at 41 percent, PC penetration at 80 percent and mobile penetration at 87 percent, a new environment is being created where in-home and wide-area networks have new opportunities.

“No product is sold in isolation anymore,” Scherf says. “A device connects to a network, which brings content and applications to the consumer both in and outside the home."

Opportunity exists as well for technical support services for the digital home, which will be a $1 billion market by 2011,” Scherf forecasts.

As of 2007, 50 percent of U.S. Internet households were watching short video clips online, and 25 percent were downloading short video files. DVR household penetration reached over 40 percent of the U.S. online population in 2007, furth…

Just Say "No" to Associated Press

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The Associated Press wants to charge you $12.50 to quote five words from news stories published by the news agency. Michael Arrington says TechCrunch simply won't link to, or quote AP.
Of course, you can go their Web site and pay them. On this score, I agree with Michael. Just say "no." I prefer Reuters in any case.

PhoneGnome Virtual PBX Launched

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PhoneGnome has introduced a new “PhoneGnome for Business” product with a “virtual receptionist” feature, allowing PhoneGnome boxes to be used by small and medium business or other small organizations.

The service works with or without the PhoneGnome box, an appliance-based way to integrate IP telephony with standard telephone service.

However, when the virtual attendant function is used in conjunction with remote users also equipped with a PhoneGnome box, any existing telephony number with the Virtual Receptionist, used as a company’s main number, gets free inbound minutes.

"If you set up each virtual location with the box, all inter-office calls and transfers will be 100 percent free - even if those locations are oceans apart," says David Beckemeyer, PhoneGnome CEO.

"And what’s nice about the PhoneGnome approach is you don’t have to be a SIP or VOIP expert to set it up," says Beckemeyer. "The box self-configures when you connect it, doesn’t need a computer, and …

AP Screws Up

AP seems not to get it. Michael Arrington at TechCrunch is so incensed about what many of us consider dumb policies that TechCrunch now refuses to link to or even quote Associated Press.

AP apparently hassled the Drudge Report (also not a smart move) for linking to their stories along with short quotations via reader submissions.

Drudge Retort is doing nothing different than what Digg, TechMeme, Mixx and dozens of other sites do. AP does not want people quoting their stories, despite the fact that such activity very clearly falls within the fair use exception to copyright law. They claim that the activity is an infringement.A.P. vice president Jim Kennedy says they will issue guidelines telling bloggers what is acceptable and what isn’t, over and above what the law says is acceptable. They will “attempt to define clear standards as to how much of its articles and broadcasts bloggers and Web sites can excerpt without infringing on The A.P.’s copyright.”Those that disregard the guidel…

AT&T Launches More U-verse Markets with VoIP

AT&T has launched U-verse--with VoIP--in portions of the Columbus and Cleveland, Ohio and Reno, Nev. markets. The voice is priced about the same as cable digital voice.

Unlimited VoIP costs $40 monthly. A separate plan offering 1000 minutes of talk time costs $30.

The moves mean the competitive landscape is changing: AT&T finally is making a push into VoIP, for example. Up to this point it has been the cable companies that have profited most from VoIP in the U.S. market.

$1.54 3G iPhone to be Sold

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Deutsche Telekom's T-Mobile will sell Apple Inc's new iPhone for as little as 1 euro ($1.54) for the 8-gigabyte version together with a 69 euro monthly contract.

And you thought a 3G iPhone for $199 was a great deal.

More Handset Subsidies Because of New iPhone Pricing

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Among the likely ramifications of the new 3G iPhone pricing are competitive responses from other carriers.

Wireless service providers are likely to increase their own mobile handset subsidies, boost marketing budgets, and reduce prices on some services, analysts and industry insiders say—all likely to mean slimmer margins, reports Olga Kharif at Business Week.

That would be a directional shift. In the past year, U.S. wireless carriers had scaled back on the subsidies that resulted in lower handset prices in exchange for long-term wireless service contracts. But now that AT&T is boosting its subsidy of the iPhone, chances are other operators will follow suit, especially on iPhone copycats.

680 Million Mobile Internet Subs in Brazil, Russia, India, China by 2012

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Brazil, Russia, India and China—collectively known as BRIC—represent 43 percent of the world's population and will account for nearly 1.2 billion mobile phone subscribers this year, according to eMarketer.

"Mobile is not simply viewed as an extension of the Web in BRIC, as it is in the United States, Western Europe and parts of Asia-Pacific," says John du Pre Gauntt, eMarketer senior analyst.

"Mobile is the Internet," he says.

eMarketer projects that the BRIC countries will account for over 1.7 billion mobile phone subscribers by 2012. Of that amount, over 680 million subscribers will access the mobile Internet.

Over the Top or Walled Garden Video?

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At the end of the day, we'll probably find that both linear multichannel video and "over the top" video will be part of the user experience on a regular basis, despite our discussions of which model is better.

In part that is because linear, walled garden TV experiences still are convenient, and because interactive features more common to Web experiences will gradually migrate into the TV experience as well.

People use multiple forms of voice and messaging products as well, for the same reason. Some formats are highly useful in some settings and for some reasons, while others retain an advantage in other settings. Most people use both tethered and mobile voice. More people are using both fixed and mobile broadband. More people also are using more over the top video. But linear subscriptions haven't dipped as the new habit takes hold.

That doesn't mean there won't be changes. There always are whenever a new medium arises. Old media are reshaped, at the very least…

More Mobile Broadband than Fixed Broadband Revenue in 2008?

The number of mobile subscriptions will increase from 3.3 billion in 2007 to 4.7 billion in 2012, representing more than two-thirds of the world’s population, say researchers at Pyramid Research.

And though voice continues to account for more than 80 percent of global mobile revenue,
revenue from global mobile data services, despite lower revenue per user, will surpass that of fixed Internet access services in 2008, Pyramid argues.

Voice Switchers or Wireless Substitution?

Wireless substitution is getting lots of attention as voice landline market share shifts and "wireless-only" households register in the low-double-digits in some surveys. Yankee Group surveys have suggested that 15 percent of respondents no longer have wireline phone service.

Indeed, switched access telephony in the United States has decreased by 17 million lines from 2005 to 2008 and is expected to continue to lose another 10 million by 2011, says Patrick Monaghan, Yankee Group senior analyst.

But Monaghan doesn't think wireless substitution explains much of the incumbent line loss. In fact, he says, residential home phone service has only experienced a two-percent year-over-year loss from 2005 to 2008.

That's something on the order of five million subscribers. His conclusion: Most consumers are not cutting the cord. They simply are choosing cable or other providers.

So what's more challenging: wireless substitution or landline market share losses?

Monaghan argues th…

Are Devices Key to Engagement?

So why don't users "love" their communication service providers? At some level, you can blame the quality of customer service. In some cases you might blame the service itself. The answer is vitally important.

Businesses and products that customers "love"--are highly emotionally involved iwth--make more money than businesses and products that users are not emotionally bonded with.

So ask yourself: does anybody you know "love" their dial tone? Does anybody you know love their bitstream?

Ask yourself a different question, then. Do you know anybody who loves their car, loves a car, loves a perfume, a set of golf clubs or a recent movie featuring four Manhattan women?

You're getting different answers, aren't you? So here's the point: at a basic level, communication service providers will make higher margins, and more sales, if they somehow can create an experience so personal that users actually create emotional bonds of the sort they have with th…

Should Telcos Have Gotten into IPTV?

With the news from comScore that U.S. Internet users viewed 11.5 billion online videos in March 2008, a 13-percent gain versus February and a 64-percent gain from March 2007, it probably is inevitable that some observers will question the commitment telephone companies are making to multichannel video entertainment.

In March, 135 million Internet users spent an average of 204 minutes viewing online video. That represents more than 40 percent of the U.S. population. So given the clear trend to more consumption of "over the top" video, it is perhaps inevitable that a reexamination of the video business case should occur logical to some observers.

To put matters simply, some might argue that telcos should not have gotten into entertainment video, much less IPTV, at all.

As someone who has argued that most telcos will not make much profit--if any--directly from video services, but who nevertheless sees no way for telcos to avoid getting into the linear, multichannel video business,…

Mobile Data Market Segments

Aside from text messaging, which continues to grow, many observers would say that sales of PC cards are the second most important new mobile data revenue stream, increasing use of smart phone data plans notwithstanding. Within the smart phone segment, "almost all of the evidence I've seen to date shows that the market is deeply divided into two groups," says Michael Mace, Rubicon Consulting principal. When surveyed, most people in the United States and Europe say they will not pay anything extra for mobile device features other than voice and SMS, Mace argues. "They'll use those features if you give them away for free, but as soon as you ask them to pay, about 65 percent of the population drops out," he says. "Fortunately, the other 35 percent of the U.S. and European population is willing to pay extra for mobile data features," Mace says.

The issue is that at least four distinct market segments can be identified. There are PC card users, then three s…

4G Initially is Cellular with More Bandwidth

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I've learned over the years that when assessing trends, it's always safer to watch what people and organizations do, rather than what they say. Because people and organizations often say one thing and then do another.

Consider IPTV. It gets sold to investors on the value of enhanced applications. It gets bought by real-world consumers largely as a substitute for cable TV. IP telephony is touted for its enhanced features. It mostly gets bought as a substitute for plain old telephone service.

Now fourth generation networks are touted as a platform for machine-to-machine applications that will result in mobile penetration as high as 400 percent or more.

So watch what people spend their money on.

Sprint Nextel executives have been touting new machine-to-machine applications and mobile broadband, saying WiMAX will not simply be 3G with more bandwidth. WiMAX supporters, in fact, often talk about the "mobile Internet" as the way WiMAX will be different from 3G and upcoming LTE …

Is Tip Jar a Business Model?

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Piper Jaffray analyst Gene Munster chatted with 20 Apple developers recently and found as many as 71 percent of new iPhone apps might be offered to users for free.

To be sure, people sometimes write apps for no reason other than the recognition. But is there a business model here?

One might ask whether the tip jar is a business model. For street musicians, it is, if not a terribly good business model.

So is the "freemium" model any better? " Should developers give away an app or service for free, acquire a lot of customers very efficiently through word of mouth, referral networks, organic search marketing and then offer premium priced value added services or an enhanced version of your service to your customer base? Lots of people have, and will continue to try.

The typical business model for a "freemium" approach is ad support for the "free" services and then subscriptions for the enhanced services. The eternal issue is perhaps how much to offer free a…

2% Android Handset Penetration by December 2008?

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Strategy Analytics analysts predict that Android, backed by an alliance of more than 30 mobile phone operators, handset makers, software firms and component manufacturers, will be installed on two per cent of smart phones by December 2008.

That might be an aggressive forecast. At mid-year, it is overstating matters to say even a trickle of devices even are being shown in prototype form.

British chipmaker ARM, for example, has unveiled a prototype mobile phone that will use the operating system Android, launched by Google in November 2007.

The prototype features a Web browser, map software, multimedia applications, text messaging, calendar functions, email and other mobile phone functions.

Designed, obviously, to rival Apple's iPhone, ARM's prototype uses Google as its Web browser home page, Google Mail as its email application, and Google Maps for navigation.

Although the Android project is at a relatively early stage, the first Android-based mobile phones are expected to be launch…

59% Willing to Cut the Cord?

A new poll conducted by Los Angeles Business found 59 percent saying it was indeed an option.

The other 41 percent said that it was not an option, and might be considered "hard core" wireless substitution resisters.

That's not especially good news for providers of landline voice service, if respondents are at all serious.

Verizon Introducing Wireless-Broadband, Wireless-TV Bundles

Verizon Communications is introducing new dual-play packages based on wireless and broadband service, or wireless plus TV service. If a customer is eligible for FiOS TV, a triple play package can be built.

The Flex Double Play bundle will provide discounts ranging from $8 to $12 a month for those who combine a Verizon Wireless plan with broadband or FiOS TV. Adding FiOS TV, Verizon's cable-TV service, on top of wireless and broadband yields another $8 a month in savings.

The move is a step beyond the old requirement that customers buy a landline voice line to get the best price on a DSL service.

The discount applies to DSL service with downloads at 3 Mbps or 20 Mbps FiOS service.
The package is not available for the 7 Mbps DSL or the 50 Mbps FiOS services, though.

Verizon Growth Profile Has Changed

The business climate for tier one providers is quite a bit better than it was just several years ago, when some analysts feared the best tier one telcos could do was hold steady in terms of revenue and profit. "In the past 18 months, we talked a lot about growth for Verizon," says Greg Miller, Deutsche Bank Securities analyst.

"Only two to three years ago, it was something that many people didn't think was going to happen, considering what was going on with the competitive dynamic in cable."

"Clearly, we've started to see some fairly significant growth within the business," he says. Also, the growth is "not just confined to one segment in the business."

Global Facebook Traffic Catches MySpace

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April 2008 was the first time Facebook traffic officially caught up to MySpace in terms of unique monthly worldwide visitors, according to data released by Comscore. Both services are attracting around 115 million people to their respective sites each month.

But there are clear regional differences. It looks like MySpace continues to hold a steady lead over Facebook in the U.S. market. That being the case, most of Facebook’s growth has come in international markets.

Facebook added 75 million monthly uniques over the last twelve month, but just 13 million of those visitors are located in the United States.

7.8 Million Business VoIP Lines by 2012

Business VoIP lines to Total 7.8 million by 2012, say analysts at Pike & Fischer. If one assumes there are something on the order of 110 million business lines now in service, that's about seven percent. Some of us think business VoIP "lines" will be higher, but disguised in the form of IP trunks. It will be very hard to count them, since no regulatory agency records such things. Nor is it clear many IP trunking providers will release figures relating to "lines" rather than "IP trunks" in service.

If you ask me, 7.8 million is a low forecast.

Carphone Warehouse Blames Wireless for Fixed Broadband Sales Dip

You might not be surprised if a broadband access provider blames either housing or economic sluggishness for lower than expected unit growth, in the U.K. or U.S. markets. So it's probably no big deal that Carphone Warehouse blames a housing slowdown for lower take-up of additional broadband lines.

But note this tidbit: Carphone Warehouse also says "mobile broadband sales" are partly to blame for lower fixed broadband sales, warning it expects lower revenue next year if the trend continues.So the question logically arises: are some U.K. consumers substituting wireless broadband connections for fixed connections?

Execs Know Change is Coming; Just 30% Claim Insight

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There's no question global telecom service provider executives know big changes are coming. There's universal agreement that new revenue sources will displace voice as the industry mainstay.

There's wide agreement that traditional voice revenues will shrink for a variety of reasons. A shift of some usage to Web-mediated or IM-mediated providers and applications is one factor. But so are other IP-based and enhanced versions of voice communications that will substitute for legacy voice. Higher-fidelity voice is one example, say researchers at Telco 2.0.

What also remains clear is that just 30 percent of executives claim to know "quite well" the additional needs users may have for new voice and messaging products. At this point, that's refreshing. The industry has been surprised by the biggest innovations in demand on a fairly regular basis.

Mobile wasn't thought to be such a big deal. But mobile accounts now surpass landlines in many countries. Text messaging …

Comcast Upgrades Sacramento, Davis, Roseville and Placerville Calif. Cable Modem Speeds

Comcast is doubling its highest Internet speeds for residential customers in the Sacramento, Davis, Roseville and Placerville areas to download speeds of 16 megabits per second and upload speeds of 2 Mbps. Customers who already get Comcast's highest-speed service, which offers 8 Mbps downloads and 1 Mbps uploads, will be automatically upgraded to the faster service at no charge. The automatic upgrade to the new higher-speed service begins June 31. Comcast offers two other, lower-tier services of 4 and 6 Mbps. Those customers would need to sign up for Blast! to receive the higher speeds.Comcast and other cable operators typically conduct such market-by-market upgrades when competing against higher-speed telephone company offers. AT&T is a factor, but in Roseville, SureWest Communications offers a 10 Mbps Ethernet access service broadly to consumer customers.

Mobile Transaction Processing: $1.9 Billion

The market for mobile digital commerce services grew to $1.9 billion in 2007, say researchers at S2 Data Corp.

Digital commerce service providers process the financial transactions that monetize premium content from music, video and gaming companies over the mobile operator's network.

By 2012, the market for mobile digital commerce services will grow to $1.9 billion.

Operators are seeing data revenue exceed 30 percent of total service revenue as the ring tone market shifts from a primary to a partial revenue stream in a premium content mix that includes ringback tones, games, full track downloads and mobile video, S2 says.

Tolerance for Email Outages?

Oddly enough, though many users will tell you that email is more important than voice, they also seem more tolerant of email than voice outages.

Most organizations put up with periodic outages and most seem to tolerate that state of affairs.But email seems to benefit from different expectations, in particular the store and forward use model.The fact that voice mail is the same sort of experience doesn't seem to detract from the possibility of a synchronous session at least part of the time.Curious, don't you think?

WiMAX Threatens 3G, Fixed Wireless

WiMAX provides the right mix of
features and pricing to appeal to consumers, though business users will provide more of a challenge, say researchers at In-Stat.

The commercial user frequently requires ubiquitous coverage, which will be an issue initially.

"While early WiMAX network coverage will not be as large as 3G cellular, it will be adequate to appeal to consumers," says Daryl Schoolar, In-Stat analyst.

"When respondents were presented with
service examples and picked the one they most preferred, the one representing WiMAX was picked more than two-to-one over the one representing 3G cellular data, he says

Respondents are very interested in a wireless broadband service that
will allow them to connect multiple devices under a single service
plan, Schoolar notes.

Respondents also say they want a service that can meet both their at home and away Internet needs.

For this reason, fixed broadband operators are vulnerable to losing subscribers to WiMAX.

Survey responde…

Belgacom Eyes Cable

A growing strategic reality in the global telecom business is the need to "go out of region" to fuel growth. Belgacom, for example, is offering €420m to the cable companies and municipal shareholders of the Belgian cablenet Interkabel.

In a statement the incumbent telco said that its offer was €70m more than had been made by its rival Telenet and 40 percent more than the upfront payment offered to the municipalities.

In this case there is the additional tactical consideration of buying customer base and revenue that is denied a key in-region competitor.

But make no mistake: organic growth is slow, tedious work these days. Leaps occur mostly through acquisition.

Sprint Churn Bottoming?

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Sprint Nextel has lost one million customers since the end of 2007, a fact mirrored in surveys of ChangeWave Research members.

The more important news, though, may be a possible bottoming. It is possible Sprint finally has stabilized its churn problem.

In March 2008, for example, a survey of 3,597 consumers found 11 percent reporting they are Sprint Nextel customers.

Some 31 percent said they use Verizon while 28 percent reported using and AT&T. To be sure, that indication of market share among survey respondents does not track very well with other measurements of market share, such as the carriers own quarterly and annual reports of subscribership.

No surprise: Sprint customers are least satisfied of all of the major provider customers. When asked how likely they were to change service providers in the next 6 months, a relatively high percentage of Sprint customers (21 percent) said they're likely to switch, compared to just 10 percent of Verizon customers and 11 percent for AT&a…

iPhone Sales to Triple?

Right now it's hard to say for sure, but there's sound logic behind predictions that Apple now will attempt to dramatically increase sales of iPhones, now that carriers are subsidizing the device. The rationale?

Richard Windsor, Nomura analyst, notes that higher volumes are necessary. "Apple must increase its volumes very substantially to make up the difference” between what it was making before, and what it will be making now on subsidized devices, without a recurring revenue share.

Windsor notes that a dollar from revenue share has EBIT margins of 100 percent, while hardware revenues have an EBIT margin of closer to 30 percent.

So a simple back of the envelope analysis suggests that if Apple wants revenue to grow, it will have to sell three times as many devices at the lower margins, to make up for what it might have earned under the old business model.

Cheaper iPhone = Digital One Rate

Some of you may remember "Digital One Rate," the first "bucket of minutes" wireless voice plan, launched by AT&T when Dan Hesse, now Sprint Nextel CEO, ran the AT&T Wireless business. You might also remember that Digital One Rate ignited a huge wave of wireless voice usage.

It is conceivable that the new 3G iPhone, with price points aimed at the "the other side of the chasm" crowd (the mass market), as well as the inevitable responses by competitors, could well ignite a new round of data services use by fairly "average" mobile users.

A $200 iPhone with 3G is just the sort of thing that could trigger dramatically-expanded mobile Web and mobile broadband use, driving smart phones and mobile Web services into the lead edge of the "early majority" market that mobile providers will have to crack if 3G is to become a user mainstay.

With the latest release, Apple is taking aim at the enterprise segment, one of several key smart phone se…

iPhone, Other Devices Will Drive Data Revenue to $70 Billion

Goldman Sachs analysts Simona Jankowski and Thomas Lee now predict there will be 15 percent compounded annual growth in revenue in smart phones over the next five years as a result of “more affordable smart phone devices and focus by handset vendors following iPhone.”

That will result in increased email, Web and other data uses, leading to a ballooning of telecom services revenue, from $19 billion last year to $70 billion in 2012.

BlackBerry Vs. iPhone

The most-important take-away from the new 3G Apple iPhone announcement is the lower prices, which we flagged up as a barrier to uptake in the first version, says Steven Hartley, senior analyst at Ovum. But Alec Saunders over at Saunderslog.com thinks BlackBerry will start to feel some real heat, now that it is clear the iPhone and BlackBerry devices will be priced head to head.

Many of us BlackBerry users might concur, but also might note that we are quite attached to the reliability of key entry. If Apple can do just a bit better on that front, many of us will find few barriers to switching. Right now, it remains an issue.

YouTube for Business

Cisco is announcing what will surely be seen as "YouTube for business." Enterprise TV, a new YouTube-like video posting and viewing service aimed at enterprises, aims to make it easier for companies to do everything related to video: creating it, capturing it, and playing it.

Employees can capture video of meetings or training programs and upload it immediately to their enterprise networks, where employees can watch it on demand.

Social Nets Used by 22% of "40 or Older" Internet Users

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About 22 percent of U.S. Internet users ages 40 and over use social networking Web sites, according to JWT BOOM/ThirdAge. A separate survey by ExactTarget fount that 39 percent of 35 to 44 year-olds used social networks, use fell sharply with age.

Only 13 percent of 55 to 64 year-olds were social networkers, and only four percent of those ages 65 and older used social networking.

About 75 percent of Internet users ages 15 to 24 use social networking sites, ExactTarget finds.

The implications are most significant for marketers who rely on word of mouth. According to the JWT BOOM/ThirdAge study, more than 75 percent of 40-and-over users received promotional e-mails about products and services and then clicked through to the site being promoted.

More than 55 percent of 40-or-older users purchased a product or service promoted in an e-mail.

Some 93 percent of respondents read an article about a Web site in print and later visited the site.
About 83 percent visited a Web site after seeing an ad…

14 Million iPhone Sales in 2008?

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Analysts at RBC Capital think a stunning 14 million--not just 10 million--new Apple iPhone units will be sold in 2008.

If so, it will be clear why higher-bandwidth mobile networks are needed. What isn't so clear yet is the precise impact all those new devices might have on access bandwidth.

RBC estimates that 70 percent of those 14 million units will be sold to first-time iPhone buyers. In all likelihood, that means 9.8 million new users who will disrupt traditional usage patterns.

But AT&T executives say they are confident they understand the dimensions of new demand, based on the 2G iPhone users they already are supporting. If not, they'll have time to adjust, says Ralph De La Vega, AT&T Wireless CEO.

1Q: 1.7 Million IP or Hybrid PBX Licenses Sold

About 1.7 million IP or hybrid PBX licenses were sold in North America in the first quarter of 2008, according to researchers at iLocus. That implies sales of 1.5 million licenses in the U.S. market.

Who Blogs?

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A Deloitte & Touche study of blog usage by age found a direct relationship between the two. The younger the user, the more likely he or she was to read or keep a blog on a weekly basis, according to Deloitte.

For example, 55 percent of Millennials (ages 13 to 24) surveyed read a blog, and the percentages decline for every age cohort in the study until reaching just 16 percent among matures (ages 61 to 75).

Similarly, 35 percent of millennials keep a blog, whereas only one percent of matures do. The age groups in between—Generation X (ages 25 to 41) and baby boomers (ages 42 to 60)—fall between those extremes.

U.S. Smart Phone Sales Double

The worldwide smart phone market grew more than 29 percent and the North American smart phone market doubled in the first quarter of 2008 compared to a year ago, according to Gartner analysts. Apple is the third largest vendor of smart phones, selling 1.7 million units worldwide to grab a 5.3 percent share of the market, Gartner says. In the U.S. market, though, Apple already is the second-largest vendor, with 20 percent of the market. Globally, users bought 32.2 million smart phones in the first quarter 2008, an increase of 29.3 percent compared to the first quarter of 2007. In North America, unit sales more than doubled to 7.3 million.