Light me up
Municipal fiber project Citynet Amsterdam has released documents for the European tender for construction of passive infrastructure, available upon request. Let's get digging.
Thursday, April 21, 2005
This program is brought to you by... you
As if he didn't have enough to worry about in the Netherlands, John Malone is apparently now concerned about this internet thing. I think I, and several thousand others, have been consistently saying for some time now that trouble was brewing (I seem to recall writing 130 pages on the issue a couple of months back), so I don't know exactly who he is warning.
As if he didn't have enough to worry about in the Netherlands, John Malone is apparently now concerned about this internet thing. I think I, and several thousand others, have been consistently saying for some time now that trouble was brewing (I seem to recall writing 130 pages on the issue a couple of months back), so I don't know exactly who he is warning.
Alphabet city
This via a mega-value reader, from Global Telecoms Business, a new acronym, even less appealing than SPIT:
This via a mega-value reader, from Global Telecoms Business, a new acronym, even less appealing than SPIT:
We're battling with the concept of IMS for the next issue of Global
Telecoms Business. It's one of those abbreviations within abbreviations -- IP
multimedia subsystem -- so it's particularly meaningless to most of us. Then Eli
Katz of the Internet Telephony Service Providers' Association offered us another
new abbreviation, SPIT -- for Spam over Internet Telephony. And so we wondered about who creates all these, and had a go ourselves, but came up only with VOMIT -- Voice over Mobile IP Telephony. Any better contributions gratefully received.
Pipe down
In this era of pervasive communication, it's probably best not to crow about your gross margins in one place and expect that the information will be confined to the original audience. I've given quite a lot of airtime recently to the mounting anti-Malone insurrection in the Netherlands, which seems to have been sparked off by his recent interview with the Financial Times. Since this interview, which claimed that "in the Netherlands where cable TV is like a utility, we make a gross margin of 75 to 80%," the Dutch press has been nipping at Mr. Malone's ankles like a lot of angry little terriers (or being Dutch, extraordinarily tall terriers), and they show no sign of stopping. Today's Volkskrant contains another hit job, in which the reporter has done some digging into previous OPTA filings to come up with a ruling on pricing between Canal + and Multikabel (owned by Liberty) mandating a EUR0.11 per channel per month cost. Based on this, the reporter arrives at a monthly content cost per subscriber of EUR3.30, leaving readers to question why the average household is paying EUR15 per month for basic cable.
UPDATE: Another valued reader in the Netherlands sends me his observation that the print version of Volkskrant looked like this:
"On the frontpage, just below the name Volkskrant, there's blue banner with 18 points bold heading: 'Usurious profits for MSO's' and below, almost same size text): 'Cost to cable companies: 5 euro, Price for subscribers: 15 euro See page 7'
And on page 7 it's the opening, half page broadsheet, with a large color picture of some guy shoving cables in a duct."
In this era of pervasive communication, it's probably best not to crow about your gross margins in one place and expect that the information will be confined to the original audience. I've given quite a lot of airtime recently to the mounting anti-Malone insurrection in the Netherlands, which seems to have been sparked off by his recent interview with the Financial Times. Since this interview, which claimed that "in the Netherlands where cable TV is like a utility, we make a gross margin of 75 to 80%," the Dutch press has been nipping at Mr. Malone's ankles like a lot of angry little terriers (or being Dutch, extraordinarily tall terriers), and they show no sign of stopping. Today's Volkskrant contains another hit job, in which the reporter has done some digging into previous OPTA filings to come up with a ruling on pricing between Canal + and Multikabel (owned by Liberty) mandating a EUR0.11 per channel per month cost. Based on this, the reporter arrives at a monthly content cost per subscriber of EUR3.30, leaving readers to question why the average household is paying EUR15 per month for basic cable.
UPDATE: Another valued reader in the Netherlands sends me his observation that the print version of Volkskrant looked like this:
"On the frontpage, just below the name Volkskrant, there's blue banner with 18 points bold heading: 'Usurious profits for MSO's' and below, almost same size text): 'Cost to cable companies: 5 euro, Price for subscribers: 15 euro See page 7'
And on page 7 it's the opening, half page broadsheet, with a large color picture of some guy shoving cables in a duct."
Mainstream disruption
The Financial Times seems to have turned up the gain on its radar and is giving more space to market disruption themes. Yesterday’s IT Review supplement had as its headline story “It’s the internet, but not as we know it.” Must say it was refreshing to see names like Gawker, Six Apart, Joi Ito, Bram Cohen and Skype all on the same page, and to know that a few thousand FT readers were having their world rocked at that moment. Today there is a long piece on Open Office. What’s the world coming to?
The Financial Times seems to have turned up the gain on its radar and is giving more space to market disruption themes. Yesterday’s IT Review supplement had as its headline story “It’s the internet, but not as we know it.” Must say it was refreshing to see names like Gawker, Six Apart, Joi Ito, Bram Cohen and Skype all on the same page, and to know that a few thousand FT readers were having their world rocked at that moment. Today there is a long piece on Open Office. What’s the world coming to?
Monument to folly
This is a familiar site to Londoners - the abandoned and decaying InterPhone call boxes dotted around London, perhaps one of the poorer examples of facilities based competition from the 1990s. I have recently seen some guerilla Wi-Fi folks suggesting that these could be used as sites for open nodes. This brings a new meaning to the concept of co-location. A gallery of other forlorn and unloved call boxes is here.
Out of the box
I don't think this is the kind of stupid network we had in mind. I used to see a lot of this in my neighborhood back in NTL's darker days, but not so much recently - until this morning. If anyone from NTL is reading, this box is near the corner of Lordship Lane and Barry Road in SE22, but if you don't hurry you may find someone living in it when you arrive.
Wednesday, April 20, 2005
Is Skype all that?
Lest my recent focus on Skype be misconstrued as being blinkered to reality, here are some tidbits which highlight the challenges of keeping such a large and rapidly growing user base happy, while fending off challenges.
First from a platinum value reader in Norway, a response he received to a problem with SkypeIn:
"Hello,
We are emailing you in regards to the Norwegian SkypeIn number that you recently purchased. As we explained yesterday due to technical reasons these numbers are currently out of service and will not work for incoming calls. Unfortunately we cannot guarantee when the numbers might become available again and therefore we have to reverse the purchase that you placed and cancel the number. We have refunded the entire purchase price to your credit card or Paypal/Moneybookers account.We sincerely apologize for this inconvenience and as compensation for this we are adding 10EUR SkypeOut credit and 3 months of Voicemail to your account. We will also notify you via email as soon as we have Norwegian SkypeIn numbers available again so that you can place a new purchase.
Regards,
Skype Support"
Another reader notes:
"A friend of mine had his SkypeOut account cleared out recently."
I don't know if this is a case of some sort of outright hack, or merely an example of what Steve Kennedy has highlighted about SkypeOut dormancy policy. I suspect it's the latter, but I am trying to find out more background.
UPDATE: My source reports that his friend's account was indeed compromised, and that calls were made to Australia.
Lastly, another platinum value reader from Norway claims to have some insight into MSN Messenger numbers for the country, which he reckons are in the vicinity of 600k on any given day. This is roughly equivalent to 100% of broadband accounts in Norway, though obviously many users will be on narrowband as well. We can read this in one of two ways - either there is a massive opportunity for Skype migration from legacy IM (as a young reader told me recently - "all my friends went directly from ICQ to Skype"), or there is a massive inert legacy IM base out there waiting for a Skype-like experience to be delivered by MSN, Yahoo! or AIM. My money (well, 50p or so - we are in a deflationary industry afterall) is on scenario 1, but we can't rule anyone out.
Lest my recent focus on Skype be misconstrued as being blinkered to reality, here are some tidbits which highlight the challenges of keeping such a large and rapidly growing user base happy, while fending off challenges.
First from a platinum value reader in Norway, a response he received to a problem with SkypeIn:
"Hello,
We are emailing you in regards to the Norwegian SkypeIn number that you recently purchased. As we explained yesterday due to technical reasons these numbers are currently out of service and will not work for incoming calls. Unfortunately we cannot guarantee when the numbers might become available again and therefore we have to reverse the purchase that you placed and cancel the number. We have refunded the entire purchase price to your credit card or Paypal/Moneybookers account.We sincerely apologize for this inconvenience and as compensation for this we are adding 10EUR SkypeOut credit and 3 months of Voicemail to your account. We will also notify you via email as soon as we have Norwegian SkypeIn numbers available again so that you can place a new purchase.
Regards,
Skype Support"
Another reader notes:
"A friend of mine had his SkypeOut account cleared out recently."
I don't know if this is a case of some sort of outright hack, or merely an example of what Steve Kennedy has highlighted about SkypeOut dormancy policy. I suspect it's the latter, but I am trying to find out more background.
UPDATE: My source reports that his friend's account was indeed compromised, and that calls were made to Australia.
Lastly, another platinum value reader from Norway claims to have some insight into MSN Messenger numbers for the country, which he reckons are in the vicinity of 600k on any given day. This is roughly equivalent to 100% of broadband accounts in Norway, though obviously many users will be on narrowband as well. We can read this in one of two ways - either there is a massive opportunity for Skype migration from legacy IM (as a young reader told me recently - "all my friends went directly from ICQ to Skype"), or there is a massive inert legacy IM base out there waiting for a Skype-like experience to be delivered by MSN, Yahoo! or AIM. My money (well, 50p or so - we are in a deflationary industry afterall) is on scenario 1, but we can't rule anyone out.
Who ate all my minutes? You did, you did
Apologies for the title, probably incomprehensible to anyone outside the UK. Anyway, my main point is to highlight a comment made by Viatel CEO Lucy Woods on my panel at ECTA yesterday, in relation to Viatel's white label broadband deal with Manchester United. "It won't be a minute before they're doing VoIP too, and we expect a number of other Premiership teams to follow suit." One million registered users of the team website is a nice base to start marketing to, and the options for promotions are great. "Receive discounts on merchandise when you make x minutes of calls," or perhaps more likely, "receive free minutes when you purchase a team jersey."
Apologies for the title, probably incomprehensible to anyone outside the UK. Anyway, my main point is to highlight a comment made by Viatel CEO Lucy Woods on my panel at ECTA yesterday, in relation to Viatel's white label broadband deal with Manchester United. "It won't be a minute before they're doing VoIP too, and we expect a number of other Premiership teams to follow suit." One million registered users of the team website is a nice base to start marketing to, and the options for promotions are great. "Receive discounts on merchandise when you make x minutes of calls," or perhaps more likely, "receive free minutes when you purchase a team jersey."
Whose disruption is it, anyway?
Yesterday I moderated a marathon session on disruptive technologies and business models at the ECTA conference in Barcelona. For those who don't know it, ECTA is the industry body representing competitive carriers in the European market - i.e., the previous generation of infrastructure-based disruptors. This was an interesting situation to be in, for as one friend noted, we were in pretty salubrious surroundings for a bunch of disruptors, and the "pinstripe quotient" was quite high.
My panel participants all did splendidly, particularly during the moderated discussion and Q&A sections, despite being from fairly disparate backgrounds: Paolo Campoli from Cisco, Lucy Woods from Viatel, Simon Peachey from VideoNetworks, Michael Jackson from Skype, and Espen Fjogstad from Telio. All the presentations were very strong, but I thought Espen's in particular was very insightful, spending more time on the industry macro issues giving rise to a company like Telio, than on the company itself.
Moment of the session, from my point of view, was some fairly impassioned questioning from a representative of a large European cable company. "We have invested heavily in a network and have to guarantee we can service the debt associated with that investment, so why should we tolerate services like Skype and Telio on our network?"
I thought the responses from Espen and Michael were diplomatic, but unequivocal - (I paraphrase) these are the sorts of developments inevitable in an IP world, and you should have been prepared for them. On the one hand, they may serve as accelerators for your sales of broadband connections (a message I have been hearing from Vonage and others in the space since the beginning). On the other hand, the other impacts they may have on your business are down to your cost structure and strategic positioning, which is nothing to do with us. My unstated thoughts at the time were: "the Skype client assigns itself a random primary IP port, with port 80 and port 443 as alternatives, so exactly what do you propose to do about it in any case? It's not what you want to hear, but the only option is to learn to deal."
I unfortunately missed what promised to be a very interesting presentation from Andrew Szelke of Bridgeport Networks today, as I had to be back in London. Based on the slides he showed me, I imagine it was a scorcher. The other highlight, for my money, was an industry lawyer, who walked up to Michael Jackson of Skype at lunch, and offered his heartfelt thanks for the service. "Roaming rates in Spain are extortionate, and I've been Skyping people all morning long from my iPaq."
Yesterday I moderated a marathon session on disruptive technologies and business models at the ECTA conference in Barcelona. For those who don't know it, ECTA is the industry body representing competitive carriers in the European market - i.e., the previous generation of infrastructure-based disruptors. This was an interesting situation to be in, for as one friend noted, we were in pretty salubrious surroundings for a bunch of disruptors, and the "pinstripe quotient" was quite high.
My panel participants all did splendidly, particularly during the moderated discussion and Q&A sections, despite being from fairly disparate backgrounds: Paolo Campoli from Cisco, Lucy Woods from Viatel, Simon Peachey from VideoNetworks, Michael Jackson from Skype, and Espen Fjogstad from Telio. All the presentations were very strong, but I thought Espen's in particular was very insightful, spending more time on the industry macro issues giving rise to a company like Telio, than on the company itself.
Moment of the session, from my point of view, was some fairly impassioned questioning from a representative of a large European cable company. "We have invested heavily in a network and have to guarantee we can service the debt associated with that investment, so why should we tolerate services like Skype and Telio on our network?"
I thought the responses from Espen and Michael were diplomatic, but unequivocal - (I paraphrase) these are the sorts of developments inevitable in an IP world, and you should have been prepared for them. On the one hand, they may serve as accelerators for your sales of broadband connections (a message I have been hearing from Vonage and others in the space since the beginning). On the other hand, the other impacts they may have on your business are down to your cost structure and strategic positioning, which is nothing to do with us. My unstated thoughts at the time were: "the Skype client assigns itself a random primary IP port, with port 80 and port 443 as alternatives, so exactly what do you propose to do about it in any case? It's not what you want to hear, but the only option is to learn to deal."
I unfortunately missed what promised to be a very interesting presentation from Andrew Szelke of Bridgeport Networks today, as I had to be back in London. Based on the slides he showed me, I imagine it was a scorcher. The other highlight, for my money, was an industry lawyer, who walked up to Michael Jackson of Skype at lunch, and offered his heartfelt thanks for the service. "Roaming rates in Spain are extortionate, and I've been Skyping people all morning long from my iPaq."
Masque of the Red Death
It's always painful to see the dismay and utter disbelief which greets the passing of an institution or an industry, especially in the reactions of those caught up in it. We are witnessing this in the case of Rover now in the UK, and the very idea that an institution like GM (or Ford, for that matter) could have wound up in such trouble probably inspires incredulity in many people, not least of all its employees. "I knew things were tough, but I never imagined things could go so wrong so quickly." This seems to be a common response.
Several years ago, while in Tokyo on a marketing trip with a former employer, I met up with a Japanese colleague for a drink. Walking around in the financial district at night after one too many, we both stopped to behold the darkened gargantuan monolith which was the Yamaichi Securities building (this being not long after its calamitous bankruptcy and closure). My colleague stared in blank awe, and remarked "Iya, are wa rippa na biru datta na" ("Yeah, that sure was an amazing building."). His use of the past tense was telling - the physical infrastructure was looming there before us, but the 100-year old institution (in a Japanese context probably as venerated as Goldman Sachs in the US) it served was not, so in his mind it was some phantom vision from the past, which no longer existed. As two members of a company about to be sold down the river, this was a chilling moment for us both, and I've never forgotten it.
Back to the present day, and poor old telecom. Today I presented at the Marcus Evans conference on Strategic Pricing for Telecom Content and Services in London. I agreed to it months ago, and as the date approached I found myself a bit uninspired. Then, a few weeks back, I saw the program, and noticed that there didn't appear to be much in the way of disruptive stuff on the agenda. I got the sense that it was going to be largely business as usual, and this was just the inspiration I needed. I could have talked about a variety of issues (believe me, I wanted to), but in the end decided to try to hit the audience (and organizers) where they live, and devote my entire presentation to Skype.
My introduction included a statement of concern that too often the industry works from the premise of what it can deliver, or needs to deliver, rather than what the consumer actually wants/needs (and my final slide was Richard Stastny's list of ten lessons from Skype, with special emphasis on "you can compete with everyone, but you can't compete with your customer"). I also questioned whether perhaps players in the industry are too focused on killing one another, while ignoring some significant issues lurking in less obvious (to a telco) areas of the market. In other words, as I've been saying, for as long as I can remember to anyone who would listen, if you're a telco, then your radar must be attuned not only to your competitors, but also to the agendas of Bill and Steve, Sergei and Larry, Terry and Jerry, Niklas and Janus, and even some single-name sources of anxiety.
One slide of my introduction contained a quote from Edgar Allan Poe's "The Masque of the Red Death". For those who haven't read it, basically the idea is that a decadent regime is hiding behind thick castle walls from a plague which is devastating everyone outside, diverting itself by having a masqued ball. Just keep dancing and we'll be fine. An interloper appears, and the king demands that he be unmasked, but the intruder (whether he is merely a carrier of the disease, or embodies some karmic revenge, is unclear) turns out to be the harbinger of doom, already among them. Okay, my use of it was partially tongue-in-cheek, but I had a serious point to make: your assassin is probably already inside the castle walls and you may not even know it.
Now, to be fair, my audience of around 50 marketing/strategy people from various European carriers were clearly very bright, successful people, undoubtedly very busy, and probably with heavy expectations upon them to deliver in very fluid markets. However, in my introduction, I asked for a show of hands in response to a series of questions, and was somewhat concerned by what I found:
How many of you read blogs? - (three out of 50)
How many of you feel you understand what RSS (I gave the long form name as well) is? - (none)
How many have heard of BitTorrent or eDonkey? - (Perhaps 5 - 7 hands)
How many have used BitTorrent or something like it? - (only one or two sheepish hands)
How many have heard of KaZaA? - (Almost everyone - I pointed out that this was the old school)
How many are acquainted with Skype? - (Just under half)
How many use Skype or have used it? - (Around a quarter)
I pointed out that the list I had just run through was a fair representation of some of the most popular activities of broadband users, and in every respect represented some threat to what the telcos are trying to do strategically. We had some laughs along the way, but there were also some long faces as the implications of my message sank in. For example, I related an anecdote from a friend within the European incumbent space, which goes like this:
I wouldn't say that anything I said today would be new or unfamiliar to readers of this blog or others dealing with related issues. However, for my audience, the people formulating and guiding Euro telco pricing strategy, much of it seemed to be completely new (I was astonished to see that precisely none of my audience had clocked the Skype/Motorola announcement, despite 60% of them being from mobile operators). On the one hand, given my bearish view of Planet Telco as a world governed by silo mentality and overburdened with organizational complexity, this was hardly surprising. On the other hand, as a human being, I am more concerned than ever about the human implications of what lies ahead. Over to you, Mr. Darwin.
It's always painful to see the dismay and utter disbelief which greets the passing of an institution or an industry, especially in the reactions of those caught up in it. We are witnessing this in the case of Rover now in the UK, and the very idea that an institution like GM (or Ford, for that matter) could have wound up in such trouble probably inspires incredulity in many people, not least of all its employees. "I knew things were tough, but I never imagined things could go so wrong so quickly." This seems to be a common response.
Several years ago, while in Tokyo on a marketing trip with a former employer, I met up with a Japanese colleague for a drink. Walking around in the financial district at night after one too many, we both stopped to behold the darkened gargantuan monolith which was the Yamaichi Securities building (this being not long after its calamitous bankruptcy and closure). My colleague stared in blank awe, and remarked "Iya, are wa rippa na biru datta na" ("Yeah, that sure was an amazing building."). His use of the past tense was telling - the physical infrastructure was looming there before us, but the 100-year old institution (in a Japanese context probably as venerated as Goldman Sachs in the US) it served was not, so in his mind it was some phantom vision from the past, which no longer existed. As two members of a company about to be sold down the river, this was a chilling moment for us both, and I've never forgotten it.
Back to the present day, and poor old telecom. Today I presented at the Marcus Evans conference on Strategic Pricing for Telecom Content and Services in London. I agreed to it months ago, and as the date approached I found myself a bit uninspired. Then, a few weeks back, I saw the program, and noticed that there didn't appear to be much in the way of disruptive stuff on the agenda. I got the sense that it was going to be largely business as usual, and this was just the inspiration I needed. I could have talked about a variety of issues (believe me, I wanted to), but in the end decided to try to hit the audience (and organizers) where they live, and devote my entire presentation to Skype.
My introduction included a statement of concern that too often the industry works from the premise of what it can deliver, or needs to deliver, rather than what the consumer actually wants/needs (and my final slide was Richard Stastny's list of ten lessons from Skype, with special emphasis on "you can compete with everyone, but you can't compete with your customer"). I also questioned whether perhaps players in the industry are too focused on killing one another, while ignoring some significant issues lurking in less obvious (to a telco) areas of the market. In other words, as I've been saying, for as long as I can remember to anyone who would listen, if you're a telco, then your radar must be attuned not only to your competitors, but also to the agendas of Bill and Steve, Sergei and Larry, Terry and Jerry, Niklas and Janus, and even some single-name sources of anxiety.
One slide of my introduction contained a quote from Edgar Allan Poe's "The Masque of the Red Death". For those who haven't read it, basically the idea is that a decadent regime is hiding behind thick castle walls from a plague which is devastating everyone outside, diverting itself by having a masqued ball. Just keep dancing and we'll be fine. An interloper appears, and the king demands that he be unmasked, but the intruder (whether he is merely a carrier of the disease, or embodies some karmic revenge, is unclear) turns out to be the harbinger of doom, already among them. Okay, my use of it was partially tongue-in-cheek, but I had a serious point to make: your assassin is probably already inside the castle walls and you may not even know it.
Now, to be fair, my audience of around 50 marketing/strategy people from various European carriers were clearly very bright, successful people, undoubtedly very busy, and probably with heavy expectations upon them to deliver in very fluid markets. However, in my introduction, I asked for a show of hands in response to a series of questions, and was somewhat concerned by what I found:
How many of you read blogs? - (three out of 50)
How many of you feel you understand what RSS (I gave the long form name as well) is? - (none)
How many have heard of BitTorrent or eDonkey? - (Perhaps 5 - 7 hands)
How many have used BitTorrent or something like it? - (only one or two sheepish hands)
How many have heard of KaZaA? - (Almost everyone - I pointed out that this was the old school)
How many are acquainted with Skype? - (Just under half)
How many use Skype or have used it? - (Around a quarter)
I pointed out that the list I had just run through was a fair representation of some of the most popular activities of broadband users, and in every respect represented some threat to what the telcos are trying to do strategically. We had some laughs along the way, but there were also some long faces as the implications of my message sank in. For example, I related an anecdote from a friend within the European incumbent space, which goes like this:
Executives from the mobile unit of incumbent A arrange a Skype conference
call with executives from the mobile unit of incumbent B. Incumbent B decides it needs to include a colleague, also on Skype, and conferences him in. They thank him for agreeing to join, and ask him where he is and how he is connected to the internet. He responds, "I'm on the road, using our 3G data card on my laptop." There follows an unstated Homer Simpson-esque "Ddoh" and many seconds of silence as the participants absorb the implications.
I wouldn't say that anything I said today would be new or unfamiliar to readers of this blog or others dealing with related issues. However, for my audience, the people formulating and guiding Euro telco pricing strategy, much of it seemed to be completely new (I was astonished to see that precisely none of my audience had clocked the Skype/Motorola announcement, despite 60% of them being from mobile operators). On the one hand, given my bearish view of Planet Telco as a world governed by silo mentality and overburdened with organizational complexity, this was hardly surprising. On the other hand, as a human being, I am more concerned than ever about the human implications of what lies ahead. Over to you, Mr. Darwin.
Skype valuation, clarified
A point of clarification. I have seen the $130m valuation attributed to me, when I was actually using this figure from another blogger as a point of departure. I thought the implication of my post was clear - that $130m might be a ballpark figure for potential of the SkypeOut business alone - but that there was a lot not captured by it, i.e., SkypeIn, licensing revenues, revenue shares, the "option value" of a community this large, and other intangibles. My gut feeling is that a figure 3 - 4 times this might be more appropriate, but that the issue won't be relevant until the business is much bigger and more mature.
A point of clarification. I have seen the $130m valuation attributed to me, when I was actually using this figure from another blogger as a point of departure. I thought the implication of my post was clear - that $130m might be a ballpark figure for potential of the SkypeOut business alone - but that there was a lot not captured by it, i.e., SkypeIn, licensing revenues, revenue shares, the "option value" of a community this large, and other intangibles. My gut feeling is that a figure 3 - 4 times this might be more appropriate, but that the issue won't be relevant until the business is much bigger and more mature.
Mobyle marketing
Noticed this on the London Underground today. It's a Viacom lighted sign with an infrared port embedded in it. Passersby can activate the infrared port on their handset, hold it close to the sign and find out if they have won a trip to Madrid to see Moby, apparently via an image displayed in their photo gallery on the handset. Didn't work for me, but maybe I was just another loser. The board makes the point "No data is stored on this device and it is absolutely free." What, no premium rate text-based revenues from the campaign? Where's the fun in that?
Monday, April 18, 2005
Skype-embedded laptop
An uber-value reader in Germany points me to the MD 95500 from German company Medion, which comes preloaded with Skype. The brief description here does not list it, but click on "Animation zum MD 95500" for the Flash tour, and then click on "Ausstattung," or look at the HTML version here, where it is all-too-clear, and apparently includes 120 free SkypeOut minutes.
An uber-value reader in Germany points me to the MD 95500 from German company Medion, which comes preloaded with Skype. The brief description here does not list it, but click on "Animation zum MD 95500" for the Flash tour, and then click on "Ausstattung," or look at the HTML version here, where it is all-too-clear, and apparently includes 120 free SkypeOut minutes.
What price freedom?
A reader contacted me with the question: what do you reckon Skype is worth? Coincidentally, Rodrigo has had a crack at the answer in his interesting blog. He comes up with a putative figure of $130m, which I work out to be about $130 per SkypeOut customer. The problem is we don't have any way of knowing what the average ARPU per SkypeOut user is. I have spent EUR15 to date, but then again I use Skype almost exclusively to communicate with other Skype users. More intensive users, especially highly nomadic individuals, would probably generate an annual ARPU of $75 without much effort.
All-in-all, if SkypeOut ARPU across the 1m user base was on the order of $40 per user, then a $130m valuation would be slightly over 3x annual SkypeOut revenues. By contrast Yahoo! currently trades on just under 13x prospective revenues, and that's after some fairly savage share price performance in recent days. It is also important to remember that we need to take into account SkypeIn revenues (I am happy to pay EUR10 per quarter for a US number, but I would be surprised if Skype was paying more than $2 - 3 per quarter to supply it), licensing revenues, etc., for which we have no data points to work from - yet. When they become available, we'll be able to put more meat on these bones.
For the record, I have tried to go through official channels to gain more insight, visiting UK Companies House (which maintains financial statements from UK companies), to find that a company known as Skype Limited is somewhat behind in its filings. I assume it's our beloved Skype, but there's no way of knowing. I'm a bit baffled as to why the company would be registered in Worcestershire...
UPDATE: Someone thought it might be a good idea to remind readers that Skype is in fact listed in Luxembourg, just to avoid any misunderstandings. I assume that the mystery company referred to above is either a) a legacy registration from 2003, which was never followed up on, or b) someone infringing Skype's trademark.
A reader contacted me with the question: what do you reckon Skype is worth? Coincidentally, Rodrigo has had a crack at the answer in his interesting blog. He comes up with a putative figure of $130m, which I work out to be about $130 per SkypeOut customer. The problem is we don't have any way of knowing what the average ARPU per SkypeOut user is. I have spent EUR15 to date, but then again I use Skype almost exclusively to communicate with other Skype users. More intensive users, especially highly nomadic individuals, would probably generate an annual ARPU of $75 without much effort.
All-in-all, if SkypeOut ARPU across the 1m user base was on the order of $40 per user, then a $130m valuation would be slightly over 3x annual SkypeOut revenues. By contrast Yahoo! currently trades on just under 13x prospective revenues, and that's after some fairly savage share price performance in recent days. It is also important to remember that we need to take into account SkypeIn revenues (I am happy to pay EUR10 per quarter for a US number, but I would be surprised if Skype was paying more than $2 - 3 per quarter to supply it), licensing revenues, etc., for which we have no data points to work from - yet. When they become available, we'll be able to put more meat on these bones.
For the record, I have tried to go through official channels to gain more insight, visiting UK Companies House (which maintains financial statements from UK companies), to find that a company known as Skype Limited is somewhat behind in its filings. I assume it's our beloved Skype, but there's no way of knowing. I'm a bit baffled as to why the company would be registered in Worcestershire...
UPDATE: Someone thought it might be a good idea to remind readers that Skype is in fact listed in Luxembourg, just to avoid any misunderstandings. I assume that the mystery company referred to above is either a) a legacy registration from 2003, which was never followed up on, or b) someone infringing Skype's trademark.
Friday, April 15, 2005
Tepid
A valued reader in Denmark contacted me to say that financial paper Borsen ran a story saying that incumbent TDC only generated DKK1m (EUR130k) from its 500 commercial hotspots in 2004, which works out to be about EUR20 per month per hotspot. I can't find this anywhere online. If anyone can help I'd really appreciate being able to back this up.
A valued reader in Denmark contacted me to say that financial paper Borsen ran a story saying that incumbent TDC only generated DKK1m (EUR130k) from its 500 commercial hotspots in 2004, which works out to be about EUR20 per month per hotspot. I can't find this anywhere online. If anyone can help I'd really appreciate being able to back this up.
Hurts so good
A mega-value reader alerts me to this. Dutch broadband troublemaker Versatel has decided to jump straight to 20Mbps at an introductory price of EUR39.99 per month for those who sign up before June. And they're throwing in Dutch Premiere League live matches to boot. The article points out that the price is half what UPC charges for its 20Mbps service - without the football.
A mega-value reader alerts me to this. Dutch broadband troublemaker Versatel has decided to jump straight to 20Mbps at an introductory price of EUR39.99 per month for those who sign up before June. And they're throwing in Dutch Premiere League live matches to boot. The article points out that the price is half what UPC charges for its 20Mbps service - without the football.
Torrentize it, and I'll advertise it
I just noticed on the Skype forums that a user in Mexico suspects that Telmex is blocking access to the domain www.skype.com. I guess that's one way to stop it - prevent people from even going there in the first place. Maybe it's time to Torrentize Skype distribution?
I just noticed on the Skype forums that a user in Mexico suspects that Telmex is blocking access to the domain www.skype.com. I guess that's one way to stop it - prevent people from even going there in the first place. Maybe it's time to Torrentize Skype distribution?
Thursday, April 14, 2005
All in a day's work
Had some very interesting meetings and phone calls today.
Firstly, one of my mega-value contacts arranged to introduce me to management of a UK tech company, which recently re-evaluated its cellular phone spend and decided to opt for Skype wherever possible. Apparently, even after opening an overseas branch office, the company's overall telecom spend has gone down significantly relative to the levels it experienced when it was a pure UK operation. I hope to have a detailed piece on this in the near future.
Secondly, my colleague Kota Ezawa arranged a meeting with a major Japanese player in the consumer electronics value chain (I can't say who or what part of the chain), which revealed the following:
1) Parts of this company have embraced Skype wholeheartedly as a productivity tool, and love it.
2) Within the next year we will see relatively high-spec smartphones made by (apparently) unlikely (but well-respected) manufacturers at a price of around $50. I know it sounds crazy, but they were adamant, and I believe them.
Roll on, deflationary spiral...
Had some very interesting meetings and phone calls today.
Firstly, one of my mega-value contacts arranged to introduce me to management of a UK tech company, which recently re-evaluated its cellular phone spend and decided to opt for Skype wherever possible. Apparently, even after opening an overseas branch office, the company's overall telecom spend has gone down significantly relative to the levels it experienced when it was a pure UK operation. I hope to have a detailed piece on this in the near future.
Secondly, my colleague Kota Ezawa arranged a meeting with a major Japanese player in the consumer electronics value chain (I can't say who or what part of the chain), which revealed the following:
1) Parts of this company have embraced Skype wholeheartedly as a productivity tool, and love it.
2) Within the next year we will see relatively high-spec smartphones made by (apparently) unlikely (but well-respected) manufacturers at a price of around $50. I know it sounds crazy, but they were adamant, and I believe them.
Roll on, deflationary spiral...
Gloves off
Eurotelco mutual assured destruction has started in earnest: EUR350m in tangible investment over three years, plus EUR150m in marketing, to carve out a meaningful place in the bloodbath which is French broadband. Deutsche Telekom, if you'd like to step in at this point with a bid for Iliad (to save my monthly performance numbers), I'll kiss you - all 200,000 of you.
Eurotelco mutual assured destruction has started in earnest: EUR350m in tangible investment over three years, plus EUR150m in marketing, to carve out a meaningful place in the bloodbath which is French broadband. Deutsche Telekom, if you'd like to step in at this point with a bid for Iliad (to save my monthly performance numbers), I'll kiss you - all 200,000 of you.
Azureus ate my mouse ears
A Norwegian super-value reader alerts me to this story. Broadcaster TVNorge (a unit of SBS) commissioned an independent study of viewers, to assess BitTorrent use. Out of a sample of 1,000 persons, 9% claimed to have used BitTorrent, and out of that group, 8% said they had downloaded a SouthPark episode in the past month, while 18% had downloaded The Simpsons, and fully 38% had downloaded an episode of ABC's dystopian take on Gilligan's Island known as Lost.
This highlights a point I've raised before (both here and in "proper" research): the cracks in traditional industry structures expand to form gaping canyons in the IP world. Licensing, royalty collection, pay TV windows, many of the mechanisms that make the entertainment world tick, are based on notions of national borders and markets, which are made a nonsense by IP. The European market is a huge consumer of American TV, and doesn't have the patience to read about interesting shows online and then wait for the calendar to catch up with the arcane licensing regime - it will pursue its own brand of time-shifted viewing.
A Norwegian super-value reader alerts me to this story. Broadcaster TVNorge (a unit of SBS) commissioned an independent study of viewers, to assess BitTorrent use. Out of a sample of 1,000 persons, 9% claimed to have used BitTorrent, and out of that group, 8% said they had downloaded a SouthPark episode in the past month, while 18% had downloaded The Simpsons, and fully 38% had downloaded an episode of ABC's dystopian take on Gilligan's Island known as Lost.
This highlights a point I've raised before (both here and in "proper" research): the cracks in traditional industry structures expand to form gaping canyons in the IP world. Licensing, royalty collection, pay TV windows, many of the mechanisms that make the entertainment world tick, are based on notions of national borders and markets, which are made a nonsense by IP. The European market is a huge consumer of American TV, and doesn't have the patience to read about interesting shows online and then wait for the calendar to catch up with the arcane licensing regime - it will pursue its own brand of time-shifted viewing.
Wednesday, April 13, 2005
Ripples across the Skype pond
Today I had a couple of "cold" contacts via Skype, one from the regulatory affairs manager of a UK ISP, and another from a sell-side analyst at an independent firm. The former was an accident. He inadvertently hit my "Click-to-Skype" link (for those who don't know, it's simply 'callto://Skypeusername' - and makes me wonder about the scope for future abuse, e.g., people posting links like 'callto://tonyblair'), but we subsequently had a fruitful chat. The latter contact was intentional, initially via email, then migrating to Skype.
The sell-side analyst is a name I know from many years back, though we have never met (I generally tend to shun the analyst circuit as a dry well when it comes to the issues I focus on - this may be unfair on my part, but has done me no harm to date). He told me that, not only is he able to use Skype in the workplace without fear of recrimination, but his firm is teetering on the brink of migrating to Skype en masse. There we go - when financial institutions in the hallowed City of London, retrograde in almost every other respect (family-friendly work practices, IT paranoia, macho work culture, management control, you name it), adopt Skype, that is truly something compelling.
Today I had a couple of "cold" contacts via Skype, one from the regulatory affairs manager of a UK ISP, and another from a sell-side analyst at an independent firm. The former was an accident. He inadvertently hit my "Click-to-Skype" link (for those who don't know, it's simply 'callto://Skypeusername' - and makes me wonder about the scope for future abuse, e.g., people posting links like 'callto://tonyblair'), but we subsequently had a fruitful chat. The latter contact was intentional, initially via email, then migrating to Skype.
The sell-side analyst is a name I know from many years back, though we have never met (I generally tend to shun the analyst circuit as a dry well when it comes to the issues I focus on - this may be unfair on my part, but has done me no harm to date). He told me that, not only is he able to use Skype in the workplace without fear of recrimination, but his firm is teetering on the brink of migrating to Skype en masse. There we go - when financial institutions in the hallowed City of London, retrograde in almost every other respect (family-friendly work practices, IT paranoia, macho work culture, management control, you name it), adopt Skype, that is truly something compelling.
Memory lane
A momentary break from the apocalyptic for some harmless nostalgia. I found this in the garden shed today. It is a space hopper (hippity-hop to the Americans) which I got from Orange back in 1999 in exchange for some loyalty points I had on my account. Orange used to give away all sorts of quirky things. I recall that one prize for people who had amassed a lot of points was to have a caricature drawing of yourself done in a private sitting by a professional cartoonist. Cellular penetration was a lot lower back then, and Orange was a really cool, imaginative brand, with a genuine sense of humor. UK residents, or others familiar with Orange during the period, will look at the single-word instruction on the object (characteristic of their marketing at the time), and smile with fond remembrance.
Roll on Madison Ave.
I don't have a huge number of reasons to gloat on the stock selection front (as our upcoming Global Monthly may illustrate), but I'm still happy with the decision to load up on advertising-related names when I see things like this. Vonage ranks third again in US web impressions, losing out only to consumer finance and online DVD rentals, and beats the pants off SBC. Oh, and lest I forget, Firefox had nearly 2.7m visitors to the site in March. I wonder what Mozilla's global advertising budget is?
I don't have a huge number of reasons to gloat on the stock selection front (as our upcoming Global Monthly may illustrate), but I'm still happy with the decision to load up on advertising-related names when I see things like this. Vonage ranks third again in US web impressions, losing out only to consumer finance and online DVD rentals, and beats the pants off SBC. Oh, and lest I forget, Firefox had nearly 2.7m visitors to the site in March. I wonder what Mozilla's global advertising budget is?
Gaijin, Skype home
Found this courtesy of HK's blog in Japan. It's in Japanese, but fortunately I read that (at no extra charge to you dear reader, though getting there caused me great pain). A company called Sofnet Japan, which has an expanding national network of pay-as-you-go internet kiosks, is to introduce Skype (look at the photo - is that a Cyberphone?) at three of its eight locations in the JR (Japan Rail) station in Hiroshima. Depending on how that goes, they may do more. Now that Skype allows centralized storage of contacts (and you can log into a client as another user), it's the new Hotmail.
Found this courtesy of HK's blog in Japan. It's in Japanese, but fortunately I read that (at no extra charge to you dear reader, though getting there caused me great pain). A company called Sofnet Japan, which has an expanding national network of pay-as-you-go internet kiosks, is to introduce Skype (look at the photo - is that a Cyberphone?) at three of its eight locations in the JR (Japan Rail) station in Hiroshima. Depending on how that goes, they may do more. Now that Skype allows centralized storage of contacts (and you can log into a client as another user), it's the new Hotmail.
What's wrong? Blog me all about it
I wonder how long we'll have to wait to see this sort of thing in the investor relations arena? Maybe the guys over at 173DruryLane can sell their blog to Sainsbury's?
I wonder how long we'll have to wait to see this sort of thing in the investor relations arena? Maybe the guys over at 173DruryLane can sell their blog to Sainsbury's?
Notes from Mission Control
One feichang hao reader wrote in to express concern that I might have been talking about downloads rather than users in my previous posts. For clarification, the data I received contained actual user numbers, which I am not at liberty to disclose. If I gross up the implied total user base on the basis of one country's user number and the share of total (let's say the US), then I get nowhere near the total download figure. Therefore, I conclude that these are real users. I'm trying to confirm the basis of definition and calculation with Mr. Z, but I feel confident in saying that, as a conclusion, there are a helluvalot of users sitting on Europe's broadband plant, and judging from the telco traffic to the site today, this seems to be something of a concern.
One feichang hao reader wrote in to express concern that I might have been talking about downloads rather than users in my previous posts. For clarification, the data I received contained actual user numbers, which I am not at liberty to disclose. If I gross up the implied total user base on the basis of one country's user number and the share of total (let's say the US), then I get nowhere near the total download figure. Therefore, I conclude that these are real users. I'm trying to confirm the basis of definition and calculation with Mr. Z, but I feel confident in saying that, as a conclusion, there are a helluvalot of users sitting on Europe's broadband plant, and judging from the telco traffic to the site today, this seems to be something of a concern.
Tuesday, April 12, 2005
Houston, we have a problem...
If there's a Mission Control for the telcos, it's time to open up another box of doughnuts and get out the sliderules - it's going to be a long night. Pairing the Skype numbers in the preceding post with the global broadband stats we have to hand, it looks as though Skype penetration of broadband accounts is well over 20% in Benelux, the Nordics, and Switzerland, and in the high teens in France, Germany, and Spain. Still, it could be worse. I come up with a number north of 50% for both Brazil and Israel, and in the 40's for Taiwan.
If there's a Mission Control for the telcos, it's time to open up another box of doughnuts and get out the sliderules - it's going to be a long night. Pairing the Skype numbers in the preceding post with the global broadband stats we have to hand, it looks as though Skype penetration of broadband accounts is well over 20% in Benelux, the Nordics, and Switzerland, and in the high teens in France, Germany, and Spain. Still, it could be worse. I come up with a number north of 50% for both Brazil and Israel, and in the 40's for Taiwan.
Whose net is it anyway?
Stumbled across this map in an interview with Cybergeographer Martin Dodge last week. Totally unsurprisingly, the infrastructure of the net is heavily concentrated in rich nations, but it's interesting to ponder how the balance of content is going to change in the course of the "wedia" phenomenon, and the general cataclysmic shifts (thanks for the pointer, JD Lasica) in media creation and consumption heralded by IP, and supported by broadband growth.
As a possible indicator of things to come, have a look at the recent breakdown of Skype users by country (top 20), which Niklas Zennstrom very kindly sent me this morning, and contrast with the previous rankings and percentage contributions (in parentheses) from October 2004 (keep in mind that absolute user numbers have at least trebled in many countries since the previous reading).
[1] United States - 9.13% (1, 10.3%)
[2] Poland - 7.87% (3, 8.78%)
[3] Taiwan - 7.80% (2, 9.24%)
[4] China - 6.75% (6, 5.89%)
[5] Germany - 6.06% (5, 6.18%)
[6] Brazil - 5.85% (4, 7.24%)
[7] France - 5.62% (7, 5.53%)
[8] United Kingdom - 3.50% (10, 2.94%)
[9] Netherlands - 3.47% (8, 3.50%)
[10] Japan - 3.17% (12, 2.61%)
[11] Spain - 2.64% (15, 1.82%)
[12] Israel - 2.36% (11, 2.94%)
[13] Canada - 2.22% (13, 2.46%)
[14] Belgium - 1.95% (14, 2.10%)
[15] Italy - 1.91% (18, 1.44%)
[16] Denmark - 1.73% (9, 3.07%)
[17] Sweden - 1.62% (16, 1.76%)
[18] Turkey - 1.59% (not ranked)
[19] Switzerland - 1.42% (19, 1.22%)
[20] Australia - 1.41% (17, 1.46%)
Parts of the Skype cybermap match what we know about the web's existing structure and power laws, and parts surprise. Look at the representation of Poland and Turkey, the two fastest-growing broadband markets in H2 2004, and also the impressive growth of China (wait until broadband development in India really picks up).
For all this developing market growth, the highest absolute growth since October came from Spain (4.6x October's level), Italy (4.2x), Japan (3.9x) and the UK (3.8x) - all wealthy markets (but hardly at the cutting edge of the internet, or of global entertainment content, for that matter). Conversely, Denmark, a very early adopter of Skype (in the very early days I believe it was the largest single country for a short period of time), has found itself swamped by growth elsewhere.
Stumbled across this map in an interview with Cybergeographer Martin Dodge last week. Totally unsurprisingly, the infrastructure of the net is heavily concentrated in rich nations, but it's interesting to ponder how the balance of content is going to change in the course of the "wedia" phenomenon, and the general cataclysmic shifts (thanks for the pointer, JD Lasica) in media creation and consumption heralded by IP, and supported by broadband growth.
As a possible indicator of things to come, have a look at the recent breakdown of Skype users by country (top 20), which Niklas Zennstrom very kindly sent me this morning, and contrast with the previous rankings and percentage contributions (in parentheses) from October 2004 (keep in mind that absolute user numbers have at least trebled in many countries since the previous reading).
[1] United States - 9.13% (1, 10.3%)
[2] Poland - 7.87% (3, 8.78%)
[3] Taiwan - 7.80% (2, 9.24%)
[4] China - 6.75% (6, 5.89%)
[5] Germany - 6.06% (5, 6.18%)
[6] Brazil - 5.85% (4, 7.24%)
[7] France - 5.62% (7, 5.53%)
[8] United Kingdom - 3.50% (10, 2.94%)
[9] Netherlands - 3.47% (8, 3.50%)
[10] Japan - 3.17% (12, 2.61%)
[11] Spain - 2.64% (15, 1.82%)
[12] Israel - 2.36% (11, 2.94%)
[13] Canada - 2.22% (13, 2.46%)
[14] Belgium - 1.95% (14, 2.10%)
[15] Italy - 1.91% (18, 1.44%)
[16] Denmark - 1.73% (9, 3.07%)
[17] Sweden - 1.62% (16, 1.76%)
[18] Turkey - 1.59% (not ranked)
[19] Switzerland - 1.42% (19, 1.22%)
[20] Australia - 1.41% (17, 1.46%)
Parts of the Skype cybermap match what we know about the web's existing structure and power laws, and parts surprise. Look at the representation of Poland and Turkey, the two fastest-growing broadband markets in H2 2004, and also the impressive growth of China (wait until broadband development in India really picks up).
For all this developing market growth, the highest absolute growth since October came from Spain (4.6x October's level), Italy (4.2x), Japan (3.9x) and the UK (3.8x) - all wealthy markets (but hardly at the cutting edge of the internet, or of global entertainment content, for that matter). Conversely, Denmark, a very early adopter of Skype (in the very early days I believe it was the largest single country for a short period of time), has found itself swamped by growth elsewhere.
We disrupt this program to bring you the following...
I was observing a blogging moratorium over the weekend and offline yesterday, but I noticed this article from last Friday with interest. Media buyers in this survey are clearly feeling pretty bearish about terrestrial broadcasting and three notable names expect Freeview to outstrip Sky within three years, in line with my own bearish views. I would love to see the respondents' underlying assumptions about future television viewing generally, as I assume this sort of survey is carried out from an industry silo perspective.
I was observing a blogging moratorium over the weekend and offline yesterday, but I noticed this article from last Friday with interest. Media buyers in this survey are clearly feeling pretty bearish about terrestrial broadcasting and three notable names expect Freeview to outstrip Sky within three years, in line with my own bearish views. I would love to see the respondents' underlying assumptions about future television viewing generally, as I assume this sort of survey is carried out from an industry silo perspective.
Shameless self-promotion corner
I am taking part in two conferences next week, the first being the ECTA conference in Barcelona, where I'm moderating a panel on disruptive technologies and business models on Tuesday, the second being the Marcus Evans Strategic Pricing for Telecom Content & Services conference in London on Wednesday, where I will probably upset some people.
I am taking part in two conferences next week, the first being the ECTA conference in Barcelona, where I'm moderating a panel on disruptive technologies and business models on Tuesday, the second being the Marcus Evans Strategic Pricing for Telecom Content & Services conference in London on Wednesday, where I will probably upset some people.
Friday, April 08, 2005
Will torrent for food
Gary Lerhaupt of Prodigem pinged (pung?) me to alert me to the new torrent marketplace he has set up. This allows independent publishers to set prices for their work, which may now be licensed under a newly-added copyright mechanism. A sample torrent is here. I'm very impressed with Prodigem (BT users can view my poorly shot testimonial here), though I remain convinced that, given all the moves being made by the internet majors in beefing up their blogging/photo-sharing tools (and the growing momentum of "wedia"), the concept is bound to inspire imitation at major league level.
Gary Lerhaupt of Prodigem pinged (pung?) me to alert me to the new torrent marketplace he has set up. This allows independent publishers to set prices for their work, which may now be licensed under a newly-added copyright mechanism. A sample torrent is here. I'm very impressed with Prodigem (BT users can view my poorly shot testimonial here), though I remain convinced that, given all the moves being made by the internet majors in beefing up their blogging/photo-sharing tools (and the growing momentum of "wedia"), the concept is bound to inspire imitation at major league level.
Thursday, April 07, 2005
People on the move
I just received this press release, which intrigues me. A mutual acquaintance introduced me to John Petrillo when I was in New York last September, and we met up for a couple of drinks to discuss disruptive technologies, and in particular the project he was involved with at the time - MeshNetworks. Now I'm really curious to see what IDT (and I guess by extension, Net2Phone) have up their sleeves.
I just received this press release, which intrigues me. A mutual acquaintance introduced me to John Petrillo when I was in New York last September, and we met up for a couple of drinks to discuss disruptive technologies, and in particular the project he was involved with at the time - MeshNetworks. Now I'm really curious to see what IDT (and I guess by extension, Net2Phone) have up their sleeves.
Trouble in the pipeline, revisited
We've given a lot of coverage to the anti-coax backlash brewing in the Netherlands, and a mega-value reader points to this update: the head of national comms regulator OPTA is talking open access and price controls for large MSOs, though he stops short of defining what "large" means. As the largest (38% market share), UPC certainly should qualify. This market may end up giving us the first case of a telco unbundling cable lines.
We've given a lot of coverage to the anti-coax backlash brewing in the Netherlands, and a mega-value reader points to this update: the head of national comms regulator OPTA is talking open access and price controls for large MSOs, though he stops short of defining what "large" means. As the largest (38% market share), UPC certainly should qualify. This market may end up giving us the first case of a telco unbundling cable lines.
France, here we come
UK Online has fired the opening salvo in the UK's impending broadband price war. Service terms are relatively attractive given the increasingly draconian bandwidth caps being imposed in the market, and at this price I'm seriously beginning to question my loyalty to cable, though they have me bundled into a corner for now.
UK Online has fired the opening salvo in the UK's impending broadband price war. Service terms are relatively attractive given the increasingly draconian bandwidth caps being imposed in the market, and at this price I'm seriously beginning to question my loyalty to cable, though they have me bundled into a corner for now.
Skype tipping point? Yep
Richard asked the question earlier in the week and was widely trackbacked, and here's a couple of more datapoints in answering the question. Verisign thinks there are 900m internet users globally, and Point Topic counts 150m broadband lines (registration required, but free and well worth the effort) at the end of 2004. At c.30m registered users, Skype would appear to have penetrated 20% of its addressable market, and with around 2m concurrent users, more than 1% of the world's broadband population is running Skype at any given time. What's more, if the 155m user figure for MSN Messenger in this Financial Times article is correct, then Skype is ahead of MSN in terms of addressable market penetration, and in a much shorter period of time. I'd call that a tipping point.
UPDATE: In the time it took to visit the restroom and get a cup of coffee, an astute reader has chimed in: "May be worth bearing in mind that Skype's addressable market (& MSN's for that matter) is quite a bit more than the 150m broadband subscribers (probably ADSL + cable). It also includes businesses, govts, schools/universities, cybercafes etc with leased-line or other fast, shared connections." True enough, and while my market definition perhaps overestimates the market penetration, my reader's response clearly highlights the greater potential.
Richard asked the question earlier in the week and was widely trackbacked, and here's a couple of more datapoints in answering the question. Verisign thinks there are 900m internet users globally, and Point Topic counts 150m broadband lines (registration required, but free and well worth the effort) at the end of 2004. At c.30m registered users, Skype would appear to have penetrated 20% of its addressable market, and with around 2m concurrent users, more than 1% of the world's broadband population is running Skype at any given time. What's more, if the 155m user figure for MSN Messenger in this Financial Times article is correct, then Skype is ahead of MSN in terms of addressable market penetration, and in a much shorter period of time. I'd call that a tipping point.
UPDATE: In the time it took to visit the restroom and get a cup of coffee, an astute reader has chimed in: "May be worth bearing in mind that Skype's addressable market (& MSN's for that matter) is quite a bit more than the 150m broadband subscribers (probably ADSL + cable). It also includes businesses, govts, schools/universities, cybercafes etc with leased-line or other fast, shared connections." True enough, and while my market definition perhaps overestimates the market penetration, my reader's response clearly highlights the greater potential.
AOL pushes das boot out
Andy gives a preview of AOL's US VoIP launch and promises more details later today, but being the two-headed monster it is, AOL Germany has let the cat out of the bag a bit earlier. The Teutonic iteration is an ATA-based service, with some fairly aggressive pricing, at least versus DT's headline per minute pricing: no subscription for basic use (DSL subs with access from another provider have to pay EUR2), EUR6.90 for unlimited weekend calls to fixed numbers, EUR19.90 for unlimited any-time, and the per minute charges for calls to fixed line are right at the bottom of DT's current undiscounted price range.
Andy gives a preview of AOL's US VoIP launch and promises more details later today, but being the two-headed monster it is, AOL Germany has let the cat out of the bag a bit earlier. The Teutonic iteration is an ATA-based service, with some fairly aggressive pricing, at least versus DT's headline per minute pricing: no subscription for basic use (DSL subs with access from another provider have to pay EUR2), EUR6.90 for unlimited weekend calls to fixed numbers, EUR19.90 for unlimited any-time, and the per minute charges for calls to fixed line are right at the bottom of DT's current undiscounted price range.
Wednesday, April 06, 2005
Strange - but true?
I always like to keep an eye on where people are coming from when they stumble into this no-frills site, and that includes search results. Usually, they're fairly tedious, and sometimes mildly interesting (as when I got a slew of "Vonage IPO" queries a few months back), but this evening I got a first: "IKEA MVNO." I like it - care for 100 free any-network minutes with that sofa?
I always like to keep an eye on where people are coming from when they stumble into this no-frills site, and that includes search results. Usually, they're fairly tedious, and sometimes mildly interesting (as when I got a slew of "Vonage IPO" queries a few months back), but this evening I got a first: "IKEA MVNO." I like it - care for 100 free any-network minutes with that sofa?
Tuesday, April 05, 2005
Telenordic followup
A reader in Norway wrote in with these comments:
"I just want to tell you that I have signed up for Telenordic's GlobalLink service and tested it.The service offers a fixed rate of NOK 2.99 per minute to basically everywhere. It is a 'call back' service where you call a number in Norway and hang up five seconds after initiating the call (just enough time for Telenordic to register the cell phone number you are calling from). Immediately after hanging up, Telenordic calls your cell phone and a machine asks you to enter the number of whom you want to call. Then, a call is set up and charging commences once the called party picks up. For many handsets (it appears they are all(?) running Symbian) you may download a GlobalLink client application. I did this on my SonyEricsson P900. The client simplifies the calling process: basically you just enter a number or click on a contact in your phone's contact list and all the call back-stuff is taken care of behind the scenes. I tried clicking on an entry in my contacts list who lives in Canada and her PSTN-phone started ringing after, say, 10 seconds. Everything worked fine.
My wife has relatives in Pakistan who own cell phones. I will ask her to call them when she comes home to see how that works (I don't speak Urdu and they speak neither Norwegian nor English so I cannot call them myself :). Calling a cell phone in Pakistan is among the more expensive calls one can make from a PSTN phone in Norway. We always try to use SkypeOUT or other VoIP softphones, but quality varies a lot and often we have to use Telenor PSTN (which always works, but their rate is NOK 17 per minute--don't know what the Telenor Mobil rate is, but it is probably astronomic)."
A reader in Norway wrote in with these comments:
"I just want to tell you that I have signed up for Telenordic's GlobalLink service and tested it.The service offers a fixed rate of NOK 2.99 per minute to basically everywhere. It is a 'call back' service where you call a number in Norway and hang up five seconds after initiating the call (just enough time for Telenordic to register the cell phone number you are calling from). Immediately after hanging up, Telenordic calls your cell phone and a machine asks you to enter the number of whom you want to call. Then, a call is set up and charging commences once the called party picks up. For many handsets (it appears they are all(?) running Symbian) you may download a GlobalLink client application. I did this on my SonyEricsson P900. The client simplifies the calling process: basically you just enter a number or click on a contact in your phone's contact list and all the call back-stuff is taken care of behind the scenes. I tried clicking on an entry in my contacts list who lives in Canada and her PSTN-phone started ringing after, say, 10 seconds. Everything worked fine.
My wife has relatives in Pakistan who own cell phones. I will ask her to call them when she comes home to see how that works (I don't speak Urdu and they speak neither Norwegian nor English so I cannot call them myself :). Calling a cell phone in Pakistan is among the more expensive calls one can make from a PSTN phone in Norway. We always try to use SkypeOUT or other VoIP softphones, but quality varies a lot and often we have to use Telenor PSTN (which always works, but their rate is NOK 17 per minute--don't know what the Telenor Mobil rate is, but it is probably astronomic)."
From Norway to the world
A mega-hyper value reader points me to the introduction of flat-rate VoIP calling from mobile-to-mobile to any country for NOK2.99 per minute (EUR0.36), from Telenordic. If I'm reading this article correctly, a call from Telenor Mobile to the UK costs NOK7.49 (EUR0.91) per minute. Will look into this one in greater detail.
A mega-hyper value reader points me to the introduction of flat-rate VoIP calling from mobile-to-mobile to any country for NOK2.99 per minute (EUR0.36), from Telenordic. If I'm reading this article correctly, a call from Telenor Mobile to the UK costs NOK7.49 (EUR0.91) per minute. Will look into this one in greater detail.
Monday, April 04, 2005
It's the Skype, stoopid
Got my copy of the Eurescom Message this morning in the post, and it contains this comforting message for telcos - the stupid network is just a myth. Whew, thank God for that. I thought the sector was really in trouble for a minute there (UPDATE: I enjoyed forwarding this to Martin - I could hear him snarling all the way from Edinburgh). My friend Richard seems to be saying something ever-so-slightly at odds with this view in this strong post here (I like his point 10: "Be scared", and also his observation that a lot of the best and brightest in the industry are still in the dark about things like Skype. I have to confess that I rarely come into contact with industry people who are the in the dark about Skype these days, but I know Richard has deep and far-reaching roots in the industry, so his assessment is all the more chilling.).
Got my copy of the Eurescom Message this morning in the post, and it contains this comforting message for telcos - the stupid network is just a myth. Whew, thank God for that. I thought the sector was really in trouble for a minute there (UPDATE: I enjoyed forwarding this to Martin - I could hear him snarling all the way from Edinburgh). My friend Richard seems to be saying something ever-so-slightly at odds with this view in this strong post here (I like his point 10: "Be scared", and also his observation that a lot of the best and brightest in the industry are still in the dark about things like Skype. I have to confess that I rarely come into contact with industry people who are the in the dark about Skype these days, but I know Richard has deep and far-reaching roots in the industry, so his assessment is all the more chilling.).
GIPS going mobile
Following on from last month's Voice Engine for Symbian announcement, Global IP Sound is at it again in the mobile field, this time with OptiMobile of Sweden. OptiMobile has an interesting management lineup, as well as investors.
Following on from last month's Voice Engine for Symbian announcement, Global IP Sound is at it again in the mobile field, this time with OptiMobile of Sweden. OptiMobile has an interesting management lineup, as well as investors.
Friday, April 01, 2005
Look around you
This is the name of a strange current BBC series which aims to ironically capure the spirit and look of the various futuristic science programs which so enthralled viewers in the UK and elsewhere in the 1970s and 1980s. I'm not sure I fully understand the motivations of the creators, but one strong underlying message I get is that trying to predict the future is folly.
This leads me to an unfortunate commercial I saw last night for BT Broadband, in which a pair of grandparents, eager to share photos of their grandkids, inexplicably approach a woman in futuristic garb reminiscent of the stewardess in 2001: A Space Odyssey, who stuffs their photos into a giant pipe and off into the cloud. Fabulous.
The received selling point is that BT Broadband leads its customers into some magical world where their futuristic multimedia dreams come true. Fair enough, you couldn't do these things without a fat-ish pipe, but the tone of the commercial, as I interpreted it, was that BT is somehow actively involved in facilitating photo sharing. This is a bit like your electrical power company claiming to have made your family Christmas merely by giving you the means to light up your tree.
I think the more likely scenario is that the grandparents approach "futuristic lady", who installs the big pipe in their house and disappears, never to be thought about again, unless she messes up their bill at some point in the future. To expect that she retains any position in the chain beyond crude enabler of access is, frankly, naive.
Recently my mind keeps coming back to the comment from a reader in industry in response to this recent post: "We are doing a good job of keeping our eyes on the ball, but I am worried that the consumer may be playing something else than ball."
Indeed, catching up on my blog reading today, I have come across some amazing things which seem to bear this out, via a blog called pasta and vinegar (and this too), J D Lasica's blog, and Dan Gillmor, not to mention the Skype Journal (are these men on fire, or what?) observation that Skype awareness is significantly accelerating. How much clearer can the message to the telcos be? Look around you.
This is the name of a strange current BBC series which aims to ironically capure the spirit and look of the various futuristic science programs which so enthralled viewers in the UK and elsewhere in the 1970s and 1980s. I'm not sure I fully understand the motivations of the creators, but one strong underlying message I get is that trying to predict the future is folly.
This leads me to an unfortunate commercial I saw last night for BT Broadband, in which a pair of grandparents, eager to share photos of their grandkids, inexplicably approach a woman in futuristic garb reminiscent of the stewardess in 2001: A Space Odyssey, who stuffs their photos into a giant pipe and off into the cloud. Fabulous.
The received selling point is that BT Broadband leads its customers into some magical world where their futuristic multimedia dreams come true. Fair enough, you couldn't do these things without a fat-ish pipe, but the tone of the commercial, as I interpreted it, was that BT is somehow actively involved in facilitating photo sharing. This is a bit like your electrical power company claiming to have made your family Christmas merely by giving you the means to light up your tree.
I think the more likely scenario is that the grandparents approach "futuristic lady", who installs the big pipe in their house and disappears, never to be thought about again, unless she messes up their bill at some point in the future. To expect that she retains any position in the chain beyond crude enabler of access is, frankly, naive.
Recently my mind keeps coming back to the comment from a reader in industry in response to this recent post: "We are doing a good job of keeping our eyes on the ball, but I am worried that the consumer may be playing something else than ball."
Indeed, catching up on my blog reading today, I have come across some amazing things which seem to bear this out, via a blog called pasta and vinegar (and this too), J D Lasica's blog, and Dan Gillmor, not to mention the Skype Journal (are these men on fire, or what?) observation that Skype awareness is significantly accelerating. How much clearer can the message to the telcos be? Look around you.
Dutch WLL
KPN and T-Mobile have been awarded the 26GHz licenses in the Dutch market after an unnamed third bidder dropped out of the process. My barbaric machine translation suggests that T-Mobile walked away with 2/3 of the spectrum on offer. The licenses run to 2017. Given their aggression on the Wi-Fi front so far, it's hardly surprising that DT would emerge as the dominant force here, and I'm intrigued to see what takes shape around this spectrum. T-Mobile is already conducting Flarion trials in The Hague, and T-Mobile Ventures is a shareholder in Flarion, as well as in mesh specialist BelAir Networks.
KPN and T-Mobile have been awarded the 26GHz licenses in the Dutch market after an unnamed third bidder dropped out of the process. My barbaric machine translation suggests that T-Mobile walked away with 2/3 of the spectrum on offer. The licenses run to 2017. Given their aggression on the Wi-Fi front so far, it's hardly surprising that DT would emerge as the dominant force here, and I'm intrigued to see what takes shape around this spectrum. T-Mobile is already conducting Flarion trials in The Hague, and T-Mobile Ventures is a shareholder in Flarion, as well as in mesh specialist BelAir Networks.
Open source management consultancy
Slightly off-topic, but as our overriding focus is on disruption, and we have discussed a number of industries outside telecom from time to time, this one's for you, McKinsey. A group of smart people who have an unabashed affection for UK supermarket chain J. Sainsbury have set up a group blog to identify strategic flaws and solutions to help the company dig itself out of the hole it's in. Marketing and customer service heads have certainly been given plenty to chew on over the years from the likes of the Digital Spy forums, but this is the first case I've seen in Europe of a company-specific blog which is actively trying to engage management in how to run the business better.
Slightly off-topic, but as our overriding focus is on disruption, and we have discussed a number of industries outside telecom from time to time, this one's for you, McKinsey. A group of smart people who have an unabashed affection for UK supermarket chain J. Sainsbury have set up a group blog to identify strategic flaws and solutions to help the company dig itself out of the hole it's in. Marketing and customer service heads have certainly been given plenty to chew on over the years from the likes of the Digital Spy forums, but this is the first case I've seen in Europe of a company-specific blog which is actively trying to engage management in how to run the business better.
Vive la TDD
Interesting how little attention this announcement seems to have received, possibly because the deployment France Telecom is pursuing in its home market seems fairly innocuous and non-threatening. What I would be more interested to learn is what scope there is to exploit this in the residential space in markets where FT/Orange is a bit weaker (Netherlands, UK). In the UK, where Orange and Wanadoo appear to be lining up a more coherent cross-marketing arrangement, this could be really interesting. In fact any UK operator has the spectrum to pursue this line, with the exception of Vodafone, whose license contains no TDD, and I assume from comments here that OFCOM would welcome such a development.
Interesting how little attention this announcement seems to have received, possibly because the deployment France Telecom is pursuing in its home market seems fairly innocuous and non-threatening. What I would be more interested to learn is what scope there is to exploit this in the residential space in markets where FT/Orange is a bit weaker (Netherlands, UK). In the UK, where Orange and Wanadoo appear to be lining up a more coherent cross-marketing arrangement, this could be really interesting. In fact any UK operator has the spectrum to pursue this line, with the exception of Vodafone, whose license contains no TDD, and I assume from comments here that OFCOM would welcome such a development.
Distributed BitTorrent, the final frontier
Well, we're one quarter on from the assault on Suprnova and the premature reports of the death of BitTorrent, and meanwhile Germany seems to be emerging as a hotbed of next-gen P2P applications. Cybertelly is poised for launch, and newcomer Anatomic looks to be another emerging challenge to centralized control of content. An interview with the developer is here, and it sounds as though he's a high school student...
Well, we're one quarter on from the assault on Suprnova and the premature reports of the death of BitTorrent, and meanwhile Germany seems to be emerging as a hotbed of next-gen P2P applications. Cybertelly is poised for launch, and newcomer Anatomic looks to be another emerging challenge to centralized control of content. An interview with the developer is here, and it sounds as though he's a high school student...
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