Digital Lifescapes

First-quarter digital subscriber line (DSL) network equipment numbers are in, and according to a market research firm, there is a major upswing -- driven in part by the growing IPTV market. First-quarter DSL access concentrator port shipments reached record levels, totaling almost 19.2 million ports. That�s a 35 percent jump compared with the same quarter of last year, when 14.2 million ports were shipped, according to a report issued by Dell'Oro Group. Defining network gear volumes by ports shipped reflects business in new DSL aggregation units and upgrades adding connection ports to add capacity. "Port shipment growth is increasingly driven by service providers upgrading to all-IP networks, as well as deploying higher bandwidth equipment to enable new revenue producing services such as IPTV," said Steve Nozik, principal analyst for broadband access research at Dell'Oro Group. That included significant deployments of very high-speed DSL (VDSL) technology outside of A...

Broadcasting & Cable reports that Cablevision Chairman Charles Dolan continues to argue against the traditional industry line on � la carte. And the issue isn't pleasing the FCC or lowering cable bills, he suggests, but survival in a world where the competition is providing increasing choice and flexibility. When asked to look into cable future, Dolan said that "not giving the customer more opportunity to choose" was the TV business "at its worst." "We really need to catch up with the grocery store in this regard and stop requiring customers who want nothing more than a dozen eggs to also buy a pound of cheese. Customers should be able to buy what they want, as part of a package or independent of a package. In the end, they will be more satisfied and better customers." The U.S. National Cable & Telecommunications Association argues that a la carte models will result in higher per-channel prices and less choice as smaller networks lose the suppo...

Content may be king, but can phone companies become king of content? That's the big question everybody has about telcos and IPTV, according to Light Reading. They will have to strike the right content deals and partnerships and open up their networks if they want to profit from new technology such as IPTV, according to a group of executives attending the 13th annual Symposium, "Next Generation Media Networks." It won't be easy. Already, the entertainment industry is entwined in a web of complicated and often exclusive licensing deals, and getting the right content will be a challenge for the telcos. However, an open mind can be a big asset. "Service providers have a very substantial opportunity to play a big role, especially if they take on a role such as DoCoMo in being the gatekeeper," said Rob Glaser, chairman and CEO of RealNetworks. He said Japan's NTT DoCoMo has developed the best model for marketing entertainment content through new telecom networ...

According to Red Herring, Ruckus Wireless announced that the leading French electronics retailer 'Darty' will sell its Wi-Fi system to IPTV subscribers who want to avoid the usual television signal distribution wiring within their homes. It is the first retail deal signed by Rukus, and their first IPTV connection package marketed to consumers. Until now Ruckus has marketed its in-home systems through phone companies. Telcos such as Pioneer Telephone in the U.S. offers their customers the option of using Ruckus� MediaFlex system instead of the aesthetically less-pleasant coax wiring that connect most cable TV systems. Darty will offer Ruckus�s system as an add-on to a variety of IPTV services such as Wanadoo, France Telecom, Alice, Neuf Cegetel, Dutch Telecom, and AOL. The Ruckus package being offered by Darty can be installed by customers. They plug the Ruckus MediaFlex router into their existing broadband gateway and a MediaFlex adapter into each set-top box via an Ethernet co...

Investors lowered their expectations for 'basic cable' network values a notch, rattled by incidents of channels abruptly losing chunks of carriage and worries about a potential deceleration of growth for carriage fees. In recent years, basic cable networks sported lofty valuations, evidenced by the $2.7 bil. sale of BET in 2000 and Fox Family Channel (now ABC Family) for $3.7 billion in 2001. But recent high-profile disputes over fees multichannel platforms pay to channels are contributing to change. Earlier this year, EchoStar Communications' DISH Network dropped women-oriented Lifetime and Outdoor Life Network -- although both were later restored. "The perception has changed from a wholly-distributed network being an invaluable 'crown jewel' of the media business to a gem of potentially uncertain value when channel carriage contracts come up for negotiation and aren't automatically renewed," says Kagan Research senior analyst Derek Baine. Fully distr...

For most telcos, traditional voice is a key obstacle facing triple play uptake and subscriber RGUs (Revenue Generation Units), states a Pyramid Research report. Many incumbent telco triple-play bundles are built to prop up voice revenues, rather than build adoption of other applications -- the result; customers are uninterested. "Telco's own destructive obsession to protect their legacy voice services has been detrimental to the development of attractive triple-play services," comments Research Director Guy Zibi. "Their reluctance to push VoIP is neutering the potential of their triple play offering." Fixed operators and cable MSOs that have previously offered fixed line telephony are setting VoIP pricing closer to PSTN prices and substantially higher than third-party VoIP equivalents, a symptom of the reluctance to speed up the inevitable demise of PSTN services. "This is an industry-wide conundrum; fixed operators must tread a fine line between cannibali...

Worldwide cable modem termination system (CMTS) revenue jumped 30 percent to $257 million in 1Q06 after a 6 percent drop in 4Q05, with annual revenue forecast to reach $1.2 billion in 2009, according to Infonetics Research. The surge in the CMTS market, particularly in North America, is being fueled by the rapid success MSOs are having in signing up new VoIP subscribers, along with their desire to deliver more bandwidth to existing subscribers to support new voice, data, and video services. "Cable operators are feeling the heat from Verizon's and AT&T's fiber and higher bandwidth DSL offerings, so they're investing in more CMTS units and ports to increase bandwidth to their subscribers," said Jeff Heynen, directing analyst at Infonetics Research. "New DOCSIS 3.0-compliant CMTSs are now beginning to ship that will allow cable operators to double and triple the bandwidth to their subscribers. To counter the telcos' triple-play offerings, cable operators...

The Weinstein Company, the film studio and entertainment company formed by Miramax founders Bob and Harvey Weinstein, announced that it has made a 'significant' investment in aSmallWorld.net, an exclusive social networking site made up of "some of the most unique and influential people" from over 100 countries. The undisclosed investment also included contributions from former AOL Time Warner chief operating officer Bob Pittman and others. Founded in 2004, aSmallWorld.net currently claims 130,000 members. Features include a city guide generated by its members, offering ratings and rankings for restaurants, hotels, resorts and night clubs in 60 major cities. "Our target audience is the '3 million people connected 3 degrees,' an existing community of people that are accomplished, well-educated, highly mobile, influential, and have a strong need to stay connected," said aSmallWorld.net founder Erik Wachtmeister. Harvey Weinstein stated, "We've ...

According to Informitv, at the third Interactive Television Advertising Show in London, Nick Milligan, the managing director of Sky Media, said that television is under threat and the 30 second advertising spot is under more pressure than ever before. �I have experienced more change in our medium in the last four years than in the previous 25,� he said. �Who would have thought it extraordinary 10 years ago that we would have to defend the medium of television? Clearly it is the most powerful advertising medium.� All the main commercial broadcasters in the UK came together last year in an unprecedented way to create 'Thinkbox', an industry body to market and promote television advertising. �It is critical that we find ways of enhancing the old interruptive model and interactive advertising is a wonderful way of enhancing advertising efficiency,� declared the man responsible for advertising, sponsorship and interactive advertising across a portfolio of channels on the Sky platfor...

Philips Design is showing how simplicity could translate into groundbreaking products during the coming three to five years across the company�s entire healthcare, lifestyle and technology portfolio. 'Wand' is the central control and access device for all home content, from music to films and from TV channels to family photographs. It also acts as a control device for an entire room, from sound to lighting. Wand is an intuitive system that allows a user to point at any device and to scroll, select, play and move elements just by moving the Wand. When it is pointed, the Wand recognizes the device at which it is aimed and, through the 'active skin' portion of its rod design, provides the relevant control options for that device. For example, by pointing Wand at the Vision TV, the user can 'grab', 'move' and 'reorganize' content on the screen. Using the same intuitive gestures, it will also control the volume of the Wave sound system or the lighting...

The World's Leading Mobile Entertainment event, MEM was heralded as the best yet as it closed last week in Islington�s Business Design Centre, London. The official event of the Mobile Entertainment Forum (MEF) attracted over 1500 mobile and media executives from 46 different countries. Key themes of the event this year were Mobile music, TV and games � the three pillars expected to drive the mobile entertainment market boom. According to forecasts from Informa Telecoms & Media released at MEM, Mobile games, music and TV & video will be worth a total of $25.9 billion by 2011. �Our forecasts reveal sustained growth of mobile music and games and that the mobile entertainment market is in good health and expanding,� says Nick Lane, Principal Analyst at Informa Telecoms & Media. �Mobile music is driving the uptake of content revenues in 2006, and will continue to do so for several years.� The Mobile Entertainment Forum (MEF) also hosted its third annual Mobile Entertainment ...

The four-way battles now raging in the United States around the question of municipal, state, or national franchise agreements for "Telco TV" video services will see the telcos ultimately prevail over cable operators and local governments, according to new analysis from ABI Research. That will mean an accelerated deployment of IPTV video services to customers, and increased sales of set-top boxes. "We are at the cusp of a strong run-up in IPTV subscriber bases over the next year or two," says principal analyst Michael Arden. "The telcos have sympathy at the higher levels of government, and in general the principles of encouraging competition and preventing monopoly mean that the telcos will be victorious in this battle. It's just a question of when." Under FCC regulations, local governments can require video operators active in their areas to conclude franchise agreements and pay fees. Cable companies have had to complete agreements with every small mu...

Washington Post reports that when CBS television writers and producers sat down this spring to think about "Jericho," a new program for this fall, they crafted two story lines: one that would appear on television and one that would appear -- and fish for ad dollars -- only on the Internet. CBS calls the second one the "D" storyline, for digital. It will involve the characters and premise of the show but will consist of original content available only on the company's expanded Web site and on cellphones, where advertisers search for younger, harder-to-reach consumers. For half a century, the 30-second commercial spot was the template for television advertising, a one-size-fits-all solution that networks offered everyone from soapmakers to car companies -- take it or leave it. They still pack a punch -- for launching blockbuster movies, for instance -- but now that networks face increasing competition for ad dollars from the Internet and the wandering attention of...

Multichannel News reports that AT&T has been quietly beta-testing its IPTV product, U-Verse, in San Antonio, but it now has a potential nightmare client -- a technology savvy blogger. Alan Weinkrantz, a local San Antonio PR firm owner, will begin to detail his impressions of the product and relate the "save" offer made to him when he dropped his Time Warner Cable and Roadrunner service at his blog site. He intends to continue his very public ongoing review throughout his four-month trial of the product. Weinkrantz has technology clients, although AT&T is not one of them, he stressed. "I don't hate the phone company. I don't hate the cable company. I'm just having fun," he said of the blog. So far, he misses his Time Warner-delivered HDTV and his digital-video-recorder service, he said. But he's impressed that his television screen now has its own IP address and he likes having a home media gateway controlling three TVs, he added.

Open Student Television Network ( OSTN ) is the only 24-hour global channel devoted exclusively to student-produced TV programming. OSTN features a wide variety of programming genres ranging from soap operas like �Ivory Tower� from HRTV at Harvard University to dating shows like �Blind Date� from YTV at Yale University to talk shows like �CU@USC� from Trojan Vsion at University of Southern California to reality shows like �Frosh Life� from Duke University to news shows like �Northwestern News Report� from Medill�s School of Journalism at Northwestern University. OSTN reaches over three million users, 208 research and education institutions, and 34 state education networks and can be viewed on both TVs and PCs. On OSTN, students are not only creating content but they are also making the important programming decisions that appeal to their peer viewing audience. OSTN provides opportunities for students through resources, community, exposure and experience.

DMeurope reports that Telecom Italia has launched 'Parole e Persone', the first channel created specifically for the broadband service provider's Alice Home TV IPTV service. Through the channel, five original programs have been added to Alice Home TV and the Rosso Alice portal. The new channel will include talk shows and cultural and social themes of the day with direct audience participation of the audience via e-mail. The programing of 'Parole e Persone', which is free, will initially consist of five original formats which will be streamed each weeknight from 7.30 pm to 2.00 am and then repeated, in continuous rotation, from 2.00 am to 7.30 pm the following day. Fanny Cadeo, Debora Caprioglio, Marta Cosaro, Marina La Rosa and Raffaello Tonon will be the stars of the channel, hosting the daily programs. The channel will also be available on Rosso Alice (www.rossoalice.it), Telecom Italia's ADSL portal, where the 'content on demand' section is also avail...

Reuters reports that viewers have watched ABC television shows available online about 3 million times since the Walt Disney Co. network launched the free service just over two weeks ago, Disney's chief executive said. The figure provides an early sign of demand for television programs available on the Internet as television broadcasters experiment with new ways of reaching viewers. ABC began a two-month Internet trial earlier this month, allowing viewers to watch four of its programs, including blockbuster hits "Desperate Housewives" and "Lost," on the Web with commercials. "We're going to experiment with different business models," Disney CEO Bob Iger said at a lunch sponsored by the Boston College Chief Executives' Club. Disney is looking at a variety of options for expanding the service, which airs shows on the ABC.com site about 12 hours after they are first broadcast on television, Iger said.

Digital Connect reports that Cisco Systems' Linksys division is committed to chasing down the home and SOHO market with the help of digital integrators, says Michael Pocock, the new senior vice president and general manager of the division. "I�ve been a big fan and very passionate about the notion that the home market had to be integrated, that there is an opportunity to take advantage of all the various converging products: voice over IP with multimedia, with networking needing to go into the mass market," Pocock says. "I think Linksys is in a perfect position to take advantage of that. When you look at what vendors would be positioned to pull all of those various pieces together and be able to penetrate not only the home market but also SMB, in my opinion, there wasn�t anybody better suited in the industry than Linksys." While Linksys has traditionally focused its sales of home products through retail stores, Pocock says the sophistication of new connected hom...

Multichannel news reports that the U.S. Public Broadcasting Service (PBS) added seven programs to its roster of primetime titles available for viewing via local free video-on-demand (VOD). Cable operators now have 10 shows to choose from to make available to subscribers via free VOD up to seven days after their broadcast premieres. Joining Antiques Roadshow, Frontline and The NewsHour with Jim Lehrer will be: Nature, Nightly Business Report, Now, P.O.V., Tavis Smiley, Washington Week with Gwen Ifill & National Journal and Wide Angle. PBS will also provide quarterly features, including selected episodes from Nova, Masterpiece Theatre and Mystery. �As viewer habits shift, it's critical that local PBS stations make their content available on-demand in this way, allowing our stations to not only reach additional viewers at times convenient to them, but also to highlight the quality content and variety of services the stations offer their communities,� PBS CEO Paula Kerger said in a...

Deutsche Telekom is launching a 'Hello Future' marketing campaign with the goal of jump starting its corporate image in advance of new service rollouts. "The aim of the new campaign is to enable Deutsche Telekom to assert its role of pioneer on the market. The company is to be equated with innovative strength, reliability, credibility and continuity. Customers should trust the company, feel secure and genuinely like it," said Antje Hundhausen, Head of Marketing Communication at Deutsche Telekom. Earlier this month, Deutsche Telekom confirmed that it is on-track to launch its IPTV service by mid-year. VDSL upgrades have been completed at 12,000 aggregation points in ten cities. The company said it has signed agreements with a number of TV content providers. It also has suppliers on board for set-top boxes and software. Deutsche Telekom also confirmed that it is on-track to launch its "T-One" fixed-mobile convergence service by mid-year. A trial with some 1,00...

Forbes reports that despite the recent buzz about entertainment on cell phones, the mobile-content market has hit a speed bump. After an initial burst of growth, mobile content -- which can include everything from ring tones to video clips -- is struggling to break out of the early adopter segment and achieve mass consumption. It is too soon to forecast the demise of this promising new field, but it is evident that wireless entertainment is wavering during a crucial transition to third-generation mobile telephony, or 3G. According to Seattle-based mobile market research firm M:Metrics, consumption of wireless content has flatlined. After eight quarters of rapid growth, sales in the two main categories, ring tones and mobile games, have stalled. Every month in the U.S., only 10 percent of mobile subscribers download a ring tone to their phones, and less than 4 percent download games. Text messaging is holding steady at about 33 percent. On advanced 3G handsets, consumption is about thre...

Online payments are poised to replace paper checks as the main means Americans pay their bills, a survey released Wednesday said. According to a poll conducted by Harris Interactive for CheckFree, a vendor of back-end e-bill paying services, online payments are used to pay 35 percent of all bills, nearly matching the 37.5 percent of bills paid by paper check. Last year, the differential was more than 20 points. The number of Americans paying bills online also continues to grow. In 2005, 56 percent of U.S. households with online access said they were paying at least one bill online; CheckFree's 2006 survey edition said 69 percent of homes with Web access are paying one or more bill online. Cost, or the lack of one, is among the reasons for the surge in online bill paying. More than 9 out of 10 users who pay their bills from one consolidated site, such as a bank, brokerage, or credit union, said they got the service for free. Users also like that e-bill payments save paper, stamps, a...

Worldwide service provider next generation voice and IMS equipment revenue dropped 7 percent to $722 million in the first quarter of 2006, but is up 48 percent from the first quarter of 2005, according to Infonetics Research. Strong annual growth will continue over the next few years, driven by media gateways and softswitches, with the total next generation voice market hitting new highs each year until it reaches $6.2 billion in 2009. Phenomenal growth in residential and SOHO VoIP subscribers is forecast as well. Worldwide, the number of subscribers is expected to nearly double between 2005 and 2006 to 47.3 million, and will continue to skyrocket through 2009. In 2006, there will be: - 21.3 million subscribers in Asia Pacific, up 50 percent from 2005 - 13.6 million subscribers in EMEA, up 151 percent from 2005 - 12.3 million subscribers in North America, up 184 percent from 2005 "As usual, the first quarter for next gen voice was weak, but year over year, it continues to grow wel...

Trendwatching.com reports that while a select number of companies is cautiously experimenting with CUSTOMER-MADE projects, the opportunities represented by the co-creation trend are becoming more massive every day. CUSTOMER-MADE trend, co-creating with your customers, is the most important one to watch. Not because everything has to or will be co-created in the future, but because tapping into the collective experiences, skills and ingenuity of hundreds of millions of consumers around the world is a complete departure from the inward looking, producer- versus-consumer innovation model so common to corporations around the world. Definition: �The phenomenon of corporations creating goods, services and experiences in close cooperation with experienced and creative consumers, tapping into their intellectual capital, and in exchange giving them a direct say in (and rewarding them for) what actually gets produced, manufactured, developed, designed, serviced, or processed.� What it Isn't:...

Almost overnight, mobile video and advertising has emerged as the next step in the evolution of personal consumer media choices. For major advertisers and entertainment interests, the race is underway to figure out how to use video iPods, online video space and cell phones to get effective messages where the next generation of consumers will see them. The New York Minute Film Festival, launched the first major online film competition to showcase 60-second works of amateur and professional filmmakers last year. The second annual competition opens tomorrow, with entries accepted until early October and award winners announced in November 2006. "We welcomed entries from filmmakers in 16 countries last year and are already fielding calls from around the globe," said Jeff Cahn, one of the festival founders and partners at Convergence, the visual media company that launched the festival last year and is donating the infrastructure to support it. "The filmmaker's challenge ...

According to Pyramid Research, China�s two fixed network operators indicated that they will expand their IPTV trial areas to six more cities in two other provinces. China Telecom�s trial cities in the six provinces already have more than 30 million internet subscribers and China Netcom�s current trial area has 3 million users. This provides an initial scope of the addressable market for IPTV subscribers. Pyramid expects IPTV subscribers to take up about 2 percent (700,000) in the first year. It is likely that operators will promote IPTV bundled with ADSL which, in turn, will generate the pull factor to accelerate broadband internet migration. Through this bundle pricing strategy, total household broadband penetration will increase from 7 percent in 2005 to 20 percent in 2010. On the other hand, IPTV is forecast to increase internet average revenue per subscription (ARPS) by around US$6�7. In March 2006, China Telecom revealed that it had contacted Shanghai Media Group and Alcatel S...

Advertising for the Internet segment sizzled and national cable networks chalked up healthy increases in Q1 2006 vs. Q1 2005, according to a Kagan Research survey that also found growth in local cable underwhelming. Internet advertising posted a hefty 54 percent increase in ad revenue in the January-March period, according to the Quarterly Barometer survey in Kagan newsletter Broadband Advertising. That's off slightly from 56 percent growth in Q4 '05, as the accompanying table indicates. "With over 50 percent year-on-year growth in both quarters, I don't think one could say there's any deceleration yet," says Erik Brannon, associate analyst at Kagan Research. "The real question mark is how long it can keep going at this red-hot pace before it settles into a more traditional growth pattern like the one national cable networks are in now." Internet leader Google chalked up a 79 percent gain in Q1 ads, though the biggest percentage gain came from Barry ...

Dow Jones reports that the brief Spanish-American War ended more than a century ago, but not the federal tax assessed to fund the victory. Until now. The U.S. Treasury said it would stop collecting the 3 percent 'federal excise tax' on long-distance calls, a fee originally assessed in 1898. The government also said it will issue refunds 'requested' by consumers and businesses that paid the fee over the past three years. Taxpayers will be able to request refunds when they file 2006 tax returns in early 2007. The tax, which generates more than $6 billion annually, has survived repeated efforts to eliminate it. For decades, all telecom service providers (phone companies like AT&T) have been required to collect the excise fee from customers and pass it on to the federal government. Yet some large corporations such as Hewlett Packard successfully sued to get rid of the tax, claiming it was illegal. Others have won large refunds from the IRS. However, the average Am...

Annual sales of home media servers will reach nearly 50 million units in the U.S. by the end of 2010, according to Parks Associates' new report "Media Servers: Analysis and Forecasts." The report, which defines a media server as a hard drive-based platform with media sharing software linked via a home network, finds that demand- and supply-side drivers will spur the growth of these media centralization platforms over the next five years. "Consumers will benefit from the capabilities and features provided by home media servers, which will enhance their home media experiences and offer safeguarding and storage for their digital content," said Kurt Scherf, vice president and principal analyst, Parks Associates. "In addition, many industry players - including technology vendors, equipment manufacturers, and service providers - will benefit from the development and distribution of centralized storage platforms to the home." The media server's presence a...

At more than a century old, cinema is a mature business. Cash flow margins of its components tend to be at the low end of the spectrum for all media � which in recent history has been 20 percent for theaters and 15 percent for major movie studios. And the legacy movie production and distribution process is relatively capital intensive. Despite those drawbacks, equity capital is pouring into the industry at an accelerated rate. For example, (George) Soros Strategic Partners bought the DreamWorks live-action film library for $900 million in March. In the past few years, the top three movie theater circuits were purchased by private equity funds. "This volatile business, amazingly, never seems to be short of investment capital," notes Wade Holden, analyst with Kagan Research. "One big reason is that the major studios have a knack for turning every new technology that, at first glance, is threatening into a source of money. That goes back to the VCR and before that broadcast...

Mobile games, music and TV & video will be worth a total of $25.9 billion by 2011, according to forecasts from Informa Telecoms & Media released at the Mobile Entertainment Market (MEM) 2006 conference & exhibition at the Business Design centre, London. The growth in mobile content services will be driven by music in 2006, which will be worth $7.4 billion rising to $13.6 billion by 2011. Games continues to grow despite fears the market was stagnating and is expected to generate $2.4 billion this year, and rising to $7.2 billion in 2011. Mobile TV will make its mass-market entrance in conjunction with this year�s soccer World Cup in Germany next month. Informa forecasts mobile TV & video contributing $1.2 billion to total global mobile entertainment revenues this year, with $300 million mobile TV & video revenues generated from the World Cup alone.

According to the latest Harris Poll, the number of adults who are online at home, in the office, at school, library or other locations continues to grow at a steady rate. In the past year, the number of online users has reached an estimated 172 million, a five percent increase. In research among 2,032 U.S. adults surveyed by telephone in February and April 2006, Harris Interactive found that 77 percent of adults are now online, up from 74 percent in February/April 2005, 66 percent in the spring of 2002, 64 percent in 2001 and 57 percent in spring of 2000. When Harris Interactive first began to track Internet use in 1995, only nine percent of adults reported they went online. The proportion of adults who are now online at home has risen to 70 percent, up from 66 percent in 2005 and 55 percent in the spring of 2002. The percentage of those online at work has not really changed (35 percent now, 36 percent in 2005) yet is still up from 30 percent in the spring of 2002. Adults who are onlin...

According to Point Topic, Consumer broadband value-added services (BVAS) revenues increased by 74 percent during 2005. At the start of the year, revenues were running at an annual rate of $6.9 billion. This had increased to $11.9 billion 12 months later. And the contribution of value-added services to overall broadband profit margins was bigger in 2005 than in 2004. The increase in value-added services revenues was steeper than the growth in the number of consumer broadband lines (49 percent increase to 183 million lines) or total broadband access revenues (29 percent increase to $54 billion) during the same period. Therefore, by the beginning of 2006, value-added services were adding an extra 22 percent to access revenues. This compares with a contribution of 18 percent at the start of 2005 and 10 percent at the start of 2004. For the year 2005 as a whole, Point Topic estimates that consumer BVAS revenues were $9.1 billion, with access revenues of $47.8 billion. In value terms, the to...

WSJ columnist Lee Gomes tells the story of how simplicity, by design, may be Apple's forte -- but it remains elusive to the likes of Intel and Microsoft. Just take a look at one of the central products of the emerging post-PC world -- a living-room "media center" that will function like your current set-top box, but will also let you TiVo your favorite shows and access videos on the Web, among other things. Intel is making a big push to get into this market, and has launched a huge campaign around the newly minted Viiv brand to show how its chips work in these devices. But one of the first Viiv-based machines, judging by a review forwarded by industry watcher Pip Coburn, isn't anything I'd want in my house. The unit is described as big, boxy and ugly, with a loud fan and a badly designed remote control that crashes easily and takes a long time to do things even when it does work. Apple is rumored to be preparing its own living-room video product, and whatever its ...

Dow Jones reports that production companies and broadband infrastructure providers agreed on rules to jumpstart online distribution of films, the European Commission said. The "European Charter for Film Online" was signed at the Cannes Film Festival. Commission officials said its was the first of its kind in the world and ended a standoff between the makers and distributors of films over anti-piracy measures. We hope this is the end the problem that has been plaguing the industry - producers didn't want to put their films online fearing that they were going to be stolen," said Martin Selmayr, a Commission spokesman. "This represents the first steps to work jointly to fight piracy." According to Selmayr, the Commission now will support a pan-European license for online film distribution. In this way, companies won't have to ask for 25 separate licences, one for each E.U. member. Under the agreement, infrastructure makers agreed to put the new releases on...

ClickZ reports that Google will begin showing "click-to-play" video ads on partner sites in its content network, the company announced on its Inside AdWords blog. The ads join existing text, Flash, and image ad formats for advertisers in the U.S., Canada, and Japan. Google had been testing rich media ad units since January. According to the AdWords blog, video ads will compete for placement on sites with other text, Flash and image ads. As with image ads, advertisers can choose to bid on a CPC or CPM basis. They will be available for campaigns with both site-based and keyword-based targeting, and can also be geo-targeted internationally, nationally, or locally. To be less intrusive, Google is making the video user-initiated. When a page loads, users will see a static image until they click the ad to play it. The unit will have fast-forward, pause, and volume controls, and will click through to the advertiser's site. Google is touting the video ad unit as a good option not...

The latest research from Informa ranks the UK as the most digital country in Western Europe. The Converging Media (CM) Index, published quarterly by Informa gave the UK a CM index of 30.5 at end 2005 putting it some distance ahead of the second ranked market - Finland - on 23.1 "The UK is by far Western Europe's most digital market and its surprising number one ranking is due to the huge take-up of digital TV, the sector now boasts a base of almost 17 million users." comments Steve Mullins, editor of Informa Telecoms & Media's research service. "On top of digital TV, the UK market also added 900,000 new customers to mobile-broadband services in the final quarter of last year, accounting for an impressive growth of 23 percent." The UK now has 4.8 million mobile high-speed subscribers. Although ranking second in the CM Index, the Finns outdid the Brits with their on-the-go appetites as the market's cellcos added 35,000 new broadband subs in the final q...

Card-based contactless payment systems may be new, but the signs already point to a coming migration from cards, with their limited functions, to mobile handsets making use of Near Field Communications (NFC) to enable a whole range of sophisticated services including, but not limited to, contactless payment. This migration will offer market participants a constantly changing and expanding set of opportunities to cement customer loyalty and reap the benefits of co-branding and cross-promotion. When ABI Research first examined the contactless payment market one year ago, it forecast that over 10 million contactless payment cards would be issued in North America during 2005. As the year drew to a close, that forecast proved highly accurate. With another year's worth of insight into market dynamics, the latest update concludes that over 40 million cards, mini-cards, and fobs will ship globally in 2006. "Contactless commerce is on a steep growth curve, but cards are only an interm...

France Telecom (FT) is the latest European incumbent to confirm plans for a dual-mode phone combining the benefits of mobile and fixed wireless networks. As reported by Reuters this week, FT is aiming for a fourth quarter launch for its converged telephony service and will make an official announcement next month. The company is apparently well advanced with developments and aims for a rapid rollout to compete with similar product launched recently by competitors Iliad and Neuf. News that FT will launch a converged GSM/Wi-Fi phone solution follows nearly a year after BT launched its new Fusion product, a system that allows mobile phone users to roam onto Wi-Fi networks so that they can access landline call rates. In Germany, Deutsche Telekom is currently trialling a similar product with Nokia and is expected to make a commercial launch sometime in the next three months.

Informitv reports that the consortium that promotes Freeview digital terrestrial television in the UK plans to launch a 'Freeview Playback' brand to promote consumer awareness and sales of personal video recorders. The success of Freeview has so far been based on offering viewers a simple way to receive digital television. Freeview now wants to increase consumer awareness of the benefits of digital video recorders (DVR). The Freeview Playback initiative aims to provide an industry standard label for Freeview digital recorders to reduce consumer confusion. "The launch of Freeview Playback is crucial to driving consumer understanding and uptake and will help to define the category," said Freeview general manager Cary Wakefield. The adoption of personal video recorders (PVR) for free-to-air digital television has been comparatively limited, with the focus on the promotion of low cost set top boxes. Freeview is the fastest growing digital television platform in the UK and...

According to Business Week, backed by a Venture Capital investment, a former FCC official's startup is out to provide no-fee, ad-supported wireless service. There's little debate whether the U.S. is a laggard in high-speed Internet access. About 40 percent of U.S. households surf the Net over so-called broadband connections. That's about half the rate in Korea and Japan. And it's significantly behind many countries in Europe. Furthermore, consumers in those countries pay significantly less for more bandwidth, relative to the typical U.S. version of broadband -- now more accurately referred to as 'narrowband plus' service. Harder to settle is what needs to be done. Enter John Muleta, a senior U.S. communications official under both Presidents Bill Clinton and George W. Bush. Muleta, former head of the wireless bureau at the Federal Communications Commission, wants to offer free wireless broadband to consumers across the U.S. So he has launched a new company calle...

HD Radio and HD2, also known as multicasting or supplemental audio channel broadcasting, offer a multitude of new opportunities for North American broadcasters faced with fierce competition from satellite radio. According to a recent study from ABI Research, satellite radio has gained more than nine million paying subscribers in four years, and is now putting a crunch on the traditional broadcasting market. "Fear of satellite radio is prompting an unprecedented level of cooperation among broadcasters in their efforts to launch HD Radio and HD2," says Frank Viquez, director of ABI Research's transportation practice. Viquez adds that HD Radio multicasting is especially attractive to broadcasters because of its ability to divide the radio signal into separate audio channels, allowing new programming opportunities. "Traditionally, many stations with dual formats have been forced to split their programming according to a certain time schedule; thus HD2 offers them many ne...

Although media networking is growing, many owners of Media Center PCs or PCs with TV tuners are still not using them for recording TV broadcasts, reports In-Stat. Analysis shows that many of these owners are not recording TV programs on those devices, and opting instead to use their Personal Video Recorder or Digital Video Recorder instead. This is one of the key findings of a new In-Stat consumer survey with broadband users to determine interest levels, and current use of, various digital home client devices, home networking equipment and applications. "Wireless LAN (WLAN) is strongly preferred as the home networking technology of choice for not only experienced home network users wanting to upgrade their equipment, but also those who are planning to set up their first home network," says Joyce Putscher, In-Stat analyst. In-Stat also found the following: - There is still a low awareness of what Media Center PCs are, as evidenced by the 70 percent of respondents who did not h...

According to John Dvorak, the content owner's DRM mantra is actually a smoke screen for their anti-competitive behavior, and the protection of a broken legacy business model that intentionally bundles small pieces of good content with lots of 'crap' content. "The record industry needs DRM more than the movie industry does, because it needs a surefire way to keep people from copying the one good song from an album. It needs the leverage of that one good song to continue to gouge the public with high prices. In many instances, the one good song per album actually amounts to the user spending $15-$18 for one song, since the other ones are junk. The record industry folks hate iTunes and other single-song distribution mechanisms for this reason. They've even suggested that certain singles be sold for more money than usual. They are trying to recoup all the money they would have made selling albums with one good song and 13 pieces of crap. For the people who run the movi...

Technology-oriented marketers are often doomed to making the same mistakes, over and over. A common mistake is the assumption that a really creative marketing campaign idea can generate demand for a product launch that otherwise appears to lack a compelling innovation. The Snap.com contest is perhaps a good case study in this regard. The well-intentioned leadership team at this new search engine describes their challenge as "faced with somewhat daunting objectives of driving traffic to Snap, launching the new brand, capturing market share from companies like Google, Yahoo, and MSN, and doing it with a launch budget that pales in comparison, a contest was born. We were just not sold on the traditional marketing methods available, they are for the most part boring and we were under whelmed at the prospects of using a standard banner campaign to market Snap (not to mention no money to do a big TV campaign)." Understood; traditional promotional marketing methods probably aren...

Advertising Age reports that for the week of the broadcast network upfront presentations, Bolt Media hopes this statistic delivers a bullet to TV: Only one in four 12- to 34-year-olds can name all four major broadcast networks: ABC, NBC, CBS and Fox. The finding comes via an online poll conducted by Bolt Media, a 10-year-old Web site that six weeks ago relaunched itself as a place for users to upload videos and photos. About 400 members responded to the questions, including one that asked how respondents spent their free time. The most popular activity? That would be surfing the Internet, which 84 percent said they did during their idle periods. Hanging out with friends came in second at 76 percent, watching movies third at 71 percent and TV viewing fourth at 69 percent. The five most-watched TV networks were Fox, Comedy Central, ABC, MTV and Cartoon Network. "There's a massive movement going on in people under 30 and how they spend their media time," said Bolt President ...

The IAB, in conjunction with its Broadband Committee and Measurement Task Force, announced final Broadband Video Commercial Measurement Guidelines at the IAB Leadership Forum: Broadband & Beyond in New York. These measurement guidelines determine at what point a broadband video commercial is counted and address on-line browser or browser-equivalent based Internet activity that involves streaming video and audio advertising content and are principally applicable to Interactive media companies and ad-serving organizations. Once again, this measurement standard measures the ad itself, at the point where a consumer views the commercial, versus other media that measure the programming or content. By issuing this set of measurement guidelines in the early stages of this burgeoning platform, the Interactive media industry has taken a proactive step in helping to streamline the development of infrastructure and business practice. The broadband guidelines were completed after an industry-wi...

The Christian Science Monitor reports that more and more, Americans are being caught in a dilemma: They love electronic gadgets with lots of bells and whistles. But they're also frustrated when they get their new toys home and find out they aren't easy to install or operate. Half the products returned to stores are in good working order, but customers can't figure out how they work, says a recent study conducted at the Technical University of Eindhoven in the Netherlands. On average, American consumers will try for just 20 minutes to get a new gadget to work before giving up, the study adds. As a result, the world continues to be filled with poorly designed products, doomed to either gather dust in a bottom drawer or be returned to the store. The problem only will worsen as technological change accelerates, some observers say. (Finally figured out your VCR? Here comes TiVo and Slingbox.) But manufacturers are beginning to see the importance of simplifying their products. In...

According to Research and Markets, the Internet's leading portal companies have enjoyed a stunning rise (traffic, net revenues), and have established themselves as powerful brands, thanks to a handful of extremely popular key services. Their business models rely a great deal on advertising services and distribution, for low per-unit margin but high volume markets. So these Internet giants are working to be as big as they can, by offering an array of (possibly free) appealing services. They are battling it out chiefly amongst themselves in the services market, seeking to gain a greater share of the pie, while also destroying rival services' value by offering certain paid services for free, or at drastically reduced prices. This ongoing battle of the Internet giants is not without consequences for the telecom industry. Concerned with creating new revenue streams, telcos can either elect to develop their own service offerings directly, or to join forces with Internet portals and a...

New approaches to customer care -- In today's intensely competitive telecoms environment, proper, timely and relevant customer care is absolutely vital to the future success of operators and service providers. In this short panel discussion , Keith Willets, chairman of the TeleManagement Forum, bluntly says that "telecom operators do customer service differently, they do it quite badly." Furthermore, where other industries have apparently learned to use web based self-service and self-help to improve customer service, the telecom sector lags the market leaders by primarily outsourcing call centers to countries with low-cost labor. Willets suggests that the solution to help broadband service providers to catch up is to fundamentally rethink the way that customer service is delivered.

Dow Jones reports that U.S. television networks - CBS, ABC, NBC, and Fox - made their best efforts this week to wow advertisers with their fall programming lineups, but the hype may do little to boost advanced ad sales. The TV ad market is changing, and the importance of the "upfront" ad market appears to be in decline. Cable, the Internet, and digital video recorders are challenging the dominance of the traditional 30-second TV spot. "The most obvious proliferation of new distribution platforms is increased leverage for advertisers, who now have more options when putting their budgets to work," Merrill Lynch & Co. analyst Jessica Reif Cohen said in a report. But the question is whether the upfront market matters as much amid an onslaught of new media alternatives and resistance from advertisers. Traditionally, about 80 percent of broadcasters' advertising space is sold for the coming season at the upfront market, which takes place months before the shows ar...

As technology continues to advance, consumers are increasingly using different forms of audio and video on their own terms � a phenomenon Edison Research began tracking in 2005 called "on-demand media consumers." The last 12 months have seen numerous partnerships arising from consumer adoption of these technologies and behaviors that have led to unprecedented control over the types of programming they consume and when they consume it. The advent of on-demand devices and services such as TiVo/DVR, iPod with video, Video On Demand (VOD) programming from cable/satellite TV providers and others is beginning to change the way content providers deliver media and the manner in which they are consumed. Arbitron and Edison Media Research present the latest in their series of Internet and multimedia market studies entitled "Internet and Multimedia 2006: On-Demand Media Explodes." A total of 1,925 people were interviewed to investigate Americans� use of various forms of tradit...

It's no small accomplishment that the five full-pay TV movie services are thriving, given that an explosion of media over the past 10 years has intensified the competition for consumer dollars. Despite the challenges from video-on-demand, video games, mobile TV phones and the like, total subscriber units to the five full-pay premium services rose from 46.4 million at end 1995 to 81.5 million at end 2005, according to Kagan Research. That's a 76 percent increase. How did HBO, Showtime, Cinemax, The Movie Channel and Starz collectively achieve those gains? "The premium services have quickly adopted new technology over the past decade and a half," says Deana Myers, senior analyst at Kagan Research. "They've managed to reposition themselves by embracing the new, rather than standing still and letting new media marginalize them." For example, the three companies that own the five services were early adopters in multiplexing � creating new TV channels for digi...

After an 8 percent hike in revenue in the fourth quarter, worldwide DSL aggregation hardware slowed in the first quarter of 2006, dipping 5 percent to $1.6 billion, according to Infonetics Research. The dip in revenue reflects cheaper port prices, not a slowdown in the market, as evidenced by the 38 percent jump in DSL ports from 2004 to 2005. By 2009, worldwide DSL aggregation hardware DSL port shipments are expected to soar to 460 million. "The broadband boom is in full force, and we're at the stage now where DSL aggregation hardware revenue is pretty flat because ports are getting so cheap, but we'll see a nice ramp up in revenue in 2007 that will continue to climb rapidly at least through 2009," said Jeff Heynen, directing analyst at Infonetics Research. "The first quarter of 2006 saw a huge jump in VDSL port shipments, indicating an increase in fiber to the curb and fiber to the node deployments, a sign that DSL providers are focusing on getting higher bandw...

Incumbent network operators that are hoping to boost revenues by charging premium fees for delivery of some broadband content are likely to realize modest gains if current rules that guarantee so-called net neutrality are eliminated, according to a new report from Light Reading Insider. "At first glance, charges for the delivery of Internet content look as though they could provide an additional $10.7 billion in carrier revenues by 2010," notes Simon Sherrington, research analyst for Light Reading Insider. "Such fees could expand carrier business data revenues by around 16 to 17 percent in the U.S. alone and would go a long way toward improving profitability and financing new infrastructure deployment." But a variety of factors � including potential customer churn, competitive pressures from operators that maintain net-neutrality policies, and the ongoing threat of re-regulation � would likely diminish those revenue gains, Sherrington says. "If operators could ...

JupiterResearch finds that 63 percent of large companies plan to syndicate content via Really Simple Syndication (RSS) by the end of 2006. According to a new report by JupiterResearch Senior Analyst Greg Dowling, currently only 29 percent of large companies (with more than $50 million in annual revenues) publish content via RSS. The growth of RSS is also highlighted by the fact that 48 percent of current RSS publishers are spending $250,000 or more to deploy and manage syndicated content. However, JupiterResearch has also found that spending at this level is inconsistent with the current rate of adoption. "Despite low perceived adoption rates and definitive measurement standards, site operators are increasing spending on RSS deployments," said Dowling. "In order to maximize their investment in RSS, site operators should leverage emerging tools and technologies specifically tailored to RSS." RSS users are heavier consumers of online media than traditional online user...

Cinema advertising could be a $1 billion business in a few years, National Association of Theatre Owners president John Fithian said Thursday at the Cinema Advertising Council's second annual Marquee Marketing at the Movies event. "Patrons are not just comfortable with the preshow, they actually like it," Fithian said at the gathering designed to entertain and rally Madison Avenue a week before it goes through the broadcast networks' annual upfront presentations. Last year, Fithian said, cinema advertising accounted for $500 million in revenue for theater owners, ranking third behind the core revenue streams of ticket sales and concessions. With total year-to-date revenue for theaters up over last year, advertisers and theater owners are optimistic that the medium's growth momentum will continue. Ironically, when viewed from a theatre owner profit margin perspective, the sequence is very different -- concessions are most profitable, followed by advertising and las...

The addition of incremental value-added services (VAS), such as TV-based caller ID and home monitoring, to basic triple-play service bundles in the U.S. will boost monthly revenue per subscriber to $206 by 2010, according to Parks Associates. By definition, a bundle features any combination of landline voice, wireless voice, high-speed Internet, or television from a single service provider. Current revenue per subscriber from triple-play bundled services is $148 per month. "The bundled services market is becoming increasingly crowded with service providers, including cable MSOs and telcos, all offering similar combinations to consumers," said Deepa Iyer, research analyst at Parks Associates. "At present, competitors are struggling to differentiate beyond aggressive price cuts and catchy promotions. At the same time, customers place a premium on specific value-added services, so naturally broadband carriers are going to use these features as key competitive differentiator...