Technology | Media | Telecommunications

Saturday, April 30, 2011

Online OTT Video Service Most Important Features


In the U.S. market, eMarketer estimates that 158 million internet users will likely watch video online at least monthly in 2011 -- up from 145.6 million in 2010.

One in five consumers in the U.S., UK, Australia, Brazil, Germany, Italy and Spain told Accenture in March 2011 that they were watching significantly more online video.

Increased convenience is the key to online video demand around the globe. Two in five internet users surveyed said the ability to catch up with episodes -- by pausing and watching at their leisure -- was the most important feature of online video.

Another 24 percent said being able to use online video like a personal video recorder was the most important feature. That said, interactivity and social features were the least popular choice globally -- cited by only 11 percent of all internet users polled.

Online video viewers reported that their leading frustrations include delays due to buffering and poor video quality. Moreover, advertising interruptions while watching video was also a frequently mentioned annoyance.

In the U.S., some TV viewers may want to interact socially. According to a March 2011 survey by Harris Interactive, 17 percent of American consumers use the internet or social media during a TV show to post comments or read about the show.

But about twice as many web users interact online after watching video content.

eMarketer says that if network TV related services, such as Hulu, really want to improve and update their online video streaming offerings, then they should keep the basics in mind before hoping to increase engagement. As an example, perhaps they should seriously consider discontinuing or further limiting their advertising, given the amazing upside growth of the Netflix advertising-free service.

Friday, April 29, 2011

Pay-TV Set Top Box Upside in Developing Countries

There's been numerous recent reports of financial turbulence within the traditional pay-TV sector, but there are still valid instances of some meaningful revenue and profitability progress in the global ecosystem.

Despite the fact that actual device shipments remained relatively flat over the last year, worldwide set-top box (STB) revenues were actually up in 4Q10 over 4Q09.

Total revenues for the quarter were $5.7 billion -- as compared to $5.3 billion in 4Q09, according to the latest market study by In-Stat.

"Even though overall growth in the market was not dramatic there were certainly regional nuances that are worth noting," says Norm Bogen, VP Digital Entertainment at In-Stat.

For instance, there was a significant migration from standard definition (SD) to high definition (HD) in the larger and more advanced markets -- such as North America and Asia-Pacific.

While in the developing regions -- such as the Middle East/Africa and Latin America -- there has been a surge in standard definition boxes with high definition just beginning to make an appearance.

In-Stat's latest market study findings include:

- In North America, satellite set top box unit shipments approached 18 million in 2010.

- European cable set top box revenues are forecast to be $212 million in 1Q11.

- Worldwide IPTV set top box unit shipments increased by 3.7 million in 2010.

- During 2010, in Latin America, 8 million more SD set top box units were shipped than HD boxes.

Thursday, April 28, 2011

MSOs Need a Pay-TV Market Segmentation Study

In the U.S. market, video entertainment "cord cutting" refers to the disconnection and replacement of high-cost pay-TV services. Video cord shaving refers to the elimination of premium channels, or the migration to lower-cost pay-TV service offerings.

Total U.S. pay-TV subscribers remained flat, growing by only some 148,000 during 2010, that's a 0.15 percent annual growth rate -- indicating no significant trend toward video cord cutting/shaving, according to the latest market study by In-Stat.

"A substantial portion of pay-TV subscribers, however, exhibit similar characteristics to video cord cutting households," says Keith Nissen, Principal Analyst at In-Stat.

In-Stat believes that it's important to track these at-risk subscribers, rather than the pay-TV subscriber base as a whole -- because they're the early-adopters that would lead a new trend that could quickly gain momentum. In-Stat says that 30 percent of U.S. MSO customer base would qualify as at-risk subscribers.

In general, In-Stat's latest market data confirms that adoption of online video is growing. But, except for Netflix, the frequency of use is not expanding.

This is largely because consumers are going to online portals to view specific TV and movie content. The frequency of viewing online video will probably not increase until must-see original online programming is introduced.

I believe that there's a window of opportunity for Cable MSOs to study the market segmentation implications of their accelerating subscriber losses. Migration to lower-cost alternatives to traditional pay-TV is the primary motivation for many people who disconnect service, but it's not the only reason.

Now is the time to uncover the other key market drivers, before the trend gains new momentum -- as customer word-of-mouth attracts even more converts to the Netflix subscription offering. As an example, once people choose to supplement cable TV with Netflix, what percentage later disconnect cable service, and why do they do it?

In-Stat's latest market study found the following:

- Cable operators lost 2.5 million subscribers, but satellite and telco operators made up most of the difference.

- Neither age nor household income appear to impact pay-TV service cord cutting.

- More households added premium channels during 2010 than dropped premium channels.

- Cable sports is valued significantly less than on-demand access to TV content or premium TV channels; more sports will not protect against cord cutting.

Wednesday, April 27, 2011

Why Global PC Shipments Will Continue to Decline

Several factors contributed to the latest contraction in the worldwide PC market. Global PC shipments declined 3.2 percent during the first quarter of 2011 -- compared to the same time last year, according to the latest market study by International Data Corporation (IDC).

In contrast, IDC expected a mere 1.5 percent growth in shipments. Clearly, a spike in fuel and commodity prices and the disruptions in Japan added to the industry problems, further dampening a market struggling to maintain momentum.

The PC market showed clear indications that frugality, combined with a shift of focus, will be the norm for the time being. Mature regions are more focused on necessary replacements, as few compelling reasons were present to buy secondary PCs.

Emerging markets fared better due to lower saturation rates, but also slowed somewhat with Asia-Pacific (excluding Japan) slowing to a 5.6 percent growth and China continues to slow after experiencing high growth in 2010.

"While the consequences of events in the Middle East and Japan remain unclear, these will surely be factors that will influence short term market performance for 2011," said Jay Chou, senior research analyst with IDC.

Good-enough computing has become a reality, driving sales of Mini Notebooks and now Media Tablets. Macroeconomic forces can explain some of the PC business transition, but PC vendors must now deliver a compelling user experience that will justify new spending.

The U.S. and worldwide PC market continues to work through a difficult period that is expected to continue into the next quarter, but may start to improve in the second half of the year, according to IDC's assessment.

Slower than expected commercial growth in the first quarter failed to offset the ongoing challenges in the consumer market. While some of the decline may be due demand for media tablets, extended PC lifetimes and the lack of compelling new PC experiences played equally significant roles.

Tuesday, April 26, 2011

Market Fragmentation Shifts Pay-TV Balance of Power

The big news this week in the U.S. market was the Netflix Q1 2011 results, which demonstrates that we continue to witness a period of significant transition within the realm of video entertainment market leadership.

That said, perhaps there's still an upside opportunity for legacy channel-centric pay-TV service providers that invest the time and effort to prepare for the apparent market segmentation challenges -- as on-demand services continue to gain market share.

Furthermore, while some of the world markets with a historically vibrant broadcast TV viewership have lost momentum, or are already showing signs of a major contraction, other emerging markets show promise.

In some regions of the world, market fragmentation is shifting the balance of power -- and the associated video entertainment revenue streams -- as a growing segment of consumers search for lower-cost alternatives to legacy pay-TV services.

Global Pay-TV Markets in Transition

As a result of the changes within the global economy over the last few years, pay-TV subscriber numbers had been negatively impacted. Today, few in the video entertainment industry dispute the new market realities.

However, the situation seems to be improving -- as the total number of pay-TV subscribers by year-end 2010 were greater than year-end 2009 by a little over 6 percent, according to the latest market study by In-Stat.

"Nearly every region showed gains or held their own in 2010. However, cable providers were impacted, to at least some degree, by a migration to satellite and/or IPTV in virtually every region," said Stephanie Pickering, Industry Analyst at In-Stat. "Only Western Europe showed any gains in the total number of cable TV subscribers."

In-Stat's latest market research insight includes:

- China has the largest number of pay-TV subscribers with over 160 million. Shanghai Media SiTV is the largest operator; however, no other pay-TV operator has more than 5 million subscribers.

- The largest regional market of IPTV subscribers is Western Europe with nearly 17.5 million subscribers, of which France has nearly 11 million, led by CanalSat-TPS (Vivendi) and Free (iliad).

- Net Servicos de Comunicacao of Brazil is the largest cable service provider in the Caribbean and Latin America region.

- AT&T went from the sixth largest IPTV operator in the world at the end of 2009 to the fourth largest in 2010.

Monday, April 25, 2011

Asia-Pacific to Surpass 3 Billion Mobile Subs by 2015

The business of mobile phone subscription market development is a constantly evolving challenge. As new wireless technologies are introduced they tend to displace the older ones, if not immediately, eventually.

By 2015, the Asia-Pacific region will surpass 3 billion cellular mobile service subscriptions, according to the latest market study by In-Stat.

"Perhaps no global business model is more fluid than the marketing of cellular communications," says Chris Kissel, Analyst at In-Stat.

Depending upon market conditions, mobile operators can now offer simple 2G analog services or extremely sophisticated mobile networks capable of delivering 40-60Mbps downlink speeds, with many additional offerings in between.


In-Stat's market research found the following:

- FDD-LTE subscription in North America will exceed 10 million in 2012.

- Eastern Europe will realize their 100 millionth 3G cellular subscription in 2013.

- 2011 is the last year that 2G GSM North American subscriptions will be greater than 50 million as operators in the region move their subscriptions to 3G and pre-4G airlinks.

- In 2015, the Asia-Pacific region reaches 500 million combined WCDMA, HSPA and HSPA+ subscriptions.

- 2012 will be the peak of CDMA Rev A, with almost 130 million subscriptions worldwide. Rev A subscriptions are forecast to decline through the remainder of the forecast period.

- CDMA Rel 0+ and Rev B are both predicted to increase subscriptions over that same period.

Saturday, April 23, 2011

Why Tablet Applications are More Engaging than TV


If you're thinking that all the commentary you have read about the rise of the tablet computing era is pure hype, then think again. There's much to be learned by following the development of this evolving trend.

eMarketer reports that research on tablet usage has found that they're primarily being used for entertainment, and the availability of media content on the devices is still driving purchase intent.

A March 2011 market study by mobile ad network AdMob amplifies those findings further, with survey results showing that for many owners tablets are fast becoming a primary source of digital entertainment.

Nearly seven in 10 tablet owners reported spending at least 1 hour per day using the device, including 38 percent who spent over 2 hours on the device. And, while just 28 percent consider it their primary computer, 77 percent are spending less time on desktop or notebook PCs -- since they acquired a tablet.

More than two in five respondents now spend more time each day with their tablet than with a traditional computer or with a smartphone -- and a third use tablets more than they watch TV.

The number one tablet application, according to the survey, was playing games. Since the games being used on tablets are likely single-user games, it would appear that it's the personalized experience that makes the tablet more engaging than using a gaming console and a TV to play these games.

Searching for information, emailing and reading the news rounded out the top four activities -- suggesting that web surfing and keeping up with communications are important tablet activities that go beyond pure entertainment, without reaching very far into the realm of productivity.

Friday, April 22, 2011

Online Video Ads Reach 43 Percent of U.S. Population

comScore released data showing that 174 million U.S. Internet users watched online video content in March 2011 for an average of 14.8 hours per viewer. The total U.S. Internet audience engaged in more than 5.7 billion viewing sessions during the course of the month.

Google Sites, driven primarily by video viewing at YouTube.com, ranked as the top online video content property in March with 143.2 million unique viewers, followed by AOL, Inc. with 57.0 million viewers and Yahoo! Sites with 56.4 million viewers. Microsoft Sites came in fourth with 53.1 million viewers, while VEVO ranked fifth with 52.6 million viewers.

Google Sites had the highest number of viewing sessions as it neared the 2 billion mark, and highest time spent per viewer at 276 minutes, or 4.6 hours.

Americans viewed 4.3 billion video ads in March, with Hulu generating the highest number of video ad impressions at more than 1.2 billion. Tremor Media Video Network ranked second overall (and highest among video ad networks) with 804.3 million ad views, followed by Adap.tv (553 million) and BrightRoll Video Network (398 million).

Time spent watching videos ads neared 1.9 billion minutes during the month, with Hulu delivering the highest duration of video ads at 520 million minutes.

Video ads reached 43 percent of the total U.S. population an average of 33 times during the month. Hulu also delivered the highest frequency of video ads to its viewers with an average of 47 over the course of the month.

Other findings from the comScore market study include:

- The top video ad networks in terms of their potential reach of the total U.S. population were: Tremor Media at 47.9 percent, BrightRoll Video Network at 40.5 percent and Break Media at 39.6 percent.

- 83.5 percent of the U.S. Internet audience viewed online video.

- The duration of the average online content video was 5.2 minutes, while the average online video ad was 0.4 minutes.

- Video ads accounted for 12.7 percent of all videos viewed and 1.2 percent of all minutes spent viewing video online.

Thursday, April 21, 2011

Residential Gateways Enable New Service Delivery

Residential gateway devices are critical to ensuring the successful delivery of multiple broadband service applications -- such as on-demand digital video, IPTV and VoIP -- to subscriber homes.

These broadband service applications are required to help operators increase their revenue-per-subscriber, by positioning service providers as being able to offer more than basic Internet access.

Infonetics Research recently conducted a survey of incumbent and competitive telecom operators in North America, EMEA, and CALA who use residential gateways and CPE to offer broadband and multi-play services.

The resulting market study report captures service providers' strategies for deploying and pricing residential gateways, and their top picks for vendors, services, technologies, and features.

"There is consistency among our survey findings from last year and this year: Service providers want to deploy residential gateways that are powerful and flexible and have multiple options for advanced interfaces, both wired and wireless," said Jeff Heynen, directing analyst for broadband access at Infonetics Research.

Also, gateways need to support a growing list of features to ensure the quality and security of the content being delivered in the home. Features like remote access, IPv6, and IGMP figure prominently among the respondents -- all of which signal a desire to deliver multicast video in the home.

Highlights from the Infonetics market study include:

- Service providers increasingly rely on residential gateways instead of basic modems to deliver voice, data, and video services, because they can be remotely managed, have an open application layer to add on new features, and offer higher throughput and greater security features.

- IPTV is the fastest-growing service that respondent operators expect to offer over their residential gateways.

- Comtrend and Cisco head the list of vendors service providers consider among the top three residential gateway vendors.

- Operators are looking to entice new subscribers with low up-front costs as the competition for new broadband subscribers intensifies, leading many to bundle their residential gateways with multi-play services instead of leasing them.

Wednesday, April 20, 2011

UK Embarks on Path to Next-Generation Broadband

The broadband Internet access market is gaining momentum in Britain, with the total number of superfast lines delivering speeds in excess of 25Mbps set to pass the 250,000 mark this April - according to the latest market study by Point Topic.

Point Topic's Chief Analyst, Tim Johnson, says the number is still quite modest -- currently only 1 percent of homes in Britain -- it does mean that superfast broadband could be in a position to follow in the footsteps of first-generation broadband that was deployed 10 years ago.

"We went on from there to reach over 13 million broadband lines within five years," he said. "Now we have over 19 million. It's dangerous just to assume that history will repeat itself -- but it's still a good pointer to what will happen to superfast broadband in this decade."

Point Topic's estimates for the current penetration are based on its market data from the end of 2010. These show there were 175,000 superfast broadband lines in use by then. The majority were for the 118,000 Virgin Media customers signed up to the 50 megabits per second (50Mbps) cable broadband service.

The remaining 57,000 subscribers were getting superfast broadband over telecom infrastructure owned by incumbent telco BT and alternative network operators (altnets).

Projecting these figures forward and allowing for some increase in growth suggests there were about 236,000 superfast lines by the end of March.

"At that rate we should pass the quarter-million milestone sometime between now and the end of April," said Johnson.

Virgin Media customers are all being served using the DOCSIS 3 standard over co-axial cable infrastructure. As of the year end in 2010, another 3,700 superfast end-users had fibre all the way to their homes (FTTP) giving them up to 100Mbps download speeds or even more.

The remaining 53,000 or so had fibre to their local BT street cabinet (FTTC) with very-high-speed DSL (VDSL) over the last few hundred metres of the telephone line to their homes.

In December 2010 the great majority of the BT lines were sold by BT Retail as their BT Infinity superfast broadband service. An estimated 3,000 were BT Wholesale lines resold by over 20 different ISPs, all relatively small ones so far. The remainder were at BT pilot sites for its FTTP service.

Of course, "superfast" broadband is a relative term. Meaning, compared to some of the high-speed broadband benchmarks already set in the leading Asia-Pacific markets (Hong Kong, South Korea, etc), the UK definition appears modest or even slow by comparison.

Tuesday, April 19, 2011

Home Network Device Market has Mixed Upside

Infonetics Research released its latest quarterly home networking devices market forecast -- which tracks, ranks, and analyzes vendors that make residential gateways, broadband routers, powerline adapters, coax-Ethernet adapters, and home network attached storage (NAS).

Sales of home networking devices grew 11 percent in 2010, to $5.15 billion, on the heels of a 46 percent jump the previous year, with all segments of the market posting increases.

"We're expecting a challenging year for residential gateways this year, as operators have a lot of inventory on hand. They're also having trouble adding new DSL and cable subscribers, said Jeff Heynen, directing analyst for broadband access at Infonetics Research.

This overall trend will keep the market flat in 2011 -- despite strong sales of Homeplug Powerline adapters, MoCA coax-Ethernet adapters, and some home NAS devices.

The Infonetics market study highlights include:

- Quarter-over-quarter, the home network device market was up just 0.1 percent in 4Q10 as residential gateway and broadband router sales slowed in Asia-Pacific and Central and Latin America after a surge the previous quarter.

- The small but fast-growing MoCA coax-Ethernet adapter segment posted the highest revenue growth in 2010, up 93 percent.

- D-Link leads the highly competitive broadband router market in 4Q10. Pace, which recently acquired 2Wire, now leads the residential gateway market.

- The EMEA region leads the world in HomePlug adapter and home NAS device sales, primarily because IPTV penetration is so much higher there, particularly Europe, where telco operators typically offer a HomePlug kit to connect an IP set-top box in the home to a residential gateway.

- While relatively small now, the home NAS market is forecast by Infonetics to more than quadruple between 2010 and 2015 as more consumers purchase these devices to centrally store digital content to share across multiple PCs, tablets, gaming consoles, connected TVs, Blu-ray players, smartphones, and other platforms in the home.

Monday, April 18, 2011

Design Enhancements will Drive Digital Camera Market

The global digital still camera (DSC) market began to recover in 2010 after a significant downturn in 2009, primarily caused by worldwide economic conditions and the increased strength of the Japanese Yen.

DSC unit sales are expected to rise faster between 2011 and 2012, and then continue a steady growth rate over the forecast period -- fueling worldwide revenue to approximately $43.5 billion by 2015, according to the latest market study by In-Stat.

"The DSC market will continue to evolve over the next five years. Semiconductor vendors have a renewed opportunity to address these new demands by supplying solutions to DSC manufacturers looking to differentiate from the competition," says Stephanie Ethier, Senior Analyst at In-Stat.

There's been new progress on the following features: sensitivity, image quality, and video functions.

Compact DSC revenue will remain relatively flat over the forecast period. However, the technology will continue to improve due to the additions of back-side illumination (BSI) sensors that increase small optical format CMOS sensitivity, some all-glass lenses, auxiliaries like Bluetooth, Wi-Fi and GPS, and the beginning of stereoscopic and stereoscopic-like imaging.

In-Stat's latest market research findings include:

- During the period forecast, revenue growth in interchangeable lens digital still cameras surpasses that of compact fixed lens cameras as sensor pixel sizes become less important than image quality.

- Semiconductor vendors will continue to take advantage of opportunities in sensors, image processors, inertial (MEMS) components and micro-controllers.

- By 2015, interchangeable lens DSLR and various implementations of mirror-less cameras will account for 40 percent of worldwide DSC revenues.

- Compact camera ASPs are expected to see minor reductions as the decreasing cost of most electronics and camera bodies is offset by introductions of area-larger sensors and higher quality lenses.

Saturday, April 16, 2011

Mobile Marketing Increases on European Smartphones

 
Over the last few months I've shared a variety of market study summaries that highlight the now rapid adoption of new smartphones, within the U.S. marketplace in particular. This transition is much more pervasive, and global, than you may have imagined.

The European EU-5 marketplace is no exception. eMarketer now forecasts that the number of mobile web users in the UK, France, Germany, Italy and Spain to double between 2010 and 2015.

More than 58 million residents of the EU-5 will use the mobile internet at least monthly, according to eMarketer estimates for 2011. But that will still represent less than a quarter of the population.

"Greater use of browsers and apps, in addition to the already widespread use of text messaging, mean enhanced opportunities for marketers to engage customers at every stage of the purchase process, from building awareness all the way through to after-sales service and customer relationship management," said eMarketer principal analyst Noah Elkin.

Contrary to the popular belief, Europeans are apparently already receptive to mobile marketing efforts, according to eMarketer's recent assessment.

"The willingness of consumers in Europe to interact with brands on their mobile phones -- and their growing appetite for perks such as coupons and special offer alerts -- have jump-started a new phase in mobile marketing," said Elkin.

More companies are moving from direct response campaigns to efforts aimed at driving awareness and ongoing customer engagement. Loyalty efforts are likewise becoming more sophisticated, and marketers are placing emphasis on permission-based practices.

The combined efforts are dovetailed with well-established practices of opt-in mobile marketing in the region.

These, along with other factors, will contribute to major increases in mobile advertising spending in Europe. Mobile ad network aggregator Smaato and research firm mobileSQUARED now predict a tenfold growth rate between 2010 and 2015.

"Successful mobile marketing demands a comprehensive approach," said Elkin. "Leading European marketers understand that mobile is central to the ways customers interact with them. Consequently, they know that mobile is central to the health of their brands."

Friday, April 15, 2011

Media Tablet and eReader Product Design Innovations

Demand for Media Tablet and eReader devices continues to be strong, with product design innovations increasing user adoption. As a result, worldwide revenues for device semiconductors grew over 2,000 percent to $3.3 billion in 2010, according to the latest market study by International Data Corporation (IDC).

With the arrival of Android Honeycomb, dual core processors, and increased bandwidth, IDC expects Media Tablet and eReader semiconductor revenues to grow by 120 percent year over year in 2011.

"The opportunity for semiconductors in Media Tablets and eReaders has exploded and semiconductor suppliers are scrambling to bring to market semiconductor and software platforms to enable these products," said Michael J. Palma, research manager for Consumer Semiconductor research at IDC.

Beyond semiconductors, these suppliers are also providing OEMs with much of the system software as well as support for access into app stores, which is helping to dramatically shorten product design cycles.

Tablets are defined by their connectivity, user interface, and battery life. Semiconductor firms provide the technology to enable these features, with touchscreen controllers and sensors providing the rich user experience; baseband modems, WiFi chipsets, and related integrated circuits (ICs) providing connectivity; specialized semiconductors managing the battery life; and the overall device managed by application processors (APUs).

The appeal of Media Tablets will drive the semiconductor revenue opportunity to a five year compound annual growth rate (CAGR) of 31 percent.

"For the next several years, we will see rapid innovation cycles for products launched into the marketplace and semiconductor suppliers will continue to satisfy evolving end user requirements over the coming years," added Palma.

Highlights from the IDC market study include:

At 99 percent share of APU shipments, the ARM processor architecture dominated this market in 2010 and is expected to lose only a few points in 2011 as the MIPs and x86 architectures struggle for a role in the market.

Media Tablets and eReaders are two devices that share components but whose bills of materials (BOM) are optimized for very different functions. The 2010 average Tablet semiconductor BOM was nearly one and one half times as much as the BOM for eReaders.

Storage and memory ICs accounted for 40 percent of the semiconductor revenue opportunity in 2010, but falling prices for Flash and DRAM will drive system BOM cost reductions through 2015, leading these components' share of semiconductor costs to fall nearly in half over the forecast period.

Thursday, April 14, 2011

Worldwide Mobile Phone Subs Reach 5.5 Billion in 2010

According to the latest market study by ABI Research, the global mobile phone services industry concluded 2010 with 5.5 billion subscriptions.

The Asia-Pacific region accounted for 53 percent (2.9 billion) of that total. One-third of this can be attributed to the huge 2G market in India -- another one-third to China.

As of December 2010, China had 860 million subscribers, although 3G subscriptions accounted for fewer than 50 million, or roughly 5.5 percent of the total.

"While there are wide differentials in disposable income, it is still surprising how slow China's 3G rate of growth has been," said ABI Research practice director Neil Strother.

China's literacy rates are high, familiarity with the Internet is also high through PC use in extended families as well as ubiquitous Internet cafes. And yet, 3G adoption has been muted.

At the end of 2010, China Mobile's TD-SCDMA subscriber base stood at more than 20 million, China Unicom’s WCDMA had 14 million subscribers, while China Telecom had more than 12 million CDMA subscribers.

"3G is generally still viewed as a luxury service in China," notes research associate Fei Feng Seet. "China Unicom reported its 2010 ARPU for WCDMA subscription at US$18.75 per month, which is three times the US$6 monthly ARPU for GSM."

Despite the launch of 3G networks, mobile consumers have not jumped into upgrading their subscriptions immediately as rapidly as in other markets. In fact over the past year, 2G has gained about 80 million subscribers.

ABI believes that demand for 3G data services should pick up in the next two years as prices drop and more consumers require mobile data. 3G is forecast to reach 36 percent of China's subscribers by 2016.

It is unclear whether all the operators will be issued TD-LTE 4G licenses or whether the FDD version of LTE will also be an option in 2014.

Wednesday, April 13, 2011

U.S. Smartphone Adoption Increased by 13 Percent

comScore released data about the key trends within the U.S. mobile phone industry during the three month average period ending February 2011. Their latest market study surveyed more than 30,000 U.S. mobile subscribers.

For the three month period ending February, 234 million Americans ages 13 and older used mobile devices. Device manufacturer Samsung ranked as the top OEM with 24.8 percent of U.S. mobile subscribers -- up 0.3 percentage points from the three month period ending in November.

LG ranked second with 20.9 percent share, followed by Motorola (16.1 percent) and RIM (8.6 percent). Apple saw the strongest gain, up 0.9 percentage points to account for 7.5 percent of subscribers.

69.5 million people in the U.S. owned smartphones during the three months ending in February 2011 -- up 13 percent from the preceding three-month period. Google Android grew 7.0 percentage points since November, strengthening its number one position with 33.0 percent market share.

RIM ranked second with 28.9 percent market share, followed by Apple with 25.2 percent. Microsoft (7.7 percent) and Palm (2.8 percent) rounded out the top five.

In February, 68.8 percent of U.S. mobile subscribers used text messaging on their mobile device. Browsers were used by 38.4 percent of subscribers (up 3.1 percentage points), while downloaded applications were used by 36.6 percent of the mobile audience (up 3.2 percentage points).

Accessing of social networking sites or blogs increased 3.3 percentage points, representing 26.8 percent of mobile subscribers. Playing games represented 24.6 percent of the mobile audience, while listening to music represented 17.5 percent.

Tuesday, April 12, 2011

Over-the-Top Video Service STB Market Share

Infonetics Research earlier this month released its fourth quarter 2010 (4Q10) Cable, Satellite, IPTV, and Over-the-Top (OTT) set-top box (STB) subscriber market share and forecast.

In the fourth quarter of 2010, Infonetics witnessed the dramatic growth of over-the-top video entertainment services, as service providers and equipment vendors seemed to reach their optimal price-points.

However, by and large, these services continue to complement traditional pay-TV rather than fully replace it. On a global basis, demand for set-top boxes continues to increase as more countries transition from analog to digital broadcast television and more operators offer enhanced services -- such as HDTV and DVR.

"There is increasing demand for hybrid set-top boxes, which leverage the existing broadcast infrastructure, but utilize the broadband connection to incorporate OTT content and increase interactivity and on-demand services," notes Teresa Mastrangelo, directing analyst for video at Infonetics Research.

Highlights from the latest Infonetics market study include:

- Worldwide set-top box (STB) sales dipped 1 percent in 4Q10 from the previous quarter, to $3.63 billion, with cable STBs seeing the biggest sequential decline.

- Infonetics projects STB shipments to increase 25 percent from 2010 to 2015, while revenue declines 5 percent to $13.1 billion, as STB average selling prices (ASPs) continue to drop.

- Over-the-top (OTT) media servers (standalone set-top boxes such as Apple TV, Roku Media Player, Boxee STB) experienced the strongest sequential growth, nearly doubling quarter-over-quarter -- as providers such as Netflix and Hulu launched low-cost streaming services toward the end of 3Q10.

- Netflix added more than 3 million subscribers in 4Q10 -- nearly twice as many as in the previous quarter, and 3 times as many as during the same period in 2009. Netflx now supports a subscriber base that exceeds 20 million.

- Hulu introduced its paid service, Hulu Plus, last year at a similar price point; its subscriber base is expected to exceed 1 million in 2011.

- It's anticipated that Amazon UK's purchase of LOVEFiLM will likely drive increasing OTT media server demand in Europe.

- OTT media server revenue jumped 90 percent in 2010, and is forecast by Infonetics to grow to $1.16 billion in 2015.

- The race for vendor leadership in the overall set-top box market is extremely tight, with Motorola just edging out Pace and Technicolor for worldwide revenue in 4Q10 -- due its focus on the lucrative North American market and offering more STBs with HD and DVR functions, which produce higher ASPs.

Monday, April 11, 2011

Traditional Pay-TV Providers Can't Find VOD Upside

Last year, in the fall, the U.S. cable TV service providers decided to work together -- in an unprecedented collaboration effort -- to promote their collective Video-on-Demand (VoD) offerings. They agreed to invest $30 million in an advertising campaign, and they created a dedicated web site (which is now redirected to a Facebook page).

If there was increasing pay-TV subscriber interest in their offering, then they would have increased their share of the growing on-demand video market. So, what was the outcome? Across the whole U.S. market, to date about 10,000 people say they "like" the Movies on Demand brand.

Clearly, this experiment demonstrates that the traditional pay-TV sector has a very tough road ahead -- as more and more people's video entertainment needs shift away from the channel-centric pay-TV model.

Infonetics Research earlier this month released its fourth quarter 2010 (4Q10) Cable, Satellite, and IPTV Video Infrastructure and Subscribers market share and forecast report. The results are very telling.

The overall video infrastructure market was impacted by yet another decline in video-on-demand and streaming content server sales in the quarter -- as well as a slowdown in digital cable and satellite middleware sales, which are tied directly to set-top box sales.

Digital cable and satellite STB sales declined this quarter, particularly in North America -- as net subscriber growth over the last few quarters has been weak.

North American video infrastructure showed the greatest overall decline in the quarter, dropping 7 percent, after two straight quarters of revenue increases.

"North American MSOs and telco IPTV operators slowed their purchases of VOD servers as they continue to struggle with slow uptake of pay VOD programming," notes Jeff Heynen, directing analyst for broadband access at Infonetics Research.

Highlights of the latest Infonetics market study include:

- Worldwide video infrastructure revenue sequentially dipped 3 percent to $836 million in 4Q10.

- Worldwide video encoder revenue increased 10 percent and topped the $100 million mark in 4Q10, representing the third consecutive quarter of growth for MPEG-2 encoders and renewed efforts among cable operators to expand their HD channel lineups.

- Concurrent leads the worldwide video-on-demand and streaming content server market for revenue in 4Q10, followed by ZTE, SeaChange, and Cisco, as Huawei drops from the top 5.

- Operators aren't generating as much revenue from pay video-on-demand services as they would like (much of the unicast video traffic is free or is for subscription services such as HBO, Showtime, and Starz), explaining why cable operators want to be allowed to offer first-run movies earlier, as that would allow them to charge more per movie.

Saturday, April 09, 2011

Why Respected Thought Leaders are Very Influential


Many companies in technology-centric industries like to believe that they employ lots of thought leaders, when in fact they don't. Why are they mistaken? They confuse product subject matter expertise (SME) with real thought-leadership. It's not the same. Moreover, informed people understand the key differences.

What is Respected Industry Thought Leadership?

According to Craig Bading, who wrote a book on the subject, "Thought Leadership is establishing a relationship with and delivering something of value to your stakeholders and customers that aligns with your brand/company value. In the process you go well beyond merely selling a product or service and establish your brand/company as the expert in that field and differentiate yourself from your competitors."

Are you still confused -- does your company employ recognized thought leaders? Let's consider some of the common characteristics of corporate SMEs who are likely NOT industry thought leaders:
  • You are very knowledgeable about your own company's products or services but you don't really understand the macro environment of your target customer segment. You offer naive perspectives.
  • Your name is on lots of white papers and blog posts, but a ghost writer produced all the meaningful content. You speak in sound-bites, but there's little substance in your point of view.
  • You frequently attend internal company meetings to increase your exposure, but people in the marketplace never come to you for guidance. In summary, your market influence is insignificant.

Thought Leadership and the Role of Content Curation

Creating, finding and sharing compelling content can prove to people that you know your marketplace, you're a true thought leader in your industry and can help customers prepare for important new developments.

Why are real thought leaders in such demand, and how do they actively benefit their employer? eMarketer reports that marketers are placing an ever-greater emphasis on content marketing's ability to add value for targets and prospects.

According to February 2011 market study by HiveFire, nearly half of U.S. marketing professionals surveyed are now curating content as part of their strategy, and another 42 percent are familiar with the practice but not participating.

Even among that group, 85 percent had done at least some content curation -- for example by sending an article or other content to a prospect. The main objectives of content curation, according to the survey, were establishing thought leadership and improving brand buzz.

Earlier research conducted by Junta42 and MarketingProfs in May 2010 found that brand awareness was the top goal of content marketing for business-to-business marketers in North America -- cited by 78 percent of respondents.

And while lead generation and search engine optimization were lesser objectives in the HiveFire study, content marketing is proven to improve results in both areas. Besides, HubSpot has also reported on the effectiveness of blogging -- and how content created for social media efforts can boost search rankings.

How Content Curation Helps You Attract Followers

Effective content curation is rare, and perhaps relatively unique. According to HiveFire, the greatest challenges are creating content that is original and compelling, and finding the time to do so. However, it's less challenging to find quality content from third parties. Regardless, nearly half of marketers reported that it was still difficult.

The survey results also found content curation was growing in importance, with nearly seven in ten respondents saying that finding, organizing and sharing content was more important than it was last year. The same number believe it will be still more important in 2012.

Once again, it helps to list the characteristics of companies that are likely NOT good content curators. Your blog posts are always about your products and services and you hardly ever link to outside resources. Your twitter stream is mostly about your company with the odd mention of customers -- it rarely includes links to content with meaningful insights for your primary stakeholders.

Friday, April 08, 2011

Android Primed to Lead Mobile Device Market Upside

According to the latest market study by ABI Research, 302 million smartphones shipped in 2010, resulting in a resounding 71 percent growth over the 2009 shipment levels.

Android's success since its launch is expected to continue. Approximately 69 million smartphones running the Android operating system (OS) shipped last year, and ABI Research expects that by 2016 Android will have captured 45 percent of the market.

"Android, Bada and BlackBerry have a great opportunity to fill the vacuum being left by the disappearance of the Symbian OS within the next two years," says senior analyst Michael Morgan at ABI.

ABI believes that the Apple iOS, which held a 15 percent share of the market in 2010, should continue moderate but steady growth over the mid-term -- likely backed by new product introductions.

ABI Research forecasts a relatively modest 19 percent market share for iOS in 2016.

RIM, which held 16 percent of the market in 2010, is expected to lose just a little ground, and is forecast at a 14 percent share by 2016.

"RIM's slight loss of share doesn't mean falling shipments," says Vice President Kevin Burden at ABI. "RIM has found its niche, but the consumer market will grow faster than its portion of it."

Windows Phone 7 and Samsung's Bada are both aimed at low- to mid-range handsets. With 4 million units shipped in 2010 (amounting to a 1.5 percent market share), Bada has taken off very well, very fast.

According to ABI's assessment, Bada may reach 10 percent market share by 2016. Windows Phone 7, on the other hand, which shipped in two million handsets in Q4 2010, will have to find growth through its Nokia channel -- to take more than 7 percent of the market by 2016.

Burden concludes, "The overall smartphone market growth for 2010 is not really so surprising. What is more significant is the 19 percent compound annual growth rate (CAGR) contained in our forecasts through 2016.

Thursday, April 07, 2011

Online Game Virtual Goods Sales to Double by 2014

Video games had been the domain of teen males in the past, but this is no longer the case. Two distinct developments have changed the player demographic of online games. First, the development of social networking sites, such as Facebook. Second, the increasing prevalence of mobile smartphones.

In the past, within the U.S. market you had to pay $30 to $50 for a game -- or $20 per month for a subscription -- but now you can play them for free, thanks to the rise of the virtual goods revenue model.

This transition has driven the number of social networking and online worlds (SNOW) accounts beyond 10 billion in 2010 -- with nearly 4.5 billion of those considered active accounts, according to the latest market study by In-Stat.

"The virtual goods revenue model is one of several mediums that SNOWs use to generate revenue," says Vahid Dejwakh, Industry Analyst at In-Stat.

The basic premise is to allow everyone to create an account and play for free and then offer users the option of purchasing virtual goods to be able to move up and advance in the game or just to have more fun.

This model is sometimes used exclusively, though it is often combined with the more familiar subscription model, where subscribers pay a monthly fee to have access to exclusive content. Apparently, SNOWs also generate a substantial amount of revenue through advertising deals, from banners to branded goods offers.

In-Stat's latest market study findings include:

- The top 10 virtual goods companies earn 73 percent of current worldwide revenues.

- The Americas and EMEA regions now have grown to account for well over a quarter of all virtual goods sales. However, Asia-Pacific still dominates the global market.

- Online gaming and social networking will drive virtual goods revenue over $7 billion in 2010.

- The emergence of social and casual games on social networking sites and mobile phones has created a 2D virtual goods market that exceeds $2 billion.

- In-Stat forecasts total virtual goods revenues will more than double by 2014.

Wednesday, April 06, 2011

Why Android is Gaining Smartphone OS Market Share

The worldwide mobile smartphone market is forecast to grow 49.2 percent in 2011 as more consumer and enterprise users turn in their feature phones for smartphones with advanced features. Those devices will most likely be based upon Google Android.

According to the latest market study by International Data Corporation (IDC), smartphone vendors will ship more than 450 million smartphones in 2011 compared to the 303.4 million units shipped in 2010.

Moreover, the global smartphone market will grow more than four times faster than the overall mobile phone market. "Overall market growth in 2010 was exceptional," said Kevin Restivo, senior research analyst with IDC.

Last year's high market growth was due in part to pent-up demand from a challenging 2009, when many buyers held off on mobile phone purchases. The expected market growth for 2011, while still notable, will taper off somewhat from 2010.

To capture the strong consumer demand for smartphones, manufacturers have unleashed a steady stream of new models and features over the past two years. The battle for mind and market share has also resulted in stiff competition among the smartphone operating systems.

"Android is poised to take over as the leading smartphone operating system in 2011 after racing into the number two position in 2010," said Ramon Llamas, senior research analyst with IDC.

For the vendors who made Android the cornerstone of their smartphone strategies, 2010 was the year they gained momentum. This year will see an acceleration, as these same vendors broaden and deepen their portfolios to reach more customers -- particularly first-time smartphone users.

However, Nokia's recent announcement to shift from Symbian to Microsoft Windows Phone will likely have significant implications for the smartphone market going forward.

"Up until the launch of Windows Phone 7 last year, Microsoft has steadily lost market share while other operating systems have brought forth new and appealing experiences," added Llamas.

The new alliance brings together Nokia's hardware capabilities and Windows Phone's differentiated platform. IDC expects the first devices to launch in 2012. By 2015, IDC believes that Windows Phone to be number two ranked operating system worldwide behind Android.

Tuesday, April 05, 2011

How Mobile App Stores Grew to $6.6 Billion Industry

According to the latest market study by Portio Research, over the last 2 years the mobile app store sector has grown to a $6.6 billion industry in 2010 -- this revenue growth is forecast to continue over the next 5 years.

Smartphones allow users to download, install and run advanced applications (apps). One factor impacting the growth of mobile applications has been the accelerated worldwide adoption of smartphones.

Furthermore, the success of Apple's App Store has inevitably led to others in the mobile space following suit and introducing their own application storefronts. Today, there are a rapidly increasing number of app stores in the market, with no signs of the trend slowing.

Smartphone and platform vendors, MNOs, and third-party players and independent retailers are also entering the mobile applications market -- demonstrating that mobile apps present great opportunities for all players.

The mobile applications ecosystem encompasses platform developers, application developers, aggregators, mobile operators, handset and operating system (OS) vendors, and application store owners. The apps marketplace is witnessing both consolidation and the formation of consortiums -- to challenge Apple's market leadership.

Mobile applications -- software programs that run on handheld devices such as smartphones and tablets -- have huge potential, with mobile applications already having captured mainstream public attention.

With stakeholders making huge investments to improve the quality and utility of mobile apps, the worldwide mobile applications user base is expected to grow at a CAGR of 37 percent between 2009 and 2015 to reach nearly 256 million by 2015.

Between 2009-2015, mobile application downloads are expected to increase at a CAGR of 53.2 percent, while global revenue from mobile applications (including in-app payments) will grow from $6.6 billion in 2010 to over $23 billion by 2015.

Monday, April 04, 2011

Mobile Network Macro Base Station Deployments

Mobile phone usage is changing and becoming richer with applications. The movement from 2G to 3G is helping to facilitate instant messaging and web-browsing. Given the high cost of wireline broadband Internet access in some parts of the world, a mobile phone will be the way many experience the Web for the first time.

Now, video-intensive applications are being accessed by mobile phones, which is adding to the traffic growth on mobile networks globally. As a result, the number of macro base stations deployed will increase to over 6 million by 2014, according to the latest market study by In-Stat.

"The amount of infrastructure spending in China, India, and the U.S. is mind boggling," says Chris Kissel, Industry Analyst at In-Stat. "Over one third of new base stations deployed from 2011 to 2014 will be in China, India, or the U.S., resulting in a substantial shift in the structure of the industry."

Clearly, CAPEX spending will move industry leadership from Western Europe to the wireless Big Three nations -- comprised of China, India and the United States.

Although the surge in cellular infrastructure spending is global, there are regional and even local differences as to which technology is being employed and supported.

This factor has been instrumental in the development of the largest trend in macro base stations, which is the ability to facilitate multiple air-links.

Major mobile operators are making networking upgrades at sites using the same racks and wiring, in addition to enabling software-defined radio (SDR) base stations -- in order to create an environment where mobile operators can upgrade their networks as needed.

In-Stat's market study uncovered the following:

- Asia-Pacific region spent over $22 billion in each of the three years from 2008 through 2010.

- In Canada, new base stations grew 30 percent in 2009 and another 22 percent year-over-year in 2010.

- In the Philippines, there are roughly 1,500 active base stations supporting 802.16e WiMAX.


- France will deploy nearly 7 thousand LTE base stations in 2014.

- Nigeria will deploy almost 5 thousand GSM GPRS & EDGE/EDGE+ base stations in 2011.

Saturday, April 02, 2011

Newspaper Advertising Losses Could be Much Worse


Online advertising was predicted to gain share of U.S. marketer spending by more than 10 percentage points between 2009 and 2015. However, the current spending on digital media -- including internet and mobile -- has not yet risen significantly, according to the latest assessment by eMarketer.

Among the major media of television, internet, radio, mobile, newspapers and magazines, U.S. adults still spend the most time each day with TV. eMarketer estimates adults watched television for 42.9 percent of the time they spent each day with those media in 2010, and ad dollars align closely, at 42.7 percent.

The internet, by contrast, took up 25.2 percent of U.S. adult daily media time in 2010, but received just 18.7 percent of marketer's ad budget.

"Those of us focused on the internet channel have complained for years that it hasn't been getting its fair share of media dollars based on time spent," said eMarketer CEO Geoff Ramsey. "However, the precise extent of that imbalance has been shrouded in mystery and exaggeration. Now we know it's a gap of 6.5 percentage points."

Mobile ad spending is also behind. It claims 8.1 percent of time with these media, but most of that is devoted to communications activities marketers are not looking to interrupt.

Magazines and newspapers, meanwhile, still account for far more advertising budget investment -- relative to the known consumer consumption (or more to the point, the lack thereof).

eMarketer formed its estimates through a meta-analysis of data aggregated from research firms and other organizations that track advertising spending and time spent consuming various media.

These spending and consumption patterns mean that print media receive the most ad spending for each hour adults spend with them. Print ad spending has dropped considerably by this metric since 2008, but remains high.

Even television gets only a third of the ad spending per hour that print does. If you think that the U.S. newspaper and print magazine industries are in dire trouble now, then imagine how bad things could get for them when marketers react to the market reality.

When you consider that just $0.12 was spent on internet advertising for each hour adults were engaged on the web last year, and that mobile got only one penny per hour of engagement -- it's a major disconnect. That said, today's savvy online marketers may actually be able to benefit from this scenario.

Friday, April 01, 2011

U.S. Mobile Financial Services Market Demand

comScore released the latest insights on the state of the mobile financial services market. The report found that in Q4 2010, 29.8 million Americans accessed financial services accounts (bank, credit card, or brokerage) via their mobile device, an increase of 54 percent from Q4 2009.

The comScore market study analyzed the reasons inhibiting consumers from accessing financial accounts via mobile devices, finding that preference for online access and security concerns topped the list for both smartphone and feature phone users.

"More people are turning to the convenience of mobile devices for their financial service needs, fueled in part by the adoption of smartphones, 3G devices and unlimited data plans," said Sarah Lenart, comScore vice president.

In Q4 2010, 29.8 million Americans accessed financial service accounts via their mobile device -- up 54 percent from the previous year. And, 18.6 million users accessed their financial accounts via mobile browser in Q4 2010 -- up 58 percent from the previous year, 10.8 million accessed their accounts via applications, up 120 percent.

SMS (text message) represented the smallest access point for financial service audiences with 8.1 million users, up 35 percent.

Among mobile banking and credit card users, nearly half prefer going online via a fixed device as the primary way to access their accounts, with 47 percent of mobile banking customers and 44 percent of mobile credit card users doing so.

Mobile has become an increasingly important access channel with 36 percent of mobile credit card users and 26 percent of mobile banking customers indicating it is their primary method of accessing their accounts.

Only a small segment of these users listed speaking with a representative in person or on the phone as their primary access method.

comScore also analyzed the reasons consumers cite for not utilizing their mobile devices for financial activities. The results indicated that preference for using a fixed online device topped the list for both smartphone and non-smartphone users at 53 percent and 45 percent, respectively.

Security concerns were also rated highly as a concern among both smartphone users (33 percent) and non-smartphone users (30 percent). Perhaps not surprisingly, 29 percent of non-smartphone users stated cost as a reason for not accessing these accounts, while only 10 percent of smartphone users said the same thing (as unlimited data plans void this concern for many smartphone users).

About 26 percent of smartphone users also indicated that slow connection speeds hindered their mobile financial service usage. Demonstrating the overall strong awareness of these services, only 6 percent of smartphone users and 5 percent of non-smartphone users stated not knowing about these services as a reason why they did not access these accounts.