Digital Lifescapes

If you look back over the past decade, while the Global Networked Economy has evolved as the leading nations in the Asia-Pacific region continue to expand their infrastructure capabilities, the market for broadband Internet access in America has been remarkably stable. While the FCC has historically been tasked with administering the nation's communications laws and associated regulation, it has struggled to have an impact with the part of its charter that's focused on "supporting the nation's economy by ensuring an appropriate competitive framework for the unfolding of the communications revolution." By and large, even in the major metropolitan areas of the country, a duopoly still exists -- where the majority of wireline broadband internet subscribers are being served by either a single local incumbent cable company and/or a single legacy telephone service provider. Once again, Leichtman Research Group (LRG) has provided some illuminating market data that...

According to the latest market study by Leichtman Research Group (LRG), the nineteen largest cable and telephone providers in the U.S. -- representing about 93 percent of the total market -- acquired 330,000 net additional high-speed Internet subscribers in the second quarter of 2010. Net broadband additions in the quarter were the fewest of any quarter in the nine years LRG has been tracking the industry. That said, it's not clear what is responsible for the significant decline. Is it still the economic environment, is the market fully saturated at the current price points, are limited-time price incentives not attractive to the prospective customers? Other key findings from the market study include: - The top phone companies had a net loss of about 7,500 subscribers -- compared to a gain of 385,000 subscribers in 2Q 2009. - AT&T had a net loss of 92,000 subscribers in the quarter -- this is the first time that any of the top ten broadband providers reported a quarter...

Wi-Fi has achieved consumer electronics device ubiquity, according to the latest market study by In-Stat . The number of applications and devices where Wi-Fi technology is integrated continues to expand. Not only is Wi-Fi now in nearly every smartphone sold, but the wireless connectivity technology is in almost every handheld game, tablet, netbook or notebook computer sold. Now, include new wireless network applications such as automotive, digital cameras, E-readers, Blu-ray and personal video recorders -- plus, new medical and industrial applications -- and with every type of device, there is likely a Wi-Fi chipset inside. As a result, it should come as no surprise that In-Stat's latest forecast for Wi-Fi chipsets will pass one billion units shipped annually by 2012. "Overall the Wi-Fi chip business has never looked stronger," says Allen Nogee, Principal Analyst at In-Stat. While traditional products like routers, wireless access points, and business gateways a...

The AT&T recent decision to implement broadband data caps and charge extra fees for heavy data usage on wireless devices poses grave implications for over-the-top (OTT) video service providers, according to the latest market study by iSuppli Corp . By discontinuing its unlimited access plan, AT&T is now seeking to limit data usage of smart phones. The data caps will make it difficult for any high-quality video streaming application -- without the permission and support of wireless operators. "iSuppli believes that most of the emerging streaming Internet models are mistaken in postulating that they could displace, over time, traditional television and movie delivery mechanisms without paying for related network costs," said William Kidd, director and principal analyst for financial services at iSuppli. Meanwhile, new broadband subscribers worldwide are projected to rise in 2010 by 63.5 million -- up 8.4 percent compared to total net additional subscribers of 58.5...

The FCC's number one long-term goal: At least 100 million U.S. homes should have affordable access to actual download speeds of at least 100 megabits per second and actual upload speeds of at least 50 megabits per second. Meanwhile, what is happening with subscriber adoption in the short-term? Leichtman Research Group (LRG) found that the nineteen largest cable and telephone broadband service providers in the U.S. -- representing about 93 percent of the market -- acquired over 1.4 million net additional Internet subscribers in the first quarter of 2010. These top broadband providers now account for over 73 million subscribers -- with cable companies having 40.2 million broadband subscribers, and telephone companies having nearly 32.9 million subscribers. Other findings from the LRG market study include: - The top cable companies added over 915,000 subscribers, representing 65 percent of the net broadband additions for the quarter versus the top telephone companies. - Ove...

Broadband service delivery in the United States is highly concentrated -- with most new subscriber additions still going to the very largest service providers, as new competition continues to elude the marketplace. Leichtman Research Group, Inc. (LRG) found that the nineteen largest cable and telephone providers in the U.S. market -- representing about 93 percent of the market -- acquired nearly 4.1 million net additional high-speed Internet subscribers in 2009. Annual net broadband additions in 2009 were 75 percent of the total in 2008. The top broadband providers now account for nearly 71.8 million subscribers -- with cable companies having 39.3 million broadband subscribers, and telephone companies having 32.5 million subscribers. The market status-quo remains intact, with no immediate signs of progressive change on the horizon. Highlights from the Leichtman market study include: - The top cable companies netted 57 percent of the broadband additions in 2009. - The top...

As the South by Southwest Festival of 2009 comes to an end, let's acknowledge the open unConference events -- as people from all over the world connected together and joined their Indie Music or Independent Film "community of interest" while in Austin, Texas. I've launched the GeoBrava Media project, in celebration of all the independent talent that stays true to their art-form -- passionately creating new digital media content -- regardless that their work is considered unCommercial by the legacy big-media companies. Free and Open Distribution Models The rise of the unLabel music production and open distribution model is a revolt in response to the traditional record label's business practices. Ditto, with the rise of the unStudio video production and open distribution phenomenon. A multitude of social media networking sites are creating the new open marketplace online, where the vast market supply is freely exposed to the awaiting eclectic market demand. The ...

The switchover to digital television (DTV) broadcast transmissions will reduce coverage, and therefore viewers, within many markets of the United States. People are unaware of the consequences of this transition -- including most TV advertisers. The Federal Communications Commission (FCC) released two reports that show changes in the coverage of the nation's full-power television stations as they prepare to transition from analog to digital broadcasting on February 17, 2009. The FCC initiated this side-by-side comparison to proactively identify the changes associated with the switch to digital broadcasting by TV stations and share the information with consumer viewers throughout the country. "It is critical that broadcasters use the information in these reports to inform their viewers about how changes in their coverage may affect them," stated FCC Chairman Kevin Martin. "We expect broadcasters to make this information readily available and include it in all of thei...

For several years now, I've reviewed the dozens of market research results that land in my email inbox each week, and then I post the ones that are most thought provoking to me -- here on my Digital Lifescapes blog. Sometimes I insert my own perspective into the mix. Other times I reflect upon an event I've attended, or write about my personal experiences. A new blog post is the end result, and most are focused -- in some shape or form -- on the Global Networked Economy. I continue to post content, and -- according to my Web site analytics and RSS feed stats -- more and more people apparently read the content. I never ask for feedback. That is, until now. Yes, these are unsettling times, given the global economic climate. I sense that we, the human race, are at a crossroads. What we, collectively, choose to do next will shape our shared future together on this planet. That's what I believe. Now is a good time to consider how far we've progressed, on the home front. Man...

The FCC, with its low bar of expectation policy, still maintains that any data speed above 200 Kbps is considered broadband, as the rest of the developed world laughs at this apparent denial of truly Olympic proportions. Meanwhile, In-Stat noted that at the NXTcomm show in Las Vegas, Verizon announced it is increasing the top speed of its FiOS broadband service in 10 states. They will now offer downloads at 50 Megabits per second (Mbps) and uploads at 20 Mbps -- up from 30 Mbps downstream and 15 Mbps upstream. FiOS service areas in California, Delaware, Indiana, Maryland, Oregon, Pennsylvania, South Carolina, Texas, Virginia and Washington will benefit from the speed increase. Apparently, the 50 Mbps service is already available to FiOS customers in Connecticut, Florida, Massachusetts, New York, New Jersey, and Rhode Island. However, the broadband boost comes with a high price (compared to other countries) -- the 50 Mbps download and 20 Mbps upload service will cost $140 per month. In-...

During the period 2007-2012, the worldwide mobile subscriber base is expected to increase by 1.8 billion, according to the latest market study by Portio Research. Around 67 percent of these new subscribers -- a little above 1.2 billion subscribers -- are expected to come from just 10 fast-growing country markets worldwide. Of these top 10 growth markets, nine have been identified as high-volume, low-ARPU (Average-Revenue-Per-User) emerging mobile markets with significant potential in the next five years. Portio's study identified only one truly wealthy nation among this top 10, the United States of America, home to one of the highest ARPU rates in the world, yet also the 4th biggest growth market of the 2007-2012 period. The U.S. is expected to add more than 65 million mobile subscribers to the worldwide subscriber base in the period 2007-2012. This might look relatively insignificant compared to the massive numbers expected to be added from high-growth markets such as China (542 m...

Dynamic Spectrum Access is a novel approach that uses new radio technology within a specially-designed regulatory framework to allow spectrum to be shared efficiently, moving away from fixed allocations to a more flexible and dynamic arrangement. A key component will be software radio and its derivatives, collectively known as smart or cognitive radio. These radio technologies use several techniques to change to different radio frequencies, adjust power levels, and change waveforms, and are able to detect other users of the spectrum to avoid interference. "Spectrum, especially in the UHF band, is attractive to mobile operators for mobile TV, voice and high-speed data services," says ABI Research analyst Ian Cox. "It is also used by terrestrial TV broadcasters, the military, and security services, and they all want more of it. Regulators, over the years, have boxed themselves into a corner by allocating it exclusively for individual applications. This can now begin to cha...

The WCA Thought-Leaders Forum: U.S. Presidential Candidates Debate Broadband -- a go-to website about the candidates and their broadband policy positions -- was featured as the resource for the Telecom Policy Report's article entilted "19 Presidential Candidates in Search of a Broadband Policy." Telecom Policy Report cited the WCA as a diplomatic source for broadband policy. "Its editors thank the Wireless Communications Association International (WCA) for putting together a comprehensive listing of the broadband policy positions of each of the candidates in the primary contests. The WCA tried hard to be non-judgmental and to simply present the candidates and their positions." The article provides an individual review and commentary on each of the Democrat and Republican candidate's stated broadband polices, emphasizing the importance of increased public awareness for the issue, particularly at a time when the U.S. is falling further behind in ...

According to an SNL Interactive report, XM Satellite Radio and Sirius Satellite Radio have offered details of the programming choices a merged company would offer, promising to provide consumers with "a la carte" packages starting at $6.99 per month. I'm left wondering, why didn't the FCC or the U.S. Department of Justice push for this type of requirement before approving the AT&T merger with BellSouth -- or any of the prior mergers that reduced the potential for competition, while further consolidating the American communications and media landscape? SNL says that the proposed packages seem to lend credence to the satellite radio company's claims that their proposed merger would result in lower prices and expanded consumer choice, a contention merger opponents such as the National Association of Broadcasters dismiss. Under the proposed pricing plans, which the companies said they planned to include in their reply comments filed with the FCC on July 24, custo...

Just a little over a year ago, most analysts thought the U.S. market would only see deployments of fixed WiMAX in rural areas with little or no DSL or cable modem service. During the summer of 2006, however, the bar of expectations was raised off the ground -- but it needs to go much higher. In July, Clearwire made a firm commitment to shift its proprietary network to mobile WiMAX, receiving investments from Intel and Motorola. Shortly afterwards, Sprint announced its plans to deploy mobile WiMAX to make use of its extensive 2.5 GHz spectrum, becoming the first major mobile operator to commit to WiMAX. "Today we are watching major strategic alliances, partnerships, and mergers starting to take place," says ABI Research principal analyst Philip Solis. "DirecTV and EchoStar announced a partnership with Clearwire, allowing Clearwire to bundle broadcast video and -- when its network is deployed -- provide the DBS companies with a fast, low-latency pipe into the home." ...

Nearly half (about 47 percent) of all adult Americans now have a high-speed internet connection at home, according to the latest survey conducted by the Pew Internet & American Life Project. Keep in mind, high-speed is a relative term, since anything over 200kbps is considered "broadband" by the FCC. The percentage of Americans with broadband at home has grown from 42 percent in early 2006 and 30 percent in early 2005. Among individuals who use the internet at home, 70 percent have a high-speed connection while nearly a quarter of Americans (about 23 percent) still use dial-up connections. Is the U.S. broadband glass half-empty, or half-full? You decide. The 12 percent growth rate from 2006 to 2007 trails the 40 percent increase in the 2005 to 2006 timeframe, when many people in the middle-income and older age groups acquired home broadband connections. Those groups continued to show increases in home broadband adoption into early 2007, but at much lower rates than in the...

U.S. regulators have denied a request by the cable television industry to delay new rules designed to open up the market for cable TV set-top boxes -- and in the process have started to unravel the longtime duopoly of Motorola (owner of General Instrument) and Cisco (owner of Scientific Atlanta). According to a Reuters report, the Federal Communications Commission (FCC) said it would not postpone an order that requires cable companies to separate the security functions from set-top boxes and put them into a CableCard that can be easily used in TVs and set-top boxes made by other manufacturers (not owned by the duopoly). "In a new era with a competitive set-top box market, consumers will enjoy greater choice and reap the benefits of exciting and innovative features -- such as the ability to watch Internet videos or view slideshows of family vacations on their TV sets," FCC Chairman Kevin Martin said in a prepared statement. I believe that Chairman Martin should have gone farth...

IDC predicts that regulation around net neutrality will be decided in favor of facilities-based broadband service providers like AT&T, Verizon, and Comcast -- in a decisive move by the combined telecom and big media lobbyists who are are actively shaping U.S. government policy. IDC believes that keeping the Internet free from net neutrality regulation will ultimately benefit large scale Internet incumbents like Google, eBay, and Amazon. Here's their rationale. Core to the net neutrality debate is the issue of control and monetization of broadband networks by facilities-based broadband providers, according to IDC. In contrast, I believe that the real issue is big media companies maintaining their "gatekeeper" influence, with a perpetuated status quo that favors both a bias of perspective and a scarcity of alternative opinion. Led by an explosion in Internet video, IDC forecasts that the U.S. consumer Internet generated IP traffic is going to be three times heavier in ...

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...