Archive for May, 2008

Akimbo’s End: An Insider’s Account

Analysts I spoke with today were unsurprised that Akimbo Systems went dark this weekend after multiple strategy revisions. (See their analysis of the kinks in Akimbo’s plans here.) But one thing that did surprise some of them was how soon after the company’s last infusion of capital and new management the final flame-out took place. Some reports have hinted at friction between employees of the video-on-demand vendor and its most recent top executives. I personally heard from one former employee, whose detailed account of Akimbo’s internal problems is excerpted here:

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Wireless Roundup: FCC ponders new spectrum;

Most carriers live by the maxim “You can never have enough spectrum.” Now the FCC has adopted a variant: “You can never sell enough spectrum”. Flush from the $19.6 billion 700 MHz auction, the FCC is now examining what other parts of the electromagnetic rainbow it can tap for commercial wireless use. The two prime candidates are new Advanced Wireless Service licenses and, of course, the highly controversial ‘white spaces’ between broadcast channels.

FCC chairman Kevin Martin has scheduled a vote over whether to auction off another 25 MHz of the upper AWS band, but not for the traditional voice and data services of the original AWS sale. Instead, Martin is proposing the winner of said auction would begin an immediate and aggressive roll-out of a nationwide broadband network AND offer service gratis to the end customer. It sounds very similar to the now defunct plans of several muni-Wi-Fi providers, except this would require the operator to actually buy the airwaves it uses. It may sound far-fetched but the FCC has already gotten proposals from at least one company to offer just such a service. M2Z apparently thought enough of the free business model that it took the FCC to court when it rejected its request for the license.

Google founder Larry Page was in Washington this week lobbying the FCC, Congress and anyone else that would listen about the virtues of white space between the 700 MHz spectrum–how it would be an optimal place to shove a new broadband network. The FCC doesn’t appear to be anywhere near a decision on what to do with these nooks between television broadcast channels. It does, however, have the National Association of Broadcasters breathing down its neck to kill such a proposal, while Google pushes for the opposite. Meanwhile it continues to test white space devices, all of which seem to work in the lab, but not necessarily outside of it.

Nokia’s quest to gain greater market share in the U.S. got a welcome boost this week. T-Mobile announced it would launch four new Nokia feature phones this month. Avian securities estimated Nokia has 18% of T-Mobile’s “shelf space”, but that percentage would start inching up in June. T-Mobile is the smallest Tier I operator in the U.S. so Nokifying it handset portfolio won’t have a tremendous impact, but with new CDMA handsets emerging and its support for the new AWS bands, Nokia may see its market share percentages inch up a few points. NPD had Nokia with a No. 4 market share at 8% in Q1, still far behind No. 3 LG Electronics at 17%.

The Cricket EZ phone made the U.S. Consumer Product Safety Commission’s recall list this week because of problems establishing audio connections with 911 systems. Leap Wireless, Cricket’s umbrella company, reported the problem to regulators earlier this year and voluntarily recalled the devices. Leap officials said that it started notifying its customers by phone and text about six weeks ago, asking them to come to Cricket store for a firmware upgrade. About 190,000 phones are on the network, the majority of which have been fixed, Leap said.

Ontela’s networked camera phone platform is gaining some momentum among U.S. operators–at least the smaller ones. Cincinnati Bell this week launched Ontela’s photo upload application, which uses the cellular data network to automatically transfer photos snapped with a cameraphone to online photo storage sites or a customer’s PC. Alltel launched the same service in April.

Peter Adderton’s new digs

MVNO pioneer Peter Adderton is back. Instead of starting a new virtual operator, though, Adderton is attempting something new, a media and marketing agency dealing in virtual media.


Analyst: Is carrier femtocell pricing doomed?

Of femtocells, TeleChoice’s Danny Briere writes:

“Now that I’ve seen some of the initial telco offerings taking shape and deployments looming, I’m disappointed with the word on the street about femtocell pricing. Carriers are thinking like telcos, not consumer electronics manufacturers. They’re taking something quite simple and making it complex – just like the rest of their cell phone plans.

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The economics of a mature market

Has the wireless market in the U.S. finally hit its saturation point? Have we finally “matured” so much that every subscriber add is a steal from someone else’s network and the few remaining souls without a cellphone are just too plain stubborn to not bother with? Do we have to look elsewhere for growth? There are plenty of signs pointing to just that.

A new report from Bernstein Research points out that Q1 net subscriber adds dropped 23% year-over-year, and overall subscriber numbers have fallen from 11.5% to 7.9% in the same period. Further, the NPD Group found that handsets sales volumes dropped 22% in Q1 compared to the same quarter in 2007. It’s eerie how those two percentages match up. Sure, we’re still growing, but the boom days are long gone.

What’s most interesting about this trend, however, is how it will change the fundamental business of wireless. more

Not everyone sees the magic in Jack

The success of MagicJack in numbers alone is without a doubt notable. The company is selling around 8,000 devices per day and has experienced 25% week-over-week growth since it first came onto the VoIP scene in September. Still, not everyone is singing Jack’s praises. The company has left many Jack users frustrated with its customer service department. While most seem willing to accept the technology glitches inherent in any new service, many have taken issue with the company’s response to dealing with these issues.


All signs point to 3G

Employee emails banning vacation from June to July. Reneged Wi-Fi support. Rumors of subsidies and out of stock handsets. As we grow closer to the one-year anniversary of the launch of Apple’s iPhone, the shady dealings around the handset have grown omnipotent.


The TV emperor has no clothes

No less a source than Mark Cuban is pointing out the current fallacies of the Internet video model, although he is using Craig Moffett of Bernstein Research to do it. Moffett has become the industry’s supreme number-cruncher, a guy willing to look past the spin to what quarterly earnings and federal regulatory reports actually tell us. He’s the canary in the coal mine about recent access line losses, among other things.

This time, though, Moffett, and now Cuban, are taking on the reality of advertising support for video and how Internet video is undermining the current market, while priming a new audience of viewers to expect to not only get video content for free, without ads, but to also get only the best of what content creators have to offer.


Wireless Round up: T-Mobile subs grow; Leap, Metro expand

T-Mobile reported 981,000 new net subscribers for the 1st quarter bringing its total up to 30.8 million. T-Mobile continues to make the transition from the tiny Tier I to a large operator in its own right. It was helped along by its the closing of its acquisition of SunCom Mobile in February, which added another 1.1 million subscribers (not included in the net adds) to its roles. Still, T-Mobile has a long way to go to catch up to the big three. AT&T ended the quarter with 71.4 million subs, and Verizon Wireless with 67.2 million. Sprint, the No. 3 and most struggling operator, still hasn’t reported its Q1 results (coming Monday), but it had 54 million customers at the end of 2007. Of course, T-Mobile may being doing a lot better in the customer count in the next few quarters if any of the swirling rumors about Deutsche Telekom buying Sprint prove true–operationally, that would be another story


Speculating on Sprint

Is Sprint finally giving up on Nextel? After three years of trying to integrate the iDEN network operator into its business, it looks like it may be throwing in the towel–at least according to the Wall Street Journalmore


May 2008
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