Consumers taking the wheel in defining services
By Brian Santo
CANNES – Consumers are confronted with more and more devices that keep expanding the options for where and when they can access a widening variety of content. That’s creating a desire and expectation among consumers to share content across devices. For service providers, accommodating those desires and expectations is straining resources and forcing the investigation of new business models, according to many of the guests at the Third Annual C-Cor Global IP Summit.
C-Cor Chairman Dave Woodle opened the conference with the observation that IP’s perspective has changed in two short years, from investigating what service providers can do, to extending solutions across networks, to a complete shift in focus to the consumer perspective. Now that service providers are laying the groundwork for new services, what are the services and capabilities consumers are demanding?
Consumers, Woodle noted, are spoiled in that as soon as they get something, they want something more. Demand for HD is exploding, and consumers now want multi-screen access to the same content.
Service providers, of course, keep trying to accommodate the increasing demands but must do so despite constraints on resources ranging from bandwidth to storage. That’s only one challenge to providing the personalized content consumers are demanding.
Another is correlating all of the services. Yes, the triple play is widely available, perhaps even on one bill, but consumers still end up having to contend with multiple contact numbers and addresses, and services still differ from device to device.
Furthermore, business models are changing and will have to change more. Consumers only want to pay for what they’re using, but that doesn’t necessarily correspond to the business models most service providers have.
Herve Payan, SVP of France Telecom’s content division, explained that France is one of the most competitive markets in the world, and that multi-screen capability is already available because of it. “We’re selling 20 megabits per second, plus unlimited telephone, plus 150 channels for about 30 euros, or about $40 a month. That’s what’s going to happen all over the world with greater competition.”
An audience member asked how it was possible to make money under those circumstances. Payan replied that the model is changing. Previously, France Telecom was making money largely from access, but the revenue stream is now shifting so that it is coming more from applications. The assumption, he said, was that costs keep rising, and it’s hard to make money under those circumstances. But the assumption is false. Once the infrastructure is in place, network cost is hardly a factor.
France Telecom has 20 Mbps. Is that enough? Payan said that, so far, it is, even if that bandwidth has to be juggled for consumers using all three services in the triple play at once. Maybe broadband access might have to be compromised under those circumstances. France Telecom’s service can do one HD channel at a time now, but with improved compression rates, it will be able to do two simultaneous HD channels next year, Payan said.
Charter Communications CTO Marwan Fawaz noted that 60 to 70 percent of Charter’s IP traffic is peer to peer, and that there’s an expectation of 30 to 50 percent traffic growth every year for the next 10 years. “You have to invest in your network. It’s not sustainable to keep the speeds we have today.”
Those speeds are frequently 6 to 8 Mbps for cable operators (in contrast to France Telecom – that’s for data and voice only). Service providers are simply going to have to provide more bandwidth. Charter’s Fawaz and Kable Deutschland CTO Lorenz Glatz said their organizations would be increasing their top broadband speeds to 16 Mbps.
Fawaz said Charter will be deploying set-tops with cable modems going forward, and the company is looking at options for moving IP content to TVs via the DOCSIS backchannel.
Survey shows Verizon’s service atop cable ops’
By Traci Patterson
Verizon’s customers like the company more than most cable customers like their cable company, claims a new Verizon-commissioned survey.
Verizon said nearly 40 percent of its customers were very likely to recommend Verizon bundles to others. Comparable numbers were just above 31 percent for Cox, 28 percent for Time Warner Cable, 25 percent for Cablevision, 24 percent for Charter and 23 percent for Comcast.
And a large number of cable customers reported that they are ready for a new TV and Internet provider. A third or more of the customers at Comcast, Cablevision, Cox and Charter, and more than a quarter of TWC’s customers, said they were likely to switch providers. Fewer than 18 percent of Verizon’s customers were likely to switch.
The survey, conducted by Flake-Wilkerson Market Insights, queried Verizon customers and competing cable companies’ customers on how they feel about their phone, Internet and video packages.
The companies were rated on overall performance, reputation, value, billing, customer service, products and services, quality and reliability, and pricing. Verizon beat the top five competitors on overall performance, quality and reliability, and customer service, the company said.
The survey was conducted in markets where Verizon’s FiOS Internet and TV services are available, and participants did not know who had commissioned the poll.
Verizon’s FiOS Internet service recently placed fourth in PC World Magazine’s 100 Best Products of 2007 ranking, and an American Customer Satisfaction Index report showed Verizon and the telecom industry leading cable in customer perceptions of service quality.
FTC: Broadband moving toward more competition, not less
By Traci Patterson
Policy makers should carefully consider the potentially adverse and unintended effects of regulation for broadband Internet access, says a new 170-page Federal Trade Commission (FTC) report entitled “Broadband Connectivity Competition Policy.”
“This report recommends that policy makers proceed with caution in the evolving, dynamic industry of broadband Internet access, which generally is moving toward more – not less – competition,” said FTC Chairman Deborah Platt Majoras. “In the absence of significant market failure or demonstrated consumer harm, policy makers should be particularly hesitant to enact new regulation in this area.”
“We commend the agency for comprehensively examining the competitive forces, both economic and policy, at work in today’s Internet,” said NCTA President and CEO Kyle McSlarrow, in a prepared statement. “As the leading provider of residential broadband in America, cable welcomes this thoughtful report.”
Free Press, an adamant open access supporter, said the FTC has ignored the overwhelming public support for net neutrality. S. Derek Turner, research director for the company, said: “On fourth down, with the future of the Internet on the line, the Federal Trade Commission decided to punt. While the FTC rightly acknowledges that consumers strongly prefer the free and open Internet the way it is, much of the agency’s lengthy new report largely ignores our broadband reality.
“Millions of Americans can’t access or afford high-speed Internet services, and the United States continues to slip in every global ranking of broadband progress. The same phone and cable companies whose anti-competitive policies created this sorry situation are now proposing to become gatekeepers over Internet content and services. But the FTC seems content to stand on the sidelines.”
Adelphia’s John, Timothy Rigas off to jail
By Traci Patterson
On Wednesday, a federal judge ordered Adelphia Communications Corp.’s founder John Rigas and his son, Timothy Rigas, to report to prison on Aug. 13, nearly three years after the two were convicted in a corporate fraud case, the Associated Press reported.
In May, the 2nd U.S. Circuit Court of Appeals in Manhattan upheld the men’s convictions, on charges of securities fraud, conspiracy to commit bank fraud and bank fraud.
John Rigas was sentenced to 15 years in prison, and his son to 20. Last year, another son, Michael Rigas, was sentenced to 10 months of home confinement after pleading guilty to a charge of making a false entry in a company record.
Cablevision offering new Web portal to subs
By Traci Patterson
Cablevision Systems Corp. has unveiled an Optimum Online Web portal that provides enhanced personalization options, automatic news and information delivery based on location, and integration with iO digital cable and Optimum Voice.
The site allows users to check TV listings, listen to voicemail messages and manage their account with one control panel.
Other features of the new portal include a search engine, centralized video content, and a new lifestyle channel with features such as health news and horoscopes.
Nielsen to acquire Telephia
By Traci Patterson
The Nielsen Company is set to acquire Telephia Inc., a consumer research firm for the telecom and mobile media markets. Terms of the transaction, expected to close in Q3, were not disclosed.
Telephia provides measurements of consumer behavior, product quality and consumer attitudes in the telecom and mobile spaces.
The acquisition fits in with Nielsen’s entry into the mobile sector. The company recently said that its Nielsen Wireless service will begin measuring mobile Internet and video usage.
Broadband briefs for 6/28/07
* Cricket picks Alcatel-Lucent for network upgrade
Alcatel-Lucent has been chosen by Cricket Communications Inc. for its network expansion. Under the terms of the five-year agreement, Cricket has committed to purchase up to $126 million worth of equipment, services and software from the company.
The expansion includes the deployment of 3G CDMA2000 1xEV-DO Rev. A technology, which will provide Cricket’s customers with VoIP, high-speed Internet and mobile video telephony services.
* MoCA’s contributor class adds first members
Broadcom Corp., Conexant Systems Inc. and BroadLight Inc. mark the first three companies to join MoCA’s new contributor class. The companies will participate in the formation and direction of new specifications.
* Harris Broadband partners for FTTP launch
Parasun Technologies Inc. has partnered with Harris Broadband to launch digital phone service in Brownwood, Texas, utilizing fiber-to-the-premises (FTTP) technology. Harris is using Momentum Telecom as a third-party voice service provider.
* Microsoft adds media, entertainment exec
Microsoft Corp. has named Katherine Styponias as general manager of its Media & Entertainment Group, where she will lead the business development team and work with content suppliers. Styponias joins Microsoft from Prudential Equity Group, where she served as senior VP and senior cable, entertainment and satellite equity analyst.
* Cisco hits 1,000th WAN customer mark
Cisco has passed the 1,000th-customer mark in the wide area network (WAN) optimization market.
The company launched its Wide Area Applications Services (WAAS) solution in September.
* Verizon building fiber in Virginia
Verizon is starting its all-fiber construction in Manassas and Manassas Park, Va. The company must obtain cable franchises from the respective city councils in order to offer its FiOS TV service.