NTCA's The New Edge

FLO TV at an End?

Steve Fravel — Wed, 28 Jul 2010 19:54:30 +0000

Citing low subscriber growth during the first three years of operations, Qualcomm is said to be looking closely at options for its FLO TV division. Those options may include selling the division outright, selling the spectrum or finding a partner that can modify the business and take it in a new direction.

Qualcomm reportedly invested $683 million to acquire the wireless spectrum necessary to provide the FLO TV service. FLO TV provides ESPN, ABC, CNN, CBS and Comedy Central among the approximately 20 live channels carried. It is not a nationwide service, though it is available in most major cities around the country.

FLO TV was advertised during the Super bowl and the NCAA Men’s Basketball Tournament, but it has not attracted a sustaining subscriber base. The personal TV device sells for about $150, and the monthly subscription is in the $10-$15 range. FLO TV is the underlying service for both Verizon and AT&T mobile TV offerings available as part of each company’s cell phone service.

According to information provided by the company, Qualcomm is also considering combining existing content from electronic magazines and newspapers along with non-traditional content, working with software developers on applications that would expand the user experience.

Adding options to the television content may be an alternative, I question whether most consumers are willing to pay more per month to have a mobile TV service. Several existing television services will have mobile television available as part of the regular service fee. There may well be a use for the FLO TV technology and bandwidth, but it is likely content other than traditional television.

No related posts.

Disney Pays $763 Million for Social Games

Steve Fravel — Wed, 28 Jul 2010 15:27:02 +0000

According to observers, the social gaming business is booming. Disney’s initial payment of $563.2 million places the Walt Disney Co. squarely into social gaming as the largest Hollywood operator. The deal is reportedly structured to include additional payments of nearly $200 million should Playdom achieve significant undisclosed growth benchmarks.

The concept uses simple games that include ”virtual retail” opportunities for players to purchase everything from clothing and spa visits to refreshments for their game characters. Playdom is one of a group of game developers that are part of the rapid expansion of social game growth in network environments like Facebook.

Playdom will be developing social games based on Disney characters, providing an additional entertainment and interactive experiences for fans who are devoted to networks like Facebook.

According to reports, Disney officials look at the Playdom purchase as additional diversification in their extensive digital media portfolio. The investment places them well into casual social gaming while at the same time allowing for participation in the more complex gaming platforms like XBox, Wii and Playstation.

This is an interesting business where a revenue stream opens that involves “virtual goods and services.” Players are able to outfit characters with all manner of products. According to industry reports, virtual goods and services sold in social games may reach more than $800 million this year.

AT&T Launches New Hotzones, Advances WiFi Strategy

Jesse Ward — Mon, 26 Jul 2010 20:08:05 +0000

AT&T announced today that it is expanding its WiFi hotspot initiative, launching another free “hotzone” in Charlotte, N.C., with another hotzone to be deployed in Chicago in the coming weeks.

AT&T initially launched its hotzone concept back in May with a massive network in New York City’s Times Square.

The free (if you are an AT&T customer) WiFi hotspots are intended to supplement AT&T’s mobile broadband coverage in areas with consistently high 3G traffic and mobile data use.

Despite these high-profile locations and deployments, AT&T is still calling this a “pilot project,” collecting and analyzing user data to determine whether this is a worthwhile endeavor.

AT&T is certainly committed to WiFi as a connection medium. The carrier is the largest WiFi operator in the world, with more than 20,000 WiFi hotspots through retailers such as Barnes and Noble, Starbucks and McDonalds, with all three now offering free Wi-Fi to any store patron.

Last week AT&T unveiled its latest quarterly statistics for Wi-Fi use, reporting a significant second-quarter increase in the number of WiFi connections, fueled by the rising number of customers with Wi-Fi enabled smartphones and devices, as well as an increasing number of businesses and venues offering Wi-Fi access for their customers.

In the second quarter, AT&T handled 68.1 million connections on its public Wi-Fi network — up from 15 million connections in the second quarter of 2009. Customers have made 121.2 million connections in the first half of 2010, already surpassing the 85.5 million connections made in all of 2009. Wi-Fi usage has seen steady and significant growth each quarter, including a nearly 30% increase from the first to second quarter of 2010.

“Wi-Fi plays an important role in AT&T’s strategy to mobilize everything for customers, complementing our wired and 3G wireless networks and bridging the gap between connectivity at home and on the go.” AT&T said in a release. ”

For more on AT&T’s hotzone strategy, see this release.

VOTW: Guy Walks Across America

Jesse Ward — Mon, 26 Jul 2010 18:59:12 +0000

And last but not least, our video of the week (VOTW): Guy Walks Across America.

Watch this average Joe trek past American landmarks. The video was created by a combination of stop-motion and time-lapse shots. The finished project consists of 2,770 still frames shot over 14 days. In this behind the scenes footage, the filmmakers explain the journey: six guys traveling cross-country in an RV, living on the Gatorade diet and stopping at scenic places along the way to do their shoots.

No related posts.

Zayo Partners with 10 Independent Telcos for Colorado Fiber Network

Jesse Ward — Mon, 26 Jul 2010 14:47:25 +0000

Zayo Bandwidth, a national provider of fiber-based solutions for carrier, enterprise and government customers, announced late last week that it has joined forces with independent telephone companies to form the Colorado Communications Transport LLC (CCT). CCT will develop a 746-mile fiber-optic transport ring which will cover northeastern Colorado and provide connectivity to major communication hubs in Denver.

In addition to Zayo, the founding members of CCT include 10 telcos in northeastern Colorado: Agate Mutual Telephone Cooperative Association Inc., Eastern Slope Rural Telephone Association Inc., Nunn Telephone Co., PC Telcom, Peetz Communications LLC, Plains Cooperative Telephone Association Inc., Roggen Telephone Cooperative Co., Stoneham Cooperative Telephone Corp., Wiggins Telephone Association and Willard Telephone Co.

The network, which is expected to be operational by the end of 2010, will provide high-speed capacity and access to major traffic aggregation points throughout rural Northeast Colorado. Zayo also plans to leverage the network to offer high-speed transport service for its large, wholesale customers. The CCT network will interconnect with Zayo’s rural Nebraska network.

“It is an honor for Zayo to be working cooperatively with the member companies in an effort to enhance service and network quality for the communities in this region,” said John Scarano, COO & Co-founder of Zayo Group and President of Zayo Bandwidth. “We look forward to collaborating with this team in helping to connect Colorado.”

For more, see this release.

Rumor: Verizon to Launch Usage-Based 3G Pricing

Jesse Ward — Fri, 23 Jul 2010 18:40:02 +0000

Update: John Killian, executive vice president and chief financial officer of Verizon, reported on the carrier’s annual earnings conf call that VZW has no no immediate plans to migrate to usage-based data pricing plans. However, Killian said Verizon is studying the possibility of adding such plans for 3G.

Verizon Wireless is planning to introduce new usage-based mobile data pricing plans on July 29, according to a post at Engadget. The tech blog cited an unnamed source which offered few details except that Verizon is preparing to announce the pricing changes at the end of this month.

Numerous media outlets have repeated the 3G usage-based pricing rumor, but Verzion has declined to comment. However, just yesterday, Verizon business development executive director Jennifer Byrne was quoted in media reports stating that new Droid X users are consuming 5X the amount of data as compared to other device users, perhaps laying the groundwork for the yet-to-be confirmed pricing changes. Further, Verizon executives have repeatedly noted that the carrier likely will release 4G usage-based data pricing when it launches its LTE network in the fourth quarter.

AT&T paved the way back in June when it switched from a flat-rate pricing scheme to a usage-based model for mobile data. Analysts have speculated that other carriers might follow suit. Of note, Sprint Nextel and T-Mobile USA have indicated they have no plans to change their current pricing structures.

For more, view the Engadget post.

Alcatel-Lucent Intros IPTV Solution for Small Telcos

Jesse Ward — Fri, 23 Jul 2010 15:57:31 +0000

Alcatel-Lucent is targeting small telcos with the release of a compact IPTV solution, powered by Microsoft Mediaroom, which can scale from 1,000 to 100,000 set-top boxes. The solution provides high-quality television programming, and also enables new services through the blending and personalization of Web and broadcast content.

Alcatel-Lucent’s Integrated Solution for Microsoft Mediaroom is a substantially modified version of an existing solution that the company has previously deployed in more than 25 large networks globally. The new solution, based on Microsoft’s Mediaroom Hyper-V architecture, includes a unique design that can support more than three times as many households, while using a smaller number of servers.

Alcatel-Lucent collaborated with HP on the solution, using BladeSystem with HP Virtual Connect technology to reduce the complexity of the architecture and increase flexibility to respond to changes in workload demands.

Cinergy MetroNet, a triple-play service provider in Evansville, Indiana, is the first customer to use the solution and will begin offering Alcatel-Lucent-powered IPTV services to six cities later this month, with the potential to reach about 50,000 customers.

Cinergy MetroNet plans to offer its customers multimedia services such as broadcast TV blended with Web content; the ability to simultaneously record multiple shows while watching another; and the delivery of personalized content such as weather, traffic and news.

“Operators who support from 1,000 to 100,000 set-top-boxes are underserved when it comes to IPTV and next generation multimedia services,” said Geeta Chaudhary, vice president of Alcatel-Lucent’s Multimedia Integration Services group. “To address this need we created an optimized IPTV solution that is pre-integrated and lab tested, minimizing the technical and commercial risks associated with launching IPTV services. We estimate that more than 11 million new IPTV subscribers will be served by regional communication service providers in the coming three years and this compact release is designed to help our customers better address this huge opportunity.”

Alcatel-Lucent faces stiff competition from the likes of Minerva, Nokia Siemens Networks, Cisco, Occam Networks, Calix and Adtran, to name just a few. Vince Vittore, principal analyst for Yankee Group, offers this analysis: “Alcatel-Lucent’s approach to this market is unique because it combines a great user experience with a reasonable price point and leverages its experience as a video integrator.”

For more, see this release.

LightSquared to Build Nationwide, Wholesale 4G Network

Jesse Ward — Wed, 21 Jul 2010 20:59:51 +0000

LightSquared, backed by Harbinger Capital Partners, is investing billions to create a nationwide, wholesale, 4G wireless network, using satellite and terrestrial technology. The new company, which was launched just yesterday, has received $2.9 billion in assets from Harbinger, and raised a portion of $1.75 billion in debt and equity from unnamed sources.

LightSquared does not plan to compete directly with retail providers, but rather offer wholesale access to a variety of other mobile broadband providers. ”As the nation’s first wholesale-only integrated wireless broadband and satellite network, LightSquared will provide wireless broadband capacity to a diverse group of customers, including retailers; wireline and wireless communication service providers; cable operators; device manufacturers; web players; content providers; and many others,” LightSquared said in a release. LightSquared plans to offer its partners three coverage options: satellite-only, terrestrial-only or a combination of the two.

The company has selected Nokia Siemens Network to build, operate and maintain the wireless network in an eight-year deal valued at $7 billion. The network will consist of approximately 40,000 cellular base stations, and the company plans to cover 92% of the U.S. population by 2015. LightSquared controls 59 MHz of nationwide spectrum.

LightSquared is the new name for mobile satellite communications company SkyTerra, originally set-up by Harbinger. Harbinger’s business plan hinges on a key 2003 FCC ruling which allows the satellite firm to utilize its spectrum for terrestrial wireless services as long as it provides dual-mode devices, and the terrestrial network remains ancillary to its satellite services.

Tech blog Giagom points out although this project is (initially) well-financed, many hurdles remain, including available network speeds, and the variety, size and capability of customer devices. It’s too early to determine if LightSquared will make it off the ground, or if the company will bring its wholesale LTE broadband network to rural areas. Nevertheless, the initial cash outlay and the partnership with NSN is something to watch.

For more, see this release.

NTELOS Buys FiberNet, Expands Regional Fiber Network

Jesse Ward — Wed, 21 Jul 2010 14:57:05 +0000

NTELOS, an independent telco based in Waynesboro, Va., announced yesterday that it will acquire One Communications’ FiberNet business for about $170 million.

NTELOS is committed to building a regional fiber network. Last fall the telco made a deal with Allegheny Energy to acquire 2,200 miles of fiber in Pennsylvania, West Virginia and parts of Maryland, Kentucky and Ohio. Fast forward 10 months and through this new transaction with FiberNet, NTELOS is inheriting a 3,500-mile fiber optic network that covers all of West Virginia and surrounding areas in Ohio, Maryland, Pennsylvania, Virginia and Kentucky. Once this transaction is completed, NTELOS’ network will contain nearly 8,000 miles of glass.

“In addition to immediate financial contributions from the embedded customer base, this acquisition will provide NTELOS with new opportunities within our core business of providing high bandwidth services to large enterprises, government customers and carriers,” said Frank L. Berry, NTELOS executive vice president and president of wireline operations. “Consistent with our strategic growth vision, by increasing FiberNet’s customer penetration and usage across our service area, we will further leverage operational and back office platforms already in place.”

NTELOS expects to close the FiberNet deal, which is subject to FCC, state regulatory and antitrust approvals, in the fourth quarter of this year.

For more, read the release.

VocalTec and YMAX/magicJack Announce Merger

Jesse Ward — Mon, 19 Jul 2010 19:50:08 +0000

VocalTec Communications Ltd. and YMAX Corp., the creator of magicJack, have successfully merged. The new entity will be called VocalTec and will be traded on the Nasdaq under the symbol CALL.

This is an interesting matchup. MagicJack has a well recognized brand with more than 6.5 VoIP million units sold since 2008. In fact, magicjack is the largest CLEC in the United States in terms of area codes available and certification in number of states.

For its part, VocalTec will add softswitch, application servers and a softphone to the mix. VocalTec bills itself as the “inventor” of VoIP and the softphone and says it has the patent portfolio to back up the claim.

The parties believe that the combined company has an enterprise value of $245 million and a per share value of at least $17.50. VocalTec projects 2010 revenues between $110-$125 million, and expects to show a profit this quarter with cash on hand and no debt.

Look for VocalTec to challenge the likes of Google Voice and market leader Skype in future offerings.

For more, see this release.