Saturday, October 15, 2011

Free WiFi in the air - with GOL

One of Brazil's leading airlines, GOL, is making new ground with a free on-board WiFi connection.

Before you raise your arms too high: The service is used for on-board entertainment, and not for connecting to the Internet. Anyway, this is a great idea, and a great step for on board entertainment.

I am getting tired of the slow badly designed entertainment systems that airlines are installing, and as many bring their smartphones, tablets, and PCs with them on board, why not using them to connect to a large collection of multimedia content. The system is to a certain extent rendering the content to the type of screen that you are used to work with. Interactivity on the current systems is really bad, and the typing is almost impossible, but all this can now change, and you can get on with real interactivity while on board. I tested the new system on a flight from Sao Paulo to Rio, and I am just sorry that the trip was so short.

This is a great way of doing stepwise innovation. Get people used to using their own devices on-board, and guess what: The next step to connect this service to the Internet is very easy. GOL can also offer downloads that you can bring with you, which in turn will become a new platform for branded services.

You can just go on thinking about the potential of this new service. Segmented advertising: Let the system know your preferences and you can get targeted advertising. When you do your on-line check in, you may, in the future, be able to chose among films from a great selection that you would like to see during the flight, and the films are loaded to the aircraft system while on the ground.

Personal devices have much more processing power per user then the current installed devices. This means that you can run much more complex and graphics demanding games.

Thumbs up for GOL. Great initiative. I am already eager to see the next step.

Thursday, October 13, 2011

Google is on to something - again

Once again Google is showing the Internet is gaining traction as a source of revenue with it's own source of growth power. The global credit crunch is most likely causing a drop in overall advertising spending, but the continued migration to digital advertising is still giving great benefits to companies like Google, which announced their quarterly result today with revenue jumping 37% over last quarter to $7,5bn.

It is now about two years since Google started talking about its Mobile First strategy, and investors have been so what uncertain about the ability for mobile advertising to contribute significantly to the total revenue, and last year Google announced that the annualised renevue from mobile was about $1bn. According to Financial Times, the revenue from mobile has now climbed up to $2,5bn annualised. A 150% growth in one year.

This shows that Steve Jobs was right when he said that innovation should always stay ahead of the curve, so asking people what they want is really just making you look back. The high penetration of the Android OS for smartphones is also contributing to Google's strategy on acquiring data about our habits, which is so important for brining relevant advertising to the small screen. This is very important, as people will not tolerate too much irrelevant crap on their phones, which are considered to be more personal than both the TV and traditional computer screen.

Sunday, July 3, 2011

Why wait for 4G?

Too many people start to jump on the hype of 4G, while there are still all the options in the world to improve on the current technologies in the 3GSM (or just 3G) family. Therefore, I thought it would be good to explain briefly here some of the concepts that can improve the networks. In Latin America, many networks are still clearly inferior to their European sister networks, even thought they use the exact same equipment. Differences in the installed capacity is a good part of the reason, but network optimization and improved radio planning can also make great contributions to an improved quality and capacity.

When I was taking a ride on the rapid train from Madrid to Barcelona earlier this year when I was at the Mobile World Congress, I enjoyed a fantastic experience with about 1,5 Mb per second bandwidth on about 85% of the train-ride  This experience was so much superior to what is offered on a flight, not to mention that the 3 hour trip goes from downtown Madrid to downtown Barcelona with no long check-in or baggage pick up queues. From when I took the handle of my suitcase at the Hall 6 in the far end of the conference area, till I sat on the train it took me 25 min, and I walked all the way to and from the metro. But, that's another story.

This, today done with 3G, and can be done in Latin America with the same 3G equipment also. The Air is the same, right? And the equipment is already there.

Over the last few weeks I have participated in various events, discussing broadband and the mobile Internet access, and I keep hearing questions about when will 4G get here, so we can get a better service. In my opinion, the ones who are waiting for 4G are wasting their and our time, as there is so much that can be done now: MIME, 64QAM, Multiple Carrier, are all general upgrade features for the HSPA networks, but there are also more to do: Heterogeneous Network, or HetNet, is used to designate a radio cell planning concept where large macro cells and small low power pico-cells are making up a much more efficient network, which can gain in both quality and capacity. In many cases even without demanding more spectrum.

The gain in quality comes from the shorter distance between the handset and the base station. The handset transmits with a much lower power than the base-station, so if the distance is too long, the up-link from the handset to the base-station looses quality due to interference.

The gain in capacity comes from the fact that smaller low power cells gives little interference with the large macro cell even if it is transmitting on the same frequency. The mobile network can therefore serve more handset in the in coverage area of a macro cell without actually loading the large cell and its base-station. The traffic is simply handled by the small low-power pico-cells.

In  both cases, the small pico-cells can be served by so called Remote Radio Units (RRU), which can coordinate the power and inter-working of the cells in order to increase efficiency. *)

Conclusion: There is no reason to sit down a wait for 4G, but all the good reason to get going a with 3G network optimization.

*) Ericsson's concept covering this new small radio units is called AIR (Antenna Integrated Radio), and is a small box with antennas build in, which can be placed directly on building walls in shopping malls for example.
General information in article
The Magazine Ericsson Review on the topic

Tuesday, May 3, 2011

Broadband data caps are now migrating to wireline access

Just as we have seen the tendency of operators putting volume caps on mobile broadband tariff plans spreading from the US to Europe and further on to emerging markets throughout 2010, as I described in articles on Network Neutrality Mobile Broadband Caps and spreading to the UK last year, we are now seeing the same initial tendencies coming up for wireline broadband access introduced (once again) by AT&T in the US.

This is the practical way by which the network operators are trying to solve the issue that they are addressing in the Net Neutrality discussion on future congestion problems, in which Verizon has already come to understanding with Google in 2010. In many cases network operators are afraid of becoming utility companies like energy companies. Compared to the same tendencies as when electric energy generating became centralized, and the parallel to the effect of cloud computing, as described by Nicolas Carr, one of the roles that the network operators offering broadband access are taking, is in fact the role of a utility. In the sames manner you can now see governments in Brazil and Finland for example, working on making broadband connection a human right, just same way that we have right to electricity and water. This is also the reason that the roll-out of Internet access often suggested candidates to receive public subsidies, which is also apparent in the Telebras discussions in Brazil.

My conclusion is that heavy users should pay more than the average users, as we are used to in other businesses, expect for street lightning, but there is no direct connection to how much light you enjoy and the cost of providing it. Telecom regulators must see to that the price-point established in the industry is fair and in line with the benefit that the broadband access bring to society at large, and governments would be better off using their funding to create incentives to the telecom industry, in stead of using the tax payers money to compete with the current broadband providers. We end up paying twice.

Saturday, April 30, 2011

Is the Brazilian market now ready for MVNOs?

This week in Brazilian telecom was clearly in the sign of the MVNO and the derivatives that comes out of virtual retail business models on top of current mobile networks. Much of the discussion took place on the MVNO Summit (Twitter hash-tag #ITM_MVNOLA) held by Informa in Sao Paulo. This years event had more relevance than former years because the publication of the Brazilian regulation for the operation of MVNO a few months back.

D@tora and Porto Seguro had already announced their agreement to operate on TIM's network, and did now also announce Ericsson as their infrastructure supplier for Switching, HLR, Billing, Pre-paid, and other network nodes. In other worlds, we are talking about a full MVNO, which, as per the Brazilian rules can resell traffic from various network operators simultaneously, and also move their customer from one network to the other. To some extend the operators have pushed the market in to this mode by being reluctant to make the necessary investments in order to host have multiple wholesales customers in their network. This could yield a bigger pressure on their wholes sales prices, and turn out to have been a bad decision, but I will write more about that in another article.

The overall feeling that I get is that the market is reluctant to take the first steps into this new era, partly because there are unsolved legal issues in the way ANATEL has issues the regulation, and because the margins on Mobile Telecom in Brazil are already low, meaning that if you are to insert more companies into the food chain without increasing the prices to the end user, there will be less to everybody. The interesting fact is that the MVNO market in Denmark developed with even lower average EBITDA margins than in Brazil. It does not help that issues like ICMS (type of VAT tax) is not clearly resolved, meaning that MVNOs risk paying a tax-upon-tax which present further problems.

ANATEL has decided to issue the regulation in two flavours:

A Licencing, which gives even less room to maneuver than a conventional Branded Reseller as known from other markets, because the reseller in this case in sharing the legal responsibility in all aspects for the service, including the commercial ones with the host operator. This means, that if a customer to a reseller, or light MVNO as they are sometimes called, chooses to test a dispute in a courtroom, they can just as well go to the mobile host operators with their claims, who have more cash to go for. Furthermore, the host operator's brand has to appear in all marketing material and communication with the subscriber. This means that success cases that we have seen on other countries, where resellers have reached a customers satisfaction index of 0,90 against their host network with 0,70 are less likely to happen in this case as the brand will always appear together. As the market in Brazil believes that the MVNO's will not be able to obtain whole sales prices lower than what the market is offering today (though I think this will change), resellers will have to bet more on differentiation which is difficult as the regulation forces the resellers back to the host operators brand at any time.

The other tipe of certification is a so called Auhtorization, which in effect will give the MVNO the same rules and obligations as a network operator, meaning that they are also responsible for the technical and quality aspects of the services, even if they choose to leave all that to a host operator. This gives, in my opinion, MVNOs a better framework for effectively developing their own brands with increased brand value. Theoretically, the technical responsibilities should be be negociated back-to-back with the host operator. Unfortunately, this also means that MVNOs have to live up to the sames rules when it comes to having physical shops and outlets in all areas where they offering their services, which is putting the otherwise so popular Internet based distribution model in question. At lest, MVNOs would have to negotiate a representation through a retail store, which will limit the interest of smaller player who want to test unproven business model in the market. The official expression this week of interest by the national Brazilian post office to enter as an MVNO confirms that this is a market for larger players.

In both cases, the success of the business depends on the ability to negotiate reasonable traffic deals with the operators. After all, nobody will shift to a new service provider and pay more for their basic calls, just because the provider has a better call center with nice attendants, or more pictures of Micky Mouse to sell you.

So, all in all, after this week, my feeling is that the market could definitely have been more clear. There are substantial risks, taxes, cost, legal unclarities, that, initially at least, will hold new players back. After all, the critical voice by CEO John Strand, from Strand Consult on last year's event proves to be more right than many of the opponents on last year's edition of the conference. MVNO is never the same between two markets, and is just like learning to ride a bicycle: There is a limit to how much a pre-study will help you. You need to get up and try. You will stumble in the beginning, but eventually the market will succeed.

Friday, February 4, 2011

Mobile Broadband Growth Accelerating

I have already written about the strong growth we are experiancing in Moible Broad Band, in my blogs Smartphones lay mobile network down at festival and Mobile Broadband Congestions. Now operatrors are planning for the expansions of their networks for 2011, and it is now clear that the growth in Brazil is even bigger than initially estimated.

There seem to be a consensus among operators that this years capacity planning should lay between 5 and 10 times the current capacity. This does not mean that the total traffic is expected to grow anywhere near that amount in 2011, as the installed expansion will both try to make up for the strong growth in 2010, and the take the networks will into 2012. Mobile Operators in Brazil have been criticized for bad quality and capacity, and are apparently now investing in improving their image. Operators have got more experience with the mobile broadband business and introduced tariff plans with volume cap and other products well fitted to the strong uptake in Smartphones and Tables, and now see heavier investment as more secure, as future revenue streams are beginning to become more firm and predictable. Vivo in Brazil has even announced a plan to cover 2800 municipalities until the end of 2011, and the roll-out seem to be well under way.

In 2010 several operators were forecasting a 20-times growth until 2014, but with the growth in 2010 and the new expansions forecasted for 2011, things are clearly moving faster than initially estimated. It should be remembered thought, that the data volumes in the mobile network in many cases still are well under 10% of the volume in they fixed counterparts, so there is still good room for growth. That balance is likely to change over the coming years as Tablets and Smartphones really start to kick in. Ericsson Consumer Lab released numbers this week from a survey in the USA and South Korea, showing that 45% of Smartphones users report that they spend less time in their PCs after they began to use smartphones.

The global market for smartphones grew very fast with about 75% in from 2009 to 2010, and according to Nielsen, a market research company, the sales of smartphones grew 128% in Brazil, corresponding to a market share of 10%, against the 25% for USA.

All in all, this seems to confirm the words from Google's CEO, Eric Smidth at the IFA conference in 2010 that the mobile Internet growing eight times faster the it's fixed counterpart when at the same size.

Sunday, January 30, 2011

Finger bending with new Apple iPod Touch

I was happy without knowing it.
I had an iPod for two years, and now I decided to upgrade. Fine, with camera, mike, nice display, and so on, but the ON/OFF bottom has got a down grade. The bottom has been moved from the left to the right side. When you hold the iTouch with you right hand, which I assume most people do, the Index Finger was naturally placed right over the ON/OFF bottom. Pressing the bottom unintentionally is not a problem, as it is only the screen you turn of, and can you always turn it back on. I use it very much as a screen lock, but that is much more difficult now. On this new iTouch, in order to turn the sceen on and off I have to bend my finger to the right, with a difficult and unnatural movement. Have I missed a brilliant clue with this?

Friday, January 21, 2011

How to get connected ... NOT!

Some of you have followed my tweets and Facebook comments on the attempt to find out how to get a Mobile Internet connection during my stay in Sweden this week. The idea was to buy a Prepaid SIM card with a couple os Gigs on, plug it into the phone and start browsing. Nice and easy. So where did I get the idea that this would be possible? Over the last couple of years I have done this frequently in the UK, Portugal, and Denmark among other countries. Comparing my user experience, I would actually say that "3" in the UK so far is the best:
You buy a blank card. Fill up your account from your credit card, and then buy the services that you need. Both voice and data. NICE!

So, when I walked down among the shops in Sweden's Silicon Wally, called Kista, and saw a small booth where the Swedish "3" operator was offering 16 Mb/s browsing on mobile Internet, Wow, I thought I was close to getting blown away by the latest mobile internet offering. I had consulted some specialized blogs before leaving Brazil, and "3" apparently had a good offer for 99 SEK browsing up to 20Gb in a week, which was the time I was planning on staying.
Comparing to some hotels where 24 hours of WiFi will cost you more than that, and the Telia Homerun that cost 50 SEK for 24 hours with much less coverage, the case was clear. The guy at the booth told me that they did not sell prepaid there. :-(

OK, after looking around I found a "3" shop.
So the first question is was asked was if wanted to talk or surf. "Both", i said confidently. "Well then you have to buy a 200 SEK montly voice packet and then fill a data packet on top". Now, the picture suddenly was very different. I was then told that staying for a week, I could choose a data SIM card and fill 99 SEK for a week of use, but not fill a voice package on top. So I would not even be able to receive calls on the card. I was then surprised to see that the SIM itself would also cost 99 SEK. So my expected price for a weeks connection just went up 100%. Well, hopefully I can use the card next time I come back, unless they cancel it due to lack of top-up.

Parly happy I went back to my hotel hoping to get plugged in. Next disapointment. My phone, or the SIM card was apparently loaded with an access configuration profile (APN) with: No access! Actually no nothing. I could not even receive calls. Not event a default link to the operators homepage where I could read more on how to connect.

This worked very well in the UK. I plugged in the SIM and opoened the browser and I was already looking at my "3" account top up page where I could also see my usage what i had left.

Via my laptop I went to the operator homepage, under topup I was only offered to top up via credit card. But I had already bought a 99 SEK voulcher at the shop. Back on the voucher I then discovered a link. Great! The site offered my voucher top up and credit card. The only problem was that the voucher .php-link did not load. Not on Chrome, or Explorer. Dead! The credit card link was working very well. So, I signed into "my 3", and could see that I had no surfing time, and apparently was not going to get some either. I also tried to register to use other customer services like the "3" mail account and other interesting things, but wihout a Swedish social security number that is not possible.

I went to bed. Disillisioned, and 198 SEK less of good Swedish cash.

Next morning i woke up, insisting on not giving up. The voucher top up did still not work, even days after. The card should al least be able to connect. So I asked mother Google for help. A helpfull soul has published the a list of APN's for Swedish operators. It apears that "3" uses different APNs for pre- and postpaid. So I tried with and BINGO! Connction! To any site on the Internet. But it still said that I had not done any top up with my voucher, and that I had one week of surftime left. Which was apparently true because the SIM has been working in my phone for the rest of the week.

I am still left with a number os questions unanswered though:
- Does the SIM initially have 99 SEK worth of browsing preloaded?
- If, so, why did the they claim in the shop that i should buy a 99 SEK top up?
- Why does the Voucher Top up not work?
- Why doesn't the SIM card not load the right APN to the phone. The postpaid APN was automatically loaded.
- Is there a "My 3" WAP page where I can see my usage? The "my 3" web page web page does not show anything.
- Will my SIM work when coming back after 9 months?
- Why is "3" only interested in my identity if I have a Swedish social security number.
- Does "3" consider my type of pre-paid business customers at all?

So today, at the end of the week, I am a connected, but no a happy costumer. My consern is that Brazil will hold worldcup in 2014 and Olympics in 2016. I just hope operators will consider a better reception to temporary mobile customers than what I have experienced here.