SMS: Wireless

Sprint is in hot water

Fri, 12 Jan 2007 05:01:22 GMT

Seems like 2006 was a bad year for Sprint Nextel in the US. The carrier recently released their 2006 year end results and provided revised guidance for 2007. Sprint has not faired well in 2006 as the integration of Nextel`s iDen network has not been as smooth as it expected. Sprint has been busy with the integration efforts and I feel this has resulted in them being too internally focused and have thus lost touch with their customers and their needs. This just goes to show that acquisitions are not always a positive thing for a company. It is ironic though, that TELUS Mobility has been able to successfully operate 2 networks (CDMA and iDEN) and also boasts one of the lowest churn rates in North America.

Attached are some of the highlights from the Sprint release:

Revenues in 2007 will be flat compared to 2006. Sprint indicates 2007 revenues will be in the $41-t0-$42 billion range.
ARPU will continue to fall as Sprint will offer unlimited calling as part of a new CDMA based product for Boost customers.
2007 will be the year of billing integrations for Sprint and if they do not execute them well, churn will sky rocket. The folks at Sprint should talk to their friends at Bell Mobility, who had to incur high churn due to botched billing system integrations a few years ago.
Sprint lost 306,000 subscribers in the fourth quarter of 2006. Most of this churn occurred due to issues with their iDen network. Such high churn will not sit well with the industry pundits as it reflects Sprint's lack of ability to retain its clients and thus recoup any acquisition costs and generate positive cash flow. I believe this churn will continue as Sprint works to resolve all the issues its faces on its iDen network.
Sprint is also planning to lay off 5,000 employees in 2007. The majority of these lay offs will occur in the first quarter of this year. This will further impact morale for Sprint employees and will negatively impact clients, thus further adding to churn.
The capital expenditures are going to be up in 2007 to $8.5 billion
Sprint will increase their capital expenditure as it spends $300 million on WiMAX in 2007, and that amount is expected to increase in 2008. In addition, Sprint has indicated that it will spend more money on setting up an additional 4,800 cell sites. This will result in Sprint maintaining 67,000 cell sites, when compared to 26,00 for Verizon and 45,000 for Cingular. I hope the majority of this investment in infrastructure is on the iDen side to resolve the numerous issues faced by clients on that network.

My thoughts on the iPhone

Fri, 12 Jan 2007 03:40:20 GMT

I stayed away from piling on about the iPhone over the last few days as everyone was gushing over the device. I have read quite a few posts on the iPhone, some listing the specs and other talking about the pros and cons of the device. I thought I would share some of my thoughts with my readers as well.

I am truly amazed by the iPhone, I think it’s a great example of innovation in the mobile industry and innovation is always good for the consumers. As a consumer, I also think the release of the iPhone will increase competition between the hardware vendors and consumers will benefit from this increased competition. I do not want to spend too much time on discussing the specs for the phone but I am really excited about their Visual Voicemail feature. I believe this feature has been developed in conjunction with Cingular. Visual Voicemail allows you to point to any voice message and directly listen to it without listening to the preceding ones. This is really cool. One of the major issues with PDAs nowadays is the battery life and I am happy to say that the 5 hours of "talk time" on the iPhone is quite impressive. Now that I am done swooning over the features that I liked, back to what I wanted to talk about in the first place.

Most of the features of the iPhone already exist in various Windows Mobile devices today, so why all the hype and will this device gain significant traction against the heavy hitters like Motorola, Nokia, etc? I read a post on Gizmodo comparing the functionality of the iPhone against the functionality of a Windows Mobile device and I think the author touches upon a very key point. The success of the iPhone depends on the user experience not the amount of technology and functionality that Apple has packed into the device. People will be willing to adopt the iPhone if it works better than the existing BlackBerry and Windows Mobile devices in market. People are looking for devices that just work and make it simpler to stay in touch with their information and their loved ones. Is it easier to make a call, read an email, access your voicemail on an iPhone than other devices? Does the battery life truly last 5 hours (and this is important for us road warriors)? Is it faster to surf the web and easier to watch movies on this than a Windows Mobile device? If the answer to all of these questions is a resounding yes, then Apple will have an edge over the competition.

Based on the functionality of the iPhone, I feel this phone will appeal more to the young consumer segment VS the enterprise segment / business user. Enterprise users prefer a device that is suited more for core messaging and Personal Information Management (PIM - Calendar, Notes, Task, etc). The BlackBerry is a great example of this type of device. It is great at email and has great PIM functionality. The iPhone is more of multimedia device with which you can access your music, internet, videos, etc, similar to a Windows Mobile device.

Kids that love to stay connected to all their email, music and media will want this device. However Apple faces a challenge that mobile phone hardware manufacturers have struggled with for a long time. How do you sell a $600 device to youths that are on very tight budgets? I do not believe that a lot of kids can afford a $500-$600 device and I don’t think a lot of parents will be willing to buy their kids a $500-$600 device either. Young adults will also crave this device but do the ability to pay for it. In addition, companies will not be willing to pay a whopping $500-600 per device per employee. This is where RIM, Motorola, Nokia and Microsoft have often struggled, how to pack all the functionality without sacrificing user experience and yet making the phone affordable. Cingular might subsidize the device heavily, but will do so, if they believe that they can recoup the subsidy through higher monthly revenues. Again, kids and consumers shy away from paying $80-$100/month for their phone plan.

My gut tells me that this device will be adopted by the masses (consumers in the young adult and teen categories alike) despite the high price point. The cult following of iPod and Mac users will shell out this kind of money for a mobile phone produced by Apple. We have seen it happen before with the gaming consoles, why can’t it happen with mobile phones? Parents and kids are willing to pay $400+ for a Xbox 360, some were even willing to pay upwards of $1500 at launch for an Xbox. Why? It’s because of the status associated with the brand and the promise of a great experience associated with that brand. Apple has built its brand, similar to Xbox and people are willing to pay a premium for it. Kids will be willing to work an extra few shifts so they can afford to buy the iPhone. All Apple has to do is ensure it delivers on that brand promise and provide the market with a great device that just works. Oh and one more thing, Apple should work with the carriers to ensure that carriers provide rate plans that don't cost an arm and a leg. I think it’s in the best interest of the carriers (and Apple) not to heavily subsidize the device upfront but charge a lower monthly fee.

One thing is for certain, everyone is keenly awaiting the release of this phone.

Wireless predictions for 2007

Fri, 05 Jan 2007 05:40:01 GMT

Everyone is betting on what will be the big trends in 2007. I have seen blog posts predicting the trends in men's fashion to technology and the online space. I have not come across any posts predicting the trends in the Canadian Wireless industry, so I thought I would create one of my own.

I think the following will be big trends in the wireless industry in 2007

Music on your cell phone - this will continue to be big, especially in the first half of 2007. The much anticipated release of the iTalk from Apple will take downloading and listening to music to your phone to a whole new level. The iTalk can also be used to watch videos on your cell phone.
Watching TV and/or video clips on your phone. Better phones combined with faster networks will make it easier and more affordable for people to watch videos on their cell phone. This will lead to more people watching TV/video clips on their phone.
Social networking which includes podcasting and blogging from your phone should be big as more and more youth enter the realm of social networking on their desktop. Carriers will have to take notice of the explosive growth of social networking sites and podcasting on the Internet and will want to monetize the trend by allowing consumers to blog/podcast from their very own phone.
Mobile Search will be a big area of focus for consumers and carriers alike. Consumers can now access an ever increasing amount of media (pics, ring tones, music, videos, apps, games, etc) from their cell phone. They will need a Search engine to find what they are looking for, either on their phone, on their carrier's WAP deck or even the internet.
Mobile application powered by Location Based Services such as mobile mapping solutions will start gaining popularity. Mobile social networking apps overlayed with mobile mapping might also make it to market.
Cheaper, cooler PDAs and the abundance of mobile email apps will lead to more people accessing email on the cell phones.
Mobile advertising, will it or wont it happen in 2007? I don't think it will be huge in 2007 but I do think it will launch on a small scale in Canada.
After much talk and hype, local number portability will finally happen. This should cause downwards pressure on the price of monthly cell phone plans.
The entrance of Amp'd Mobile in the Canadian wireless industry will shake up the dormant MVNO space. This will also lead to more innovative marketing and bundling of services in the mobile prepaid arena in Canada

Lets see how many of these actually happen.

How to get 18-24 yr olds using a BlackBerry

Thu, 04 Jan 2007 05:06:20 GMT

The folks at BlackBerry Cool are talking about RIM should start engaging the 18-24 year olds. I agree with them that this is one of the most attractive segments for wireless carriers, yet challenging to engage. They are also one of the most fickle user segments and will change their tastes at a drop of a dime. If its no longer in fashion, then they wont be caught dead using the a particular device. Steve St. Pierre at BlackBerry Cool recommends that RIM needs to abandon traditional advertising and start leveraging cool new marketing tactics to capture mindshare with this segment. I think it will take a lot more than cool advertising for RIM to engage and start capturing this segment of users.

People aged 18-24 do not have large disposable incomes and BlackBerry devices are not that cheap. Once you add the monthly service fees that is required to use your Blackberry, you are way out of the price range of a 18-24 year old. As Steve points out, a large proportion of these users still rely on their parents to help fund all or part of their existence. I cannot see any parent that will be willing to shell out money to buy a BlackBerry and then pay for the monthly service fees for their kids.

If RIM is serious about the capturing a share of the mass consumer market, they need to deploy a 3 pronged strategy; improve device form factor, reduce device cost and reduce monthly service fees. RIM needs to work on developing more devices like the BlackBerry Pearl that would appeal to the youths of today. The device needs to be small, sleek and light weight. This is where RIM can leverage some celebrities to endorse these new cool models and also target the youth with some grass roots marketing campaigns in schools and universities. Wireless Carriers are laser focused on reducing their cost of acquisition, thus they will not be very keen to offer deep discounts on the various BlackBerry models. RIM will have to take the first step and offer these devices to the wireless carriers at a cheaper price. By lowering the cost of the device to the carriers, we should see retail pricing for these devices drop considerably in the marketplace. Lower device costs will also make a BlackBerry more attractive to the 18-24 year olds and their parents who are footing the bill. The last component of the strategy will be a lot tougher for RIM to execute on. Wireless carriers are enjoying the high profit margins resulting from wireless data revenues, especially revenues associated with PDAs such as the BlackBerry. RIM will have to work very closely with the wireless carriers and convince them to reduce the monthly service fees for BlackBerry users or atleast come up with multiple low tier plans that will fit the tight budgets of 18-24 years olds. This will be an uphill challenge for RIM as wireless carriers are hesitant to launch low tier plans and initiate a price war that will result in everyone losing revenue. However, if RIM is successfully in executing on the 3 pronged strategy, the 18-24 market is their's for the taking. 18-24 year olds are hooked on Instant Messaging and SMS'ing, having a BlackBerry just makes it a lot easier.

RIM is not alone in trying to woo the 18-24 year olds. Handset manufacturers like Nokia, Samsung, Motorola,etc are all trying to develop cooler versions of PDAs that will appeal to this target segment. The Moto Q and the Samsung Blackjack are a testament to this. Will the youth of today prefer BlackBerry devices or will they prefer PDAs running on the Windows Mobile software? This remains to be seen. I will say though that if I was an 18-24 year, I would have preferred something like the Audiovox Smartphone, which was is a good blend between phone and PDA. However, gone are the days when I fit in that age group :)

Bright future for mobile social networking offerings

Mon, 27 Nov 2006 06:59:41 GMT

I came across an article on BusinessWeek.com about Vodafone's bullish stance on mobile social networking services. It will be interesting to see which online social networking service Vodafone partners with in the next few months. I am glad to see that Vodafone is finally moving into the social networking sphere. The Online industry experts have often stated that the consumers that are heavy users of such online social networking services are also heavily dependant on their cell phones. They are addicted to being "connected" to their friends and social networking services accessible via the mobile phone further feeds the addiction. Mobile social networking solutions will also allow carriers to realize incremental revenues from their installed MMS infrastructure as people love posting and viewing photos, videos, etc on their blogs. Most online social networking services offer some type of mobile interface, Windows Live Spaces can be accessed via the browser on any phone and I believe MySpace also has a mobile component through their alliance with Hello.

Arun Sarin, Vodafone's CEO indicates that he expects 10% of their revenue to come from mobile advertising, mobile video and mobile social networking services in the next three to four years. These are very aggressive forecasts in my opinion, especially given the challenges we face regarding usability of mobile applications. People thought that mobile email and mobile Instant Messaging would be huge revenue generators, however both these services languished for long periods of time with limited success. Consumers were disappointed with the user interface and the usability of various mobile email and IM applications. That was a huge barrier to adoption and establishment of critical mass in regards to these applications. Heavy investments in developing mobile interfaces for email and IM solutions have lead to significant improvements in the UI and experience on the mobile phone. This has led to these apps taking off in the last few years and gaining widespread adoption. I hope the companies that bring mobile social networking services to market with the carriers learn from past mistakes and spend considerable amounts of time developing a very simple UI for the applications. Multiple companies have a niche carved out for them in the online social networking space on the PC, however the winner on the mobile phone will be the company that delivers the easiest UI for consumers. The youth, who are heavy users of online social networking services are very picky and have very high standards for usability. They will discard an application that is not easy and intuitive to use. I do agree with Arun's comments as he clearly states that there is huge potential for mobile advertising and apps such as mobile social networking or mobile video. It will be interesting to see if Vodafone joins forces with big names such as Blogger, MySpace and Windows Live Spaces or tries to develop their own proprietary solution.

Lower productivity for BlackBerry/PDA users

Sun, 19 Nov 2006 08:18:10 GMT

Don't enterprises deploy BlackBerries / PDAs across their organizations to improve productivity? Well they might want to rethink that. A global study of over 1,700 business professionals by the IABC has found that people using BlackBerry and other PDA type devices have reported lower productivity than those without these devices. I was surprised to hear this as the whole point of having a BlackBerry was to increase your productivity by utilizing your down time. Isn't that the premise on which companies spend thousands of dollars on deploying BlackBerries across their organization?

The survey found that email overload in organizations leads to a decrease in productivity, now that's no surprise, if you spend your whole day reading and answering email, then when will you actually do work? It is interesting to see the variance in people's responses based on their geography. The shocking thing was that the negative impact to productivity was even higher for people using BlackBerries / PDAs VS people who didn't have any type of device (93% vs 85%) . A higher percentage of BlackBerry / PDA users also reported receiving too much email and spending time just parsing through the information they receive on an daily basis. Having been a BlackBerry user in the past and currently using a Windows Mobile Device, I can truly say that you are more prone to your inbox running your day rather than you being in control of it. Chances of sending a short email with incomplete or missing info also increases when you are typing it on a BlackBerry, thus expect more emails in return asking for clarification. Also expect to send a lot more emails asking for clarification from those who have sent you messages from their BlackBerries. I knew one of my old managers would be sending me emails from his BlackBerry as his questions were short phrases rather than full sentences. I would end up trading an additional 2-6 additional emails so I knew exactly what he was after and why. Checking email on your PDA also increases the chances that you will respond to an email in an emotional state and might regret it later. In addition, receiving a flame mail or bad news via email after hours can also sour your mood for the evening or weekend. Again, this is all stress that you don't need and can do without.

The survey also found that the biggest source of email overload was external news sources and professional subscriptions (at 61%) followed by email from your colleagues (39%). People love signing up for numerous news letters and email distribution lists, they want to be in the know but they don't realize that this can lead to information overload which will actually impact them negatively. You have gone too far if you are spending the majority of the day reading through emails sent to distribution lists that you are on or news letters that you subscribe to. You actually need time to "do work" rather than just read about work. :)

I still love my Windows Mobile Device as it helps me stay on top of my work and inbox even when I am not in the office and on the road. I commute an hour each way to work on the train and get a lot done on my Starcomm 6700. You just have to ensure that you are disciplined about the usage of your device.

Regardless of whether you have a BlackBerry/PDA or not, it requires discipline to ensure that your inbox doesn't control you, rather than you being in control of it. I know people who use the following best practices to stay on top of their email and don't let their inbox control them:

They have turned off the "toast" in Outlook that notifies you that a new mail has arrived and provides you details about the email
They only do email twice a day, once in the morning and then at the end of the day. They shut down their Outlook for the remainder of the day
They use Outlook rules to parse all the info that is nice to read and is received from various mailing lists that they are on VS a must read and respond
They turn off their BlackBerry / PDA when they get home and turn in on in the morning on their way to work

Hope the above tips help. Email can be overwhelming and having a BlackBerry / PDA seems to make it worse. However if used properly, these devices can increase your work life balance and make you more efficient at your job. I have certainly benefited from my Windows Mobile Device and continue to use it fiercely, much to the chagrin of my fiancee, who competes with it for my time :)

Free cell phones for all

Thu, 16 Nov 2006 01:48:17 GMT

Just reading through some of the old email that has collected in my inbox over the last few days and I came across a article sent to me on Eric Schmidt's vision of free cell phones for those who are willing to be exposed to advertising. I found the article very interesting and thought provoking. In a nutshell Eric believes that if people are willing to be exposed to advertising on the mobile phone, they should see an increase in subsidies and a decrease in the cost of wireless service. People are starting to spend increasing amounts of time on their phones and are using them for more than just voice conversations. Data consumption on mobile devices is on the rise, much to the delight of the wireless carriers. People are getting used to accessing their data regardless of device and location.

Directionally, I agree with Eric, however I think this is utopian view. End users will be more accepting to be exposed to advertising if they can benefit from lower fees for their wireless service. I also saw that Mark Evans had commented on the article on his blog. I feel people are over simplifying this issue, especially for the Canadian marketplace. The wireless carriers exercise a great degree of control on what content their users are exposed to on the devices that are on their network. How will wireless carriers react to an advertisement by a competitive carrier appearing on their handset?

Lets discuss the possibility of advertising lowering the monthly service fee for end users. End users will be more than accepting of advertising if it lowers their monthly service fee significantly. However the presence of advertising on mobile devices will result in an increase in the data being transferred on the wireless network. Carriers will have to recognize higher revenues from advertising as they will need to cover the additional costs of the data transfer resulting from the ads. Will mobile advertising generate enough revenue to compensate for the costs associated with increased data traffic resulting from ads, the increased voice/data traffic resulting from increased usage as lower prices will drive up usage, and still be profitable for the portals/advertiser? In addition, canadian wireless carriers will have to loosen up the restrictions they have placed on the content that is made available to their subscribers. Virgin Mobile subscribers in the US are being exposed to mobile advertising in return for a 75 minute credit. I am looking forward to when mobile advertising launches in Canada.

Windows Mobile devices gaining traction in Canada

Wed, 15 Nov 2006 04:02:43 GMT

WOW, times have certainly changed over the last few months. Windows Mobile devices are certainly growing in popularity in Canada and the wireless carriers are pushing the Windows Mobile platform along with RIM devices. There are a variety of devices consumers can choose from that work on the Windows Mobile Platform, the Starcomm 6700, the Palm Treo 700wx, the Moto Q, the HP iPAQ h6516 and the Audiovox 6600. If you want to pick an unlocked GSM device to use on the Roger's network, then the choice is endless.

I was looking through the PDA section in the online gift guide on the TELUS Mobility website and it just hit me, Windows Mobile devices are now stealing the spotlight from BlackBerry devices. There were 2 devices on the BlackBerry platform and 2 devices on the Windows Mobile platform being showcased by TELUS (look at the pic below). This is a big change from last Christmas when Windows Mobile devices were no where to be found. Kudos to folks on the MED team at Microsoft.

Mobile Advertising hits Canada on Roger’s Blackberry devices

Thu, 17 Aug 2006 16:00:52 GMT

I apologize I have been lazy and have not been posting to this blog for a while. What can I say, the weather has been great and I have been enjoying the sun rather than sitting in front of the PC. Let me tell you, food tastes different when you BBQ at 4.00am in the morning J

CanWest MediaWorks and Rogers Wireless announced the launch of bbTV, a media player for the Blackberry devices on Aug 8^th. I know its old news by now, but I found the launch of this service very fascinating for quite a few reasons.

Roger’s clients can download a media player on their BlackBerry and then again access to video content from Global News, Global National, Global Morning and the Financial Post. Sports related video content can also be accessed from Rogers Sportsnet. BlackBerry users that want to download the media player and avail of this content can do so by subscribing to $5 video rate plan.

Here is where things get interesting. A large number of BlackBerry devices are provided by enterprises to their employees. As the enterprise is responsible for the billing, I am not sure they will allow their employees to add another $5 to their data bill. This pricing model will work for people whose companies pay a fixed portion of the bill and the employee is responsible for the rest.

I do not believe that enterprise users will care much for accessing video content on their BlackBerry. Most people see it as an email/PIM device and that’s it. The current suite of BlackBerry devices are primarily focused at the enterprise user. Although the form factor of devices has changed over the last few months, the BlackBerry is far from a prosumer device (the BB 8100 is a whole different story).

What fascinates me the most is the business model for this service. It is a hybrid model that combines the subscription and ad funded models. Users will be exposed to five second advertising at the start and end of the video clips. This is a new and innovative way to target road warriors. Advertisers wanting to reach the enterprise segment should be all over this, but they should keep in mind that the size of the audience will be extremely small. CanWest Media already has some big names like GM and Royal Bank interested in advertising on the BlackBerry devices. What gets me is that even though users are exposed to advertising, they still have to pay $5 a month to avail of this service. If I am paying $5 a month, I do not want to be exposed to any advertising.

It will be interesting to see how Roger’s clients react to the introduction of mobile advertising. I believe this is the only service with a mobile advertising component to it in the Canadian market., however it is a sign of things to come.

Cool Gizmos that caught my eye over the weekend

Tue, 08 Aug 2006 04:02:01 GMT

Yes, yes, I like playing around with gadgets & gizmos and trying out the latest technology. 2 cool gadgets caught my eye over the weekend, the Pantech C 300 and the Blackberry 8100 (on Engadget).

The folks at Pantech claim that the C 300 is the smallest camera phone in the world. Great, but that very fact reduces the target market for this phone. The phone will appeal to the female segment of the market who are looking for a compact device. I am not sure men will like the C300 as the buttons on it might be too small to comfortably operate. In addition, I am not sure if a phone with the battery life of upto 3 hrs will appeal to a road warrior.

The BlackBerry 8100 seems to be a very cool looking device, i heard that RIM has worked with Apple to design this phone. Releasing this phone might be another leap forward for RIM in trying to secure a foothold in the prosumer market. This device might go head to head with the Motorola Q.

I cant wait until these devices are released in Canada…probably on Rogers’s GSM network at first.

Telus & Amp’d Mobile pair up to deliver a solid punch

Mon, 07 Aug 2006 21:23:43 GMT

The rumors have been confirmed, Telus and Amp’d Mobile from the US have entered into a partnership that will result in the Amp’d branded phone service being available in Canada. Amp’d Mobile is a youth focused mobile service that offers post-paid and pre-paid service. Amp’d Mobile has invested a lot in exclusive mobile content targeted as the youth and use that as a key differentiator to attract people. They can be viewed a direct competitor to Vrigin Mobile (although Virgin in Canada only offers pre-paid service).

Although Amp’d Mobile will be leveraging Telus’s wireless network in Canada, this cannot be described as a typical MVNO deal. Telus will also be responsible for managing the sales, distribution, pricing, billing, operations and customer care for Amp’d Mobile in Canada. In return, Amp’d will grant Telus the exclusive rights to all its mobile content and will be responsible for procuring and launching the latest suite of Amp’d branded handsets. This service will be available in Canada in early 2007.

This partnership is a win-win-win for Telus, Amp’d and consumers in Canada. In a single move, Telus has gained access to a vast variety of exclusive mobile content that includes 3D mobile games, music, live sports and concert streaming, mobile communities, etc. Amp’d can enter the Canadian market and take advantage of the Telus network and operations infrastructure to reduce the time to market. Canadians will also win as more competition drives innovation and choice. People will benefit from a larger selection of handsets, varied pricing and a vast variety of mobile content. Amp’d Canada does have a presence on the web but their site is nothing but a “coming soon” page with a link for jobs.

This move is very indicative of the next battleground for Canadian mobile carriers. All of them see mobile content as the next big revenue stream and are willing to invest heavily to win on that front. It is interesting to note that each carrier is investing in mobile content very differently. Rogers is spending a lot to acquire mobile content by signing deals with various content aggregators and music labels. They have even signed content deals with music channels such Much Music and are releasing Much Music branded phones. Telus is also working various content aggregators to acquire mobile content and with this deal has ensured that it can offer exclusive mobile content from Amp’d Live. Bell Mobility has access to mobile content through its sister company Bell Sympatico and is also working directly with numerous mobile content aggregators. They should also try to leverage their relationship with Virgin to gain access to all the mobile content generated from V-fest. This will give them the extra edge they need as they are falling behind in the mobile marketplace. Virgin will also have to get into high gear and increase their marketing spend to respond to Amp’d Mobile going after the same target segment. There is another brand solely targeting youth and will be huge enough to change the Canadian wireless landscape.

Canadian wireless revenue outstrips landline revenue for the first time

Thu, 03 Aug 2006 20:38:33 GMT

Telecommunications revenue in Canada realized moderate growth of 3.5% in 2005. The Canadian market closed off 2005 at $34.5billion, up $1.2 billion from the previous year according to a report from the CRTC. Most of this growth was lead by revenue from wireless and high speed internet. The interesting point here is that wireless is the biggest and fastest growing component of the telecommunications market. Wireless revenues grew by 16.2% to $11 billion in 2005, making up approx 32% of total telecom revenues. Local and access revenues have been now been displaced from the top spot of being the biggest contributor to telecom revenues. This is a first in Canadian history.

This trend will continue in 2006 as wireless companies aim to increase mobile data revenues. I think the major drivers of this revenue will be investment in mobile content targeted at consumers and investment in various mobile enterprise solutions (devices and apps that run on the data network).

Visual Radio launches in India

Tue, 01 Aug 2006 16:10:29 GMT

I came across an interesting post on GigaOm recently. It seems Indians listening to FM radio on their phone can now watch visuals and be exposed to advertising while listening to music. Nokia, HP, the mobile operator Hutch, and a local radio station, Mirchi have launched this service in India. This Visual Radio service is available in Delhi at the moment and Airtel is also contemplating a launch shortly. People listening to music on their phone will also be able see the picture of the singer, be exposed to trivia about them, see info on any upcoming concerts and might even be able to indulge in m-commerce and buy tickets to the upcoming concert. This type of service allows mobile users to interact with their phones in an interesting new way, while allowing advertisers to reach the mobile audience while they are on the go. This also represents a lucrative opportunity for the wireless operators and mobile content suppliers to monetize all the eyeballs focused on that tiny mobile screen.

The success of this service like many others depends on the execution and the ability of the mobile operator to demonstrate value of this service. Pricing and the end to end user experience will also play a key part in this service. If the mobile operators charge exorbitantly for this service, including the ability to listen to FM radio on your phone, they will price themselves out of the market. The youth segment, which I believe will make up most of the target user market and early adopters is very price sensitive. In addition, I believe this type of service is very price elastic, thus the mobile operators will have to work hard to find the sweet spot. Pricing for mobile data and song downloads in Canada is a perfect example. I believe they are priced too high to make it attractive for the average youth who might be interested in downloading a ring tone or the song on their phone.

This type of service does represent a unique opportunity to allow advertising to subsidize the cost of mobile data and even particular types of mobile content. Given India’s mobile population and the revenue potential from mobile advertising is huge. If done right, advertising can enhance one’s experience, thus if a person is listening to a particular song, presenting them with a ring tone for that song or the MP3 for download, along with concert tickets is an ideal extension of that experience. If this ad revenue allows mobile operators to allow make mobile data and content more affordable, user adoption of such services can sky rocket and mobile operators will be able to recoup their investment in network infrastructure in a shorter period of time. The investment in infrastructure is a sunk cost from the operator’s perspective and the variable cost of transporting a KB over their mobile network is not significant either. Thus operators should look to mobile advertising revenue to cover their sunk costs and should only charge consumers what it costs them to transport the mobile content over their network plus a small margin (hey, everyone got to make money and demonstrate shareholder value). With improvements in network and handset technology leading to feature rich phones with better form factor, I truly believe that pricing will be the last barrier to mass adoption of mobile music downloads.

Composing an email while driving just got a whole lot easier

Fri, 28 Jul 2006 17:32:47 GMT

Lets be honest, how many of us are guilty of checking email on our PDAs (eg BlackBerry, Windows Mobile or Palm devices) while driving. Yup, guilty as charged. Now how many of us are guilty of even trying to compose an email on our PDA while driving? Yup, guilty as charged again.

Well, reading and composing emails while driving just became a lot easier due to the iLane gadget. Intelligent Mechatronic Systems Inc (IMS) a Waterloo based technology company has developed a device that coverts text into voice and vice versa. The device integrates with the audio system in your car and is also compatible with Bluetooth capable devices and audio systems. The technology used in iLane alerts you to any new messages when they arrive and coverts the text into speech. This allows you to listen to the contents of the message rather than read it. The device also allows you to dictate an email, thereby preventing you from typing it. Using the iLane gadget is supposed to reduce the distraction while you are driving by eliminating the need to look at or type on your PDA. The device is powered by the cigarette lighter in the car and does not work on batteries. The device has not been made available for commercial release, there is no information of price points or its distribution channels.

I believe the introduction of such a device will increase the chances of accidents as they will distract drivers who are trying to listen and/or compose an email while driving. It’s ironic but we are becoming captives of the very technology that was supposed to help increase productivity and help regain some work life balance by untying us from our desks. We can now be tied to our email even while we are driving and further increase the chances of an accident. I can just see it, a sign on the highway that will encourage people not to talk to or listen to their iLane device and practice safe driving J The introduction of the iLane device will certainly add to the interesting behavior we see from crackberry addicts.

Cool gadget and cool technology, its just that I am not thrilled with having more distracted drivers on the road as they are all listening to their emails or even worse, composing one while driving.

Which carrier will take home the spoils

Thu, 13 Jul 2006 04:25:47 GMT

As I was on the topic of mobile radio earlier in the week and was checking out TELUS Mobility’s website, I couldn’t help but notice their Mobile Music, Mobile TV, & Mobile radio product offerings. These services got me thinking about the mobile content sphere and how all the carriers have dug their heels in and are going head to head on this front.

If you looked at the advertising and promotions that were being executed by the mobile carriers a year or two ago, you would have seen a major focus on phones followed by rates for you monthly plans. Over the last 6-8 months, I have slowly been noticing that I am getting bombarded with advertising around the latest phones and what you can do with them. A day doesn’t go by where I don’t see an ad for the SPARK service (from TELUS), Frank & Gordon (the beavers from Bell) promoting MP3 phones and Rogers promoting the “Live Out Loud” campaign. The carriers have become very serious about mobile content and are hoping that this will help maintain or increase ARPU in a market where they are facing downwards pressure. As monthly rate plans become cheaper and carriers use them as the primary acquisition vehicle, they are relying on these value added services to make up any loss in revenue.

Its interesting to note that each carrier has executed on their mobile content strategy very differently with differing levels of investments. Rogers is clearly the leader when it comes to mobile content, especially mobile music. They have significantly invested in this area and have been banking on their “Live Out Loud” message for a while now. They have the greatest depth and breath of mobile content and were the first to release MP3 phones. Rogers continues to leverage their CRM system to educate customers that have purchased a music capable phone by communicating with them using various tools. Rogers’s welcome kits are customized based on the phone you buy and it iforms you of all the cool things you can do with your phone eg listen to music. They are laser focused on this strategy and have been executing on it for close to a year, if not more. Their recent World Cup campaign was amazing and did a great job of integrating their different services such as downloadable MP3s, downloadable video content, video messaging and information alerts such as sports scores. They also had a contest associated with their campaign. One of the unique things about Rogers it hat they are the only carrier in Canada that have launched and continue to launch phones with an iTunes player (the Motorola Rokr and the Motorla Slvr). I am not sure if this is paying off for them and if people are willing to give up their iPods for their phone.

TELUS’s approach to mobile content is very different to that of Rogers. They have launched a sub brand – SPARK that includes all their mobile content and mobile fun offerings. I am personally not too clear on what SPARK is, it seems to be a mixture of voice rate plans, combined with some bundles for mobile content. I also heard about certain phones being referred to as SPARK phones but their website does not substantiate this. That being said, they have accelerated their entry in this spaces by launching Mobile TV, Mobile Radio & Mobile Music offerings. They don’t see to have ring back tones as part of their offering whereas Bell & Rogers both offer this service. TELUS recently announced that they were the exclusive wireless sponsor of Canadian Idol. This must have been a significant investment and clearly demonstrates their commitment to win in the mobile content arena. They will have to do a better job of helping people understand what SPARK is before they can hope to win on this front.

Bell’s strategy is very similar to TELUS’s, they have launched the “Fuel Zone” where a person can go and “fuel up” their phone with all kinds of mobile content (video and picture messaging, mobile TV, MSN Messenger, etc). Bell was the first carrier to launch Ring Back tones & MSN Messenger in Canada. They are being aggressive on the content acquisition front but and Bell has been leveraging their infamous spokespeople, Frank & Gordon to promote their MP3 phones. However, based on the noise being made in the marketplace by Bell, they have to be more aggressive in this sphere. Its going to be fun to see who wins the battle on the mobile entertainment front.

TELUS & XM launch Canada's first streaming mobile radio service

Mon, 10 Jul 2006 05:05:28 GMT

I noticed that TELUS Mobility recently launched their Mobile Radio service on July 6^th. The release that went across the wire caught my eye as it mentioned XM & TELUS, two well known brands in Canada. You can now listen to 20 channels of XM’s satellite radio service on your mobile phone for $15/month. You can basically access streaming radio after you download a XM client on your phone. The service is only available on two phones in the TELUS lineup. This seems to be another first for TELUS as they are the only mobile carrier to offer such a service in Canada. Although, you can only get 20 channels, TELUS and XM have done a great job in providing a variety of channels that appeal to people with varied tastes. The channel line up definitely caters to the younger demographic, as they are the ones that will be all over this service. I feel that the price point is slightly high at $15/month, I don’t see a lot of people (especially the youth) willing to spend $15 in addition to their monthly service charge. I think Sprint in the US has got the pricing right as they offer a similar service from SIRIUS for $6.95/month. This is much more affordable and I can see people willing to pay $7 for the luxury of accessing a streaming radio service over the phone.

The web team at TELUS has to do a better job of ensuring that their website is up to snuff, especially the pages that deal with a service that they have recently launched. I wanted to find out how you listen to streaming radio on your phone and it took me two clicks from the mobile radio homepage to get an error message which prevents you from accessing this information.

The launch of this service is a great move for both XM and TELUS. XM has beaten its rival, SIRIUS to be the first to launch a mobile streaming radio service and has also partnered with a wireless company that has a great brand in Canada. In addition, TELUS has beaten the other mobile carriers to the punch by being the first to launch this service. They must be especially proud of the fact that they beat Rogers, who appears to be the leader in the mobile music space in Canada. I am sure the folks at Rogers are watching this launch very closely and are hatching some plans of their own.

Overall, its a cool service and congrats to the TELUS team for being the first in Canada to launch this.