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Welcome to ZenUnwired; a blog dedicated to tracking developments in technology and strategy, and to deciphering the impact of these developments on wired and wireless ISP's, device manufacturers, OS and application developers, and most importantly - you.

Friday, April 30, 2010

Weekly Roundup - Week Ending May 1st 2010


Here are the top stories in the US and Indian wireless markets this week


US
Wireless Carriers:
Sprint announced its Q1 results earlier this week. Although Sprint lost 75,000 net subscribers during the quarter, there were some huge positives. The biggest one in my opinion, is the not-so-surprising strength in Sprint's prepaid business. During the quarter Sprint added 348,000 net prepaid subscribers. Taking this statistic along with AT&T's and Verizon's steep drop in postpaid subs in the first quarter, clearly points to the emergence of the once-forgotten prepaid segment as a dominant driver of adds in the already mature US wireless industry. This is also bolstered by the fact that Tracfone (a prepaid MVNO in the US, and a subsidiary of America Movil) added 1 Million customers to its base in Q1. I expect Sprint's fortunes to continue improving in the rest of 2010, on the back of the impeding launches of devices like the EVO and to a lesser extent - the BlackBerry Bold 9650 (a Sprint exclusive). Also, it looks like the EVO is closer to launch than ever before. Sprint is reportedly hosting EVO launch events all over the country - like this one in New York City on May 12th

The only other significant event among carriers this week is that T-Mobile is dropping the 5GB Cap on its mobile broadband card. This has far reaching implications for the industry, especially because all the other majors have been talking up tiered data pricing as a way to manage network congestion. T-Mo's move in the other direction might force others to follow suit, but this is yet to be seen.


Device Manufacturers:
The big news among device manufacturers this week is that the Palm saga might finally be over. On Wednesday evening HP and Palm announced that Palm would be sold to HP for $1.2 Billion. HP is betting big on the WebOS and is reportedly planning on introducing WebOS on a host of new and emerging devices like tablets. The CEO of Palm, Jon Rubinstein called this a huge step forward for Palm on his memo to Palm insiders. While I sure hope things work out for Palm and its employees, I for one was saddened by the way things ended for the once storied brand.

HTC is the belle of the ball these days. It continues to crank out hit after hit android devices all over the world. Examples of these devices include the Nexus One, the EVO, Droid Incredible, etc. Its no wonder that HTC is reportedly expecting to see a 36% increase in its sales in Q2, thanks to Android. Also in noteworthy news, in a weird twist of fate, it looks like Microsoft will be collecting royalties on Android phones made by HTC. Imagine that! It is especially ironical considering that Google doesnt make a buck by licensing the OS that it created.

So Apple is turning evil (as if it never was before?). Apple responded to the Gizmodo's great iPhone fourth generation leak by raiding Gizmodo editor Jason Chen's home and confiscating his computers. Ok - so it wasnt Apple that raided Jason Chen's house - it was the Silicon Valley cops. Big difference, right? In any case, the raid set the blogosphere afire (free speech, yada, yada) and it even prompted Jon Stewart to create this EXTREMELY funny segment on the Daily Show. If that wasnt enough, Steve Jobs is in the middle of a pissing match with Adobe over enabling Flash on the iPhone. First, Steve Jobs explained why he doesnt want to enable Flash on the iPhone. Adobe responded, and then announced that it would stop developing its iPhone platform. Just when you thought this couldnt get any funnier, Google recently announced that Andoid 2.2 Froyo will support Flash soon. Just goes to prove that geeks with a ton of money are still geeks (angling to make more money) at the end of the day.

Other news this week include:

Mobile OS:
Two quick news-bites here.

Miscellaneous:
Here are some miscellaneous bits of data that I thought were interesting
  • Facebook believes that the the entire web will be social, and is 'friending' tons of sites out there - with your personal information. Oh and by the way, you are automatically enrolled in this experiemtn. Dont believe me? If you are a Facebook user, go to sites like www.yelp.com, and you will immediately be notified how many of your friends are Yelp users and how you can share your reviews directly with them. And dont even get me started on the "Like" button. Facebook as gotten a lot of flak for this new "Like" feature. The simple explanation for all the hullabaloo is that while you "Like" a page on the net, it is up to the webpage owner to report what the link really is. In other words, while you could be "Liking" a salad recipe you find online, the webpage owner can report that you "Like" Viagra. Take my advice and opt out of these new features - at least till Facebook gets its act together.
  • Apparently one quarter of online videos are viewed in primetime. I wonder if this bodes well for Google's "DragonPoint" set top box rumored to be launching soon. I would think so.
  • The integration of your car with your cellphone continues. Check out QNX's LTE connected car. Note that QNX was acquired by RIM/BlackBerry earlier this year. 
  • The tablet market took a couple of major hits this week. First, HP killed its Windows 7 tablet and apparently Microsoft has also killed the Courier. So it looks like the only real contender for the iPad's throne is the JooJoo.
  • Here are three really great articles. One is on the global rise of the smartphone, the other on the enormous promise of 'location', and finally one on three successful business models built around content.


INDIA


Industry News:
The Indian 3G spectrum auction seems to be drawing to a close. After day 17, the price of a pan-India license stood at Rs.93.3 Billion (approximately $2.1 Billion). Here are all the details, examined on a daily basis that should give you a great perspective on the bid progression. After you take a couple of minutes to digest the astronomical prices, read Telecom Circle's analysis (and deck) on the 'fair price' of a 3G license in India.

The Telecom Regulatory Authority of India (TRAI) has released the subscriber and market share data for the Indian market (as it stood on March 31st 2010)


Wireless Carriers:


Miscellaneous:
Here's something light to end the post with.



Thats all folks! More next week!

Friday, April 23, 2010

Weekly Roundup - Week Ending April 24th 2010

Here are the top stories in the US and Indian wireless markets this week.

US


Carriers:
Its 1Q results reporting time in the US. This week both AT&T and Verizon reported their 1Q results. While as expected, both carriers did well in terms of net adds and revenues, there were a couple of themes that seem to be emerging. 
  • Firstly, it looks like the growth in postpaid subscribers is slowing down considerably. For instance, AT&T reported that they added only 512,000 new postpaid subs wile Verizon only added 423,000. This in turn points to the fact that prepaid might be finally gaining some much deserved traction in the market. A brief look at the various prepaid offerings available today clearly shows that these plans deliver tremendous value - especially when compared to their postpaid counterparts. Yes, the uber-cool devices that everyone's lusting for are still not widely available on prepaid yet, but this might change depending on whether 1Q's slowdown in postpaid is just a blip or whether it signifies a larger trend. It is definitely important to point out here that if what we are seeing is indeed a trend, Sprint seems to be perfectly poised to take advantage of it. We should probably find out more on Wednesday next week, when Sprint reports its 1Q numbers. Also important is the fact that this week, Walmart announced that it plans to roll out an ad campaign touting its Straight Talk service shortly. Straight Talk is a prepaid service that runs on the Verizon network, and is sold largely through Walmart. What I'd be interested in finding out is whether this new ad-campaign is a Walmart initiative - or whether the execs at Verizon just woke up and smelt the coffee?
  • The second theme that I found interesting is that for the first time, both Verizon and AT&T disclosed the number of 'connected devices' on their networks. In layman's terms, connected devices are non-traditional wireless devices that run on a carrier's networks. E.g.: Amazon Kindle. Verizon reported that it has 7.3 Million of these devices on its networks whereas AT&T reported 5.8 Million devices. Connected devices are widely expected to be the next growth engine for the wireless industry. By how much you ask? This post on Chetan Sharma's blog should give you an idea. And its not just wireless carriers that are placing their bets on this growth. Lets take one type of 'connected devices' - car infotainment, as an example. RIM's purchase of QNX Systems and Ford's Sync AppLink, which is a voice control mechanism for smartphone apps, indicates that you should expect to begin seeing integration between your car and your smartphone by the end of the year. Can you imagine listening to your Pandora station while driving to work? How about listening to your favorite podcast? Once again, the 'connected devices' trend seems to favor Sprint. Sprint has traditionally been known to be the most innovative wireless carrier (though it had lost its way a bit in the past couple of years), and has always had a lions share of these connected devices on its networks. What is left to be seen is - how (and whether) Sprint will get its act together, leverage its 4G network, and make inroads into this market - or not. 


In other news, the Sprint Overdrive 4G is continuing to receive great reviews. While it is a well established practice in the industry to talk-down competitors products, I was surprised to see Verizon reps lying outright about the Overdrive. Shameful! Meanwhile, I thought the Sprint WiMax iPad case was both clever and sneaky. 

In device news this week, the 
Droid Incredible is rated as impressive, Sprint is rumored to be getting the BlackBerry 9650 on May 15th, T-Mobile is rumored to be getting the BlackBerry Bold 9700 in white on May 5th, and AT&T is apparently blocking employees vacations in June for the iPhone launch.

Device manufacturers & Mobile Operating Systems:
Here's something we all know by now - Apple's next generation iPhone was outed by Gizmodo this week. As expected, terabytes of data (or more) has been created in the blogosphere about this - so I'll lay off this topic :) That said, I am definitely an admirer of how Apple incorporates the voice of the customer in almost all of its customer-facing operations. For example, I was recently reading how there is a correlation between (a) where Apple decides to open its retail stores, and (b) the propensity of customers in that area to buy Apple products. This isnt rocket science, but Apple's magic lies in its execution - to rise above individual priorities and fiefdoms (which there are bound to be tons of) and execute initiatives in the best interest of the company. I believe that it is because of Apple's disciplined execution that it is able to report blowout numbers every quarter. Well done, Apple!


There is also growing evidence that the relationship between Apple and Google is getting thornier. The spat started with Apple blocking the Google Voice app from the Appstore. Then Eric Schmidt resigned from Apple's Board of Directors. And now we hear some tidbits every other week that point towards greater animosities between these two tech giants. For example - last week we heard that Apple is removing the Google branding from iPhone 4. Now we are hearing that Google’s free turn-by-turn navigation is not coming to the iPhone. So is the Microsoft Vs. Apple wars over? Is the new war between Apple and Google? And if yes, what are we - the customers - to expect in coming months?


comScore reported that Android doubled its market share between November 2009 and February 2010, and that this growth is not showing any signs of slowing down. I completely agree with comScore's predictions - and its easy to see why. For example Dell is planning on releasing high end smartphones and tablets based on the Android platform, Android 2.2 is on its way, and finally, new entrants (into the US market) like ZTE with stated global ambitions are betting on Android. Conventionally - i.e. per well established industry dynamics as defined in the Porters Five Forces model - when one industry player develops a highly successful operating model, other industry players intensify competitive pressures against the leader. But so far, attempts by other players to dislodge Apple's and Android's growth trajectories aren't faring well. BlackBerry's new OS 6.0 is expected to be released soon but its already been rated as evolutionary rather than revolutionary. Windows 7 is some ways away from being launched, while WinMo is in the tank. Palm is still in a world of trouble - and might soon be bought by Lenovo or it might just license webOS. Symbian barely made a dent in the US. So where does all of this leave us? - For now the mobile OS wars in the US seem to be increasingly just a two player game.


On to lighter stuff




INDIA


The 3G spectrum auction is dragging on. On the 11th day of bidding, the price of a pan-India license stood at Rs.72.68 Billion (about $1.6 Billion) which more than twice the base price of Rs.35 Billion. Recently, I read a great report that hypothesized that the 3G spectrum auction process was designed primarily to help the Indian government maximize its revenues than to help the industry. While I'm not usually a believer in conspiracy theories, the recent bid prices make it hard to ignore the authors point of view. The BWA auctions are slated to start shortly after the 3G spectrum auctions are completed. I bet the TD-LTE equipment makers and service providers cant wait!


Here's another tidbit that I found to be both interesting and very surprising. Per data recently released by Google, India is ranked third among the countries which regularly request Google to remove unpalatable content. It is also among the top 20 countries worldwide involved in aggressive electronic monitoring of its citizens.


Carriers:
I have realized that Indian wireless operators launch innovative circle-wise pricing schemes almost every single day. Therefore, I wont be covering pricing changes and market launches starting this week. 


So after cutting out the clutter, significant news includes Bharti's international aspirations. After completing its purchase of Zain's wireless assets in 15 African nations, Bharti is looking to replicate its low-cost Indian model in Africa. While the purchase has been going well in most part, regulatory approvals in each of the 15 markets are expected to be required in order to push the purchase through. Recent news point to the fact that this process might be hitting a rough patch in Congo and Nigeria. Also this week, Bharti launched its ‘Airtel World SIM’ which is a single GSM-based International SIM card that works seamlessly in 150 countries and supposedly saves its jet-setting customers upto 85% on International calls. This sounds a lot like TruPhone's Local Anywhere service to me.


I have said this over and over in my posts, and I will say it again. All things considered, the Indian wireless market today is highly price sensitive. No wonder, carriers are perpetually tinkering with their pricing on a daily/weekly basis. In my opinion, this price sensitivity exists in most segments of the market - and the only reason we aren't seeing higher churn rates is because many subscribers are 'tied' to their mobile numbers (this is why I think MNP is going to completely change the market dynamics in India). Carriers therefore have been attempting to develop 'sticky' services that will hopefully get subscribers to stay. Airtel's Live Aarti and MTNL's 3G mobile TV streaming are two of many such innovative services that are being launched. I wonder how well Mobile Money will work in this environment. 


Well, thats it folks! More next week

Monday, April 19, 2010

Weekly Roundup - Week Ending April 17th 2010


Sorry I'm a couple of days late, but here are the top stories in the US and Indian wireless markets for the week ending April 17th 2010.

US

Regulatory
  • On the regulatory front this week, the Truth in Caller ID Act of 2010 finally made Caller ID spoofing a crime, and that includes VoIP. Finally you can breathe a sigh of relief that your number cant be used by others for purposes that range from benign – like crank calls - to nefarious – like identity theft – without legal repercussions.
  • Mobile DTV tests will begin on May 3 in Washington D.C., with 20 channels. Also, Sprint is also pushing its mobile TV service quite heavily these days. Will this finally whet consumers’ appetite enough for them to try watching TV via their mobile devices? I guess time will tell.

  • The FCC is reported to be pursuing its broadband agenda in spite of the legal setback last week.

Wireless Operators

Device Manufacturers
Since networks have become more-or-less ubiquitous, mobile devices have transformed into the great battleground in wireless - not only between device manufacturers but also between the carriers who manage to snag these uber-cool devices.  Here's a great little article from Gizmodo on the Apple vs. Google vs. Microsoft wars.


Mobile OS
Quantcast has released its study of the wireless web consumption by Mobile OS for March 2010. The iPhone is still the top dog, accounting for 61% of the share. The other notable news from this study is that on an absolute basis, the iPhone lost 2.2% of its share in March, whereas Android grew by 1.8%. Android's growth is even more striking in the quarterly numbers. For 1Q, the iPhone dropped by 4.3% and Android grew by 4.6%. It will be interesting to see how these numbers change this summer on the back of some high profile device launches like Verizon's Incredible, Sprint's EVO and the rumored fourth generation iPhone.

Miscellaneous:
Here's a list of some other things that went on in the industry this week plus some opinions and some relevant research.


INDIA


  • Let's start with some funny stuff. I seriously don't see the connection here but the UN is reporting that there are more Mobile Phones than Toilets in India. Maybe the UN wants to highlight the unsanitary conditions in India, bu their choice of mobile phones as a comparison metric is hilarious!
  • The latest mobile subscribers data (for the month of March 2010) from COAI is now available. That said, the data does not include any numbers from Reliance - apparently they haven't reported yet.
  • Rural Wireless: Accenture recently released their study on business models that can be employed for profitable rural expansion. If you haven't read it, I highly recommend it. It is available for download here. Some additional challenges and opportunities of going rural have been identified by the Plugged.in team and these can be viewed here. Similarly, trak.in has identified rural handset needs here.
  • 3G Auctions: As of the end of last week, the 3G spectrum auction bids crossed the $1.3 Billion mark. Macquarie Group estimates that a pan-India license could now cost bidders as much as $2 Billion.  
  • In some troubling news for Indian operators, Light Reading's analysis of numbers released by TRAI points to the fact that mobile ARPU in India slid by 12.4% in 4Q 2009 to Rs.144 (US$3.26). Additionally, it is expected that these trends will continue sliding in 2010. Minutes of Usage (MOU) also slid in 4Q, and surprisingly CDMA MOU was faring better than GSM.


Wireless Operators

Miscellaneous:



Well, thats it folks! More next week (hopefully, on time)