While Microsoft isn’t exactly hurting, the company has had very mixed success entering new markets for some time. In fact, without the OS and Office cash cows, it’s failures would have torpedoed most companies. One thing Ballmer and company do seem to have is tenacity. That tenacity can be seen in action with Windows Phone.
Windows Phone is a well executed smart handset platform that came to market a little to late. It’s also lacks any real advantage over the established Apple and Android platforms. Add to that the obstacle a its licensing fee and there’s not much to make Windows Phone compelling to potential manufacturing partners. That gives Android a price advantage while Apple holds the overpriced designer label space. Microsoft has tried to remove that disadvantage by patent trolling Android manufacturers, with mixed success. There are also rumors that the company could acquire the ailing Nokia, likely giving Windows Phone a stable hardware partner. None of this will open any shelf space for MS as long as devices are joined at the hip to service plans that are sold exclusively by carriers.
That brings us to Skype. The VoIP company that Ebay notoriously overpaid for, was acquired for far less by Microsoft last year.The company is currently testing an app that will add the mostly free to talk service to Windows Phone 8. Tight integration of Skype into the Windows Phone OS has the potential to accelerate the end of by the minute mobile voice plans forever. That is assuming the carriers cooperate. While the mobile hardware space continues to become more crowded, the carrier space is not with incumbents scrambling to consolidate. Despite what we keep being told, mobile data is enormously profitable. That profitability is eclipsed by the margins on voice by the minute and messaging. Without major changes in the wireless connection business, Skype will do nothing to improve Windows Phone’s fortunes. (more…)
The wireless business as we know it should have ended with the smartphone. It did not because of tight handset control by a small cartel of service providers. This cartel succeeded in locking up the supply of devices largely by denying access to their networks with third party devices. By leveraging a tight knit relationship with regulators and lawmakers, these companies have also successfully locked up the lions share of wireless spectrum for their exclusive use. This same cartel is now clamoring to lock up more of the most useful airwaves even as they hold currently hold spectrum that is not being utilized. Lawmakers who have an unending need to spend more welcome the idea of a new windfall from yet another auction to exclusively assign public airwaves to the cartel.
Meanwhile, back in the real world, wireless carriers are aggressively offloading increased data traffic to narrow, increasingly overcrowded unlicensed WiFi networks. The reason isn’t hard to figure out. If more traffic can be pushed onto someone else’s network they can still charge large without building adequate infrastructure. Why not allow more unlicensed frequencies? Congress wants more money, and the carriers do not want an abundance of open spectrum available. That would encourage a whole new wave of competition that will demand new investment while pushing down prices. Make no mistake about it: The growing abundance of cheap WiFi only tablets and entertainment devices that do more than the carriers’ locked handsets could spell doom if the availability of WiFi grows.
I’m not the lone wolf howling on this open spectrum soapbox. Yochai Benkler at Technology Review seems to agree with me on most major points and has several good ones to add. Open spectrum is not being discussed by lawmakers because it does not benefit them. The next wave of wireless could lift all ships, including those of pols and a cartel. They need to get out of the way to make it happen, and they need to hear from all of us to make it so.
In broadband policy, one could argue the French have been leading the world. France relies on a relatively open market that has created an abundance of options and very high standards for consumer broadband service. In contrast, American policy relies on bureaucrats and pols picking winners and losers. This has given the US artificially scarce, substandard service at high prices. The average French city dweller has broadband all but a lucky few Americans can only dream about for about the cost of a night out at the movies. What about wireless? Most of us dream of a single connection we could use with any and all of our wireless devices. In France and a few other European countries, that dream is a reality.
For a couple of months now, France Telecom’s Orange unit has been allowing iPad owners in Austria to share one allotment of data with a phone, while other shared data plans were recently launched in France, the United Kingdom and Spain.
Although the plans vary somewhat by country, the basic premise is the same. Users pay an extra couple of dollars a month for each additional device that shares data — similar to the way families and businesses here have long been able to share minutes between multiple phones.
“We believe that’s really a way for the future,” said Olaf Swantee, senior executive vice president for France Telecom’s Orange unit. (Wall Street Journal)
While there is more wireless competition in much of Europe, there are also regulations that separate devices from service. Most Europeans shop for their device(s) before choosing a service provider. To be fair in making comparisons, a single standard (GSM slowly shifting to LTE) makes things a little simpler, but modern technology has pretty much negated that advantage with programmable transceiver circuits on a chip. In other words, network agnostic devices would be readily available here in our multi-standard world too if the market was open. By the way, thanks to a more open market, Europeans also tend to pay less for devices than we currently do.
Why not here, you ask? It’s certain consumers would flock to the carrier(s) who offered all device access via a competitively priced catch all account. After all, that’s essentially how we use our fixed connections. The hard reality is that we have a Wireless Cartel that prefers things the way that they are with a subscription for every device. And… our pols and regulators are aggressively defending that status quo. We could change this, but we’ll need to make far more noise than we’re making today. With AT&T and Verizon consistently placing in the top ten lobbying spenders, that noise needs to be deafening to overcome appeal of the perks reps and regulators enjoy. The message that needs to be delivered is simple: No more than 2o% of available spectrum can be controlled by any single entity, and all devices must be sold unlocked. With these fair, open market rules in place, competition will take care of the rest.
It’s no secret that AT&T’s under investment in infrastructure has become a major liability for the company that now wears the once proud technology leader’s logo. The iPhone has rewarded the company with steady wireless growth, enough to cover for its land based Uverse disaster. While is has been beefing up it’s wireless infrastructure recently, it has not kept pace with demand created by growth created by internet capable handsets. This could be a real chill on revenue growth as AT&T loses it’s iPhone exclusive. Needing a quick fix, the company is beefing up its WiFi network in the most congested locations.
“We’re excited to start the next phase of our hotzone program with additional Wi-Fi coverage areas in New York City and, soon, in San Francisco,” said Angie Wiskocil, senior vice president, AT&T Wi-Fi Services. “AT&T Wi-Fi will be available across a wider area for Manhattan residents, visitors and New Year’s Eve revelers during the busy holiday season and beyond. Plus, San Francisco residents are expected to soon be able to enjoy a Wi-Fi hotzone in the Embarcadero Center area as they shop, dine and work.” (ATT.com Press Release)
AT&T may have tripped over a broader wireless solution without trying. The company has hap hazzardly established a WiFi presence that nearly rivals some carriers 3G coverage. This gives the smart phone user access to decent bandwidth in select locations without burning precious monthly plan bits. Fixed line customers stuck with a slow connection at home may be enticed to stay with free access to a robust WiFi network when out and about. AT&T skates by big investments by deploying commodity, off the shelf hardware that does not need expensive tower leases and permits that can use existing infrastructure for back haul. Customers can access the network with commodity devices and use it as they please.
Switching to a broader view, I think that this calls into question how we’re managing spectrum. Using a tiny sliver of shared spectrum, AT&T is providing service to the masses quickly and cheaply. ANYONE can use that spectrum quickly and easily by plugging in an approved device. The FCC pre-certifies the devices we use and polices any bad behavior. Thanks to the chaos of an open market, new bandwidth goes on online in the blink of any eye.
Meanwhile back in Washington, carrier lobbyists are beating the drum for more exclusive spectrum to enable the chosen few to keep consumers on their exclusive plantations. I think it’s for a reboot. No more exclusive licenses to spectrum. We’ve tried the other way and it’s kept American technology behind the curve and forced us to pay the highest prices in the developed world for service. I’m not suggesting that we put the existing carriers out of business, I’m only suggesting that we stop protecting them from competition. Yes, I know the rest of the world is still doing it the old way. Staying with that model has turned us into lagging followers. It’s time to lead.
Broadband has facilitated the move of many services that were once the domain of satellites to terrestrial fiber. There may be new hope for the L and S satellite band operators who have been in search of a new cash cow. With the world hungering for more wireless broadband spectrum, a hybrid satellite / earth based system using this 100MHz band is worthy of consideration.
The FCC is interested in learning more about ATC, Dean Brenner, VP of government affairs for Qualcomm, told me. SkyTerra’s VP of regulatory affairs, Jeff Carlisle, said he was meeting with the FCC to point out that companies holding ATC licenses could get 100 MHz of spectrum online within the next couple of years. Back in 2003, the FCC overruled objections from the CTIA and the wireless industry, and told satellite companies holding spectrum in the L and S bands that they could offer broadband as long as it had a both a satellite and a terrestrial network component. Companies with this ATC approval promptly went out and raised billions to create such networks. (Gigaom)
Those channels of static that compose the majority of the TV band in most locales have been put to good use in one Virginia town.
The first public white spaces network officially launched on Wednesday in Claudville, Virginia. It is uses sensing technology from Spectrum Bridge with software and Web cams supplied by Microsoft and PCs supplied by Dell. The project was funded the TDF Foundation. (Network World)
This is a step in the right direction, but far too little and very late. The airwaves belong to the public, not to the revolving door elites in Washington DC or the wireless cartel that they serve. We need rules that grant this spectrum to the public to use as it sees fit before some enterprising bureaucrat develops another auction scheme.