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…)
FCC announces a public test of White Spaces. It’s only a test and there’s no word of it being made public going forward. Leave the cork in the champagne bottle, but it may be OK to chill it and hope.
Now that Google owns Moto patents, Apple wants a truce. Advice to the Searchzilla: sue with prejudice until they the fruity kids call a truce with every Android device maker. Then go after Microsoft.
Verizon jumps into the prepaid biz with a $50 unlimited plan. Watch for AT&T to use this as “proof of a competitive market” without T Mobile. It could be a trojan horse as prepaid rates can be raised or lowered at will. If V sticks to this for the long haul, look for the second tier to move unlimited below $40. Even at that price wireless will continue to be phenomenally profitable.
Windows 8 preview scores half a million downloads in 12 hours. It’s free to try, but at $150 or more to buy, I don’t think there will be so many easy takers.
Intel’s Atom gets some Android love. This late in the game no one may even care. A significant number of device makers have no other relationship with Intel that it can leverage. That will make getting any market share difficult.
Freedom loving American geeks have been advocating for the open, unlicensed use of White space frequencies for the last 4 -5 years. Open frequencies will enable entrepreneurs to rapidly deploy wireless broadband where incumbents won’t. It could also foster a little more competition in a market where Americans pay the highest prices in the world for mediocre service.
Meanwhile back in Washington, the FCC and Congress have been preoccupied with cooking up a scheme to auction off that last wireless frontier to one of the corporate oligarchs that already control most of the public airwaves. The wireless cartel fears having to compete in an open market, and pols are giddy over the idea of another money pot they can use for pet projects. In other words, very little would change.
Ironically in the land of Big Brother, where that average urban citizen is always in view of the government CCTV network, wireless freedom will prevail according to Ofcom’s White Spaces proposal:
(unlicensed white spaces) ………are predicted to boost economic activity as well as improving broadband coverage. Ofcom wants the UK to lead Europe in this “spectrum recycling”, and says it will make the spectrum “licence exempt”, so it can be used freely, according to a release which presents the results of a consultation which began last November. (Eweek)
Kudos to Ofcom for acting in the best interest of UK’s entire population rather than a few elites. Isn’t it ironic that the government we fought a war to get away from now values wireless freedom more than the one we replaced it with.
A proposal being considered by Congress will allow unlicensed use of spectrum only if its potential users are willing to pay the highest bid for it. The bill is being spun as a way to put an end to a free ride for corporations like Google. Unfortunately it is a far more sinister attack on everyone’s freedom.
Among the proposals, the law sets up an auction system for the allocation of spectrum for unlicensed use—think “white space” devices and WiFi. The Federal Communications Commission would be required to conduct auctions in which bidders could declare their intention to buy spectrum for licensed or unlicensed deployment.
But (our italics): “The Commission may only exercise its authority under this Act to allocate a portion of the spectrum for unlicensed use if—the bids for unlicensed use, in the aggregate, exceed the highest bid for such license.”
If an unlicensed spectrum sale went through under this condition, the FCC would be forbidden to impose any rules on the sale winner that “limits the ability of a licensee to manage the use of its network, including management of the use of applications, services, or devices on its network, or to prioritize the traffic on its network as it chooses.” (Ars Technica)
There are a couple of issues at work here. Congress is unwilling to restrain its insane spending, so any new source of revenue is attractive. It could also justify the continued existence of the FCC, which has become an agency without a real mission. The other is Congressional sweetharts, AT&T and Verizon want to lock up virtually all available spectrum. The real reason for this is to lock out new competitors, not to deliver better service.
New wireless technology is making it possible to deliver reasonably good service at a far lower cost than in the past. Open, unlicensed spectrum could mean a more open market for small players to enter the fringes of the market. Why should the wireless cartel fear new players in the fringes? Companies like Wal Mart began in fringe markets. Eventually fringe players could be a threat.
Congress and FCC need to be reminded that radio spectrum is defined by law as a public commons. While giving more control to a few oligarchies will bring in revenue and perhaps justify the continues existence of the FCC, neither of these are in the public interest. The best solution to spectrum scarcity is to put more of it in the commons for all to use. Oligarchs would be free to do business there along with everyone else, but they would also have to compete. For some reason these folks would rather pay any price than face a new competitor. It’s probably the same reason that Congress has labored long and hard to keep power exclusively in the hands of two political parties.
The broadband duopoly and wireless cartel are powerful. Any effort to improve broadband access quality even at the municipal level is almost always impeded by lawsuits from the incumbent carriers. The current broadband business model of investing first in lawyers and lobbyists instead of technology is about delivering less for more. As a result, most of us have about the same quality of access that we’ve had for the last decade, and are most often paying more for it.
At least on the near term, a new co-op may be the model to break the shackles of the cartels and unresponsive governments. Like modern barn raisings, very small groups could change the broadband landscape very quickly.
If we are to believe the FCC, unlicensed white spaces could deliver up to 20MBPS access to a small geographic area. While that kind of bandwidth won’t best the cable guy’s typical offerings, it will best DSL and 4G. Let’s assume I create a co-op with 40-50 fellow web workers in my neighborhood to create a private white spaces ISP. We lease a 20 MBPS pipe from a someone like a Towerstream or Speakeasy, and use members private properties for POP’s. Since we won’t be using wired right of ways or commercial towers, at most we’ll apply for a zoning variance for higher than usual antennas. Small numbers and non-commercial permitting insures we’ll be flying under the incumbent carriers’ radar. Co-op members share expenses and systems management duties and share a more robust low bandwidth connection at a lower cost. Co-op members would decide how traffic is managed – if at all. If co-cops like this get traction, the established carriers could face enough competition at the low end to reduce prices and offer more robust service tiers.
There’s no reason to stop at bandwidth. The tech coop could be much more, offering members more utility at a lower cost with the freedom of self control. For example: a utility cloud computing co-op comes to mind……