Archive for December, 2006

Has the age of the Mac arrived ?

Thursday, December 28th, 2006

An IT colleague of mine (who knows I have an interest in multimedia and how it’s affecting the web and telecommunications in general) recently bought a 23-inch iMac. He emailed me with great enthusiasm, saying how amazing it looked, with a graphical interface, very easy to use.

He had found adjusting to Windows Vista a painful experience, and by contrast the Mac has been quite simple. It has Unix under the hood, so he has all the geek tools he needs to do his job. It’s very stable, and if he can’t run an application he needs, he can boot Windows inside OSX with a product called Parallels.

According to recent articles corporates are starting to take the Mac seriously, and it may have a good chance of finding a place for itself outside the print and video production markets.

My colleague believes that, with more hardcore users moving from PC to Mac, a groundswell might be taking place, and the world might start to become less MS-focused, which will produce a flow-on of changes in the Web, and hence telecommunications.

He gave an example: one of his work colleagues was on his way home from San Jose and they had a half-hour video Skype communication while the friend was at the airport and he was at home debugging some network problems on his VPN.

He was able to share his desktop and give his telecoms colleague a hand!

Although this can be done on a PC, according to my friend it was somehow easier and more inviting on a Mac. He thinks the fact that the hardware incorporates cameras etc is part of the reason. But also the computer looks good, feels good, does not try your patience, and so is just more inviting to open up and use.

Oh, and don’t get him started on the iPod he bought to go with the iMac; and on podcasts – ‘how good are they!’ he enthuses. Again, there is nothing you can’t do on a ‘PC’, that you can’t do on a Mac but his Creative Labs MP3 player is junk compared with the Apple iPod..

You’re probably asking ‘what about the UNIX backend?’.

According to him, Linux is good for the geeks but way too technical for the masses. The Mac is super-friendly for the general population (far easier than Windows) and it has what is essentially ‘Linux inside’.

Hopefully this is not just post-purchase justification. Only time will tell. Perhaps what Apple is doing will level the playing field – particularly if their upcoming ‘media centre’ products are of the same quality.

My colleague’s prediction is that if Apple releases a good media centre product, then it will be Macs for the home and PCs for the office in the next few years. And after that, who knows…

Here is my son Ravian’s comment on the above information.

I agree whole heartedly with his analysis. The “new” Mac’s (to be specific it is the new range of Intel powered Mac’s) are soon to be in direct competition with PC’s for a number of good reasons.

The main reason for techies is the fact that because it is Intel based, Windows XP can run on it and already there have been released patched versions of windows XP that will run on the Intel based Mac. Now, it is important to note that you were able to run Windows via a piece of software within Mac OS (namely “Virtual PC”) yet because it is “virtual”, windows runs slower than running it normally on a PC and this is no good, but on an Intel based Mac you can “dual-boot” with Windows and Mac OSX which will (in the not to distant future) run as it would on a PC, but benefit from the solid architecture of the Macintosh.

PC’s and Mac’s both have their problems, but due to the fact that OSX is based on Unix (it’s important not to get Unix and Linux mixed up, they are similar but still different operating systems), means that the operating system is very stable and Mac’s can last much longer periods on or on standby than PC’s can and this is why you will see Mac notebook users just closing there laptops without shutting down whereas PC notebook users tend to shutdown more often as windows tends not to like going into standby and can have problems running for long periods without shutting down (especially if you are using memory hungry applications like design of video apps!!).

For end users the ease of use of a Mac, the “usability-straight-out-of-the-box” is the main selling point. My brother in law recently bought a 21″iMac. It comes with a little remote and has a media centre interface which seamlessly plugs into Apple’s online movie trailer connection and through his cable broadband internet connection (wirelessly piped to the Mac of course) the video’s viewed smoothly without any jumping or skipping and all this from the comfort of the couch via the iPod styled remote. Even when I view the Apple trailers via my 24mb ADSL 2+ connection on a PC, it still doesn’t seem as smooth as on the Mac, somehow that Apple logo makes computers run smoother!!!

My next computer will be a dual core Intel Macbook pro laptop without a doubt. The dual boot Windows and Mac OSX is the main selling point, but the hardware under the hood and the ease of use of the Mac have all aided in my choice!!!
See also: Global – Convergence and Digital Media

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Broadband and TV – not converging, but complementary

Monday, December 18th, 2006

One of the biggest surprises to me has been watching the old media industry, with a great deal of stumbling, manoeuvre itself to the forefront of these developments. They are combining their TV activities with the new digital media – not yet converging them, but that will come later.

It has become clear that the current concept of IPTV, as engaged in by some telcos, is not working. Customers are not prepared to pay for TV programs simply because they are suddenly available via broadband (or mobile for that matter). Also, VoD has, to date, not proved itself a successful broadband application.

Over the last few years more money has been invested in TV programming than in film-making. This clearly indicates a shift in the content and entertainment markets. The new trend is towards programs such as Lost, Survivor, Idol, Big Brother, etc. And it is here that broadband and TV complement each other.

The TV can be used as an efficient and effective medium to launch new nationwide events, which in fact are the programs mentioned above. These programs are widely anticipated and talked about in the workplace, at parties and around the barbecue.

Using the TV activities as ‘events’, broadcasters can hook a large number of other multimedia operations onto this – websites, portals, chat services, SMS services, blogs, social network groups and so on.

Of course, there are many other programs that can be used as events, to launch a range of other new media services, in sport, news or hobbies. If we look at special interest groups, regional markets etc, the possibilities are endless.

Dual set-top boxes are already arriving in the marketplace, which allow for both TV and broadband connections.

This further underlines the uphill battle telcos will face in challenging the position these media companies are currently building. There is simply no hope that they could match such activities. They might have had an advantage earlier on, but they have failed to truly understand the value of their broadband infrastructure.

Nevertheless there are many value-added infrastructure services that the telcos can offer to the new media companies. In order to run the new Internet economy you need data centres, content hosting, transaction, network management; and many companies involved in the Internet economy might want to outsource most of their ICT requirements.

Paul Budde

Digital Media will also be the major theme of the Broadband Mission to the Netherlands on 11-15 March 2007. See Australian Study and Trade Mission to the Netherlands

It will also feature as key topic at my first Roundtable for the New Year:Planning the year ahead of us.

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Austar United Communications Ltd – Historical financial results

Wednesday, December 13th, 2006

Financial results – 2006

For the 12 months ended 31 December 2006:

  • Revenue increased 11% to $503 million;
  • Gross margin increased 14% to $276 million;
  • 18% increase in operating expenses to $134.5 million attributed to subscriber acquisition expenses in the form of sales commissions and marketing;
  • EBITDA increased 10% to $142 million;
  • Profit before interest and tax was $84.2 million, a 31% increase;
  • Net profit after tax was $210.2 million;
  • A record net profit after tax of $210.2 million (includes a tax credit of $243.1 million, offset by a goodwill adjustment of $84.2 million relating to the pre-1999 tax losses recognised);
  • Cashflow from operating activities (before CAPEX) increased 20% to $111 million.

 

 

Financial results – 2005

For the 12 months ended 31 December 2005::

  • Revenue increased 17% to $454 million;
  • EBITDA increased 37% to $129 million;
  • Net profit after tax of $60 million (including the gain of $17.4 million on the Unwired transaction in Q3 2005);
  • Net debt reduced by $54 million to $282 million;
  • Programming costs for pay TV rose from $148 million in 2004 to $174 million.

 

 

Financial results – 2004

Highlights for the financial year ended December 2004:

  • Sales revenue increased 20% to $388 million;
  • EBITDA increased 77% to $100 million;
  • Net profit was $1.8 million compared to $3.8 million in 2003.

 

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Cracking the mobile business models

Monday, December 11th, 2006

As we have been predicting for more than a decade, cracks are finally appearing in the mobile business models that have been used during that time – models that have effectively stifled innovation and competition.

We have always maintained that mobile communications should be treated as a commodity and, as such, should be made available for the range of services that can be built on top of these networks. This is very much along the same lines as the MVNOs (Mobile Virtual Network Operators) that have emerged in the past (however to date the business models used by those operators have proved economically unviable).

One of the key reasons for this market failure has been the so-called battle for the customers. Potential operators of mobile services over those networks, such as banks and media companies, don’t want to be held to ransom by the mobile operators; and for their part mobile operators have so far been unwilling to hand over customer control to content and service providers. However, it will be the mobile operators who will eventually have to cave in, and there are now signs of that happening.

A combination of factors is currently creating a better environment for more innovation:

  • The mobile market is saturated and operators are desperate for new revenue streams, to at least safeguard their current revenues.
  • There are no new revenue streams from new services (ie, users will not increase their spending – they want more for the same money).
  • The regulators are chipping away at the fat margins of the operators.
  • The trend is now towards wireless broadband (HSPA/LTE/WiMAX).

Operators have little choice other than to start looking at wholesale models that they can offer to those organisations who have a vested interest in making their services available over wireless networks.

Rabo Mobile
Rabobank in the Netherlands has introduced a mobile banking service. Customers who take up the service receive, as added bonus/incentive:

  • Low-cost mobile calling and low-cost SMS at € 0.10 per minute or per SMS
  • The latest mobile phones, starting from € 4.25 per month
  • Mobile Internet: 1Mb free or Unlimited Mobile Internet access for €10 per month

The example set by Rabobank will certainly be replicated in other parts of the world. This trend will be one of the most significant the industry has ever seen and will start the race towards personal wireless broadband networks.

Paul Budde

For those interested we can look into organising meetings with the Rabobank at our study and trade mission to the Netherlands from 11-15 March 2007

See also Global Mobile Data

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Every site needs its own YouTube

Monday, December 4th, 2006

I am sure that, like me, many people are excited about YouTube but are, at the same time, reluctant to go to that site as we have no idea what to do once we get there.

Okay, you hang around a bit, click on a few video clips. If you hit a good one you stay a bit longer; if you hit a few duds (most of them) then you are out quite quickly.

Unlike MySpace, which has a far more defined purpose in new media land, YouTube is a novelty that will not survive in its current format. For the moment there is the excitement of video, unshackled from the TV and film moguls, and we’ll enjoy this for as long as the excitement around our ‘liberation’ lasts. However, after the initial thrill is over, we need more if we are to stay attracted to such a service, and if video-based communication is going to move into other websites.

Already video clips are a key component of MySpace and other social networks on the Net, and it makes much more sense to have these user-generated video clips in these places. When I want a clip relating to international events, for example, I go to the BBC site; for a local item I go to The Australian; for Sydney events, to The Sydney Morning Herald; business events, The New York Times, AFR and Financial Times. For entertainment we select media companies such as TV and radio stations; for good quality background information, ABC Radio National, and so on.

Again, all of these sites will soon have their own sections with user-generated content, be it video clips, podcasts or blogs.

All of this is proof that customers are looking for trusted sources for certain information, entertainment etc. But they also go to these sites to see if there is perhaps something that they are not necessarily looking for, but could be interested in – and they only know that by going to the site.

While there is certainly room for new companies within this new media landscape, the majority will gravitate back to a range of trusted media sites. And in the case of user-generated content such as the millions of video clips it makes sense if these are clustered together – either around the ‘trusted’ sites that already exist, or, if enough momentum is gained around a particular topic, a new ‘trusted’ site may emerge.

At the moment we are mainly seeing international developments such as MySpace, YouTube, Yahoo, Google, etc. However, national sites are now emerging, especially in those countries where English isn’t the first language. It will not take long before every community has its own site – and often the smaller the community the more interesting and active the site will be.

In the end, this last development will be one of the most significant and long-lasting results of this Internet/broadband revolution.

Paul Budde

See also:-
Global – Convergence – Consumer and Business Markets
Global – Convergence – Massive media changes – Analysis
Global – Convergence – Triple-Play Models

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