BuddeBlog

Torpedo fall short in Brazil

SMS, popularly known as ‘torpedo’ in Brazil, has been slower to catch on in this country than in other Latin American markets. In 2008, we estimate that the average number of text messages sent from Brazilian mobile phones is not much more than 10 per month, compared with about 140 in Venezuela.

This is mainly due to the high price of SMS in Brazil. In 2007, Brazilian operators were charging US$0.18 on average per message, while in neighbouring Argentina the cost was US$0.05. In Colombia an SMS was costing on average US$0.06 and in Venezuela US$0.03. In June 2007, Claro lowered its SMS price by 20% to R$0.30 (US$0.19), the lowest at the time in Brazil.

In mid-2008, TIM Brasil was charging R$0.39 and Vivo R$0.35 per message. Claro still charged R$0.30. Vivo, however, also offered several SMS packages, including one at R$14.90 for 100 text messages to be sent within a period of 30 days.

Reducing SMS prices would certainly lead to increased traffic, which would more than compensate for a temporary drop in revenues, but operators have been unwilling to test this theory; instead, they have blamed the low SMS take-up on lack of interest or ignorance on the part of the public rather than on high prices.

Nevertheless, mobile data is a promising source of revenue in this country. Given its size, Brazil is the largest market for mobile data in Latin America, with a growing demand for ringtones, mobile games, and Portuguese mobile content.

According to the latest official data, SMS traffic in Brazil increased by 20% in 2006, to 8.4 billion messages, compared with 7.0 billion in 2005. Around 90% of messages were person-to-person, while the application-to-person market accounted for the remaining 10%. Revenues from data services averaged about 7-8% of total operators’ revenues in 2006. During 2006, operators generated revenues of R$2.4 billion (US$1.2 billion) in SMS traffic.

See also:

Brazil – Mobile Market – Overview & Statistics;

Brazil – Mobile Operators.

Tweet This Post

WiMAX licence owners concerned about spectrum cap

New Zealand WiMAX licence owners say that the Commerce Commission’s decision to limit each WiMAX licence to 40MHz of spectrum is discouraging telcos from building networks.

However, the regulator claims that the 40MHz cap, which is in force until December 2012, is designed to increase the number of players with WiMAX spectrum, and that 40MHz is sufficient spectrum to deploy a nationwide network.

Operators however claim that it does not make sense for several firms to deploy separate networks. They are also complaining that they are unable to utilise their WiMAX licences until current licensees lose their rights to frequencies in 2009 or 2010.

See also:

New Zealand – Broadband – Statistics, Overview & Providers;

New Zealand – Wireless Broadband – Statistics, Overview & Providers.

Tweet This Post

NZ Communication launch delayed to 2009

After previously signing a nationwide roaming deal with Vodafone New Zealand, NZ Communications had hoped to begin services in October 2008, but has fallen behind with its network rollout, with just 50 base stations built out of the 450 it had planned. Launch is now unlikely before 2009.

The mobile operator has so far been unable to put in place co-location agreements with Vodafone and Telecom Mobile. New legislation which will speed up co-location is expected to be introduced by the New Zealand government in November 2008.

See also:

New Zealand – Mobile Communications – Statistical Overview and Major Operators;

New Zealand – Mobile Communications – Analyses;

New Zealand – Mobile Communications – Spectrum.

Tweet This Post

Mobile prepaid subscribers base declines in Australia

The period from 2000 to 2005 saw strong growth in the Australian prepaid mobile market. However from 2006 onwards the percentage of prepaid subscribers has been steadily decreasing from 50% in 2005/06, to 49% in 2006/07 and to 45% in 2007/8. BuddeComm predicts that this figure will fall further to 44% in 2008/09.

The transition to 3G and mobile broadband is a significant underlying reason for this trend. Also in a maturing market people seem to be more confident to use postpaid and capped prices are providing lower prices and the security of not getting a bill shock.

Table 1 – Australian percentage prepaid subscribers per operator – 2006 – 2009

(Source: BuddeComm based on industry estimates)

For more information, see separate reports:

Australia – Mobile Communications – Subscriber Statistics.

Australia – Mobile Communications – Revenue Overview

Tweet This Post

The very public statement from the Shadow Minister for Communications, Bruce Billson – that the Opposition is in favour of structural separation – is providing Australia with a unique opportunity to arrive at a bipartisan policy on this issue.

This point had almost been reached prior to the election, at least in relation to the infrastructure needed for the digital economy. It is great to see that both parties are united in their view on open networks, competition and innovation.

Time and again the Minister has indicated that he will not back down on his policy promises and on several occasions he has applauded the structural changes that have been implemented in Britain, New Zealand, Singapore and elsewhere.

Aside from Telstra, everybody else in Australia (including most of the financial institutions) is, in one way or another, in agreement that structural changes are needed to move forward. Interestingly, Macquarie Bank, which is now involved in Telstra’s bid for the NBN, is a forerunner in buying parts of the soon to be structurally separated local telco, PCCW, in Hong Kong.

So if we all agree that this is the best course to take, let’s do it.

Telstra has been given plenty of opportunity to offer its own alternatives and on many occasions the industry has invited the incumbent to join in the national discussion on how to best move into the future.

I have been instrumental in bringing to Australia from the Netherlands an executive from KPN, the national telco that has chosen an unregulated (voluntary) solution. But Telstra has shown no interest at all in any of the alternatives.

The only course of action now is to give the ACCC the power of structural separation. This needs to be accompanied by a strict deadline – for example, that draft legislation is to be introduced within a three-month period and that legal process is to be in place within a year. This will give Telstra three months to change its position and sit down to work out a solution that suits everybody.

In every other country, without exception, this government strategy has worked and as a consequence the final legislative implementation has been one that best suited each individual local situation. To date the full implementation of structural separation has not been necessary.

However, none of the telcos in these countries moved without a strong stick being wielded by the government.

By coming up with a firm decision, the government can also save itself a lot of headaches, as such a strong signal will – as has been the case in all those other countries – most probably be enough to produce a more amicable solution. Any more ‘lovey-dovey’ solutions from the government would only prolong Telstra’s battle of denial, delay and disruption and would not give the telco the right incentive to act more responsibly.

The sooner we can get the government to take this action the sooner we can clean up the mess and stop the rather phony NBN RFP process.

Paul Budde

See also:

Australia – National Broadband Plan

Australia – National Broadband Plan – Analysis mid 2008

Australia – National Broadband Plan Analysis RFP

Australia – National Broadband Plans from Telstra, Terria & others

Global – Infrastructure – Strategies for the Digital Economy

Global – Broadband – Regulating Fibre Access

Europe – Structural Separation Developments – 2008

Tweet This Post

The rebirth of the innovative individual

Not all that long ago it was the ‘ordinary’ person who came up with inventions, discoveries and new ideas.

It is only fairly recently, let’s say in the last 50 or 100 years or so, that knowledge became institutionalised. If it didn’t come out of a professional organisation it was without value.

Discoveries were made by pharmaceutical, telecommunication and computer companies – at universities and research institutions, and anything not vetted by them didn’t really count.

At BuddeComm we see the mass media as being much the same. It is easy to forget that it, also, has only been around for 50 years or so. Before that local newspapers, pamphlets etc were produced by local people.

The communications revolution, led by the Internet, has allowed ‘the man in the street’ to regain the status they held in the past. The new era we are moving into facilitates multi-directional flows of communication, innovation and creativity, based on cooperative models rather than on models that are structured around a central command.

That is not to say that this will be the end of professionalism. Our modern society needs quality, and while mediocre material might get an airing it will not gain credence and will eventually disappear.

More important, however, is the fact that this environment allows non-professionals to learn quickly, improve and possibly to catch up with the established professionals.

Just look at the global network NASA has established with amateur astrologists. User-generated content as we know it today did not exist two or three years ago but it is now a permanent feature of most of the respected media around the globe. And amateur blogs are breaking news and providing diverse viewpoints from people at the scene, not only from professional external journalists.

Once again, the one doesn’t necessarily exclude the other – on the contrary – but the innovative individual is well and truly back on the scene and putting their stamp on the establishment, whether government, business or science.

Paul

See also:

Global – Infrastructure – Strategies for the Digital Economy

Global Digital Media Reports

Tweet This Post

Digital TV explosion in Western Europe and US

In a new report called ‘Western European and US Digital TV Adoption, 2008 (Strategic Focus)’ from Datamonitor, Digital television (DTV) adoption will show strong growth over the next 2 years as consumers demand enhanced features, greater breadth of content and bundled communications offerings.

A further key driver in the transition to DTV services is the switch-off of analog transmission in the US and Western Europe. With the US analog switch-off date mandated for February 2009, and most Western European countries terminating transmission before the 2012 deadline, the next 2 years will see a rapid increase in new digital TV households.

DTV will grow an average of 12% year-on-year, with particularly strong adoption in the near term as broadcasters terminate analog terrestrial television. In 2007 there were 158 million households using digital television services in Western Europe and the US. By 2012, Datamonitor expects there to be an estimated 274 million digital TV households in these regions.

At the end of 2007, 54% of homes in Europe and the US had some form of DTV service. This will grow to 88% by the end of 2012 primarily due to the significant increase in digital terrestrial television (DTT) households.

For most national markets, the significant increase in DTV services will occur around 12 to 24 months prior to analog signal termination. Driven by campaigns from national regulatory authorities and public service broadcasters, there will be a massive push to migrate consumers to digital platforms to free up valuable spectrum capacity.

DTT households in Europe and the US will increase from 26 million in 2007 to 55 million by 2012, illustrating an average yearly growth rate of 16%. As a whole, however, they expect there to be a significant migration away from free–to-air services in the medium-to-long term, as bundled offerings (triple play, quad play etc.), enhanced features and premium content grow in importance to consumers.

Over the next three years, all DTV platforms will show strong growth as consumers transition to digital services. The two fastest growing platforms in Europe and the US will be digital cable and DTT. It is expected they will achieve net household increases of 50 million and 30 million, respectively.

Concerning other platforms, IPTV services will show the strongest average yearly growth at around 28%, reaching almost 23 million households by 2012. Despite satellite services illustrating very moderate growth of 5.5%, there will be a 20 million increase in subscribers by 2012, reaching around 86 million households.

See also:

Technology – Digital Broadcasting 2 – Television – DVB

Technology – Digital Broadcasting 3 – Television – ATSC, ISDB and Middleware

Global – Broadcasting – Digital TV Overview and Analysis

Europe – Convergence – Triple play and Digital TV’

USA – Convergence – Digital TV & IPTV

Tweet This Post

Alcatel-Lucent, Ericsson and Nokia Siemens leading IMS

Infonetics Research (www.infonetics.com) has produced a new study called ‘Service Provider Plans for IMS’ that provides an in-depth view of service provider thinking and plans for IMS equipment and services, including service provider perceptions of leading IMS vendors, names Alcatel-Lucent, Ericsson, and Nokia Siemens as the “top IMS equipment manufacturers.

According to the study which surveyed service providers in North America, Europe, Asia Pacific, and Latin America-Caribbean, roughly 3/4 plan to offer fixed VoIP over IMS by April 2009.

So far, IMS has mainly been deployed to support fixed-line VoIP services rather than multimedia services, likely because IMS multimedia services to date have shown varying degrees of success. As service providers accelerate their transition to VoIP to more efficiently compete, and as more of them experiment with new mobile and multimedia services, IMS will be the glue that bridges their heterogeneous networks together and assures standardization of those services.

Study highlights:

• Interoperability between different types of next gen voice and IMS equipment was the only obstacle rated by more than half the respondents as a “strong barrier” to deploying IMS
• When asked what kind of new IMS-enabled service respondents would like to offer by and after 2009, FMC was the clear leader
• 3GPP IMS leads the list of reference architectures respondents’ VoIP networks are based on now, increasing to about 3/4 of respondents by 2009
• In a series of questions asking service providers to rate Alcatel-Lucent, Ericsson, Huawei, NEC, Nokia Siemens, Nortel, and Sonus, those familiar with the vendors rated NEC highest for management, price-to-performance ratio, financial stability, and service and support
• Roughly 1/4 of respondents have already installed Ericsson MRFs in their networks
• Broadsoft dominates the field of deployed application server manufacturers

See also:

Global – Mobile Data – HSPA & IMS

Technology – Mobile 7 – 3G CDMA2000, EV-DO, UMB & IMS

Tweet This Post

The digital TV switchover in 2013 will prove challenging

Back in March this year, the government announced a $38 million strategy to drive Australia’s transition to digital TV. Its aim is to ensure that Australia meets the deadline set for digital switchover on 31 December 2013.

So far there have not been any notable developments in this area. The change-over is proving to be a very slow and protracted process. Roughly half of Australian households now do watch digital TV, however there is still a lot of work to be done over the next 5 years, to see the remaining 50% also make the move. In particular, the final 10% to 15% which includes pensioners, low income families and rural users, will no doubt be the most difficult to transition.

Another challenging problem will be trying to convert the millions of 2nd and 3rd TV sets which will still remain in people’s homes. However this obstacle should not prove to be too big as very low cost digital set-top boxes should be available and subsidised by the government if necessary.

One million dollars has been allocated by the government over two years for research into digital reception problems in multi-unit dwellings with a shared TV antenna system, however this does not go nearly far enough. The issue of poor digital TV reception in some areas has still has not been fully addressed by government. This will impact low income earners and pensioners the most.

We also need to take into consideration that, by the time of the digital switchover in 2013, entertainment based video broadband will have taken a much larger share of the market and many TV screens will have become ‘PC screens’. BuddeComm predicts that it is more likely that these PC’s are going to take over the position of the extra bedroom TV. So in all, a very dynamic market will develop over the next five years.

See also:

Australia – Digital TV – Market Overview and Statistics

Tweet This Post

A new report released by Infonetics Research called “WiMAX Network Equipment and Subscribers Market Outlook: Western Europe, Central and Eastern Europe, Middle East and Africa, India, Japan, South Korea, Brazil,” says despite licensing delays that slowed the progress of WiMAX in India, deployments are now accelerating and India remains the biggest single hope for revenue and global influence for WiMAX.

The report focuses on targeted regions and countries around the world that have strong potential for fixed and mobile WiMAX markets, either because they have huge populations, or the broadband demands of the population are not being met by existing technologies.

After India, it is expected Central and Eastern Europe, the Middle East and Africa, and Brazil will lead in WiMAX uptake, with the number of WiMAX subscribers in each of these regions roughly doubling to tripling each year through at least 2011. Sales of fixed and mobile WiMAX network equipment, such as ASN gateways, base stations, CPE, and NICs are likewise forecast to skyrocket in these regions.

Further they report that WiMAX has gained such momentum across so many regions that it is no longer sensible to suggest that WiMAX growth will be flattened by the emergence of LTE in the next few years. In populous countries with poor national telecom infrastructure, such as India, Brazil, and Africa, there is a lack of broadband services, and even of basic voice services, which is a significant driver for WiMAX adoption. In many developing countries, with India being the prime example, WiMAX is showing promising signs of becoming the primary broadband infrastructure and a prominent 3G mobile technology. India is absolutely critical to the fortunes of WiMAX, and the level of uptake there will help decide how prominent a position 802.16e takes in the overall wireless landscape in the next decade.

Report highlights:

• In 2007, Alcatel-Lucent and Alvarion led the mobile WiMAX
• network equipment market in Western Europe; Samsung led in South Korea
• Alvarion led the fixed WiMAX equipment market in Western
• Europe, Central and Eastern Europe, and the Middle East and Africa in 2007; Telsima led in India
• The number of mobile WiMAX subscribers in Brazil is forecast
• by Infonetics to skyrocket from fewer than a thousand in 2007 to 3.6 million in 2011, a compound annual growth rate of 940%
• The dearth of serviceable fixed-line networks in much of
• Central and Eastern Europe qualifies it as a ripe market for WiMAX:
• already fixed WiMAX is accelerating rapidly in Russia, where broadband demand far outstrips the availability of DSL
• Japan will be a pioneer of convergence between mobile WiMAX
• and LTE technologies and is likely to have dual mobile WiMAX-LTE services by 2011
• Due to the high penetration of fixed-line broadband and mobile,
• Western Europe will only offer a niche market for WiMAX, as a technology for SME markets and for public service applications (e.g., public safety, intelligent transportation, digital divide)

www.Infonetics.com

See also: Global Broadband

Tweet This Post