Archive for September, 2014

Mobile broadband is popular in Turkey which creates many opportunities

Tuesday, September 30th, 2014

Turkey’s broadband market has witnessed considerable growth in the number of broadband subscribers. ADSL is no longer the most popular broadband access platform, with mobile broadband the most popular platform since 2012. ADSL is still the leading fixed broadband platform with strong growth rates recorded for fibre and cable. Turk Telekom is the dominant ISP despite the influx of competitors.

Turkey’s sizeable Internet user population has fostered an emerging digital economy, encompassing e-commerce, e-government, e-health and e-education services. E-commerce in particular, as well as m-commerce are showing considerable growth and Turkey is considered to be one of the leading e-commerce markets worldwide.

The country’s broadcasting sector is comprised of a large number of free-to-air operators and a number of satellite and cable-based pay TV operators. Digital TV offerings are available.

Turkey possesses one of the largest mobile markets in the region due to its large population, which is characterised as young and increasingly urbanised and technically literate. Mobile penetration has reached levels indicative of a mature market. In 2014 2G subscribers were in decline as 3G subscribers continue to grow.

LTE technology has been trialled by the operators and during 2013 the Turkish government awarded a contract to build a LTE network for civilian and military use. In September 2014 Turkey was still awaiting a 4G LTE licensing schedule to be introduced.

In 2014 competition in the mobile market increased as the operators began to more aggressively target the mobile data sector, offering competitive pricing and new bundled plans.

Increasing take up of mobile data services has in turn underpinned growth in mobile content and applications. Turkey has emerged as a noticeable front runner in the nascent mobile payments sector, supported by the country’s relatively young population and high credit card penetration.

For detailed information, table of contents and pricing see: Turkey – Telecoms, Mobile and Broadband

We invite your comments: Comments Off on Mobile broadband is popular in Turkey which creates many opportunities

Not a knowledge-based society/economy – but a learning one

Tuesday, September 30th, 2014

I listened to an interesting presentation from Peter van Lieshout, a Dutch psychologist and philosopher and a member of the Scientific Council for Government Policy in the Netherlands.

The general gist of the presentation was that we need to apply different economic models to ensure that ‘the earning capacity’ of the country – the current economic lifestyle – can be maintained. He alluded to several examples where he believed that the Netherlands was on the wrong track. His key concerns were:

  • government policies and directions are too silo-based;
  • a rather arbitrary picking of potential industry winners who should provide for the economic wealth of the future;
  • a potentially wrong, or at least incomplete, policy direction for R&D;
  • a rather damning report on the fairly laissez-fair approach within the Dutch education system, with no clear direction regarding the curriculum;
  •  the need for more attention to the institutions and social structures that determine the nation’s earning capacity in the longer term.

Some of these issues are specifically relevant to the Netherlands, but in general his message and the issues he addressed are universal, and I will concentrate on these.

Trying to pick industry winners who will drive the economy forward is no longer a sensible direction for economic policy. The industry success cycles which have driven economic growth in the past are becoming significantly shorter and relying on those long cycles of industry success will no longer provide long-term economic security. At the same time predicting what will happen in five or ten years’ time is also no longer possible for most of the industry sectors; so picking winners will simply not be possible anymore.

Government would do much better concentrating instead on policies aimed at providing the infrastructure that will allow people and organisations to develop their own new businesses, models and opportunities that, combined, will lead to national economic sustainability and success. This is not just physical infrastructure, such as roads, energy and broadband; it is also education, legal, financial and other institutions. They should leave it to individuals and businesses to use that infrastructure to develop new economic opportunities.

In this respect he also mentioned the rigid R&D structures often deployed or subsidised in order to support those silo-based industries. In a report we wrote for the Dutch Government in 2009, we both warned against picking winners and funding the silo-based approach towards innovation (R&D funding). Instead we argued for a far more holistic approach, which we called ‘trans-sector’. Obviously we were disappointed when a year later the Dutch government decided to continue its traditional approach towards silo-based innovation policies.

Now, four years later, Peter van Lieshout approached this in a slightly different way.

What he was saying was that within an increasingly globalised economy R&D in most smaller and mid-sized western economies is less than 2% of the total amount of R&D done globally; so 98% of R&D is done elsewhere. The key to future success is to learn from, and use, the entire volume of R&D, learn from that and use it to the advantage of local economies and societies. With the internet, open data policies and increased international R&D collaboration this is becoming increasingly viable. Governments could take a lead here and focus their industry R&D and innovation policies on tapping into that wealth of global R&D work that is available, and from which local businesses and sectors can learn and profit.

Norway now has an active government policy aimed at tapping into the 99% of R&D that is done outside that country. Other countries, including the UK and Australia, have started on this track but so far have not formulated policies aimed at moving in this direction in any concerted way.

Furthermore, new growth comes less and less from product innovation and more from soft elements (knowledge, services, intellect, design, etc). More than 60% of new economic growth comes from these soft developments. As an example, Apple used existing MP3 technology to develop the iPod, and added existing technologies available in Taiwan to enhance the product. The major breakthrough was to add iTunes, as well as product design, marketing, etc, and from this the iPhone was developed.

Developing industry policies based on picking national industry and R&D winners will become increasingly futile. Most new products will now have elements that are sourced from an average of 20 countries, and in ICT even an average of 27 countries. On a product and industry level this is now a global environment and innovation and R&D is also global. Governments will need to structurally rethink their industry policies and develop new infrastructure policies that will allow their businesses and industries to respond more quickly and participate in new developments that include policies aimed at tapping into the global body of R&D that is becoming more easily accessible.

On the other side we see an opposite development. In order to maintain our own (local, national) economic lifestyle we need to concentrate more on city-based and/or regional economic and social developments – and, as we see in Europe, some of the regional developments cross borders – as it is easier to cut through silos and generate synergy at that smaller level. This will create a truly connected and learning local environment for all involved and in this way generate new social and economic opportunities for those communities.

Paul Budde

See also:

We invite your comments: Comments Off on Not a knowledge-based society/economy – but a learning one

UN Climate Change Summit – Report from New York City

Monday, September 29th, 2014

While attending the United Nations Broadband Commission meeting in New York City I was also able to follow the developments at the UN Climate Change Summit.

There was overwhelming people support for this event, the first high-level conference since the 2009 conference in Copenhagen. The day before hundreds of thousands of people around the world rallied in support of the conference, aimed at getting their politicians to take action. New York City was gridlocked during the rally, which was led by UN Secretary-General Ban Ki-moon, this was a  spectacular sight.

The focus of the Summit was on CO2 reduction and there were excellent presentations on the progress made with renewable energy, but I spent my time looking for developments in relation to energy efficiency and the smart technology that can be used to assist in that.

The major obstacle continues to be the lack of good government policies. As yet no country in the world has a comprehensive set of policies in place that looks at the end-to-end energy cycle. Driven by its renewable project Germany is learning this the hard way and is making continual adjustments to its policies, which are looking increasingly holistic.

China is another major achiever. Despite the fact that China and India were both singled out as countries that are largely failing to address their pollution problems China now leads the world in solar panel installation, with the fastest growth of new installations. But this is done within a silo approach, rather than a holistic approach placing it in the context of a broader set of smart energy policies that are needed.. The same also applies to the USA and most other countries including Australia.

Another disappointment was that the installation of smart meters is now as its lowest point in five years; investments in many countries have dried up. To a certain extent this was seen as a blessing, as the majority of these meters are not real smart meters in the sense of what is available now. While electricity companies are becoming smarter their culture sometimes stands in the way of maximising their efforts. Also, within these companies there is still a considerable silo mentality and a resistance to change; benefits that can be achieved across various sectors (e.g. customer equipment, networks, solar integration and smart meters) are each largely being addressed in isolation.

On the positive side the real push for smart energy developments is now coming from the manufacturers of a larger range of product sectors – from the big end of town in relation to equipment that needs to be installed in the grid, to consumer products and new products and applications aimed at energy savings.

With governments and energy companies largely lagging behind there was a sense that new products and applications might stimulate the other partners in the energy ecosystem to move forward. There was a real buzz regarding new disruptive developments from outside the industry, the question is how much is wishful thinking and how much is real?

During my search for smart energy developments the basic message that I received from the people I spoke to reflect the mood of the larger UN conference. There are a lot of nice speeches and high level commitments but there is not yet the political will to develop government policies that will create the changes that are so overwhelmingly supported by ‘ordinary’ people around the world and thus led to real deployment on any significant scale.

Other interesting developments that I picked up were:

  • Distributed energy developments in developing countries are initiated, not by energy companies, but by new entrepreneurs, sometimes supported by local government, NGOs, healthcare and education funds and even mobile operators.
  • Batteries are already used in some of the larger residential projects and it was envisaged that over the next 3-5 years batteries would become a standard component of most new solar panel installations. Rather than wait for the big grid, hospitals, schools and others are investing in these projects.
  • Also, in developing countries mobile phone batteries that can be recharged by solar power are increasingly being used as torches in the evening by their users – as a matter of fact this has become the number one requirement from mobile phone users to their suppliers. An initiative was taken to set up a meeting between representatives of some of the communities across Africa and suppliers such as Huawei to investigate this matter.

The general sentiment at the conference was that it is not expected that future developments in both climate change and energy efficiency will be driven by government policies; instead the impetus will come more from piecemeal activities of individual companies on the consumer side and the electricity industry and the hope is for disruptive developments, similar to what the smartphone did to the telecoms industry.

Paul Budde

See also:-

We invite your comments: Comments Off on UN Climate Change Summit – Report from New York City

Zero Mothers Die

Monday, September 29th, 2014

At the UN events in New York the following interesting initiative was launched.

The world faces unacceptably high maternal and child mortality with 300,000 women and more than 6 million children under the age of five dying every year from preventable or treatable causes. The aim of this global initiative is to reduce maternal mortality by using mobile technologies and cross-sector partnerships to support pregnant women and local health workers to overcome barriers to maternal, newborn and child health.

Unveiled at the 5th Women Leaders Forum on 22 September, the campaign seeks to ensure that all women and girls have universal access to information and services supporting maternal, newborn and child health. Zero Mothers Die wants to provide vulnerable women with mobile phones so they can access healthy pregnancy information messages and call their local health worker during emergencies.

Participating in the launch of the campaign, UNAIDS Executive Director Michel Sidibé maintained that the initiative will focus on all pregnant women and new mothers, and will have as an aim preventing mother-to-child-transmission of HIV. He stressed that no mother would be left behind.

Although significant progress has been made in reducing maternal mortality, it remains a critical issue. According to World Health Organization statistics, every day around 800 women die from complications related to pregnancy or childbirth and in 2013, 289 000 women lost their lives.

The project comprises of:

  • A mobile messaging service delivering health information to pregnant women via voice messages in their local languages.
  • Mum’s phones, unique mobile phones for vulnerable pregnant women to give them access to health messaging services
  • Free airtime packages for pregnant women to enable calls with local health workers and facilities, especially in emergencies
  • Capacity-building and education of local health workers using ICTs and localised digital content
  • Mobile money savings scheme to help finance and increase access to skilled care during childbirth
  • Solar power chargers to provide green energy to charge the mobile phones and bring financial empowerment to pregnant women.

The objectives of the initiative include:

  • Reducing maternal and child mortality through increased access by pregnant women to appropriate healthcare information, via mobile voice and text messages in local languages and dialects.
  • Accelerating mobile phone ownership and use and to increase access to healthcare, empower women with information, and reduce the mobile phone gender gap. This includes facilitating connections with healthcare workers through allocations of free airtime restricted to calling assigned local healthcare facilities and workers
  • Education and capacity-building of community health workers by using tablets and smartphones preloaded with tools to support their work as well as up-to-date, tailored training materials in local dialects to improve maternal and child health in their communities. This includes the dissemination of new technologies adapted for low-resource settings, including a ground-breaking CD4 diagnostic.

Another interesting element that was discussed was the possibility for (pregnant) mothers around the globe to ‘sponsor’ a pregnant mother in a developing country and provide her with a phone and possibly via that same phone also provide messages of support. Obviously that idea does require some further thinking, but the potential for a social media approach to generate funding is a real possibility.

We invite your comments: Comments Off on Zero Mothers Die

Triple play arriving in the Australian pay TV market

Monday, September 29th, 2014

Telcos and ISPs, as well as pay TV operators, are now following triple play models (bundling telephone, broadband, IPTV into one price package). Foxtel will launch its offering – no doubt with an attractive Foxtel-lite content package – later on in 2014. In general however, these models have already been deployed for several years in most other developed telecoms markets around the world. There are basically two triple play strategies used:

  1. Aimed at extending the customer base
  2. Offering it to existing customers to keep them loyal (stop churn).

Over the years, the second model has been more successful. Even a 5% or 10% discount is a bonus for the customer, especially in situations where they are already using all three services.  The bundling strategy creates a recontracting event, increases barriers to churn (inconvenience) and extinguishes billing relationships with competing companies.

Since its introduction a decade or so ago the first strategy has in general not been very successful. In most cases the content was not attractive enough and/or there wasn’t an interesting enough discount attached to it to get customers to move over. Only when players had control over all of the services themselves were they able to offer discounts that were appealing enough to capture new customers – the competition between BSkyB and BT in the UK is a good example, with BSkyB being able to make a very attractive offer, using video content as the ‘hero’ to its customers.

Such a level of competition is unthinkable in Australia. With Telstra a 50% owner, Foxtel will forever be hampered by the ownership arrangements and there is little hope that Telstra will sell out. Its shareholding in Foxtel continues to be its strategy to keep News Corp at bay. Furthermore, Foxtel is also restricted from making its content for its other offerings too attractive, as that would undermine its core pay TV business. So all eyes will be on what Foxtel will offer in its triple play model.

With the approach of broadband saturation and telephony revenues on the decline a new strategy is being promoted by the telcos – making the IPTV offering their hero element in their triple play packages. They are using these content services as a competitive differentiator in the market and in that way are trying to poach broadband customers from each other. They will most certainly get a run for their money from Foxtel. The company can also promote the PVR element of its services, which is popular among viewers.

We are seeing increased advertising activity aimed at using IPTV as a successful way for telcos to gain broadband customers, and so, with increased broadband competition, there will be an increase in IPTV activity.

Paul Budde

See our new report: Competition is hotting up in the Video Entertainment market

We invite your comments: Comments Off on Triple play arriving in the Australian pay TV market