Blogcetera

UK ISP, Cable and Dongle Users January 2011

2011-01-31T11:00:00.006Z

Here is an update of the UK ISP market covering DSL and Cable Access market as well as the Mobile Dongle market in the UK. I have used ITU published data for Broadband usage numbers and Neilson Ratings and ISP published figures to get an accurate picture as well all the reports and disclosures for each of the companies shown below. I believe these figures represent a reasonably accurate representation of the genuine adoption of broadband either via DSL, Cable or mobile dongle. Broadband connections included in this data cover download speeds equal to or faster than 256kbit/s

ISP	Total	% of UK Accts.
BT (inc Plusnet)	5,341,000	27.00%
Talk Talk	4,249,000	21.50%
Virgin Media	4,242,000	21.49%
Sky	3,006,000	15.20%
Orange	795,000	4.00%
O2 (Be Broadband)	663,800	3.40%
Royal Mail	600,000	3.00%
3 (Mobile Dongles)	255,000	1.30%
T-Mobile (Dongle)	195,000	0.90%
Vodafone (Dongle)	190,000	0.80%
Kingston	178,200	0.70%
Thus	93,000	0.50%

The UK Broadband market has become very concentrated with almost 20 million broadband accounts with over 98% concentrated in the top twelve providers with a high degree of consolidation among the top 5 players. The standard speed offering has increased from around 2Mb to 8Mb over the past two years, however many of the grand claims of the leading providers offering 20Mb broadband access is far of the mark with most only achieving 7-8 Mb on average.
The super fast 40Mb and 50Mb deals are beginning to enter the market but mainly only appeal to specialist hard care users in the consumer market.

Whilst the growth of mobile dongles has slowed the market continues to evolve. There are a number of players offering a range of speeds and costs. The market for the iPad and Kindle 3G devices is growing very quickly through sim only offerings. The new tablet applications such as the iPad and Samsung Galaxy and the soon to be launched Motorola Zoom represent the most exciting sector of the market and the mobile networks are likely to be climbing over each other to offer the 3G broadband connectivity. A quick look at the offerings below reveal the developments in the dongle market which will form the basis of any 3G Sim deals for the new tablets.

Who offers mobile broadband via mobile broadband dongles?

Vodafone offers a range of mobile broadband dongles, the most popular being its small and speedy "USB Modem stick" starting at £15 a month. With speeds of up to 7.2Mb and download allowance of 3Gb, this offer is a real no-brainer.
3's mobile USB modem dongle comes free on many of the 3 packages. Offering 1Gb downloads and speeds of up to 7.2Mb, 3’s £10 per month offer is great value for money.
T Mobile's USB dongles offer speeds of up to 7.2Mb and download allowances of 3Gb - 9/10 T Mobile customers say it "works like a dream".
Orange's dongle is the sleekest and fastest they've ever made, offering speeds of up to 7.2Mb.
Virgin Media was late to the mobile broadband market, but it is making some very attractive offers speeds of up 7.2Mb at excellent price points.
O2 dongles get you online at speeds of up to 3.6Mb and start from just £10 per month.

Amazon to side step Phorm!

2009-04-16T10:09:00.001+01:00

In an increasingly heated debate over privacy, Amazon UK has stated that it will not allow the online advertising system of Phorm to scan its web pages to produce targeted ads.

Amazon is one of the most popular sites in the UK and indeed worldwide and its decision to block behavioural targeting of the type promoted by Phorm is a huge blow to the approach and will no doubt influence other major sites such as eBay to review their policy.

This decision will be a major embarrassment to BT who had hoped to roll out Phorm’s technology later this year under the name Webwise. Both BT and Phorm have come under fire from privacy campaigners over the the “secret” trials that BT conducted last year.

In a statement, Amazon UK said: "We have contacted Webwise requesting that we opt out for all of our domains." The company declined to comment further on the reasons behind its decision.

In response, Phorm said: "There is a process in place to allow publishers to contact Phorm and opt out of the system, but we do not comment on individual cases."

Last month the Open Rights Group wrote to the chief privacy officers at Microsoft, Google/Youtube, Facebook, AOL/Bebo, Yahoo, Amazon and Ebay urging them to opt-out of Phorm. Amazon is the first company to give any sort of response at all but are unlikely to be the last.

Earlier this week the European Commission said it was starting legal action against the UK over its data protection laws in relation to Phorm's technology. The European Commission has described the technology as an "interception" of user data and wants UK law to reflect more explicitly the need for consent from users in order for the service to be implemented.

Given the recent announcement of Google to introduce their own form of behavioural tracking on to users search queries, it will be interesting to see whether Amazon et al decide that they wish to avoid all forms of intrusive targeting and whether the EU will take on the behemoth Google.

eBay puts Skype up for sale.

2009-04-15T11:03:00.005+01:00

Last nigh eBay, the internet auction site, announced plans to spin off Skype the internet calls business in an initial public offering some time next year.

Four years after paying $3.1 billion for Skype, eBay has finally admitted what every other industry insider realised years ago that it there really weren’t any valuable synergies to be gleamed from adding Skype to its core auction business.

The decision to sell the company opens the door for any private equity buyers to move in on Skype although it seems unlikely that anyone is already in the frame.. However, it leaves open the possibility that the creators of Skype, the billionaire Scandinavians, Janus Friis and Niklas Zennstrom, could repurchase the company since their other venture Joost is hardly creating much of a stir. It is reported that they are working with the private equity firm, Warburg Pincus, to make a bid for Skype and eBay’s move may be interpreted as putting pressure on them to put up or shut up!

John Donahoe, the chief executive of eBay, said: “Skype is a great stand-alone business with strong fundamentals and accelerating momentum. But it is clear that Skype has limited synergies with eBay. We believe operating Skype as a stand-alone publicly traded company is the best path for maximising its potential.”

EBay's plans were cheered by investors, who sent the shares up 56 cents, or 3.9 per cent in after-hours trading on Wall Street. They saw Skype as an unnecessary distraction that was tying up capital. In 2007 eBay, which is being advised by Goldman Sachs, conceded it had massively overpaid for the calls company when it took a writedown of $1.4 billion. Last year Skype generated revenues of $551 million, up 44 per cent from 2007. Its user base - now at 405 million - leapt 47 per cent from 2007.

If Friis and Zennstrom do buy back Skype, eBay is unlikely to receive anything close to what they paid for the company back in 2005, but they will be able to focus on growing the eBay business as the recession comes to an end and those “green shoots” of recovery start to take root.

Europe steps into save UK Users from Phorm's snooping!

2009-04-14T16:30:00.003+01:00

Finally someone is willing to fight for our rights to privacy in the UK. Sadly it isn't our Government. The European Commission has today started legal action against the Government over its failure to protect the privacy of British Internet users.

The case was sparked by BT’s covert use of the controversial user-tracking technology Phorm on customers using BT’s internet service in 2006 and 2007.

Phorm, a UK-based company founded in 2004, monitors users’ favourite sites and searches, and uses the information to deliver individually targeted advertising. The European Commission has been concerned about the way Phorm was secretly tested in the United Kingdom. Last year, the Government through the Information Commissioner, backed Phorm after a complaint by Brussels.

However, Vivian Reding, the European Union's Commissioner for Information Society and Media, announced the first stage of legal action, saying that the UK Government had failed to implement European laws that protect Internet users under the terms of 'The Privacy and Electronic Communications (EC Directive) Regulations 2003'.

"Technologies such a Internet behavioural advertising can be useful for businesses and consumers but they must be used in a way that complies with EU rules,” the Commissioner said. “These rules are there to protect the privacy of citizens and must be rigorously enforced by all member states.”

BT has already admitted that it conducted trials of Phorm without users’ consent in 2006 and 2007. A further, invitation-only, trial was conducted last year.

Ms Reding’s statement continued: “I call on the UK authorities to change their national laws and ensure that national authorities are duly empowered and have proper sanctions at their disposal to enforce EU legislation on the confidentiality of communications.”

Ms Reding’s contention is that UK laws must be tightened to protect consumers and comply with the ePrivacy Directive, which the UK Government signed up to in 2002. It came into force at the end of October 2003.

The Commission has now given the Government two months to respond to today’s “infringement proceeding” - the first stage of a legal process which could end up in the European Court of Justice for an alleged breach of the directive. The directive states that user consent must be “freely given, specific, and informed”, and it requires EU member states to impose sanctions in the event of breaches of the rules.

Ms Reding reinforced her stern message to the British Government in her weekly video message, delivered via the European Commission’s website.

“Privacy is a particular value for us Europeans; a value reflected in European laws for many years,” she said.

“However, in spite of the many advantages of technological development, there is an undeniable risk that privacy is being lost to the brave new world of intrusive technologies. On the global information highways, personal information is increasingly becoming ‘the new currency’. And I believe that Europeans… must have the right to control how their personal information is used.”

“European privacy rules are crystal clear,” she said. “A person's information can only be used with their prior consent. We cannot give up this basic principle, and have all our exchanges monitored, surveyed and stored, in exchange for a promise of ‘more relevant’ advertisements! I will not shy away from taking action where an EU country falls short of this duty.”

Phorm has already been investigated by the police and the Information Commissioner over privacy concerns. It has attracted interest from UK ISPs including BT, Virgin Media and TalkTalk although no company has yet fully introduced the system.

Tim Berners-Lee spoke out passionately against Phorm at a meeting in the House of Commons in March this year. "It is very important that when we click, we click without a thought that a third party knows what we're clicking on," he said. "'What is at stake is the integrity of the Internet as a communications medium. It's important there should be no snooping on the Internet."

It has always been the contention of Blogcetera and many other industry observers that what Phorm was engaged in was both against the 'spirit' and the letter of the law as laid down in the EU directive that the British Government and Parliament passed into law. Similarly there are privacy concerns as regards Google’s plans to use behavioural targeting to deploy “relevant” ads to users. It will be interesting to see whether the EU Commission targets Google as well as Phorm.

Links :The Privacy and Electronic Communications (EC Directive) Regulations 2003

Additional Reporting: The Times

Phorm to pay for opt-in customers.

2009-04-09T14:03:00.006+01:00

Phorm, the targeted web advertising company, is considering offering customers who opt-in a payment related to their surfing activity. Phorm is considering contributing to the customers broadband bill or is even willing to make a donation to charity, for any user that signs up for the service.

With BT contemplating rolling out Phorm's service to known as BT "Webwise" it may be that BT customers will be able to receive a reduction in their broadband bill.

The fact that BT and Phorm had been conducting secret trials of the system without BT’s customers’ knowledge caused major concerns over privacy last year and led to the Information Commissioner suggesting that the scheme should only be implemented as an "opt-in" service.

Given the general suspicion that users have in respect of their surfing activity being tracked, the payment to encourage "opt-in" will need to be significant for most users to accept such a service.

Australia shows how to create a 21st Century Network

2009-04-07T19:18:00.003+01:00

Australian Prime Minister Kevin Rudd has created a public private partnership to sort out the country's poor broadband network.

The programme aims to link 90 per cent of Aussie homes, schools and businesses with speeds of up to 100 Mbps - true FTTH. The remaining ten per cent of premises will get wireless or satellite links with speeds of up to 12 Mbps

The government is establishing a company to build the fibre network which it expects to cost $43bn (£20.8bn) and take eight years to complete. It will provide jobs for 25,000 people a year on average.

The government will be the majority shareholder, but intends to sell its stake within five years of the network being completed. The cash will come from the sale of consumer Aussie Investment Bonds (AIBs) and funds from the Building Australia Fund.

Rudd said slow broadband was holding Australia back. He compared a decent fibre network with the railway networks of the 19th century.

He reckons the project is Australia's largest ever "nation-building infrastructure project". Rudd had asked for private sector bids for the work but none were considered viable.

The first step will be negotiating with Tasmania which could start its fibre to the premises network as early as July. New builds will be required to provide fibre from July 2010.

Alongside this huge investment Rudd promised wholesale telecoms reform - the public has until 3 June to make its suggestions for changes.

Australia has always suffered from slow and expensive broadband for years. Some of this can be blamed on geography, although the incumbent telco, Telstra, is also culpable..

However, if Gordon Brown is serious about providing Britain with a 21^st Century infrastructure he should start talking to Rudd. Guaranteeing that everyone will have access to 1.5Mbps is just pathetic and we will continue to languish in the bottom division of broadband access. In a previous article I referred to the developments of Fibrecity projects by i3 Group Ltd. These guys deserve massive support to roll out the planned 15 locations as quickly as possible.

We need to join the Ethernet club now and get full FTTH to every home in the country and stop relying on the whining of BT experimenting with some 40Mbps service options. It just will not do. The UK needs an integrated national fibre infrastructure not some half baked commitment to ADSL access and the cost of full FTTH would far less than saving a single fat cat bank, have lasting value and create thousands of jobs.

New Local Government service – FTTH?

2009-04-06T15:11:00.007+01:00

Recent developments in Dundee and Bournemouth have suggested that soon you will be able to source your 100 Mbps FTTH along with rubbish collections. Bournemouth Borough Council is using technology from i3 Group Ltd (formerly H20networks) to build out their new Ethernet speed network throughout the district. What started as a project to deliver a new network to interconnect all their 5,000 staff is rapidly growing to a plan to deliver FTTH to 88,000 of the Borough’s households.

Bob Rhodes, IT Project Manager, Bournemouth Borough Council comments: “In partnership with H20 Networks we are making tremendous cost savings, meaning that we can put Council Tax payers’ money to better use”. One of those better uses seems to be to deliver FTTH capability to the all homes and businesses within the Bournemouth Borough Boundary. The residents of Bournemouth have been receiving letters asking them to grant permission for a free connection. i3 Group are using Bournemouth's network of underground sewers to deploy its fibre optic cabling. The entire project will cost in the region of £30m and ultimately connect 88,000 homes and is to be designated as the first Fibrecity.

The Fibrecity project of i3 Group officially connected the first 50 homes in Bournemouth to its next generation network FTTH broadband network, with speeds of up to 100 Mbps. The group is now known to be targeting a nationwide rollout figure of 2,000 homes per week and more once additional fibre cities come on tap. Bournemouth is the first of 15 town and city-wide fibre networks being built across the UK by Fibrecity over the next 10 years. Work has also started in Dundee to reach 55,000 homes.

This true FTTH infrastructure sees two fibres installed to each property that connects to the Fibrecity network using underground sewers, which is cheaper than digging up the road to lay new cable. One fibre enables homeowners to benefit from paid for services such as IPTV, telephony and super fast 100 Mbps broadband connectivity. A separate 40 Mbps fibre is dedicated to the council and will be used to deliver local services such as community TV and health services.

Cable broadband provider Virgin Media recently launched a 50Mbps broadband service which, while not a true FTTH deployment, is currently the fastest consumer broadband service in the UK. Virgin aims to have the service available to all its customers by the end of this summer. Meanwhile telco BT has also unveiled fibre-based plans, announcing a £1.5bn investment to bring fibre to 10 million UK homes by 2012. Neither of these two initiatives will offer the fully duplex services that FTTH can deliver.

The creation of these Fibrecity projects is an extremely interesting development of it may lead to the first direct local authority delivered network to be established since Kingston Telecom remained independent of the GPO National Telephone service when the rest of the country’s telephone exchanges where rolled into the forerunner of BT back in 1914.

The entry of Local Authorities into the ISP business could significantly accelerate the access of the public to the new super fast FTTH services. Equally it could lead to the increased “politicalisation” of service provision and control. Either way it is an exciting development. With the UK not even in the top 100 countries with these super fast services of FTTH and FTTB, the Fibrecity initiative is a welcome step in the right direction.

UK ISP, Cable and Dongle User Numbers - April 2009

2009-04-06T14:15:00.003+01:00

ISP	Total	% of UK Accts.
BT (inc Plusnet)	4,700,000	26.05%
Virgin Media (inc Virgin.net)	3,934,800	21.80%
CPW (inc AOL)	2,700,000	14.96%
Sky	1,955,000	10.83%
Tiscali UK	1,768,000	9.80%
Orange	1,000,000	5.54%
Royal Mail	560,000	3.10%
O2 (Be & Dongles)	340,866	1.89%
3 (Mobile Dongles)	255,000	1.42%
Kingston	203,000	1.12%
T-Mobile (Dongle)	161,000	0.89%
Vodafone (Dongle)	132,000	0.73%
Thus	126,000	0.66%
Entanet	92,000	0.51%
Clara.net UK	72,000	0.40%
Breathe	12,000	0.07%
Supanet	6,000	0.03%
Others	28,000	0.16%
Total	18,045,666	100.00%

The UK market exceeded 18 million broadband connections for the first time with all the growth being shown by the dongle market. Both Tiscali and Orange again reported lower figures and still no news on the Tiscali sell-off. The new battle ground for users appears to be shifting to the FTTH (fibre to the home) and FTTB (fibre to the building). BT announced their high speed initiative targeting 29 areas with their 40 Mbps offering. Virgin complained that many of the areas targeted were already served by their 50Mbps service.

An interesting development is the planned development of local authority run “ISPs” planned on the back of i3 Group Ltd (formerly H20Networks) in Dundee and Bournemouth who could be offering Ethernet interconnectivity to the home of a fully duplex 100Mbps 55,000 and 88,000 homes respectively. Whether these locally run ISPs ever emerge is an interesting thought since it will lead local councils into the tricky area of service provision and possible political control of services delivered or “surfed” for by their customers.

Google in attempt to grab the Twitterati

2009-04-03T07:58:00.005+01:00

It is reported by Techcrunch, that Google is in "late stage" talks to acquire microblogging service Twitter. Twitter is the micro-blogging phenomenon that lets people known as the Twitterati, post short 140-character messages. Other users subscribe to follow the stream of these tweets from acquaintances and, increasingly, companies and celebrities. After an unpleasant rocky period when the company's servers frequently were crushed under the strain of the service, the Twitter has experienced tremendous growth.

As Google's tries to find an alternative cash cow as successful as their core technology of search they have been increasingly buying up new and exciting opportunities. Twitter would seem to be its latest attempt to break its dependence on search and search related advertising. In common with the likes of News International and eBay, Google are keen to exploit the online activity of social networking and instant messaging/communications. Facebook, which attempted to acquire Twitter in 2008, is the best example of just how rich a medium the Internet can become for social interactions. However, social sites have had a hard time showing they can generate revenue and profits as well and recent numbers from MySpace suggest that News International’s ownership is not seen as attractive to either users or key staff.

Twitter isn't just about sharing with friends, though. It's increasingly about search as well. Twitter has been working to elevate the prominence of search, which can give a near-real-time window into what's on the mind of innumerable users. This fits in well with Google’s desire to be able to track our every thought and deliver a relevant ad to fit our stream of consciousness.

If Google does manage to capture Twitter will the Twitterati appreciate Google using their twittering to generate profits based on a “better matching of results with what people are actually seeking”.

MySpace is out there as an example of how users react when a big corporate wish to exploit their fun. There is always an alternative and Google may find that the Twitterati just cannot be bought.

Google didn't immediately respond to a request for comment.

Additional Reporting: Techcrunch

Call to close Google Street View

2009-03-24T13:50:00.002Z

The director of Privacy International, Simon Davies, is lobbying the Information Commissioner to close Google Street View until the company sorts out privacy-related issues.

The ICO has received a formal complaint based on the the fact that more than 200 reports from members of the public that were identified through Street View, which is a feature of Google Maps.

Before Street View was launched last year, the ICO laid a number of ground rules to which Google said it has abided. But Simon Davies considers that Street View has caused "clear embarrassment and damage" to many Britons.

The ICO, Davies continued, "never grasped the gravity of how a benign piece of legislation could affect ordinary lives" and prompted PI to ask for the system to be "switched off while an investigation is completed".

At issue is what Google promised the ICO when it gave permission for the service to operate in the UK. He demanded that Google would blur faces and registration plates. However it didn't.

Many of the issues quoted have been trivial, but in at least one case, Google snapped a woman who had moved house to escape a violent partner, but who was recognisable outside her new home. In another, two work colleagues were shown in a compromising position and suffered embarrassment when the snap circulated at their workplace.

Was this a innocent mistake on Google’s part or was the Information Commissioner a little trusting in that Google would do what they said they would do? Whatever the case, it is time that ICO started to take privacy on the web seriously and take action to safeguard our civil liberties.

BT takes aim at Virgin’s territory.

2009-03-23T21:41:00.003Z

BT revealed the list of exchanges that will get the 40Mbs fibre technology upgrade today. Twenty seven of the 29 sites are urban areas, with BT trying out just two rollouts in rural areas to "learn lessons from deploying fibre in such environments".

However, Virgin Media claims every one of the 29 sites selected for BT's initial fibre rollout is already covered by its high-speed cable network - meaning BT's initial rollout may do nothing to improve Britain's overall broadband speeds.

A Virgin spokesperson stated , "We already have 50 meg in four areas - Belfast, Watford, Halifax and Oldham”. Furthermore it would appear that all the other BT designated areas are in Virgin cable areas which are due to be upgraded to the 50Mbs network over the coming year.

While BT's fibre will provide some much needed competition for Virgin, the overlap means Britain as a whole may not see any speed increase as a result of the initial BT rollout, which will cover 500,000 premises by 2010. The decision to focus almost exclusively on urban areas will increase the “broadband apartheid” between urban and rural areas. This disparity in service provision is becoming an increasing issue for rural communities, which are suffering disproportionately in the recession. Access to broadband is being positioned as a right of all not just those who live in our cities.

Ofcom needs to ensure that every UK citizen has equal access to the new fast broadband services and that BT doesn't just use it's power to compete with Virgin at the expense of the whole UK community.

Sky and Virgin slam BBC on Canvas platform project

2009-03-23T12:23:00.004Z

As I reported last month, the BBC was quick to introduce Project Canvas to replace the now defunct Kangaroo Project. Now both Sky and Virgin have slammed the proposals.

In a robust response to the interim report from the government on Digital Britain, British Sky Broadcasting says that the plan by the BBC to set technical standards and develop new platforms for broadband video services raises concerns. Virgin Media has also raised specific questions in its response, calling for “regulatory scrutiny” of the implications for competition.

In its published response, Sky says “the suggestion that the BBC should become involved in driving broadband take-up by setting technical standards and developing new platforms raises concerns. As well as the potential for market distortion and illegal state aid, it sets a dangerous precedent and risks distracting the BBC from its core purpose, which is to invest in public service content and to make it widely available to licence fee payers on whichever platforms and services they choose to use.”

The response observes that “The most appropriate role for the BBC in encouraging broadband take-up is to make its content widely available on as many platforms as possible.” It says the core purpose of the BBC is to create public service programming and to make it as widely available and easily accessible as possible, to allow licence payers to access it on whichever platforms and services they choose to use.

“The BBC should not favour one particular platform or technology over another, and should be scrupulously ‘platform neutral’ both in the way in which it makes its content available to different services and in the way it promotes its availability to viewers.”

Sky says that based on previous experience it is concerned about the potential of the BBC “to distort the market by favouring its own distribution platforms and technologies over their competitors”. It observes that this raises potential competition and state aid issues.

The BBC was one of the partners in a joint venture video on demand initiative known as Project Kangaroo that was scrapped after being blocked by the Competition Commission earlier this year.

Sky argues that while claiming to adhere to the principle of platform neutrality, the BBC has for many years promoted the availability of its digital channels to favour Freeview over satellite and cable.

“We are concerned that the BBC is similarly intent on favouring its iPlayer service: through its extensive marketing and promotion; its proposal to entrench further the underlying technology platform by licensing it to other PSBs; and by its unwillingness to supply BBC content to competing on-demand video services like Sky Player,” said Sky.

Programming from the BBC iPlayer is currently only available as a link to the BBC web site from the Sky Player service.

“The BBC’s ‘Canvas’ proposals, currently being consulted on by the BBC Trust, potentially raise similar concerns,” in the view of Sky.

The BBC Trust says that “Canvas will offer a standards based open environment” that is open to anyone that adopts and uses its specifications, which will be “substantially based on standards used within the internet and broadcast industries.”

So far there have been no technical details on these standards or the terms on which they will be made available, for instance to other platforms like Sky, should they wish to use them.

Sky is urging the government to define more clearly the role of the BBC in driving digital and broadband take-up. It observes “The most positive contribution the BBC can make — and one that is entirely consistent with its core purpose — is to distribute its content as widely as possible and promote its availability to viewers in a way that is platform and service provider neutral.”

Clearly Sky has its own agenda to promote, but it is difficult to argue with this logic. While the BBC has promoted Freeview and Freesat as free to view alternatives to satellite and cable television platforms, it also has a responsibility to the majority of digital television homes that have chosen a pay television service.

For its part, Virgin Media, which currently carries a version of the iPlayer service on its cable television platform, has welcomed the intervention of the Competition Commission in the aborted Kangaroo venture. It said “It is important that any future initiatives involving an aggregation of this strategically critical content receive equally rigorous scrutiny.”

Virgin Media said it “notes with interest the BBC’s recent Canvas proposals to create a set of technical standards and, it is suggested, a common user interface for the IP delivery of on-demand programming to the TV.”

“While Virgin Media acknowledges the potential consumer appeal of this proposal, it is not yet clear how the BBC and its partners propose to address critical elements of the service,” it said.

Specifically, it said that it is important that the standards are compatible with cable, as well as satellite and terrestrial television platforms, noting “It is not currently clear whether or not this is envisaged.”

Virgin said the initiative should not “develop in a way that gives the BBC and its partners control, or the ability to exert undue control, over a standardized universal interface.”

The cable company said it is important that “Any such technical delivery mechanism does not become an interface or exclusive ‘gateway’” to catch-up and archive programming from public service broadcasters.

“On the contrary,” Virgin Media observed, “any such content delivered through such an interface should be made available to competing platforms on fair and nondiscriminatory terms.”

In addition to “a rigorous and objective assessment of its impact on other operators and the market as a whole” from the BBC Trust, Virgin Media said it “would welcome wider regulatory scrutiny of the potential implications of Canvas for competition.”

With Canvas, the BBC has the opportunity to lead and involve the industry in creating a genuinely open cross-platform specification for broadband video services that will benefit the market in general.

The responses from Sky and Virgin Media suggest that unless it involves the wider industry, the BBC Canvas project could well face the same competition concerns that killed Kangaroo.

In my view the BBC has no role in spending licencees money in an area which is clearly the domain of the IPTV industry developers.

Privacy fears grow - Are Government and Industry ignoring civil liberties

2009-03-23T12:06:00.006Z

Google’s Street View service has contributed massively to the concerns of privacy on the internet. Not only content with publishing views of individuals going about their legitimate business on line, Google recent announcement to use our search activity on their search engine to target advertisements takes the privacy debate to a new level.

Search information is valuable, allowing firms neatly to target ads to a person’s interests to generate billions in additional advertising revenue. Google, the industry leader, stores personal information for 18 months, and they are not alone as Microsoft’s search engine, Yahoo and AOL all retain search requests for 13 months.

But they are not the only people retaining information. Today’s revelations by the Joseph Rowntree Reform Trust, that a quarter of all government databases are illegal and should be scrapped or redesigned, throws into sharp relief the amount of information that is now available for a whole range of purposes.

The Trust says that storing information leads to vulnerable people, such as young black men, single parents and children, being victimised.

It says the UK's "database state" wastes billions from the public purse and often breaches human rights laws.

But the government says the report contains "no substantive evidence" on which to base its conclusions. A Ministry of Justice spokesman said the government was "never losing sight" of its obligations under the data protection and human rights acts.

"It takes its responsibilities seriously and will consider any concerns carefully, adapting existing safeguards where necessary," he added.

The government spends £16bn a year on databases and plans to spend a further £105bn on projects over five years but does not know the precise number of the "thousands" of systems it operates, the trust claims.

In the wake of numerous data loss scandals, the cross-party trust - which campaigns for civil liberties and social justice - examined 46 public sector systems.

It said 11 were "almost certainly" illegal under human rights or data protection laws.

And what is the Information Commissioner, Richard Thomas, doing about this? Well apparently nothing. Maybe it is time for the Commissioner to start to earn his salary and start a formal investigation as to exactly what is being stored and retained by both Government and Industry.

The trouble with civil liberties is that you don’t miss them until they are gone!

Fibre Taxation slowing the UK's broadband future.

2009-03-23T11:39:00.002Z

The Government is in danger of creating a digital divide by discouraging investment in superfast connectivity unless it reviews the issue of fibre taxation. Despite Government backing next generation Internet applications and the use of fibre optic cable, it has continued to tax the rateable value of the basic infrastructure.

Elfed Thomas, CEO and founder of i3 Group, is calling on the Government to review the issue of fibre taxation ahead of the Digital Britain report expected later this month. He fears the imposition of the tax will create a digital divide between those companies able to afford the rate, and so benefit from superfast connectivity and those unable to offset the tax and thereby relying on the traditional copper networks.

He said: "Now is not the time for the Government to impose this tax. Fibre taxation is an issue which has been around for almost a decade but never before has it been such a potentially hot topic. Its resurgence comes as the Government is expected to back recommendations for the national deployment of dark fibre - to meet the requirement for universal Internet access to at least 2Mbps broadband speeds by 2012 in the Digital Britain report.

Given the Governments expressed commitment to ensure that the entire population has access to a less than ambitious 2Mbs, this is tax is clearly out of step with this aim. It seems that the Treasury is still unaware of what is meant by “joined-up Government”. With one branch of Government committed to improving Internet access for all whilst the Treasury tie the hands of industry behind its back by demanding an income from the means to deliver it!

Japan, Singapore, China, Sweden, Denmark and even Italy are rather more enlightened than the UK Government’s piece meal approach. As I wrote last November in “When will the next generation broadband start to deliver for the UK”, our Government’s current approach and that of BT lacks the vision to deliver genuine advantage for UK plc in this crucial infrastructure. Gordon Brown needs to get Lord Mandelson and Alastair Darling talking about something other than bonuses for failure in our Banks.

Further information @ H2O Networks site.

Happy Birthday “WWW”

2009-03-13T13:31:00.005Z

The "World Wide Web", which has completely transformed the way we live, has turn twenty today. Its inception dates back to 13 March 1989, when a computer scientist, Sir Tim Berners-Lee, at the European Centre for Nuclear Research, popularly known as CERN Laboratory, presented a paper containing means and methods by which particles physics scientists could easily share and find out essential electronics documents.

At that time, the use of internet was limited to defence and academics domains only and communication was wholly text-based, banking on general newsgroups, along with remote Telnet chat to send messages.

The document, entitled "Information Management: A Proposal", heralded the worth of simplified iteration of Standard Generalised Mark-up Language, and it described what is now known as world wide web that has annealed into almost every sphere of our lifestyles.

The paper resulted into the creation of Hyper Text Mark-up Language (HTML), a coding language used to illustrate methods of presenting images and texts in the web format, and when this language get combined with Hyper Text Transfer Protocol (HTTP) and Uniform Resource Locator (URL), it builds an essential framework to support sharing of electronic documents in an electronic format.

In order to mark the twentieth birthday of the web, CERN will be hosting a couple of "short presentations from web veterans, in addition to a keynote speech from Sir Tim Berners-Lee, alongside a demonstration of the original browser".

So the World Wide Web is no longer a surly teenager. I wonder what we can expect from this fast maturing character!

Latest Trends online according to Razorfish

2009-03-12T17:56:00.003Z

Each year Razorfish, an interactive marketing company, publishes its “Digital Outlook Report.” The report is very interesting for anyone who is interested in making a living from the internet.

The first section identifies the key trends to watch over the coming year before examining them in greater depth. They are:-

Trends to Watch

1. Advertisers will turn to “measurability” and “differentiation”
in the recession.

2. Search will not be immune to the impact of the economy.

3. Social Influence Marketing will go mainstream.

4. Online ad networks will contract; open ad exchanges will expand.

5. This year, mobile will get smarter.

6. Research and measurement will enter the digital age.

7. “Portable” and “beyond-the-browser” opportunities will create new touch points for brands and content owners.

8. Going digital will help TV modernize.

Whilst the document is overly long at 180 pages and does offer a very US centric view, it is definitely worth a look and ties up with many of the issues that I have been looking at over the past three years on this blog. Get your copy from this link:- Razorfish : Digital Outlook Report 2009

Google Android paid for apps opens in the UK

2009-03-12T11:25:00.007Z

Paid for applications will be available to UK Android owners from today, T-Mobile has announced.

For the first time, Android developers will be able to set their own prices for their apps. Previously, only free apps could be made available through the Android Market app store.

Speaking at an Android developer event, Regan Whitehead, mobile internet category manager at T-Mobile UK, said: "When users click on the Android Marketplace icon in the morning there will be a wide selection of paid apps on the market," including offerings from EA Sports and Activision.

Content on the Android Market is rated by users - in a similar fashion to YouTube - so developers who slap a high price tag on their app risk pricing it out of the market, according to Richard Warmsley, head of entertainment and internet at T-Mobile UK.

The store is like "eBay - developers are posting up their apps, they're setting the price, customers are rating independently and choosing what they want to have so it's an open market approach," he said.

The widespread interest in the potential of application marketplaces is hardly surprising, since Apple revealed last year that it earned $30m in sales of iPhone apps in the first month after launching the App Store.

According to Maani Safa, head of mobile at The Telegraph Media Group, the newspaper's app - which was initially launched on Android - took about four times as long to port it over to the iPhone.

"Apple just make you jump through hoops," he claimed.

Because of these hoops, Safa said the company is "using Android as a trailblazer" - any app it creates will be launched first on Android and then ported over to other platforms because of the difficulties he had working with Apple

"Say you have a commercial deal in place and you want an application to go live on day X with an Android version. You create the application, you click on publish and literally within 10 seconds it's live in the application store, you call up the commercial partner and you tell them it's live ready to go. With the Apple version, you tell them it's date X - it gets to four days before, [Apple] gives you a call and says 'oh, by the way it's not going to go live for another two weeks'. 'Why?' 'It just isn't'."

There are currently more than 1,000 free apps available for Android.

T-Mobile's Warmsley said the top 10 apps downloaded on the G1 since its October 2008 launch are The Weather Channel, MySpace Mobile, ShopSavvy, Daily Horoscope, Free Dictionary Org, Ringdroid, Backgrounds, Barcode Scanner and Save MMS.

Currently, the G1 is only one model of Android phone is available in the UK and is exclusive to T-Mobile. Vodafone has just announced last month that they will begin shipping the HTC Magic Android compatible phone shortly. The phone will be available in the UK, Spain, France, and Germany.

As regards the G1, T-Mobile's Warmsley said he was unable to put a figure on the number sold in the UK to date, but said that while "it's not a million", in a typical week T-Mobile's current sales rate of the G1 is 70 per cent of the iPhone's sales rate. O2 claims to have shipped more than a million iPhones in the UK.

The typical G1 user is a 32-year-old male, likely to be living in London or the South East - although there are also G1 'hotspots' in Leicester and Nottingham, according to Warmsley.

Additional Reporting from Silicon.com

UK ISP, Cable and Dongle User Numbers - March 2009

2009-03-02T12:53:00.007Z

Here is an update of the UK ISP market covering DSL and Cable Access market as well as the the Mobile Dongle market in the UK. I have used ITU published data for Broadband usage numbers and Neilson Ratings to get an accurate picture as well all the reports and disclosures for each of the companies shown below. I believe these figures represent a reasonably accurate representation of the genuine adoption of broadband either via DSL, Cable or mobile dongle. Broadband connections included in this data cover download speeds equal to or faster than 256kbit/s.

ISP	Total	% of UK Accts.
BT (inc Plusnet)	4,700,000	26.20%
Virgin Media (inc Virgin.net)	3,934,800	21.93%
CPW (inc AOL)	2,700,000	15.05%
Sky	1,955,000	10.90%
Tiscali UK	1,774,000	9.89%
Orange	1,023,000	5.70%
Royal Mail	560,000	3.12%
O2 (Be & Dongles)	340,866	1.61%
3 (Mobile Dongles)	255,000	1.42%
Kingston	195,255	1.09%
T-Mobile (Dongle)	161,000	0.90%
Vodafone (Dongle)	132,000	0.74%
Thus	126,000	0.70%
Entanet	92,000	0.51%
Clara.net UK	72,000	0.40%
Breathe	12,000	0.07%
Supanet	6,000	0.03%
Others	28,000	0.16%
Total	17,940,121	100.00%

Unlike some of the largest UK ISPs, which have seen a decline or slowdown in high-speed services uptake, O2 has actually reported yet another growth increase from Q3-2008's +72,870 net additions to +73,776 for Q4. They're still some way behind 6th place Royal Mail but gaining fast.
Overall O2 outperformed the UK market in difficult economic times with over 10% growth and O2 is also working to increase broadband capacity at several locations around the UK. O2 has benefitted from the development of the growing “Internet Dongle” market. T-Mobile, 3 and Vodafone are also enjoying continued growth. BT is responding to the mobile challenge through BT Openzone (Wi-Fi Hotspots). BT has reported an increase in usage of 13% on Q3, with nearly double the amount of surfing minutes being used. BT Openzone is now available at more than 50,000 worldwide locations through roaming partners. BT FON membership also continued to climb and members now total 163,000.

As BT starts to roll out its 21st Century Network (21CN), they are seeking to work with a whole range of ISP partners such as Royal Mail to offer new services. BT Group has reported 8.1m wholesale broadband DSL connections at 31 December 2008. BT Broadband net additions of 83,000 in the quarter in the maturing broadband market, with a customer base of 4.7m including both BT Broadband and Plusnet.

Project Canvas leaps in to replace Kangaroo!

2009-02-27T17:18:00.003Z

Project Canvas, the venture between BBC, ITV and BT to "bring catch-up from the PC to the TV", will cost the partners £24m to get up and running. A fourth major partner, possibly Channel 4, Channel Five or a major internet service provider is expected to come on board in the near future.

The costs are intended to be shared equally and BBC has indicated that their share will be £6m of licence payers funding.

The venture's backers aim to provide an open technology offering so that viewers with Freeview or Freesat and a broadband connection can access catch-up and on-demand programming via their TV from online services such as BBC iPlayer and ITV Player.

The BBC anticipates that these new web-enabled set-top boxes will cost somewhere in the region of £100 to £200, and that the catch-up television service will be delivered via the internet. The BBC, ITV and BT believe a sufficiently good service could be achieved with a relatively low speed internet connection of around 1.6 Mb, and other internet service providers are expected to back the scheme.

“We are excited about what this could mean for the viewing public,” Erik Huggers, director of future media and technology at the BBC, told The Times. “While audience demand for high-quality public service broadcasting remains high, the ability of the commercial operators to deliver is seriously threatened by a changing media landscape and the difficult economic climate. Innovation is in the BBC’s DNA, and with our funding model and great content, we’re in a unique position to innovate for the benefit of everyone.”

Earlier this month, a proposed catch-up TV service backed by the ITV, Channel 4 and BBC, was blocked by the Competition Commission. The Commission ruled that Project Kangaroo, the online television venture between ITV, Channel 4 and BBC Worldwide, was blocked by the Competition Commission this month on the grounds that it would stifle the video-on-demand market, so the trio insist that Canvas will be open to any content provider that meets technical parameters. For that reason, those involved with the project are careful to label it as “Freeview mark two; not Project Kangaroo mark two”. Although I suspect it is the same team behind Canvas that was behind Kangaroo.

The team behind Project Canvas has stressed that other content providers, such as film rental services, would be welcome to offer their services through the platform, as long as they meet the necessary technical standards required.

Some television viewers are already able to watch shows from BBC iPlayer on their TV. Virgin Media offers BBC iPlayer to its 3.7 million subscribers, and this audience accounts for 30 per cent of all viewing requests logged by iPlayer.

Anyone who has tried to watch the iPlayer or any video content online at less than 2Mb will find the suggestion that, 1.6 Mb broadband accesses will be sufficient to support an adequate service to be quite amusing.

In addition, why is it going to cost £24 million to develop an iPlayer for a TV set-top box, when the likes of Sony and Pace not to mention Virgin have capability developed? Agreeing open access standards for their content to be run on set-top boxes should not cost so much and there are enough set-top manufacturers who are ready to work with such a standard and build it into their equipment. I recall from a recent Internet/TV project that the BBC frequently changed their iPlayer format to frustrate software developers trying to develop set-top box developments to deliver the iPlayer.

The BBC Trust, the corporation’s governing body, yesterday opened a consultation on the proposals, and will make a decision on the project by the end of July.

Goldman Sachs Technology Symposium - Apple Developments

2009-02-27T13:24:00.003Z

Here are the highlights of Tim Cook the COO of Apple comments at the Goldman Sach Technology Conference currently going on in Redwood City, California and favourite to replace Steve Jobs as CEO. There are some very interesting comments here as to the future direction of Apple.

Economic decline

“I’m not saying Apple’s immune to the economy. But if you look at last quarter as an example … last quarter in the U.S., the GDP growth was less than one percent. It was miserable by anybody’s calculation. Apple, in the U.S., grew 27 percent.

For us, we’re focused on what we can control. And what we can control is how much we innovate, what products we do, the experience in our stores, the experience in our channel — all of those things. I think Apple’s success depends on how we do on those things versus whether the GDP is slightly above one (percent) or slightly below zero or whatever.”

IPod Touch cannibalizing iPhone sales

“I’d rather Apple cannibalize Apple than somebody else cannibalize Apple. It was very key for the iPod line to go in this direction.”

The iPhone SDK and platforms vs. products

“First of all, I think it’s really important to realize that very few companies in the world know how to build a platform. You can count them on a few fingers. Apple is one of them. We’ve had the Mac platform for years and really understand this.

When we started with the phone, we started by getting developers to focus on web 2.0 apps. And there’s over a thousand of these today. There are probably many people in this room that use them. But people also want to do more than that. And as we got into the phone more and more, it became clear to us that we should release an SDK and we’re going to talk more about that next week at our event. But in essence what it does is it will make the product even more compelling. This is a product that has the highest customer satisfaction (rate) of any Apple product ever shipped, which is a very, very high bar. We’re super excited about where this can take us.”

The real iPhone controversy (aka the missing iPhones)

“The real controversy, if you will, from some people’s point of view is the difference between phones that are activated on Apple-chosen carriers, and the total number of phone sales. So people want to know where are the iPhones? Here’s my short version of this: We have a situation where we’ve purposefully rolled out iPhone in four markets (the U.S., the U.K., Germany and France). We did this at this chosen speed so we would learn, and could apply those learnings to future rollouts, etc. And we are right on track where we want to be. The four million units that we’ve sold over the first 200 days gives us confidence that we can achieve 10 million units in 2008.

So where are the iPhones? Here’s the privilege, so to speak, of this problem. The demand for the iPhone is so intense in the markets where we aren’t offering it that people are exporting it out of the U.S. in many different ways and then running it on local carriers … The thing that I like about that is it shows there’s a lot of worldwide demand. And I think the most important thing for Apple by far in this first 8-10 months of selling in the iPhone world is to deliver a product that would delight customers.

Of all the problems we face, this is the one I face looking at with a little bit of a smile. Because it means there’s great demand for the phone. And to have people stepping over each other to have the phone isn’t a bad thing.”

The one carrier model vs. multiple carriers for the iPhone

“In the U.S., our fundamental choice was do we want to develop two phones: a CDMA phone and a GSM phone. We didn’t. We wanted to do the simplest approach in the beginning because that’s the fastest way to learn. We wanted GSM. GSM is a worldwide standard and AT&T is the largest carrier. The business relationship that we could work with AT&T allowed Apple to be Apple and AT&T to be AT&T. This is the power of this relationship. We feel very good about that. We went into Europe and picked the top carriers in three countries and got going in those countries. Now, are we married to his model? Will we do this everywhere? We’re not married to any business model. What we’re married to is shipping the best phone in the world and continuing everyday to innovate to make (the iPhone) better and turn it from a device into a platform. We are married to that.”

Virgin Media sinks deeper into the red but grows broadband!

2009-02-27T12:42:00.004Z

The cable services provider Virgin Media had a difficult last quarter of 2008, with new customer sign ups dropping by a massive forty per cent.

The company posted losses of £50 million for the same quarter, which it said was due to the fact that it only managed to attract 14,800 new customers compared to 24,000 in the same period in 2007. At the same time Virgin Media has seen a fall in customers taking out the profitable broadband, TV and phone packages, with only 185,000 sales in the last quarter compared to 272,100 in the same quarter of 2007. However Virgin Media claims that "record numbers of customers" are now making use of its services and despite the economic crisis they have seen an increase of 57,100 on-net broadband customers, taking their total to 3.68 million. This is just 1.5% growth in user numbers at a time when Virgin has been advertising heavily and launching new services such as the new 50Mb package at the end of last year

Virgin Media also noted an improvement in tier mix, with a third of their users now subscribing to their next-generation (10Mb and above) services. Virgin Media also announced this week that it will be upgrading its 2Mbps broadband customers to a superfast 10Mbps service as it steps up its bid to become "the highest-quality broadband service in the UK". Indeed Virgin will begin migrating customers to the new connection in May, with prices for the 10Mbps package starting from £14 a month.

With Virgin’s broadband user numbers growing slower due to the economic downturn and increasing numbers of broadband users choosing to go to 3G Mobile broadband rather than tethered broadband. Recently the Office of National Statistics indicated that fixed broadband has started to fall for the first time and this trend looks will have an impact on the major operators. Expect to see aggressive price cuts to lure new customers from the major broadband ISPs such as BT and Sky during to spring of 2009 to compete with Virgin’s £14 a month 10Mb service.

At least Virgin has not yet decided to opt for Phorm like BT, however, there remain a number of legitimate revenue generating activities it could opt for now that it has deployed DPI (deep packet inspection) such as DNS and HTTP error monetisation.

Is the 3G Dongle the best broadband option for you?

2009-02-27T12:32:00.003Z

With the 3G Mobile Dongle you no longer need to be tethered to a fixed line or a long term commitment to BT or Talk Talk. Today there are almost 1 million dongle users in the UK and demand is growing so much so that, for the past two quarters that the number of fixed-line broadband connections in the UK has started to fall for the first time ever, according to the Office of National Statistics.

With near saturation of mobile phone ownership, the option to go with a mobile dongle is winning over many new users with the promise of broadband that goes with them and it doesn't require them to pay twice: once for the broadband and once for the phone line.

What is the best dongle broadband option for you? The answer to this question depends why you surf the net, whether for business or leisure or indeed a combination of both. Equally is you usage occasional or regular usage. In some cases, the mobile companies are offering laptops or notebooks as part of the tariff options. However, the two primary options are Pay-as-you-go or Contract in the same way mobile phone service is offered. So what are the options:-

Pay-as-you-go Dongles

Pay As You Go dongles are growing very rapidly in popularity as they do not require a long-term contract to enable a PC, laptop or notebook user to connect to the internet. The customer simply buys a dongle which has a set amount of time and data download capabilities.

The dongle is then plugged in to the computer as a plug-and-play device allowing for instant broadband access to the internet without a contract. The customer just uses the connection until they have used up the available amount of cash they originally purchased.

They can then just repeat the process thus avoiding a contract commitment of 12, 18 or 24 months to a mobile broadband operator. This system works very well for many users, providing them with access to the Internet, albeit with a limit in the time and the amount of available download before the credit is exhausted.

Customers who make use of their computer for longer periods of time each month very often opt to sign up for a contract with one of the big operators such as Vodafone, 3, Carphone Warehouse or Orange.

Contract Dongle

Although the same operators also offer pay-as-you-go deals, many people prefer the added convenience of long-term contract connection. The two systems basically operate in the same way making use of a broadband dongle to connect the computer to the Internet.

A contract connection offers the advantage of being simpler and cheaper to run on a month-to-month basis than pay-as-you-go wireless Dongles. The savings can actually be quite considerable if you make a large amount of use of your internet connection each month.

Downloading can be far more practical financially with a long-term contract. Many people feel that 18 or 24 month commitments can be outpaced by developments in the mobile broadband connection field. Therefore the most popular contract is one for 12 months giving a good degree of flexibility to move with the ever-changing broadband times.

In this way should you find a deal that suits your needs better, or there is a new technological developments with connection capabilities it is not a prohibitively long period until your contract comes up for renewal.

Both Pay As You Go and contract connections offer advantages and disadvantages. It is wise to consider which best suits your personal broadband Internet needs. As a rule of thumb longer hours spent surfing the web each month or large amounts of data download requirements favour a long-term contract.

Less time spent surfing and little need for major amounts of data download are best suited to be more flexible Pay As You Go dongle connections.

Network Issues

However, not everyone is convinced that mobile broadband is up to the job. 3G Mobile network availability is clearly an issue in much the same way it is for some mobile operators. There are also issues with the network when too many people are online and services drop off. As an alternative, there are a couple of firms offering satellite broadband which has been touted as a solution for rural areas, but it is comparatively expensive with Avanti offers a 2Mb service for £45 a month.

Carphone Warehouse to cut jobs

2009-02-27T12:29:00.001Z

Carphone Warehouse is expected to reveal about 400 job losses as part of a cost-cutting programme. The job losses are expected to be mainly among support staff and a consultation period is likely to start today.

According the Guardian among those affected will be call centre staff who were brought in two years ago to cope with a deluge of complaints when Carphone launched its free broadband offer, Talk Talk.

Carphone Warehouse has 2,400 stores in nine countries and employs 12,500 in the UK. Job losses are not expected in its retail stores.

Carphone Warehouse's retail division is expected to grow following a joint venture with US electricals giant Best Buy that will pitch it against UK chains such as Currys and Comet.

Last month Carphone Warehouse announced that it would review its structure and financial disclosure policy following its margin squeeze and the fact that Talk Talk’s broadband revenues had fallen by 2%.

Another Googly hits GMail

2009-02-25T07:27:00.006Z

Following on from last months Google Search problems, users of Google's popular e-mail service, Gmail, were hit by an outage yesterday. The service went offline at 0930 GMT with Google saying it was "working hard to resolve this problem". The problem covered both their general consumers and the paid for business users. Professional users of Google mail are covered by a service level agreement that promises to be 99.9% operational in any calendar month. To put that commitment in context, GMail could be down up to 72 hours per month and still meet their commitments! Most commercial email services are run on 99.999% or 5 nines availablity or just 72 minutes of unplanned downtime per month.

According to comScore there are more that 113 million users of Google’s “GMail” service worldwide. In a statement, Google said "a number of users" were having problems with Google Mail. The problem wasn’t universal with some users unaware of the problems. Users accessing GMail through a third-party email clients configured to send and receive e-mail using the IMAP email protocol were unaffected.

Outages are nothing new to email services and all Google’s competitors have had similar experiences as they developed and certainly Google has invested significantly in their Gmail infrastructure. According to Google, its e-mail service suffered an average of 10 to 15 minutes of downtime per month in 2008. The last major outage was in August 2008 when users were unable to use Google Mail for "a couple of hours".

According to comScore, Google has the world's third most popular web mail service behind Hotmail with 283 million users and Yahoo with 274 million e-mail users.

Google will need to improve their target availability if they are to offer the GMail service as a credible alternative to competitive email services.

UK Mobile Dongle User Numbers – Feb/March 2009

2009-02-23T12:05:00.004Z

I have been researching the number of users now using 3G mobile dongles to link to the Internet in order to offer some insight into this largely hidden phenomenon.

Globally the market for 3G dongles is set to grow from 20 million units in 2008 to 26 million units in 2009 despite the downturn.

In Europe, some of the strongest growth has been recorded mainly due to the near saturation level of mobile usage compared to other parts of the world due to aggressive marketing push from the operators and the handset manufacturers. This has resulted in an interesting development amongst Generation Y, those users born between 1978-2000. This group have led the way in not bothering with fixed access telephony and are consequently adopting the 3G Dongle as their preferred method of Internet access. Much of this growth is based on competitive all-you-can-eat tariffs and ease of use.

In the UK, which makes up approximately 3.5% of worldwide dongle sales, the mobile dongle user community now makes up over 4% of the overall broadband market. These figures may not seem very impressive; however, with overall dongle sales set in 2009 to see 15% growth over 2008 and with the traditional broadband market at a standstill, the dongle market is likely to continue to make significant in-roads into the broadband market in 2009. With increasing choice of low cost tariffs and user numbers in the UK could easily top one million by the end of 2009.

UK Market – February 2009

No	Operator	Number of Users	% Share	Comment
1	3	255,000	34%	The established leader of the dongle market, 3 has led the pack with its innovative pricing packages.
2	T-Mobile	161,000	22%	T-Mobile has used the UK as its primary test market for their dongle strategy and their innovative “webNwalk” service.
3	Vodafone	132,000	18%	Vodafone is the fastest growing of the major networks aggressively promoting and subsidising dongles because they are viewed as a secondary device that provides additional revenues for carriers beyond a traditional handset.
4	O2 (Dongles only)	122,000	16%	02 were the first major mobile network to enter the broadband market in the UK following its acquisition of Be, however, this seems to have been a distraction which has slowed their adoption of a dongle strategy.
5	Orange	57,000	7.7%	Orange seem to stumble from drama to crisis. Their 3G Dongle strategy is little better. They are seeing declining share of the broadband market and have been slow to put together a competitive offering for the dongle market.
6	Virgin Mobile	15,000	2%	Somewhat off the pace with their 3G dongle priced at £15 per month running over T-Mobiles network as MVNO.
	Total	742,000

To get an accurate picture, a number of published and unpublished sources have been used. One needs to guard against the marketing hype that is put about regarding sales of individual networks, but the 3G dongle market is viewed as an area of vital importance by the mobile networks. It will be interesting to see how the traditional ISPs respond. Late in 2008, BT Broadband started to offer a WiFi dongle that connected to their network hotspots, BT Openzone, to their customers as an extension of their standard contract. Neither Sky or Tiscali have a competitive offering as yet, although Tiscali could still make a good fit for Vodafone.

Asia-Pac leads the way in 3G Dongle adoption

2009-02-23T11:57:00.002Z

Asia-Pacific was home to some 121 million 3G subscribers in 2007 and an estimated 158.4 million in 2008. By 2013, the region's 3G subscriber base is forecast to reach 564 million, accounting for about 18.2 percent of all mobile users. With 3G subscriber net additions in record numbers year-on-year, mobile operators are eager to monetize 3G external broadband devices, namely dongles and data-cards, to complement their mobile broadband offerings.

3G dongle services have thus far seen promising uptake. Frost & Sullivan senior industry analyst Marc Einstein noted: "Dongles and data-cards are increasingly a preferred connectivity device of choice for Asia-Pac's broadband subscribers given the slim form-factor of the devices, faster 3G speeds and competitive service plans available."

He reckoned that by 2013, more than one in every three new broadband subscriber will use dongles or data-cards for their mobile broadband needs, giving fixed broadband players a run for their money.

New analysis from Frost & Sullivan, 3G External Broadband Devices in Asia-Pacific, finds that there were an estimated 5.2 million mobile broadband dongle and data-card users in Asia-Pacific (18 countries) in 2008, with corresponding billings of over $1.3 billion.

With the continuous rollout of new 3G networks and 3.5G/4G upgrades across the region, Frost & Sullivan believes that there will be nearly 37 million 3G subscribers using external wireless devices for their mobile broadband needs by year end-2013, with estimated billable revenues of $7.8 billion.

The uptake for these 3G devices is expected to accelerate after 2010 once 3G services become commercially available in most large Asian markets. Not surprisingly, China is expected to be the single largest market for the device with 20 percent (7.4 million) of the region's dongle/datacard users by 2013; India, a close enough second with 5.55 million (15 percent) dongle/datacard subscribers.

The switch to dongles for broadband access is hardly surprising given the difficultly that some Asian economies have had rolling out fixed infrastructure. The dongle approach enables users to leap frog into the 21st Century and get a excellent broadband access via the mobile networks. It will be interesting to see how tariffing emerges in the Asia compared to what we are seeing across Europe and most notable in the UK.

More information from Frost & Sullivan

Skype and Nokia are bonding – will it lead to marriage?

2009-02-19T17:01:00.004Z

Latest news from the Mobile World Congress in Barcelona is that Skype and Nokia have announced a partnership to provide free and low-cost calling for Nokia's N-series of Smartphones, starting with the N97 later this year. Skype’s software will be integrated into the phone's address book, providing presence detection when other Skype contacts are online, as well as enabling use of the Skype instant messaging client. Significantly, the Skype service will be available both over Wi-Fi and 3G high-speed networks, so users won't need to be near a wireless hotspot to make Skype voice calls. Users will be able to communicate with Skype-to-Skype voice calls, as well as make mobile and landline Skype calls at their low VoIP prices. Sony Ericsson also has a Skype on its Xperia X1 device, running Windows Mobile 6.1 and Skype has a mobile ‘lite’ version running in beta on LG, Motorola, Nokia, Samsung and Sony Ericsson phones.

How will this go down with the operators I wonder? I suspect this will not be viewed as such great news by the operators, who may view this as an attempt by Skype and Nokia to eat their lunch. In future I expect that the major operators will be less than happy to offer subsidised VoIP capable Nokia phones to their users. This story clearly has legs and given that eBay have indicated that Skype is no longer compatible with their long term strategy and have effectively hoisted a large “For Sale” sign over them, this move just might make Skype a good fit with either a hungry operator or an aggressive handset manufacturer.

Ten Things for Start-ups to avoid.

2009-02-19T15:31:00.006Z

Over the last ten years I have been involved with a lot of start-ups. Sometimes as an analyst for a VC and sometimes as part of the management team. Some of these ventures have quickly imploded before going beyond the idea stage, some have gone on to become successful businesses and generate significant rewards for those investors who took the early risk. However, all were guilty at some point of exaggerating many aspects of the product or service. So I have updated Guy Kawasaki's excellent The Top Ten Lies of Entrepreneurs from 2006 with a few of my own experiences to help start-ups to avoid certain pitfalls if you are looking for money from angels or VCs.

“No one is doing what we're doing.” Oh yes they can! The same is true of major corporations. When I was with BT many moons ago, I could be sure there were at least two other BT funded groups working on the same idea in some “parallel universe” of which I was unaware. Same is true of the Internet. There will be many people working on the same idea as you and depending on their abilities to get to market , they may ultimately become your competition. Your idea will seldom be unique, but finding a new angle makes the difference and may be worth funding or just do it better. Google have done quite well without being particularly original - just better. Be realistic and do your research. If you’re a business angel and you haven’t the resources of a VC, just take a few minutes to search Google and check out the entrepreneurs claim.
“No one can do what we're doing.” The first cousin of number 1 and the same answer. Yes they can and the chances are they will. VCs get hundreds and thousands of new ideas thrust at them every year and there is a good chance they will have seen something like your idea before. Show that you can create a successful and sensible market for your product and have a clear plan to get to market.
“Our projections are conservative.” No entrepreneur's projections are ever conservative – correction – no one’s initial projections are conservative. We tend to exaggerate our expectations by default. I would have millions by now if I had a pound for every time that some new start-up suggests they will be as big as Google – one I recall suggested his idea was going to be bigger! Generally, an entrepreneur has no idea what their sales will be, so they guess and will be miles out. However, VC’s tend to encourage this behaviour suggesting that unless the concept looks “interesting” the idea will not get backed. Interesting invariably means double digit growth and profitable inside three years. So we have a problem, if you do project a “hockey stick” revenue growth, no one will believe you and if you don’t, the idea will not get funded. Finding the middle way is very hard.
“Forrester/McKinsey/Bain etc says our market will be $50 billion in 2014.” Analysts create reports to serve their market of large corporate analysts and seldom have any more idea of market size than anyone else, but unless the market is projected as big who will bother buying the report. In planning, it is generally accepted that you can get close to a forecast over 1 year, but projecting 5 years out is pure fantasy. Entrepreneurs should simply remove any reference to future market size estimates from consulting firms. Empirical research and bottom up modelling will give a sounder basis for your projections. The only thing that will happen is that your forecast will change!
“All we have to do is get 1% of the market.” There are two problems with this line. First, no investor is interested in a company that is looking to get 1% or so of a market. VCs are looking for companies to face anti-trust issues because of their market dominance not just another business. Secondly, it really isn’t that easy to get 1% of any market, so you look silly pretending that it is. Once again empirical research and bottom up modelling will give you a sounder basis for your projections. It's much better for entrepreneurs to show a realistic appreciation of the difficulty of building a successful company.
Virgin/BT/Vodafone etc… is about to sign our purchase order next week.” This line never has any traction. It seldom happens. The entrepreneur claims they are just about to sign some major corporation and naturally it just doesn’t happen. The only way to play this card is after the purchase order is signed because no investor whose money you'd want will fall for this one.
“Key employees are set to join us as soon as we get funded.” Be prepared for the VC to insist on calling your prospective employee. If it's true that key employees are ready to leave their safe salaried senior positions that is great. Either have them at the meeting or have them call the venture capitalist after the meeting and testify to this effect.
“Hurry because several other venture capital firms are interested.” VCs and angels are very polite people and seldom say “not interested” or "go away" instead they say “maybe” or “we will look at it in the next financing round” or “we will fund post first revenue” etc. If they are interested they will pursue you straight away. They tend not to wait. Other investors know this and also genuine interest will be covered by a very strict non-disclosure agreement and the entrepreneur will not be able to make such claims.
“We have a proven management team.” Um…what exactly proven in this case? Being a senior manager at Microsoft or even Google these days, doesn’t mean that they can run a bath, let alone a successful start-up. Truly “proven”, in a venture capitalist’s eyes, is the founder of a company that returned billions to its investors and they are rarer than hen’s teeth. Being an experienced team is an easier case to prove, but ensure that the senior director from BT you want to bring in, is happy to share some grotty open plan office with a bunch of hippy engineers, get his own coffee and can run Excel. Along with experience come flexibility and an ability to adapt. Make he or she really fits the bill.
“Patents make our product defensible.” No it won’t. It is nice to have a patent and by that I mean a patent that has been “granted” not just filed, but you will need very deep pockets to defend it and quite frankly that will not stop all manner of people poaching your idea. A granted patent may impress Business Angels or some newbie VC, but people who know their business are aware of the limited importance in the start-up market. It will take 4-5 years for it to be granted in any case and be very a very costly exercise. Patents are good, but getting to the market fastest is more important.

Ideas that are based on sound research and market insight are the ones that get the majority of funding. Honesty is a much more important virtue in an entrepreneur than being able to spin a story. You may get some initial funding projecting dubious facts, but ultimately if the promises do not materialise the VC will be back for his pound of flesh and that is altogether a more painful experience. Things go wrong and businesses fail and entrepreneurs who have been through such experience are often much better investment risks than those who make the “outrageous” claim. Do your homework and build a credible business and remember that the most important commodity will be a large share of luck.

Facebook could damage your wealth!

2009-02-19T09:27:00.007Z

The growth of social networks such as Facebook, MySpace and Bebo has been extraordinary and represents the one of the defining services of the Web 2.0 user driven internet. With an estimated 500 million plus members of social networking sites and driving an estimated 8% of worldwide web traffic, the sector is clearly a major driver of web activity.

However, if you thought your MySpace or Facebook page is just a bit of fun and a great way to stay in touch with your friends, you also need to be aware of the far reaching aspects of the information that you place in your profile will have on other aspects of your life. Particularly these days, as it is possible for employers to check peoples profiles to get a better idea of the individual they might be taking on and if they see something they don’t like in your personal life it may cast a shadow over your professional life. For example, I know of a colleague who was interviewing for a nanny for her child and checked them out on Facebook. Whereas from the interview, the young lady seemed like the perfect candidate, her Facebook profile revealed a whole other side of her lifestyle that wasn’t particularly compatible with the type of person that anyone might want looking after their child. This maybe one of the more trivial examples, however, a more serious one was a recent case reported on the BBC website. A senior police officer lost out on the chance to become a Chief Inspector after he was found to have posted very personal information on the internet. The revealing information on his Facebook account was considered to have been very damaging due to his profession and resulted in him losing the opportunity to be considered for promotion.

So next time you are posting up those photos of the riotous night out, just take a minute to consider what your employer may think of the picture of you in a less than complimentary position.

Time to cut the Internet Bureaucracy.

2009-02-17T10:31:00.005Z

I am frequently struck by how Internet businesses seem to grow staff numbers on an exponential basis. Employing new people - preferably MBA types and under 35 - in endless non-jobs with little or no impact on the creation of new and exciting areas.

Yahoo! are a interesting example. Anybody who comes into contact with that organisation can see that at least 50% of their 15,000 staff could be made redundant and the underlying business would not suffer. They are hugely overmanned and it seems that the management is either too inexperienced to see how to change things or view a the number of direct reports relates to the bonus they can demand.

Take Google, they now employ over 20,000 people worldwide. The only business line that is really driving the revenue of the business is the original search business and the associated AdSense revenue. Today the product is much the same and just as brilliant as it was when I met with Brin and Page when the company had just 7 employees back in 1999. I suspect that percentage of today's 20,000 employees directly involved in that search and AdSense business line is fewer than 10% of the total workforce. A friend of mine was telling me about a meeting he recently had with Google. A recently appointed Director spent 45 minutes trying to explain precisely what her roles and responsibilities were within the company. Anyone who takes 45 minutes to communicate such a basic aspect of their job is probably trying to desperately cover up the fact it is a non-job. The same stories can be found in Yahoo!, Microsoft, and eBay.

The major Internet business have frequently fallen into the same trap that ultimately caused the demise of major telcos, steel companies and car manufactures back in the 1980s. They failed to understand their markets and had grown into huge bureaucracies. This recession maybe a good time for the major Internet businesses to look critically at their businesses and start to cut the deadwood and also look to fund the brightest of their exiting alumni to start new businesses and generate real dividends.

Friends Reunited - is it worth just £20M?

2009-02-17T09:47:00.005Z

Following on from my blog of yesterday on the potential for a sale by ITV of Friends Reunited, I note that JP Morgan is suggesting that the business is worth just two times Friends Reunited revenues of £18.9 million, making the business worth approximately £38 million on paper. Well valuations are calculated in many different ways, whether it is a multiple of turnover as in the case above or as a multiple of earnings or profits. When I looked at the Friends Reunited books back in 2003, the percentage profit was phenomenal, in the region of 80% plus, if my memory serves. This was due to the fact that costs were very tightly controlled amongst the then 10 employees including the founders, and the low cost of the infrastructure. It would be interesting to know how the cost base has changed since 2003 after Mr Murphy's involvement and since the unique user numbers are well down on three years ago when it was sold to ITV. My belief is that Friends Reunited still has a very strong web and non-web brand recognition and has the potential to make a very strong financial return whoever decides to buy it, if they are able to give the management the freedom to develop the business. It has been suggested that Friends Reunited are in the same space as MySpace or Facebook. Well it is worth noting that neither of these companies are profitable yet and keep generating huge losses whilst having multiple billion dollar price tags bandied about.

Friends Reunited is a very sound business and has extended well into the genealogy and dating markets. It has the potential to make profitable business and out live some of its more flashy rivals and maybe even ITV!

As for JP Morgans, well they announced a $1.3 billion loss in January 2008. I wonder what they will come out at the end of the credit crunch and given that they claim to have avoided the worst of the problems seen elsewhere.

Friends Reunited would probably make a very good fit for Barry Diller's IAC, which also owns Ticketmaster and Ask.com and continues to acquire assets being knocked down and sold by less able corporations. Just as long as they let the Friends Management run the show, the business model could make an excellent return for them. At £20 million Friends Reunited would be a steal.

Has Rich Media Advertising come of age?

2009-02-16T12:45:00.005Z

Following on my comments on the future of ITV and their multimedia future post Friends Reunited, I thought I might take a look at the state of rich media advertising and how it is developing.

On a recent assignment I was tasked to develop a revenue model that would support a free-to-air Internet TV service. Most of the models in place utilised versions of Google’s Adsense, but I felt that the user would be unlikely to click on such ads and so I started to look at rich media advertising such as ad-rollers of various types such as this pre-roller ad for the Jaguar XF.

Future revenue will be as a result of a user driven addressable advertising model whereby income is derived from the advertising model powering the Internet today. Rich media addressable advertising is a new class of advertising currently being deployed across the internet and it makes extensive use of video traditionally associated with the TV and Cinema advertising and extends the capability of the internet to enable users to interact with the advert offering numerous opportunities for advertisers to extend the contact with an interested party.

Rich media advertising provides addressable, accountable television advertising solutions that enable the delivery of targeted messages and engage viewers through interactivity. This advertising solution improves the overall effectiveness of advertising campaigns while providing true accountability through real-time reach measurement.

The New Advertising Model

Consider the advertising model from simple pre-roller advertisements which are shown whilst applications are loading and simple pay per click advertising for the purposes of building the revenue model. Pricing for rich media vary, but ads such as a 20 second pre-roller ad is approximately £12.50 CPM.

The IPA TouchPoints Survey in July 2008 indicated that the current consumer usage of broadband access is 34 hours per month in the UK per subscriber and according to a May 2008 Report from Forrester, typical online video viewing is achieving average levels of 4 hours per month per user. Over a 4 hour period a Internet/TV viewer is forecast to view ten 20 second pre rollers. For 100,000 users, this would equate to £50,000 in advertising income per week. Pre-rollers are the cheapest form of video rich media ads available. Longer 30s and 60s linear ads, mid-rollers and end rollers generate higher levels of CPM income. In the US, Microsoft is experimenting with running 60s mid-roller ad breaks for every 15 minutes of video viewed. High advertising rates are being generated by the likes of Navic Networks (recently acquired by Microsoft) who are providing a range of interactive TV ads powered by web capabilities enabling users to respond to ads and make requests and provide feedback on content. Internet/TV advertising pricing is currently at a higher level than corresponding standard Internet advertising as it is being treated as an extension of TV advertising which is historically very expensive per viewer compared to the Internet.

Pay per click (PPC) advertising provided by Google has been tried with internet video applications such as RooTV. These PPC ads currently attract and average click price of around 40p per click on Google and 29p per click on Yahoo! Click through rate (CTR) is dependent on subject matter and targeting. However, I would suggest that for the purposes of modelling use a CTR of 2% which is equivalent to current run of site rates across PPC advertising and the lower Yahoo! rate of 29p per click.

Addressable Advertising solutions help advertisers to reach the full potential of television advertising and improve the overall effectiveness of campaigns. These solutions allow advertisers to target groups of viewers using overlays on 30-second, 60-second, targeted video, or long-form advertising using any or a combination of the following: Request for Information (RFI), Telescoping, Viewer Polls, or Targeted Information Overlays.

Request for Information (RFI) & Fulfilment

RFI overlays are targeted, interactive enhancements that invite viewers to elect to receive more information on a product or service. RFIs generate highly qualified leads and provide the most targeted and direct connection with digital cable viewers. Advertisers are able to send coupons, product samples or brochures to self-selected viewers.

Telescoping

Telescoping is also known as linking to long-form advertising and bridges both linear and on-demand advertising by connecting customers with enhanced product information and enabling direct ecommerce. Interactive overlays allow viewers to link directly to long-form VOD content such as the Jag ad above. Telescoping combines the reach of linear advertising with the one-on-one nature of interactive on-demand content.

Telescoping brings together targeted interactive overlays with 30-and 60-second roller ads pushing viewers into longer more in-depth information about the advertised product or service. Telescoping to VOD solution addresses one of the biggest challenges facing advertisers today that of implementing VOD advertisements without having viewers’ access content through a complex click through process. By clicking on an interactive prompt, viewers are linked directly to the long-form video advertising content without the risk of them losing interest while navigating menus.

Viewer Polling

Poll overlays are graphical, interactive enhancements that are designed to engage viewers while obtaining their interests and opinions through viewer self-segmentation. Viewers use their existing remote controls to respond to questions posed in the overlay. Poll results are recorded, compiled, and electronically communicated back to the advertiser and can then be used to define targets for subsequent advertising campaigns.

Targeted Impressions/Spot Tags

Targeted Impressions are non-interactive overlays that enable advertisers to update their spots with time-sensitive information, address or phone number of the nearest location, product/service specials, etc. Using targeted impressions, advertisers can customise a single spot for different groups of targeted viewers.

Conclusion

Rich media advertising combines with Internet TV content now offers a powerful new advertising medium for traditional broadcasters to extract a whole range of new advertising revenues to support their transition away from declining broadcast advertising. The increase in efficiency of TV based advertising for delivering relevant messages to targeted viewers has huge additional benefits and allows the broadcaster to target new advertisers who have not traditionally tried TV advertising due to the high cost and unaccountability. Rich Media Advertising has clearly come of age and so will the major Broadcasters be able to move from the dying big budget ad spend to this form of accountable advertising? Time will tell and probably very soon!

Friends Disunited! Breaking up is so expensive……

2009-02-16T11:20:00.004Z

It was reported in the weekend papers that ITV is to sell Friends Reunited. ITV bought Friends Reunited back in December 2005 for an eye-watering £175 million ($280 million). According to the story in the Sunday Telegraph, “Analysts believe that Friends Reunited is now worth significantly less because of intense competition from rivals such as MySpace and Facebook” or just maybe they overpaid in the first place. Back in 2003, one of the major accountancy firms, BDO Stoy Hayward, was looking for a buyer on behalf of the original founders Steve and Julie Pankhurst and co-founder Jason Porter. I was asked by a client to review the business and come up with a valuation. The business was hugely profitable although there was obviously need for significant investment in their infrastructure. However, the most “toppy” valuation I could come up with was in the region of £30 million which was higher than market sentiment suggesting a £25 million price tag. In the event, Friends Reunited decided not to sell and brought in former Financial Times chief Michael Murphy as part of a global expansion plan.

This was a phenomenally successful move since Murphy increased the business’ valuation from £30 million to £175 million in just over two years. The spirit of 1999 seemed to be in the air again! Heady days indeed and at the time ITV said that the Friends’ team would have a leading role in developing ITV’s online and broadband strategy.

Sadly it hasn’t worked out as everyone had expected and yet another smart internet business failed to develop into a major force within the big company corporate world of ITV. Now ITV will pay the price in what is likely to be a fire sale of the asset at a knock down price. I wouldn’t be surprised to see Steve and Julie Pankhurst looking to use the money ITV paid them to buy back the company for a much lower figure.

I wonder whether ITV is still using the same analysts that thought £175 million was a good deal! Well it would seem they maybe since today ITV is suggesting that the downturn in TV advertising revenues is temporary and is just down to the deepening recession. Sadly anyone who follows new media with more than a passing interest will know that Google had their lunch last year and recession or not I just don’t see the Internet juggernaut altering course from taking a greater share of the converging TV and Internet advertising markets.

However, one potential future of TV lies not in traditional broadcast, but in the selective world of view-on-demand via the broadband Internet and content will be the key to its success. Whilst we are all happy to catch an amusing 30 second clip of a cat flushing a toilet on YouTube, it is hardly compulsive viewing and unlikely to attract advertisers. In reality, view-on-demand of quality content available at the user’s convenience is an attractive offering and one ITV is well placed to deliver. ITV is content rich with access to a significant back catalogue and a continuing, although diminishing, commitment to developing new content. Content will make Internet TV and IPTV fly. As for the advertising model that is evolving for video content such as pre-rollers and mid rollers etc, the pricing level will be fundamental different from the millions of pounds once paid for a 30 second slot during Coronation Street and far closer to the Internet pricing model.

So as traditional broadcast advertising continues to decline, ITV must act quickly to build a content rich Internet based future. The recent Kangaroo controversy is just a side show and quite frankly a waste of money for ITV as I believe was the development of the iPlayer a waste of licence payers money when there exists many fully developed home grown alternatives such as Vividas. ITV should use some of the funds they get for selling Friends Reunited to look to develop content in collaboration with some of the current alternative Internet TV channels such as Joost, Blinkx or even Wii TV. ITV could get into these areas with a much lower level of investment than the grand gestures of 2005 and they have the potential to offer a much more interesting future than managing decline!

BT must be desperate to turn to Phorm

2009-02-11T16:53:00.009Z

BT all but confirmed that they are going to implement the Phorm service across their 4 million users. Phorm has developed a service to deliver targeted advertising based on user browsing habits by using deep packet inspection (see comment). Phorm claims that the targeting system is entirely anonymous and the Information Commissioner seems to agree although he has advised BT that users should only "opt-in".

However, there is some doubt on the part of industry experts that the sort of targeting planned by Phorm can ever be anonymous. So why is BT involved in this dodgy area of activity? Both Talk Talk and Virgin walked away from trialling Phorm when the level of resistance became clear on the part of users and industry commentators and pressure groups. Well the answer maybe in BT's recently released financial numbers and the income that Phorm is suggesting BT can make from implementing the service despite the "opt-in". However, Iain Livingston will face the prospect of BT yielding the ISP number one spot in the UK if they sacrifice the delivery of a quality service for some dodgy incremental income. There are many more ways of making incremental income without upsetting your user base. Sadly BT is increasingly run by accountants who neither understand the technology or customers' needs it would seem. (Isn't that similar to what happened to our Banks!)

BT should be very careful or their financial worries could multiply with the addition of Phorm. This is just targeted spam and we do not want it. BT should heed that old saying - "All that glisters isn't gold!"

The Kindle 2 – is it a sequel worth reading?

2009-02-10T14:43:00.006Z

This morning Amazon announced its second-generation ebook, the Kindle 2.

The new Kindle 2 is lighter (well its 3 grams lighter!), is a more contemporary design and it can now hold approximately 1,500 books. This is many times larger than the original 200 titles of the original Kindle and there are up to 230,000 titles to choose from the Amazon Kindle Shop.

The most interesting development is the new Text to Speech feature which can read any book to you in one of three speech rates, and in either a male or female voice.

Sadly the Kindle 2 is still only available in the US. Over here we just have the Sony Reader eBook which can have just 160 books and is exclusive to Waterstones or the iRex Iliad which at £449 is a great incentive to continue to buy the “real” thing.

So when will we see the Kindle 2 in the UK? It is suggested that the problem lies with tying up deals with mobile operators or maybe it’s a problem of translating all those 230,000 titles from American into the Queen’s English. Whatever the reason, when it eventually arrives the ebook will become a definite “must have”. Interestingly, Google is also reported to be offering a browser tool running on Android, Google’s mobile OS, that allows you to read books via your Android enable mobile. It can’t be long before a Android enable ebook emerges, then the ebook market will be a little more dramatic.