Analysis – Page 3 – Digital-Lifestyles

$8Bn US Ad Income At Risk From PVRs: JupiterResearch

JupiterResearch have released research that indicates that 53 percent of Digital Video Recorder (DVR)/PVR users in America have used their DVRs to skip commercials.

Amazing isn’t it? What are the other 47% doing? Have they still left the DVR in the box, yet to plug it in? Why would anyone with a DVR not want to skip through the adverts unless they weren’t in the room; had some medical condition where they weren’t able to operate the remote control; didn’t know that they could skip through adverts; worked in the advertising industry and loved it so much they wanted to see all of the advert possible; were asleep while watching TV (this is likely given the quality of what’s shown); or a handful of other implausible reasons?

Jupiter claim that there’s a potential to threaten $8 billion out of the $74 billion US TV advertising market. This is like being at the birth of TiVo all over again – but this time for the people who weren’t there/listening/believing the first time.

Quick recap on events last time – the TV companies, advertising agencies and anyone else with a vested interest then poo-poo the idea, saying it will never catch on. You may even remember some later research from Sky TV in the UK laughably saying that their research found that people watched more adverts when using their Sky+. Yes you read that right, more adverts. Clearly it was designed to stop mass panic among their many advertisers.

Now where we’re united with Jupiter is that people watch more TV when they’ve got a DVR. That is the experience of the vast majority of PVR/DVR users.

Their report The DVR Dilemma: Managing Consumer Behavior found that the ad-skippers watched 18 hours of television, over the normal 17 of the DVR-less. Given they’re skipping the adverts, chopping around 15-20 mins of adverts out per hours, that’s a considerable amount of more ‘entertainment.’

Is it likely that the advertising world will come back and deny it again? Probably not, just you can never tell with those wiley old birds can you? I’d expect some sort of counter spin.

The DVR Dilemma Managing Consumer Behavior: JupiterResearch

RFID: Government Too Shambolic To Spy

The “wireless tag” business isn’t just for tracking prisoners out on probation: it’s also for tagging holidaymakers and train travellers.

So the news that you can hack a computer system by embedding a virus into an RFID tag wasn’t welcome in RFID circles, and the news that people at Great Wolf Resorts are tagging themselves on purpose, was, very welcome, indeed.

The problem with RFID tags is unlikely to be hacking. The exploit, unveiled by Dutch researchers, worked. Researchers at the science faculty of the Free University of Amsterdam put unexpected data into a tag, which caused a buffer over-run when the system read it.

The RFID industry responded with some optimistic explanations of why it won’t work in real life, including the suggestion that “some tags aren’t rewriteable, so it can’t happen” and (more impressively) “a well designed system would trap that hack.”

The idea that an RFID scanning system would be safe if it expected only permanent tags, is exactly the problem that the Dutch researchers were exposing, of course. The true tag may be read-only; but there’s nothing to stop a hacker producing a phoney tag that matches the signature of the real one. And the problem is exactly the expectation of the system designer. A complacent designer says: “There’s no way these tags can compromise the system, therefore we don’t have to set checks” while the competent designer says: “Who knows what random data might get in? – let’s design this system to be secure!”

Now that the theoretical insecurity is exposed, says AIM Global (the industry body that promotes RFID), systems will be secure. That sounds right.

But the problem with RFID isn’t what most people think. All sorts of scare stories have been printed, based on the idea that if you have an RFID tag, someone can track you as you move around the city.

This story comes from the way the tags work. They have no power, these tags; instead, they are activated by a coil, picking up power from the activator. Most people in London will be familiar with these: the entrance to every Tube station now has the yellow Oyster “touch in, touch out” sensor, which activates the tag in your card, and updates it.

The theory is that the tag will only get enough power to start transmitting if it is within a couple of centimetres of the activator. However, it’s been shown that you can use a focused beam to trigger the tag from a considerable distance – several metres, for sure, and perhaps several dozen metres.

Equally, you can read them from further away than the spec suggests. All you need is a particularly sensitive receiver.

The risk to civil liberties may be imaginary, as you can quickly see from the trouble prison officials are having with tagging of criminals. Putting a tag on someone’s wrist or ankle is easy enough, but reading it requires two essential steps. First, the tag has to be there (people have been merrily removing their tags so as to go out to the pub after curfew!) and next, it has to be unshielded. A simple aluminium foil shield around the tag, and it becomes invisible.

The Grand Wolf tags work on the assumption that people want to be tagged in and out of the holiday centre, so that they don’t have to be searched. Try using the same technology for tracking a prisoner on probation, and the system quickly falls apart.

What would work, would be a system which constantly monitored where the tag was, and was embedded into the skin (as with Professor Kevin “Cyborg” Warwick of Reading University, who wore a dog tag for a week) or into a tooth – so that if the user shielded it, it would instantly vanish from the map, causing an alarm. It would work – but it would require thousands and thousands of activators, all working at long distance, everywhere the user was likely to go.

The Oyster system for London Underground is to be extended so that it works on UK railways generally. That will show where the real problems are – and as any Oyster user will tell you, they are already baffling Transport For London. Travellers find that their cards beep at them as they go through the gates, saying “Seek Assistance!” – but when they present them at the ticket office, the staff say “Nothing wrong, go away.”

Clearly, there is something wrong. Clearly, the complexity of the system is too great for unskilled staff to diagnose faults. That’s where RFID opponents ought to focus their concerns – not on imaginary Sci-Fi scenarios with Big Brother spies and dog-tags under the skin, but on simple systems management.

Usability is far harder to get right than people think.

Brain Response Altered By Violent Video Games Claim

Study Claim Links Video Games To Violence The New Scientist is reporting that US researchers have discovered a brain mechanism that may link violent computer games with aggression.

Although not conclusive, the study suggests a causal link between virtual and real world aggression.

Previous studies have concluded that violent video game players are “more aggressive, more likely to commit violent crimes, and less likely to help others”, but critics argue that this just shows that violent people gravitate towards violent games, so the games aren’t responsible for turning little Timmy into Ivan the Terrible.

A team led by Psychologist Bruce Bartholow from the University of Missouri-Columbia discovered that fraggers show diminished brain responses to images of real-life violence, such as gun attacks, but not to other emotionally disturbing pictures, such as those of dead animals, or sick children.

Study Claim Links Video Games To Violence Bartholow argues that this reduction in response is correlated with aggressive behaviour.

Employing technology so advanced that mere mortals wouldn’t even know how to plug it in, the team measured a brain activity called the P300 response, which is the characteristic signal seen in an EEG (electroencephalogram) recording of brain waves as we see an image (like us, you already knew that, didn’t you?)

This P300 response whats-it reflects an evaluation of the emotional content of an image, so the bigger the response, the more people are surprised or disturbed by an image. Novel scenes also register a big response.

Study Claim Links Video Games To Violence The team shipped in a crew of 39 gamers, and quizzed them on the amount of violent games they played, before being shown a series of neutral images interspersed with occasional violent or negative (but non-violent) scenes, while sensors recorded their EEGs.

The full-on fraggers with the most experience of violent games were then found to register a smaller and delayed P300 response to the violent images.

“People who play a lot of violent video games didn’t see them as much different from neutral,” says Bartholow, with the research finding that although desensitised to such scenes, their responses were still normal for the non-violent negative scenes.

Although this may not exactly be big news – video games have been used to desensitise soldiers to scenes of war – players with the greatest reduction in P300 brain responses were found to dish out the severest “punishments” against fake opponents in another game.

Study Claim Links Video Games To Violence Throughout the tests, the violent games experience and P300 response were still strongly correlated with aggressiveness.

“As far as I’m aware, this is the first study to show that exposure to violent games has effects on the brain that predict aggressive behaviour,” says Bartholow.

Not everyone is convinced though, with Jonathan Freedman, a psychologist from the University of Toronto commenting, “We habituate to any kind of stimulus. All we are really getting is desensitisation to images. There’s no way to show that this relates to real-life aggression.”

Study Claims Links Video Games To Violence Freeman also added that stopping people playing violent video games would be like banning them from playing sports such as football or hockey.

The work will appear early in 2006 in the Journal of Experimental Social Psychology.

New Scientist

Satellite Business Joins The Niche Club

The Legacy of Arthur C. Clarke, Review: IEE Lecture

Satellite Business Joins The Niche Club Yesterday evening saw a celebration of The Legacy of Arthur C Clarke at the IEE in London.

Rightly so. His fame not only stretched across the globe, it spanned fathering the communication satellite, to great fiction. Who can forget the seminal Sci-Fi classic 2001- A Space Odyssey?

During the addresses given by the assembled industry heavyweights, pontification was rife as they pronounced on the effect of satellite technology advances and where the industry stood in the communication world today.

To boil it down – satellites would be an important part of the communications mix, but it was unlikely to be as dominant as it was once thought.

Getting stuck right in was Olof Lumberg, formerly Chairman of Inmarsat, remarking on how the cabling of the planet was making some uses of Satellite technology passé.

Seeing quite how far Skype is disrupting businesses was interesting as key figures from the satellite industry noted that customer expectations brought about by Skype and similar VoIP technology had meant that the business model that ‘costs in’ the launching of huge satellites was becoming increasingly redundant.

Satellite Business Joins The Niche Club Professor Barry Evans of the University of Surrey considered the 1980’s and 90’s were probably the golden age for communication satellites and predicted their future as an infill technology. Working alongside terrestrial delivery systems, with the possibility of satellite providing TV connectivity to mobile devices outside the fibred home.

Marcus Bicknell, Commercial Director of SES Global the satellite giant spoke about the importance of niche markets and revealed a new low cost satellite mobile phone designed to help parents locate their children.

Some were more optimistic. Sir Martin Sweeting, who heads Surrey Space Technology, a world leader in small satellite development, saw a future with far less expensive launches. This could lead to the creation of ’clouds of small deployable satellites,’ configurable to provide focused communication at times of disasters.

Happily it wasn’t all business predictions. Arthur C Clarke’s brother Frederick spoke charmingly about his brothers’ early enthusiasm in looking at the skies.

The crowning glory of the night was a recorded message from Arthur C Clarke himself, from his home in Sri Lanka. Projected onto a large screen at the grand, historic setting of Savoy Place, home of the IEE, Clarke’s lucid speech belied his eighty-eighth birthday, only a few day away.

Reassuring to hear that his commitment to technology remains.

IEE – Institution of Electrical Engineers

Analysis: Cisco Looks to Own Consumer IPTV

For a long time, Cisco was only focused on high-end corporate sales. This started to change with its acquisition spree. Back In June 2003 it acquired Linksysin order to attack the home and small business markets.

Under the Cisco banner, Linksys have madefurther acquisitions, including Kiss Technologies whoproduce DVD and media streaming solutions (at the higher end of the consumermarket).

Now Cisco have acquired Scientific Atlanta (SA), a massive company, who make set-top-boxes (STBs)mainly for cable companies, but more recently in the IPTV space (i.e.they have an Ethernet connection and video out/SCART socket or equivalent).

IPTV the future of TV
It’s now widely agreed that the future of broadband is what’s known as triple-play (the combinationof Internet, voice and video). In the past, cable companies have held avirtual monopoly on this market as CATV (cable TV) was the only technology thatcould deliver the bandwidths needed. However with the advent of new DSL (DigitalSubscriber Lines) technologies such as ADSL2+, they too can be usedto deliver triple-plays.

Cisco and SA Converge DSL is much cheaper to install as it uses existing phone cabling, ratherthan CATV which requires digging up the road, installing fibre tothe street and co-axial cable to the home (this may not be true forgreenfield sites, but in countries with existing infrastructure likethe UK it is).

In Europe, IPTV is starting to take off in a big way, broadband pricesare plummeting as operators offer the basic services for very low cost,hoping customers will take premium services.

In the UK, Sky acquired Easynet (a local loop unbundler) and they aregoing to launch an IPTV service next year (possibly more).

Cisco has a lot of clever people working there and as has seen the market grow. Now they want theirpiece of the pie. Hence the SA purchase.

Core networks
It’s not like IPTV is new to Cisco. They’ve have had an IPTV solution for several years, but theirs was aimed atthe enterprise customer (i.e. big businesses).

Cisco’s core business is, and will continue to be, selling high-endnetwork equipment to the telecoms and cable companies, ISPs, etc. All of this high-end network equipment can be IPTV-enabled.

Though Cisco have bought Scientific Atlanta, who manufacture the consumerpiece of the puzzle, by expanding the consumer take-up of IPTV they arealso expanding the core network business. Don’t forget, running IPTV servicesrequires a lot of investment in network infrastructure i.e. moreCisco kit.

Cisco are coming close to becoming a fully horizontally integrated company. After the SA purchase, there’s only a few bits missing. The actual content creation, which we think it is highly unlikely to get into – it’s far too messy, involves troublesome humans and is an unknown to them.

The other is the content encoding/delivery part. Who knows, that maybe another acquisition on Cisco’s horizon?

Cisco

Search Engines Challenge Email As Most Popular Web Activity

Using search engines has become the second most popular activity for Web users, according to new research from the Pew Internet & American Life Project.

The figures put search engines second only to email as the numero uno Net application, with reading the news registering as the third most popular Web activity.

The research reveals that an average 41 per cent of Web-connected Americans use search engines on a typical day, a sharp 55 percent rise from the middle of 2004.

In numbers, this equates to a jump from 38 million daily search engine users in June 2004 to around 59 million users in September, 2005.

As expected, email remains the Web’s major attraction, with 52 per cent of Americans checking mail on any given day, up 45 per cent from June last year.

The Pew project looked into the demographics of Web users and discovered that those spending the most time on search engines tended to be in their 30s and well-off.

‘Gen X’ surfers (29-40 year olds, not the Billy Idol-fronted band) were online the most (51 per cent), followed by ‘Gen Y’ users (18-28 year olds), ‘Older Baby Boomers’ (51-59 yrs old), ‘Younger Baby Boomers’ (41-50), ‘Matures’ (60-69) and, finally ‘After work’ (70+). We wonder who makes up these daft categories?

The report commented, “Those who use search engines on an average day tend to be heavy Internet users. They are much more likely to have broadband connections than dial-up connections; to log on to the Internet several times a day; and to have spent considerable time online during the day.”

With Google recently claiming to have trebled its index of 8bn pages and Yahoo! claiming 19.2bn pages, it’s not surprising that the search engines are getting a hammering.

What is interesting, however, is the rise in people searching using ‘local’ qualifiers, like postcodes or addresses, to narrow down their search results.

Google still rules supreme as the king of the Web search tools, registering 43.7 per cent of local searches, with Yahoo! lording it over Internet Yellow Page search sites (where users type in data such as location and business type) with 27.6 per cent of searches.

Pew Internet & American Life Project report [PDF]

Possible Impact Of Sky Buying EasyNet

Possible Impact Of Sky Buying EasyNet Sky have been mulling about an IPTV service for a while. They were in discussions with THUS who provide the telecoms back-end for their SkyTalk service and helped Sky with their WapTV services, they were talking about doing an IPTV trial with THUS, but THUS pulled out of the LLU arena due to lack of cash. They were looking at spending £20m+ on just a trial.

Though Sky have 7.3m+ subscribers, they estimate around 20% of households (in the coverage) areas cant get Sky due to dish or coverage problems (including multi-tennant buildings). City centres tend to be problematic due to high buildings obscuring the satellites. There’s also a major problem if the building is in anyway listed.

Possible Impact Of Sky Buying EasyNet Sky have got the resources to bolster a depressed telecoms market and put the necessary cash into a company to achieve a reasonable roll-out. Of course they also have the content that consumers want. If another “triple-play” broadband provider wants to get into the game (including BT Retail), Sky can make it very difficult for them by not licensing Sky content (of course Ofcom may force them to, as they have done in the cable industry).

Sky have also been talking to other high-speed broadband providers such as Be who also want to offer a triple-play.

If Sky do purchase Easynet, it’s likely they’ll move all their telecoms and Internet activities to them too, which will put THUS in a difficult position as a large ammount of corporate revenue comes from the Sky account.

Possible Impact Of Sky Buying EasyNet Sky are also in an odd position as they’ll probably utilise MPEG-4 as the coding system, which means they’ll have to modify (or supplement) their existing transmission systems which are all based on MPEG-2. They’ll also have to introduce a new IP based set-top-box. However they’ll have to be carefull as to not make it too feature rich compared to existing STB’s used to decode the satellite transmissions or existing users will want to migrate to the broadband version – which will cost Sky a huge ammount as the exisitng boxes are considerably subsidised.

Whatever route they go, Sky moving into triple-play will have a major impact on broadband and LLU in the UK.

The Genius of eBay Buying Skype

The Genius of eBay Buying Skype Meg Whitman, CEO of eBay appears to be justifying eBay’s decision to purchase Skype.

There’s been much talk that eBay overpaid for Skype, at $4.1Bn if they hit earnings targets.

My view is that they actually got a bargain.

Meg Whitman is right that “in the end, the price that anyone can provide for voice transmission on the ‘Net will trend toward zero,” and she sees that happening “in the next three to six years.” I’m assuming that she means all phone calls, as Net-based calls are currently free and it would be very worrying if she didn’t know that already.

With Skype, they’ve bought the biggest name in VoIP. Not just software-based VoIP (which Skype currently is), but all VoIP.

Whitman’s view? “Our belief is that the winner in this space will be those that have the largest ecosystem. What I mean by that is: the largest number of registered users, the largest number of voice minutes, the largest number of developers who develop the platform, the best product … that users are willing and want to pay for.”

I’ve always admired the genius of Skype, building a telecoms company, the equivalent of BT’s or AT&T’s retail business, but with a near-zero infrastructure cost to them – certainly zero compared with either of the previously named giants. Skype simply piggy-backed on their expenditure.

When I put this to Niklas Zennstrom, Skype’s CEO, as I interviewed him in the build-up VON in Stockholm, he smiled wryly. He’s good at that.

While Vonage went the route of building IBM, needing hardware where it was installed, Skype went the Microsoft route, software. We all know who won there.

Skype knew that the hardware would follow as their user numbers became irresistible. Cleverly they would take license fees from the hardware producer, while making their service more attractive.

The Genius of eBay Buying Skype ___What does eBay add?
Well there’s the obvious reasons …

They’ve got huge amounts of cash, as eBay is so profitable, clearly useful, but in the grand scheme of things, so what?

More interestingly they’ve got 168.1m registered users, ideal to grow Skype’s currently 57m registered users.

As I commented at the start of September, eBay’s interest

reflects the company’s quest for new product categories and international markets, or they could integrate Skype into the service, offering purchaser and seller to talk to each other. Another option could be to use Skype’s ability to host group discussions as a way of strengthening communities with the same interests.

This is all good for the short to middle term, growing Skype’s acceptance.

__The killer
I think the killer is slightly further out.

To set the scene – keep in your mind Vodafone, but more abstracted.

eBay own the ‘network’ through Skype.

Skype is a strong brand, with people already talking about Skyping each other. OK, currently it’s not global like Vodafone, but add a bucket-load of eBay cash and that’ll change.

That in itself is strong.

Here comes the interesting part. Search on eBay today for ‘Skype‘ and it brings up 1215 1310 items, mostly USB handsets.

We’ve been watching the market in these add-ons, and have even reviewed a few of them. This market is at a very early stage, but already, we’re seeing design applied to some of these.

When Skype goes beyond being implemented on PocketPC’s it will work without the underlying Operating System. Becomes embedded and significantly cheaper.

What pops out of the end of this is a low-cost mobile handset that speaks a number of wireless protocols and when combined with paid for or free WiFi access (which will be everywhere by then), gives you a serious competitor to a mobile phone.

Hell, eBay/Skype could even create a reference designs or two.

eBay will be in a fantastic position of sitting between the handset makers and the public. Like a global ‘phone shop’ for these devices – collecting a commission for each handset sold – without the shop, stock, support or after-sales care.

It may be that eBay haven’t thinking along these lines, but I’d you’d have to doubt it given the amount of money they’d spent on it.

Update: I’ve not had time to read all around the comments on Skype since the deal, but following writing this, I found an excellent blog on it by Mark Evans. I’d heartily recommend it.

Silver Surfers Send Sales Soaring

Silver Surfers Send Sales Soaring The UK market for online shopping looks set to soar to £60 billion (~€88 billion, US$108 billion~) by 2010 according to a new report.

Research carried out by The Future Foundation for The Air Miles Travel Company claims that within five years 20% of all retail spending could be generated by items bought over the trusty Internet

The report also highlights the growth of silver surfers – old ‘uns aged between 55 and 64 – a demographic traditionally ignored by e-tailers.

According to the report, nearly two-thirds of people heading for retirement are currently clicking away on the web – up from only a third in 2001.

These figures suggest a silver surfer shopping boom is only five years away as there’s traditionally a two to six year delay between first using the Internet and whipping out the wallet online.

James Roper, chief executive of industry body for global e-retailing IMRG, warned that companies assuming that online shopping is only young hipsters could be restricting their growth.

“It’s essential for company growth to invest in this older online shopper,” he added.

Silver Surfers Send Sales Soaring The Future Foundation commented that websites sporting yoof-orientated design, teensy weensy text and kray-zee interfaces are likely to miss out on silver surfer sales.

Instead, the report stressed the importance of creating accessible sites with clear navigation, letting age-challenged users unleash their pensions and Spend! Spend! Spend!

Internet shopping continues to increase overall, with nearly 40% of people in the UK spending online during the past six months – up 100% from three years ago.

“Today’s online shopping market is certainly booming and is set to evolve dramatically over the next five years,” said Michael Wilmott, chief executive and head futurologist at the Foundation.

“If current trends continue, the proportion of Internet users among the general population could be as high as 85% by 2010 – with a whopping 80% of people shopping online.”

The Future Foundation

Half Of UK Children Have Shopped Online

Half Of UK Children Have Shopped Online New research from UK High Street bank Halifax reveals that over half of children between the ages of seven to sixteen years old have bought something over the Internet.

Boys are particularly keen on Web shopping with over 60% saying that they’ve bought items over the Internet.

The bank’s survey found that some 53% of young people are Internet shoppers (up 10% from 43% in 2004) with Scottish lads and lassies coming out as the keenest Web shoppers, with 80% buying items over the internet.

The East Midlands region came bottom of the Internet shopping league with only 36% of young people in the area shopping online.

Boys continue to buy more goods over the Internet than girls, with this year’s figures – 60% boys compared to just 46% of girls – continuing last year’s trend where the figures were 50% and 37% respectively.

Half Of UK Children Have Shopped Online Not surprisingly, age plays a big part in who gets to shop online with less than a third of seven to eleven year olds (29%) clicking and buying compared to almost three quarters of twelve to sixteen year olds (73%).

More than half of all kids interviewed believed that Internet shopping is, like, waaaaaay better to shopping on the high street with 61% finding it easier to buy online rather than in shops for certain items.

Music, DVDs and electronic equipment are the biggest attractions online with kids spending their hard-earned ~~extortion racket earnings~~, ~~petty theft cash~~, pocket money on CDs (45%), computer games/equipment (45%) and DVDs/videos (43%).

Halifax