Wireless Internet Soars Nearly 30% – Ipsos Insight Report

Wireless Internet Access Soars Nearly 30% In 2004The number of wireless Internet users grew by 29% in 2004 according to a recent research study by Ipsos Insight.

The study estimates that 171 million people, or 44% of Internet users in the measured markets, have accessed the Internet wirelessly.

The wireless population growth was largely driven by the two biggest Internet markets, the US and Japan, fuelling 69% of user increase and adding an estimated 15 million and 11.6 million new wireless Internet users, respectively.

Wireless Internet also gained some popularity in Western Europe, South Korea, and Urban China.

Surprisingly, it wasn’t the growth in Wi-Fi enabled laptops leading the charge, but consumers accessing the Internet through their mobile phones.

In Japan, for instance, where wireless Internet, laptop, and mobile phone prevalence is highest, twice as many adults (59%) have accessed the Internet through a mobile device such as a mobile phone than have used a wireless laptop connection (28%).

Similarly, outside of North America, Germany, and Urban Mexico, mobile devices like mobile phones are propelling wireless Internet use.

This reflects the belief that mobile phones have reached a turning point, evolving from primarily a voice communication device to a popular multimedia tool encompassing data and Internet applications.

Although SMS may have been the growth vehicle for non-voice applications on a mobile phone in recent years, the survey predicts Internet-based applications are the ‘wave of the future’.

The survey discovered that one in three mobile phone households (estimated 175 million) have exchanged email via mobile phone, with one in four (estimated 124 million) using their handsets to browse the Internet.

Wireless Internet Access Soars Nearly 30% In 2004A similar percentage of users have exchanged digital image and videos over their mobiles.

With the exception of SMS and ring tone download activity, 2004 saw a year-over-year increase in wireless activities across the board, with email usage growing by 21% and the nascent market of mobile commerce growing by 60%.

Said Brian Cruikshank, Senior VP of Ipsos-Insight and co-author of the study: “These developments are indicative of an early adoption of multimedia and transaction-based activity through a mobile device. As smart-card technology handsets are introduced in many markets, transaction-based activity will be yet another frontier driving data connectivity and ARPU in the next three-to-five years.”

Ipsos predicts that 2005 will be a ‘spring board year’ for wireless Internet via a mobile phone, with uptake encouraged by cheaper 3G coverage offering more mass market services.

“The mobile phone is the most prevalent global device. The continued adoption of the Internet and the recent launch of advanced mobile networks will no doubt lead to a greater number of people connecting to the Internet through a mobile phone.

In fact, we feel that wireless Internet connection via a mobile phone may indeed become the predominant and, perhaps, only point of connection for many in the developing parts of the world, akin to the technology jump from wired to wireless voice communication,” said Cruikshank.

Ipos Insight

IP Over Satellite Standard Gets ETSI Approval

IP Over Satellite Standard Gets ETSI ApprovalSatellite broadband services should become a lot easier to implement with the adoption of the first broadband satellite standard on both sides of the Atlantic.

The transatlantic agreement sees both the US-based Telecommunication Industry Association (TIA) and the European Telecommunications Standards Institute (ETSI) adopting the Internet Protocol over Satellite (IPOS) standard.

Satellite data links are an important alternative to wired links in poorly connected rural areas or for business operations that like to regularly shuffle about to new locations.

IPOS-based equipment and software used to build satellite broadband will now be available from a variety of companies who support the standard, including Hughes Network Systems, Microelectronics Technology, Texas Instruments, TriQuint Semiconductor, Wind River Software, Intelsat and Telefonica.

“Now ratified and approved by the two major standards bodies, IPoS opens the door for greater optimisation and economies of scale throughout the satellite industry,” said Pradman Kaul, chief executive officer of Hughes Network Systems.

“IPoS is the only air interface specifically designed for the efficient delivery of broadband satellite services and offers the best means to expand satellite’s addressable markets worldwide.”

“The IPoS standard is extensively field proven, highly scalable and supports low-cost terminals. Now approved by both governing bodies, widespread adoption of the IPoS will further reduce equipment costs and make broadband available and affordable to many more users worldwide,” said Enrique Salvatierra, director of Satellite and Submarine Cables Department, Telefonica de Espana.

IPoS works by specifying a Satellite Independent Service Access Point, which creates an interface between the satellite-dependent functions and the application layers, thereby enabling an open service delivery platform.

To date, the standard has been implemented in over 500,000 sites worldwide.

IP Over Satellite Standard Gets ETSI Approval“Intelsat meets the connectivity requirements of some of the largest telecommunications service providers worldwide,” said Frederick Morris, vice president of Intelsat.

“These companies frequently turn to us for unbiased assessment of satellite broadband technologies available to their end-customers, and having standards like IPoS makes this process easier. We heartily endorse any effort to spread standardisation throughout the satellite broadband service industry.”

IPOS will be competing against the likes of WiMAX in the fixed broadband wireless market. WiMAX trials have already been started by AT&T at companies in the US and Europe is expected to experience the first WiMAX services from providers next year.

Telecommunications Industry Association
European Telecommunications Standards Institute

ASA Reports Bulldog DSL Not “The Ultimate Broadband Experience”

ASA Reports On Broadband Advert By BulldogThe Advertising Standards Authority (ASA) has dished out a mixed ruling on a complaint about claims made by Bulldog (owned by Cable & Wireless) for its 4Mbps broadband service.

Three complaints were made, but only in one instance was the complaint upheld. The challenged statements were:

  1. “the ultimate broadband experience”
  2. “the peak of speed”
  3. “makes other broadband services look like dial-up”.

The ASA ruled that Bulldog’s claim that it offered the ‘ultimate broadband experience’ was misleading, but conceded that Bulldog was entitled to say it offered ‘the peak of speed’ and that it ‘makes other broadband services look like dial-up’ – at the time of the advert.

The company’s online promotion, run last summer, bigged up their services like Mohammed Ali in a boasting mood: ‘It’s the ultimate broadband experience. Makes other broadband services look like dial-up. … Bulldog 4 gives customers in central London the peak of speed and value.’

The ASA ruled that, at the time, it was not accurate to say that the service was the ultimate broadband experience, although it was the fastest available and Bulldog had been named Best Consumer Broadband ISP 2004 in the industry’s awards.

Bulldog seems to have become unstuck by the success of their own advertising, with customers instantly clambering for a piece of the ‘ultimate broadband experience’.

The rapid increase in customer numbers following the launch of the service significantly affected service quality, and complaints started to roll in.

The ASA ruled: ‘the severe customer service difficulties that all Bulldog customers had experienced after the appearance of the online advertisement and the significantly reduced speeds some Bulldog 4 customers had experienced meant the claim that the advertiser’s service offered “the ultimate broadband experience” was likely to mislead.’

Interestingly, the ASA said that much of the evidence for the poor service had come from Web forum discussions – and they confirm that this is the first time they’ve used this type of input.

Despite all the online moaning and service difficulties, the ASA ruled that Bulldog was still entitled to say that its service offered ‘the peak of broadband speeds’, as ‘many Bulldog 4 customers had benefited from the full speed 4Mbps service.’

The ASA concluded that, ‘because the advertisers were able to offer 4Mbps broadband, which was the fastest home broadband service available at the time, the advertisement appeared, the claim was justified.’

How times have changed. From August to 8Mbit from UK online.

The ASA also agreed with Bulldog’s assessment that, ‘if the starting point for broadband was 512kbps, it was approximately 10 times the speed of standard dial-up; the Bulldog 4Mbps connection was eight times the speed of a 512kbps connection’.

In other words, it agreed that that it was fair to say that Bulldog 4 made other broadband services ‘look like dial-up’.

The ASA continued with this Olympic-length sentence (take a deep breath before proceeding):

The Authority acknowledged the claim was likely to be seen by consumers as an expression of the advertisers” opinion about their services, but nevertheless considered that the severe customer service difficulties that all Bulldog customers had experienced after the appearance of the online advertisement and the significantly reduced speeds some Bulldog 4 customers had experienced meant the claim that the advertisers” service offered “the ultimate broadband experience” was likely to mislead.

The Authority asked the advertisers not to promise a service standard that could not be provided in future advertisements.

The lessons to be learnt for both Bulldog and other ISPs is that you’ve got to be able to walk the talk and ensure that you have the resources to cope with the results of your advertising campaigns.

Bulldog Broadband

HomeChoice VoD Hits 15,000 Subs, Reach Doubles to 2.4m

HomeChoice STBVideo Networks Ltd (VNL) has announced that it’s broadband and Video on Demand (VoD) service, HomeChoice, now has 15,000 subscribers, since its relaunch in last September.

Eight in ten of their customers have also signed up to the company’s ‘triple play’ package that consists of broadband-delivered TV, broadband and voice calls.

It’s also taking this opportunity to announce that it’s going to be doubling the number of homes it can reach to 2.4 million in London and the Stevenage area, up from 1.2 million.

The VoD component of HomeChoice lets subscribers choose from over 1,000 movies, over 3000 music videos and hundreds of hit TV series, all available to watch exactly when you want.

“The concept of broadband delivered TV and VoD is very new to the entertainment-buying public and to already have 20 per cent market share of new DSL subscribers in our coverage area so soon after our launch is a great achievement. This gives us the confidence to significantly expand our network”, said Roger Lynch, Chairman and CEO VNL Ltd.

VNL initially made inroads into launching its phase 2 footprint in December 2004 when it enabled five new exchanges, including Stevenage – its first exchange outside of the M25. By ‘unbundling’ the exchange, called LLU (Local Loop Unbundling) in the trade, Homechoice is able to provide customers with a 6.5Mbit connection. 2.5Mb are used for TV and VoD delivery, and up to 4Mbit for Internet connection.

The company’s major marketing push for the re-launched HomeChoice service began in September 2004. During Q4 of 2004, VNL was responsible for one in five new DSL net additions in its initial launch footprint of 1.2 million homes.

The company has continued to build on what it offer its subscribers. In August last year, HomeChoice signed a retail deal with BSkyB enabling its subscribers to watch Sky Sports and selected Sky Movies channels on the service. It has also added telephony to its offering, and is about to launch a music download service that will allow HomeChoice customers to buy downloadable music tracks as they appear on screen. It also plans to double the speed of its broadband service from February, at no extra cost: 512Kbps will raise to 1Mb, 1Mbps to 2Mbps, and 2Mbps to 4Mbps.

HomeChoice

Music Download Giant Napster Considers Film Service

napster provide filmNapster, one of the largest players in music downloads, is considering offering a film download service. The new service would sit alongside its music offering and help to give the company a competitive edge over its rivals. The technology is already in place to download movies, so the same service model could easily apply to films, television programmes and video games, now that broadband connection speeds are getting faster and more prevalent.

In a move targeted at the younger video-game generation, Napster won’t be the first company to enter the legal movie download market. In the US, MovieLink and CinemaNow are already offering a service to a growing customer base in America. Films on these sites start at around $2.99 (£1.59 Euro 2.29). However, similar to the music industry five years ago, the film industry is struggling to keep piracy at bay with technologies that allow movies to be downloaded quickly and in full to users with high-speed Internet connections. The Motion Picture Association of America has already filed lawsuits against pirates and is cracking down on distribution networks such as eDonkey and BitTorrent.

Regardless, legal film downloads will be a winner and are the future – just like audio downloads. Since broadband, film downloads have surged considerably, and around one in four people online have now downloaded a film, according to the MPAA. Such statistics have encouraged Napster and others to keep an eye on the market.

Since Christmas, Napster UK has reduced the price of its entire music catalogue of over 1 million tracks by 20 per cent. In response to record sales, the more aggressive pricing strategy will mean that full albums now cost £7.95 (US$14.89 Euro 11.43), while individual tracks cost 79p (US$1.48 Euro 1.14) when bought by Napster subscribers or purchased with Napster Pre-Paid Cards and Online Music Vouchers. Pricing for movies has yet to be announced, but it’s obvious they’ll have to be a lot cheaper than the latest DVDs for the service to takeoff.

Napster – UK
Napster – USA
MPAA

HomeChoice Doubles Broadband Speeds, Free

HomeChoice STBVideo Networks Ltd (VNL), who run the UK VOD service, HomeChoice, will be doubling the speed of their broadband service from 1st February, at no extra cost.

512Kbps will raise to 1Mb, 1Mbps to 2Mbps and 2Mbps to 4Mbps.

Last week the two UK cable companies, ntl and Telewest, announced they would be offering Video on Demand (VoD) in the UK over their existing connections. They both offer broadband services at a range of speeds, but they are generally distinct from the TV services which are available at extra cost, except from occasional special offer bundles.

Currently ntl offer “broadband” at 300Kbps (arguable if this is broadband), 750Kb and 1.5Mbps (£37.99/month (~€57.50, ~$75). Telewest offer broadband only services (blueyonder) between 256Kbps and 4Mbps, with the top package being £50/month (~€72, ~$94). As these prices don’t include the TV services, they also won’t include VoD, when it gets rolled out.

The HomeChoice offering is delivered over a telephone line and includes the TV service; VoD; free evening and weekend phone calls; as well as higher speed broadband connections with their base level service now being 1Mbps. Their 4Mbps service is priced at #45/month (~€65, ~$85).

Roger Lynch, Chairman & CEO, Video Networks Ltd. said: “Video Networks is constantly looking for ways it can enhance its current suite of services to continue to provide a superb customer experience.”

It’s taken long enough for competition to arrive in the UK, but it finally appears to be taking root. For the UK consumer, this is all good news, as competing providers clamour to offer better deals to woo subscribers.

HomeChoice is currently available to over 1.4 million homes around London. VNL have stated that they want to expand their offering beyond London, although details are not yet public.

Existing HomeChoice customers will be notified of the automatic speed upgrades from 24th January via direct mail.

HomeChoice

ntl On Demand Brings VOD to Glasgow

ntl VOD BBC Pick of the weekToday ntl turned on its much-anticipated Video On Demand (VOD) service in Glasgow.

Accessible to all Glaswegian ntl subscribers who have the digital TV service, it features free and paid for content including advertiser-free children’s programmes, a ‘Pick of the Week’ option showing a selection of top shows from the previous seven days, a film service, a music video jukebox service, and adult content.

No new equipment is needed at the subscriber’s house, as the software in their current Set Top Box (STB) is automatically updated.

The content is accessed either by pressing the On Demand button on the remote control or by pressing the Red button while watching one of the promotional channels.

The Pick of the Week channel will be provided by the BBC in a six month initial trial. The editorial decision of what is included will rest with the BBC, and it’s expected that a range of shows will be available, including favourites (not ours) such as Eastenders. Each show will be available for seven days from its transmission and it’ll be free to access.

The viewer will have the option to pay for content too, giving then 24 hours access to the content. The cost of the items will be added to their monthly bill.

The film service is supplied by FilmFlex, a separate company run by On Demand Management in a joint venture with Sony and Disney, with “Hundreds of titles, current and classic” films available from 50p to £2. Out of general interest, On Demand applied for the FilmFlex trade mark back in September 2004.

Over 30 hours of Children’s advertiser-free programming is on offer for 20p-50p. Music videos can also be paid for (range 20p-£1.50) with over 35 hours available.

The high price ticket at £7 and largest number of hours of content (over 50) available goes to the Adult content supplied by Playboy.

Coincidentally, Glasgow was also the city chosen to launch ntl’s digital TV service back in May 2000. We imagine that the number of subscribers is manageably low (we did ask for actual numbers but, “this isn’t broken out”), giving ntl a chance to observe the performance of the system and gather feedback, before spreading it around the UK.

ntl are saying they plan to roll it out regionally over the UK during the next two years and all of their 1.4 million Digital TV customers will be able to receive the service. When we asked about the number of non-digital customers, we were told it was in the single percentage figures, possibly as low as 2-3%. Although asked, they decided to keep the order of the planned rollout cities to themselves.

In a statement Simon Duffy, Chief Executive Officer of ntl, said, “VOD is TV the way it’s meant to be.”

Telewest also launched a VOD service today, Homechoice have offered VOD in London and KIT have also been providing VOD in Kingston-upon-Hull for a number of years. ntl
On Demand management

Ofcom Strategic Review of Telecommunications Gets UK Parliament Inquiry

The UK House of Commons launched an inquiry into Ofcom’s Strategic Review of Telecommunications (SRT) yesterday.

Ofcom, the uber-regulator that among other things, oversees telecoms in the UK, started its SRT in January 2004. It was long overdue in the eyes of many, as it was the first comprehensive strategic review of the UK telecommunications sector for 13 years.

Now the UK House of Commons, Trade and Industry Committee will be looking into the workings and results of the SRT, in particular how it relates to the “extensiveness and competitiveness” of broadband in the UK.

The SRT is divided in to three phases; Current position and prospects for the telecommunications sector; Options for Ofcom’s strategic approach to telecommunications regulation; and Proposals; the first phase was published at the end of April.

Ofcom identified two key problems in Phase One; an unstable market structure in fixed telecoms, dominated by BT and with alternative providers that are, in the main, fragmented and of limited scale; BT’s control of the UK-wide access network hadn’t been addressed to date. They then posed some questions; primarily about the future of BT.

Phase Two was published in November 04 and used some relatively strong language (pretty diplomatic in the normal, non-Quango world), which we summarised as “Ofcom to BT: Equivalence or else”. It’s still open for public consultation until 3 February 2005.

Yesterdays announcement from the Trade and Industry Committee, said in the light of the Committee’s Report on the UK Broadband Market, the inquiry will be looking into OfCom’s STR process to date, the interim conclusions reached in the Phase Two document, and the direction of the remainder of the Review. They’ll be paying particular attention how it relates to the competitiveness of the broadband market in the UK, including local loop unbundling, and the “functional separation of British Telecom”.

A spokeperson at OfCom told us that they “had already briefed the Committee” and “welcomed their interest” in the SRT. When we asked about the previously expected Spring delivery of SRT Phase 3, we were told that they “still planned” to meet it. Frankly they were playing their cards pretty close to their chest.

We called the office of the Committee, but given the 21 enquiries they have on currently, no one was available for comment at the time of publishing the story.

If you have any view on the area covered by the Committee, they’re asking for written evidence on these or any other related issues by Friday 18 February 2005 via email ([email protected]). If you do write please CC ([email protected]) us in, we’d be interested in see the issues raised.


Alerted by OfcomWatch
Trade and Industry Select Committee
Ofcom – Strategic Review of Telecommunications

BT Wholesales 4m ADSL Connections

BT has, through its arrangement with over 150 broadband providers, delivery four million ADSL connections in the UK. This figure also includes connections sold directly to the public by BT Retail.

BT say they are connecting a new customer every 10 seconds, equating to an average of nearly 60,000 new connections each week.

The last million milestone was only back in August 2004 when three million connections were announced. A million new connections in one quarter is pretty good.

Currently there isn’t really any competition for BT Wholesale, although some companies are starting to make early moves with specialist services like UK Online.

We see this as another in the long running back and forth between BT and OFCOM. BT tells the press “No BT would equal No Broadband” (as Christopher Bland did to the Telegraph), OFCOM tells them to trim their prices. Is their any co-incidence that BT issued this news on the heals of OFCOM ordering BT to cut the cost of third party access to the customer, opening the market for strong competition for BT Wholesale?. As the Guardian commented

At the moment BT is the gatekeeper to all but 16,000 of the UK’s 25m phone lines, and charges for access to them. The telecoms operator suffered a blow six months ago when it was forced to lower the prices it charges for access to its network. Ofcom is aiming to get a system in place next year that will see 1 million lines unbundled a year.

Will BT continue to be so strong with meaningful competition?

Online Documentary Channel Planned by UK Channel 4

The Chief Exec of Channel 4, Andy Duncan, has been floating the idea of launching an Internet-based documentary channel, that would carry archive footage from previously transmitted shows.

Duncan also announced that Channel 4 is to “double the amount it spends on ‘public service’ Internet sites”, which he revealed was currently in the low millions, reported Brand Republic.

We understand from Ofcom that the comments were made during their PSP pitching day.

Andy Duncan moved from the BBC, where he was the mastermind of the highly successful Free-To-Air service, Freeview. He’s been speaking publicly a lot about re-positioning Channel 4, although not all of his comments have been well received.

When Digital Lifestyles spoke to Channel 4 today about the Internet-based channel, there were still only sketchy details available; in their words it was “work in progress.” They did confirm that new programmes would be commissioned specifically for the site and that content would be downloadable.

Channel 4 told us more details will become available in the New Year and the launch is muted for Spring 2005.

Channel 4
Ofcom