Infrastructure – Page 3 – Digital-Lifestyles

Atzio’s Peer-to-Peer Television

Atzio, a content delivery software company, have developed a form of peer-to-peer distribution for television networks. They predict that P2P will revolutionise the legitimate delivery of TV and video content via the web, whilst broadcasters like the BBC are looking at using the peer to peer technologies to make content distribution cheaper.

Atzio have combined time-shifted media with a “data swarming” mechanism to lower distribution costs – as in the P2P model, a piece of media is divided into small blocks and downloaded from multiple hosts using bandwidth from each machine’s internet connection. Using this technology, a broadcaster does not have to buy huge amounts of bandwidth as its audience effectively becomes the distribution method. A welcome side effect of this model is that, the higher the demand is for a piece of content, the easier it is to get as it will be stored in more places.

The BBC have looked at P2P, amongst other options, for the distribution of their Creative Archive and other content. P2P systems like this are ideal for distributing large files to many users, such as entire films, TV programmes or games – and can be extremely cheap as customers do the distribution for the content publisher.

Atzio’s Peer to Peer Television uses a custom client to secure content against unauthorised copying and distribution, with an integrated playback interface. The network is closed and controlled by the content provider, so unauthorised or infringing materials cannot be distributed and quality of product is assured. Users can browse a content provider’s catalogue for titles and then download them immediately (like video on demand), to a schedule (like a PVR), or add them to their wishlist for viewing much later. A system of this type could replace a DVD-by-post business model quite easily.

The network is compatible with the major DRM systems out there, including Windows, DivX and Real Networks.

How Peer to Peer Television works

David Wood, European Broadcasting Union – The IBC Digital Lifestyles Interviews

This is the fifth in a series of eight articles with some of the people involved with the Digital Lifestyles conference day at IBC2004.

We interviewed David Wood, Head of New Technology in the Technical Department of the European Broadcasting Union. David also works for the Secretary General as Head of New Media.

David has a background in electronics, television and the Arts – making him an ideal candidate for the European Broadcasting Union, and has worked for the BBC and Independent Broadcasting Authority.

We talked to him about the hurdles he will face in setting up a single technical platform for digital broadcasting in the EU, and the benefits of encouraging hardware, software and media providers to work together.

Some of the people visiting the site might not know about what you are up to, and certainly might not know about N2MC, the New Media Council, so can you give me some background as to what you are doing at the European Broadcasting Union and indeed what N2MC is all about?

They are kind of two separate areas. Essentially, the European Community helps to fund a series of research and development projects in a number of areas – and one of the areas is network, audio, visual systems and home platforms and it means digital broadcasting, interactive television, internet delivery and in home networks.

They are currently running a whole series of research and development projects which last two or three years in specific areas – some looking at digital television, some at the synergy of broadcasting and mobiles, and others at digital rights management issues.

Recently in the consultation discussions that we have had, amongst the projects where people share their results, there has been a feeling that Europe needs an entity – which is loosely called a technology platform – at which people from different organisations would examine where there areas or shortcomings in interoperability, production and delivery. The group has been putting together the case for setting up a technology platform which would try to investigate where there are shortcomings in interoperability and make suggestions as to what could be done.

If we look around today there are plenty of instances – for example, interactive television, as you know there is a whole range of different ways of doing that – Open TV, MHP and so on.

I believe there are currently five different interactive televisions standards in the wild?

Just in the UK alone there are three different ones being used.

So, if you take the Europe of 25 countries, it’s not that bad – but, yes there are certainly five major languages or application programming interfaces. Some people believe that we are on the threshold of what’s called high definition television and people in Europe are going off in several different routes as to the right way to deliver that.

You could also look at digital rights management and see different solutions and one solution is coming out of the mobile environment, and another solution is coming out of the digital television environment. The idea wouldn’t be to invent anything or to solve any problems that somebody else is solving, but to have people who could look at all of the networked audio/visual environment and ask the question “Have we done as much as we can on interoperability and what can we do to make everything connect together?”

It is not just a matter of the convenience for the user but of helping European industry to maintain its place in the world.

There is a general feeling that we should really do all we can to make sure that the European new media industry is as well equipped as it can be.

We worked for some time looking at what were the different issues, and we produced some proposals. The next step is to discuss with a new Commissioner, Olli Rehn, who is responsible for this area.

The idea is to meet with him in September to see how he sees this, and whether he would support such an initiative. Of course, this is a industry initiative and it is not a matter of something the Commission itself is doing.

Later in the year, if everybody agrees that it is workable, we would set up this technology platform. It happens that there are a couple of other areas in industry where the same thing is happening – one is called nano technology: areas where it seems very important for Europe to be competitive and have the best available tools, and we will do what we can to coordinate our research and development.

I suppose there is the desire to not want to reinvent the wheel every time…

Absolutely.

…but then again you are up against commercial entities who want their own technology to succeed. How are you dealing with that?

The group who have been discussing this believe that, in the long term, the interests of everybody will be best served by open systems. This is the environment that has produced, for example, the massive success of GSM and so on.

What we have to do is to find a formula in critical areas where on the one hand we encourage entrepreneurialship, innovation and forwardness, but on the other hand we recognise that with things like a public offer there is a value in having common systems and standards. Somehow the trick in the technology platform will be to find the path between those two things. What we want to achieve is both. Encourage the entrepreneurialship and so on, but allow the stability of common systems where it is possible.

Nobody has an easy or quick answer or formula. I guess these things will have to be looked at case by case but at least we have a common vision of that’s what we are trying to do: encourage competitiveness and so on, but at the same for that to grow you need to have a stable industry where people know what is going and some degrees of, if not common standards, common interfaces. The trick is to make things interoperable.

The Commission has said this week that no decision is going to be made until the end of 2005 on whether a common interactive television standard is to be looked at and that everyone should share information and play nice until then. But then you have got organisations in the marketplace there who are direct competitors to each other, for example, Sky are quite happy using their own platform. Are they really going to want to open it up to their competitors when this could possibly be a chance for them to own the interactive TV platform?

The particular case you are discussing was the issue of whether or not the Commission should encourage the national members of the Community to insist on using the MHP interactive television language.

This particular issue is a very difficult one. For example, take BSkyB who have already a legacy of 5 or 6 million set top boxes which use Open TV.

If you say to them after a given period of time that they must change to an open system, then that is a very difficult thing. Who is going to pay for all that replacement?

Perhaps sometimes you have to swallow hard and say maybe we started this process and bit late. It is the same in France: large numbers of propriety boxes already in public hands.

The Commission was faced with that dilemma: they can’t fund replacements for existing receivers and the conclusion they came to, as you rightly said, was to try to use other means – forums to encourage people towards a common system rather than making it mandatory.

That was their decision and some people think that was the right one, others think that it might have been better to bear the pain and go for a common system. It certainly illustrates that there is no simple route in this and the technology platform would have to look at it case by case. Sometimes if you get in early these things are easier to do than if you arrive late.

Can you just give me a bit of background to your session at IBC this year and the sort of things that you are hoping to cover?

I will be taking the delegates through some of the issues are significant in terms of interoperability of networked audio/visual. I will give them an update on what the result was of the discussion with the commissioner and how they might, if they wanted to, be part of any initiative of this kind – the technology platform.

Who have you got behind you in N2MC?

It is the work that we have done so far came out of the consultation group of the projects that are being partially funded by the Commission. At the beginning at least most of the actors came from that world and that is the large European companies that are involved in research and development in this area like Phillips, Thomson and Nokia.

We have also taken advice from a number of individuals who have helped us. One is a guy called Leonardo Chairiglioni who is the convenor of the MPEG Standardisation Programme. Richard Nichol former boss of Martelsham, the British Telecom labs, Jean Valliesen who is another third guru with Phillips.

So we’ve had the major manufacturers and also we have brought into the discussion quite a number of other actors like Bertelsman, the German broadcaster, BSkyB, Deutsch Telecom, Intel – quite a range of actors from the media environment. We’ve got no reason to exclude anybody.

We sampled what we thought was a cross section of people who might be interested in the initiative.

Now you mentioned Bertelsman there, what sort of feedback are you getting from content producers?

Content producers feel that they do have their own issues in terms of interoperability and everybody is conscious that, in the end, this is one of the really critical areas in terms of content distribution and programme production.

At this stage what we are doing is asking the question “In what areas could such a venture provide added value for Europe?”, but there is this definite feeling that the content industry has to be something which we help in Europe, that it is a vital part. It must be a vital part of the European media industry, so we should be particularly looking to help, if that is the right word, the content industry to make life easier, to make things interoperable, to encourage competition and at the same time encourage entrepreneurialship.

Some would say that you have a mammoth task ahead of you –

Everyone would say that!

Even just looking at one area like DRM. What sort of milestones are you setting? How are you going to know that you are on the way to sorting this out?

We are at the stage of discussion and people would say how they thought it was best to handle that particular one. But my part in the discussion has been to suggest that, probably the best way to go forward is that we need to see what the requirements are of the different ways of delivering content in terms of digital rights management.

We need a list of what broadcasters need, mobile phones need, broadband needs, and then we will see whether there are some things which are the same, some things which are different and if there are some things which are the same then we could move to a stage where we can actually use the same technical systems.

It is a matter of discussion but my fourpennethworth has been to suggest that the right way is to delineate what are the requirements of the different media and see what the similarities and differences are. That for me the way we should move forward on interoperability on DRM, but it is all for discussion.

You’ll be looking at the requirements between manufacturers for interoperability, but will you be looking at consumer requirements?

Of course, yes – the two have to go hand in hand.

Rightly or wrongly the companies, like the one that pays me – the European Broadcasting Union, and public service broadcasters somehow see themselves, apart from anything else, as the guardians of the consumers.

We are paid for by a license or by advertisements. Our shareholder is the public. When we come to the question of requirements, we have to first and foremost ask whether the customer is a user. We must the right to time shift or whatever it is they want to do.

European Intellectual Property Directives state that it’s illegal to try to circumvent a copy protection scheme. Yet there is also a fair use clause in another European directive, stating that consumers can make copies of media. These seem to be contradictory.

Yes, I guess it is a fairly complex issue and one of the things that people are wrestling with now is the use of things like the broadcast flag which the FCC in the United States is adopting.

In the US the plan, as we understand it, is that if you have a digital broadcast you have to put this signal in, on the one hand, and then you have to put some apparatus in the receiver which acts on it and prevents the signal being carried over onto an internet connection.

This is a matter of discussion but the idea of obliging receiver-makers in Europe to put anything in the boxes is pretty difficult to imagine happening. The climate of opinion in Europe – getting 25 different states to make it mandatory to have some particular prevention technology in a digital receiver – just sounds absolutely impossible.

There are lots of issues to discuss and there are no easy answers, but all of these kind of things, as you say, are matters that a cross platform body like the technology platform could discuss and see where there are common ways forward.

So out of the areas that you are going to be looking at with, what is your favourite? What are you most looking forward to getting your teeth into?

In the digital phone world you have the 2.5 G and GPRS methods of delivering digital media, and to some extent 3G or UMTS, and in addition to that there are two other routes to delivering content to handhelds by a broadcasting channels already in the wings. One is a system called DVB-H, and the other one is an enhanced profile of DAB.

How these four options will live together is a difficult one. In an ideal world, I guess, we would have some cooperative network technically where you could imagine that if there is something on your hand held that lots of people want, it comes via a broadcast path. If it is something that only a couple of people want, then it comes via the digital phone network.

Could we achieve these kinds of cooperative networks? The same notion of cooperative networks may also apply between broadband delivery and digital broadcasting to the home. Could we imagine connecting both broadband and TV and TV broadcasting, and if we can do it in a kind of seamless way for the user? Creating that world of cooperative network – well, that would be pretty exciting.

What support do you think you will get from the new Commission?

We don’t really know what his priorities are. The civil servants there change every so many years because the Commission is generally afraid that if someone stays in the job then people get friendly with them and perhaps exert too much influence or whatever it is. The staff are forever rotating – so there will be new people not just only Rehn.

The issues of interoperability in the API and MHP and all of things that you mentioned, have come out of a group led by a gentleman whose name is Adam Watson-Brown.

Adam is moving on out of that area which is loosely called Strategy and into a group which is looking at content regulations – quotas and so on. We may have quite a new order at the Commission in terms of things like interoperability and the API in the future, but it remains to be seen.

The public are now getting used to buying digital media which is quite often protected in different ways: doesn’t work on some devices, works on others, can’t be transferred, has different rights. Are you looking to the public for support in what you are doing?

The consumer associations would be very much invited to be part of the technology platform to make sure that we listened and heard what they had to say. It is a two-sided thing, we want to make industry prosperous and give the European public the convenience and so on that they deserve. We are very much aware that there are two sides of this coin.

We can’t say with certainty that we will create a technology platform and it will be useful and successful, but in the discussions there seems to be a body of opinion that something like this may be useful and we will never know unless we try.

We want to encourage people to think about the issues of interoperability, where there maybe something that could be done, what could be done, who could do it and hopefully encourage people to contribute to this process.

If we have a single aim it is to make it inclusive of all of the actors so that everybody feels that they are buying into their solution.

David is a panellist in the ‘Understanding the Range of Platforms‘ session between 14:00 and 15:30 at the IBC conference on Sunday, 12th September in Amsterdam. Register for IBC here

N2MC

European Broadcasting Union

Tony Greenberg, Ramp^Rate – The IBC Digital Lifestyles Interview

This is the fourth in a series of eight articles with some of the people involved with the Digital Lifestyles conference day at IBC2004.

We interviewed Tony Greenberg, CEO of Ramp^Rate, an IT sourcing advisor designed to help companies select the most appropriate vendors for services such as email, hosting and security.

Ramp^Rate uses its Service Provider Intelligence Index to rate vendors and marry them up with customers using an unbiased, purely data-driven methodology.

Tony started Ramp^Rate as a response to the problem of huge sums of money wasted every year because of poor sourcing decisions.

Amongst many highlights in his career, Tony ran sales and marketing at Raindance, was senior vice president at Digital Entertainment Network and was a senior executive at Exodus.

Some of our readers may not be familiar with Ramp^Rate – and it’s a rather different company from those we usually cover – could you give us some background on what you do?

Simply put, RampRate helps companies make great decisions, fast. Part of what we do is help some of the biggest entertainment and technology companies in the world understand where all these next-generation media platforms are going, and how it affects their businesses. We do a lot of research and consulting with a lot of companies you’ve heard about, companies who are looking at delivering digital media of various sorts over wireless, mobile, the web and so on.

And the other part of what we do is help those companies and many others save a lot of money when it comes to running all the information technology that helps them function. Companies spend billions of dollars on IT services, and they’ll only spend more in this increasingly technological world. But we believe, and prove it every day, that companies spend way too much money on their IT services. So we help them save a lot of money.

We do that by using what we call the SPY Index, which stands for Service Provider Intelligence Index. We help companies buy sophisticated and complex IT services – everything from outsourcing everything related to a computer in your business all the way down to simpler services such as digital rights management, e-commerce gateways, bandwidth, applications outsource management, anything that has to do with a monthly recurring service.

The SPY Index is a bit of a magic black box, but it’s basically a huge database filled with information about hundreds of IT services deals and other information we’ve collected over the past several years. We take a client’s needs, punch those into the Spy Index, and find out which of about 200 vendors we are associated with would be a good match for the services they need, at a price that is almost always far below what they’re paying now.

A vendor can be a big company such as IBM or EDS or a lesser-known smaller company such as a payment-processing house. RampRate learns everything about the vendor, puts all the key information into the SPY Index, then uses that to radically speed up the process of picking the right vendor for a given client. Saving time saves companies a lot of money, and our SPY Index gives them hard numbers that let them know what real market prices are for the services they want. They can get a great decision, much quicker than ever before, and know that it’s the best deal available on the market.

We can do this because we have an unusual structure. We use an agency model, which means the vendor and the client share the cost of our services. That’s a different approach than many consultants take. In a more typical relationship, a company like Microsoft, Disney or Sony would give a consultant a retainer. The consultant in turn would source the products and services that they need, then would be paid a uniform transaction fee from each of those vendors that was chosen. The consultant then would repay the retainer to the client. So in essence it may cost the client essentially nothing, but they likely are paying far more for the services they actually get.

Our first allegiance is always to the client, but we know our approach allows everyone to win within a shared “ecosystem” of clients, vendors and us, as their intermediary. The vendors save money because we bring really good clients to them who are ready to do deals. The clients save money because we’re able to bring them the best deal out there, from a vendor who meets their specific needs for service quality, reliability, financial stability and other factors.

We manage hundreds of millions of dollars of transactions for companies large and small, and we have strong client work in the areas of publishing and media with clients like Primedia and Microsoft and a lot of online properties such as iFilm, ESPN Motion and the National Hockey League.

Can you tell us how you actually got to Ramp^Rate?

As a kid, I built a chain of retail stores in the fashion eyewear business and had several peripheral businesses in the manufacturing and distribution arena.

In manufacturing eyewear we designed, we customised eyewear and we created a unique proposition different from many stores worldwide. We also had a direct order/direct mail company – and we even did infomercials.

I sold those companies in 1995, moved to Colorado for a couple of years and regrouped. The Internet started to happen and I moved out to Silicon Valley, kind of paving a new frontier – and I was brought in to run many of marketing functions for Exodus Communications.

At Exodus, we had a few dozen people, and we turned that into what became the largest Internet hosting company for major brands in the world. From the streaming perspective, we developed the first streaming core for all the big broadcasters from Broadcast.com to Real Networks to Akamai to Yahoo. We went public with a US$37 billion valuation, and were sold to Cable and Wireless and then on to Savvis.After that, I have invested in a few dozen companies and then moved to Raindance (RNDC), which is now public in the web-based conference-calling space, where I ran sales, marketing and business development.

Then I went to run business development at Digital Entertainment Network, where we raised US$88 million from Microsoft, Michael Dell, Enron, Intel and NBC. The network paved a new frontier in digital-media distribution, not only creating short-form programming but aligning distribution deals with most of the major portals for video on demand.

After working with a venture firm for a bit of time, we re-launched RampRate based on correcting billions of dollars of bad mistakes on IT-service decisions. We have had a concentrated emphasis in the digital-media space, especially from streaming, and now moving into IT sourcing. Most of our deals are between US$5 million and US$100 million – but we do everything down to very simple core functions like streaming media, collocation, digital-rights management and even some telecom.

We have another unit of the company that is run by Michael Hoch. He was formally research director of Aberdeen, a leading research firm in digital media, and he now runs our operations and research. The research group uses the SPY Index to identify trends, especially in digital media.

We have analysed more than 300 companies against all their competitors. We use the data resulting from transactions to help companies go to market quicker, better and cheaper with their products and services. We work with everyone from large software companies to large media companies on a research and go-to-market basis. It is a very substantive part of our business – about 25 percent of our overall revenues.

Can you tell me a little about your IBC session and what you are going to be discussing there?

There are some enormous chasms in digital-media distribution in terms of business models that “stop.” Business models stop when they lack what I call the “point of inflection,” where they can successful, based on economies of scale or possibilities in distribution.

For instance, what are the limitations of Cable VOD in regional markets? How many concurrent users can be had? Well, that’s a bandwidth issue, it’s a numbers issue.

When companies go to market with things of this nature they must make decisions from an economic standpoint: how much they are willing to invest in the distribution, their loss, and the internal rate of return on the project as they move forward into this new space.

As long as they are clear what the investment is, and what their customer-acquisition cost is, that’s great. You just have to know where you are going.Data-driven decisions, which is what we provide our clients, are really where it’s at, where we focus our energies. What’s efficient and what’s not in the marketplace for IP distribution? What is the faceoff between Cable TV and broadcast affiliates and networks? What are the efficient scales? How does wireless relate to those and how does Microsoft relate to all points in between?

I guess some of the areas that I find interesting are, who is your natural partner and who is your natural enemy in the digital-media food chain? Answering those questions will define the business models that will be successful. You can prognosticate what their cost will be in distribution all the way out three, four, even five years. It is pretty easy because you have a strong trend of costs and transactions gleaned from our database. We have everything from a data standpoint, so the trends are based on solid, real-world numbers that we know are correct.

That is quite a bit of ground you are covering there!

There are three distinct areas in the media business: creation, distribution and consumption. Almost any time any company has tried to delve into two as opposed to one they have been wholly and fully and holistically unsuccessful.

If media companies feel that, in bypassing a distribution channel such as Blockbuster, they can increase their relationship with their customer and take more profits off the table, then they are wholly and fully wrong.

I will help them try, but at the end of the day, the food chain has been established for content creation, content distribution and content consumption, and you can’t be in all those businesses.

Tell me what you are doing with ESPN and with NHL?

We have managed the sourcing for ESPN Motion. We have managed the procurement for the video-on-demand service for an online content e-commerce project for the NHL. We have testimonials on our website from those counterparts that would indicate the types of things that we did for those firms.

Are services like Video on demand and content on demand reaching mass market? What do you personally define as mass market for these services?

Anywhere an economic model exists to create profitability in a regional marketplace.

Are we getting there?

That would align with models that would throw dollars into the three channels discussed – content creation, distribution and consumption.

If I were to make a blanket statement, it is very clear that sponsored and/or branded content will pave the way as opposed to a subscription model. I believe that things like USDTV or MovieBeam, which are using the broadcast signal, offer a unique perspective and a unique revenue model for broadcasters and broadcasting affiliates alike.

In addition, the augmentation of satellite radio and distribution advertising will create another channel. A lot of these things will be bundled and pushed towards what I call Enron conversion. Who has the most to gain and who has the most to lose? You can either charge the consumer 10 bucks or you bundle it for telco to have a long-term sustainable contract with the vendor.

When you are talking about a place where you have cable or DSL, telephone, VoIP, VOD and cell phone – the telco, whether it be wireless or hardwired, really are looking to make about US$200 per household per month minimum. That’s US$2400 dollars a year or US$4800 dollars for two years which is the average churn rate for a lot of those services.

Well if there is US$48 to gain for a large telco and there is US$10 a month to be gained by a content provider, I guarantee that telco is going to be willing to pay for those services to bundle it in, to support conversion for long-term subscriber revenue into their base.

Playing the long game?

You have to. You can either play the short nickel or the long dime and ecommercing content these days is so very expensive because of on-line fraud and other issues. Unless you have a very meaty, highly valuable product or service, you could be eating up 15 percent to 45 percent of your actual revenue just in transaction costs.

Protecting the content is expensive too.

Well, that is important. We have to be more aggressive in the way we bundle, the way we package, as media companies. If I were speaking from their perspective regarding peer-to-peer services and increased distribution, which is the most valuable aspect, I’d say what they are getting for free is important, so they should really pay for the peer services.

Do you think that free to air digital TV services are going to be big in the USA?

It is hard to prognosticate where USDTV is going – all I know is that they are on loan to the spectrum, and the broadcast affiliates will have to adopt the model, with everybody and their brother starting to stick their feet in the water of trying to own something that lives in the living room.

The TiVo or PVR as we know it goes away, the cable box may integrate directly into the media centre which may look like a remote control, it may look like a light switch, it may look like a knob on your car, it may look like a cell phone.

All those things will be tried, but ultimately between hard-drive space and functionality, it doesn’t take a whole heck of a lot to put a new box next to your stereo or to integrate it into a unified system with your five-speaker digital surround sound system.

I can plug a cheap S-video cable from my laptop into my TV and VCR, and by doing that I enable every form of digital media that I can get on my system directly through the television at a very high resolution.

We are already there, it is a manufacturing thing and will be driven by the size of market.

Producing content and delivering it to many platforms is obviously expensive. What sort of efficiencies can content producers adopt to spend less money on re-purposing content?

Stop trying to deliver it themselves and rely on service providers enabling them to grow and create efficiencies in their business. Stop trying to create and distribute your content. Rely on people who do that for a living and use a sourcing advisor like RampRate.

So no need to bark if you’ve got a dog?

That’s right – everybody wants to do everything and they think they are controlling some secret sauce, but there’s no secret sauce. What they need to control is the quality of their content, because it is still a hit-based business. You get enough people to watch it, they will pay for it with their eyes through advertising or with their pocket book, through subscriptions and the like.

What’s next? What are you looking at next for your business that you can tell us about?

For us, we are very excited about the fluid marketplace that the SPY Index helps create, but really we are more excited about the fact that every business model has been tried and tested, and that data and operations have been put together to enable distribution and file-format and -protocol conversion.

Basically, there are services and web services that enable the conversion of these file types into deliverable media to all devices. It’s getting really simple to stick a content router or a box that reformats things and distributes to everything from your TV to your PC to your wireless headset to just about anything. WiFi and WiMax enable it, and it becomes the new operating system for distribution. We are very excited that there is a fluid connection within that digital-media chain.

We are going to pave new products and services, and whole new service providers, that will enable a fluid distribution through one single point. That’s exciting to us.

What keeps you awake at night? What is frightening you?

What’s frightening to me? I guess from this standpoint how powerful the telcos become three years from now.

Do you think that there will be another break up of the telcos in the US again?

I don’t know what the breakup would mean. I just think that they had been able to hold their product models extraordinarily steady until the big bandwidth started to appear. This music-download stuff is also scary as heck to me. It is very expensive to deliver; you have to have a product that will support the profit or the losses that it takes. It really feels that movies and video, long term, go the way of branding and sponsoring similar to television; the economic models are really tersely negotiated and are grave at best for a profitable enterprise over the coming two or three years.

So you think that the downloaded music business model is going to decay in another three years?

It’s the red herring of the business!

It is about transport cost and storage cost. The reality is, if you look at Moore’s Law and you do a calculation, 85 percent of all the music that people want to listen to will sit on one disc by the end of next year. Storage is so much cheaper than transport. You’ll take that drive and put it in your car. Why is Netflix working? Because they didn’t try to send it over the Internet.

Tony is a panellist in the ‘Future Business Models – Who Pays for What?‘ session between 16:00 and 17:30 at the IBC conference on Sunday, 12th September in Amsterdam. Register for IBC here

Ramp^Rate

Grand Haven, Michigan is the First US WiFi City

Many US cities are racing towards complete WiFi internet coverage, but Grand Haven, Michigan got there on Saturday with complete end-to-end high speed wireless internet access.

The WifFi deployment by Ottawa Wireless Inc is the first full and complete city-wide WiFi deployment in the US. So they only have 12,000 residents, but they receive more than two million visitors each year.

Mayor Roger Bergman said in his announcement: “As the first WiFi city in America, Grand Haven has truly lived up to its name in the Internet era, as we now allow anyone anywhere to connect to the Internet and roam the city and waterways in a completely secure computing environment. The city-wide WiFi service provided by Ottawa Wireless is already enhancing the quality of life for residents and tourists and enabling the city to provide new services.”

The service uses several hundred 802.11a, b and g transceivers to cover the six square miles of the city, and even extends 15 miles into Lake Michigan – handy for checking weather forecasts if you’re out fishing. One local web designer has relocated to his office to his boat for the summer – he’ll be fine as long as he stays under 55 mph. The new network even incorporates a VoIP service for cheap voice calls.

Ottawa Wireless’ CEO Tyler van Howelingen commented on the structure of the project: “Grand Haven demonstrates how the public and private sectors can work together to provide an entire city and everyone within its limits with more affordable, easy-to-access Internet service. This is a proud moment for Grand Haven, and the benefits of anytime-anywhere Internet access are being enjoyed by every facet of our town, from tourists, boaters, and residents to businesses and municipal agencies. Already with more than 300 customers, this WiFi service is having a dramatic impact on the way people work, play and communicate around town. Its benefits are many, as it enables new public security services, attracts businesses, boosts tourism, and supports education.”

The service is subsidized by some of the hotels and marinas in the area, who also offer it free to their guests. Normally the service is US$19.99 (€16.57) for 256 kbps.

Grand Haven

Press Release

ICANN Adds IPv6 to Root Servers

ICANN, the Internet Corporation for Assigned Names and Numbers has added IPv6 to its root servers – meaning that every object on the planet can now have its own IP address. Vinton Cerf from ICANN confirmed the news at their annual conference in Malaysia.

Every device needs a unique internet protocol address to be able to connect to the internet – this applies to computers, phones, printers, web cameras, your robot dog, everything. IPv4 is limited to only 4.3 billion addresses, and already two thirds of them have been assigned.

“This is a big, big step,” Cerf said. He’s not joking: IPv6 can potentially accommodate 2^128 (2 to the power of 128) unique addresses. To give it some scale, that would allow 100 million IP addresses per square meter of the Earth’s surface. I guess engineers really do think ahead. Though my nanobot army might use them all up fairly quickly.

IPv4 will continue to run alongside v6 for about 20 years to ensure ease of migration and stability, so don’t throw that old Ethernet card away yet.

ICANN

Happy Birthday, DNS

The domain name service, DNS, is 21. If the service hadn’t been invented by Dr Paul Mockapetris, you’d be looking up internet protocol numbers manually, almost like using a phone directory.

“The idea was to devise a way for Internet users to communicate freely with each other through an easy to operate system. Having to remember a long numerical code was not feasible as more users joined the Internet community,” said Dr Paul Mockapetris. “One of our goals was to develop a system that would allow global networking and information exchange. One of the ultimate successes of the domain name is that it is a universal every day language for Internet users across all continents.”

Dr Mockapteris (now I’ve told you his name, you’re not going to forget it, are you?) worked on the system with the late Dr Postel as part of ARPANET, and is now chief scientist and chairman of Nominum, an internet address management provider.

He predicts even greater things are yet to come for his offspring: “This year alone more than a billion users will interact with DNS to do everything from send emails, to browse web pages, or track inventory through RFID. In the next five years, I expect to see a dramatic increase in the number of ways in which the DNS is used, reaching far beyond what we have seen in the past twenty-one.”

Nominum

WiFi in Court

Bored when waiting to be called as a witness? Need to brush up a bit on public decency laws before you get called into the dock? Then if you’re at one of the seven UK courts that have just rolled out public WiFi access, then you’re in luck.

As a pilot that might lead to a national deployment, seven courts have installed BT Openzone WiFi access. Ostensibly to assist court staff in research and communications, the access points are open to the public too, and standard OpenZone pricing will apply (about UK£6, €9 for an hour).

“The hot spots should enable lawyers to access information held at their offices or receive emails and have information sent to them while they are attending court,” said Lord Justice Thomas, the senior presiding judge of England and Wales.

“When new points of law arise during the course of the hearing, they should be able to carry out the necessary research without leaving the building.”

Obviously the service will not be available in the courts themselves.

The pilot runs until 2006, and echo a similar WiFi trial in UK public library also announced this week.

The Court Service

Cable and Wireless Buy Bulldog – What’s the Threat to BT?

Cable and Wireless’ recent purchase of Bulldog means that they acquire four years of local loop unbundling experience, 38 ready-equipped exchanges and a number of well-marketed, innovative products. All for the bargain price of UK£18.6 million (€28 million) – though Bulldog’s net assets at the end of 2003 were only UK£1.6 million (€2.4 million). This puts C&W in a position to offer unique services, and not just resell products from BT Wholesale.

Bulldog have long been critical of BT, and have said some fairly dramatic things over the last few months. My own personal favourite quote was from Richard Greco, when talking to The Register in 2001: “Oftel needs to force BT to move. And if BT doesn’t, then Oftel should point the gun – and pull the trigger.” However, he was quite gushing about BT when agreed to carry their SDSL products some months later: “It really is a powerful combination.”

Bulldog’s frustration at BT stemmed from the glacial pace that the communications giant was unbundling the local loop. Bulldog have installed their own equipment into 38 exchanges, a figure that C&W now want to raise to 200. They will doubtless use this position to tempt more ISPs to jump from bitstream services to LLU – as C&W chief Francesco Caio said in a statement: “The acquisition of Bulldog will accelerate our ability to deliver directly connected DSL solutions for our existing and potential customers with an experienced team specialising in LLU services.”

Bear in mind that it’s not just BT that is causing frustration with LLU – across Europe the entire process has been slow and as yet only a small percentage of lines have been unbundled.

BT has already demonstrated that it’s worried about complaints about its LLU conduct and progress by making huge cuts to wholesale prices and promising faster progress. With C&W breathing down its neck even more, expect those exchanges to be unbundled faster than ever before.

About Bulldog

Softbank losses grow

Japan-based Softbank Corp today announced widening losses for the 2003 year ending March. Declared a net loss of 107.09 billion yen ($94.2m, 79.8m), up from a 99.99 billion yen loss in the previous year, they blame what they called “substantial expenses” to lure customers to its broadband Internet service. Sales rose 27.2% over the period.

Unusually Softbank decided not to announce their financial predictions for the current year. Their stock fell around 10% against the Nikkei Average fall of 4.8%.

The broadband services, Yahoo BB, is a joint venture with Yahoo and has been held up as an example of what broadband could be given their provision of 45mbps coverage to some of their consumers. By March they had over 4 million customers and they are targetting 6m by September 2005.

Softbank (eng)

Ofcom’s Digital Switch Over Report

“Driving Digital Switchover”, Ofcom’s report to the Secretary of State for Culture, Media and Sport, contains 30 findings and recommendations for the UK’s move to digital broadcasting, and the decommissioning of analogue signals.

Ofcom are recommending that the switch, due to be completed by the end of 2010, should be phased in region by region, shutting down analogue channels one at a time. They believe that a firm timetable will encourage the adoption of digital broadcasting between 2007 and 2010.

Additionally, they suggest that the UK Government review the BBC’s obligations to digital and add further requirements, including: obligations on rolling-out digital transmission nationwide, providing public information, continuing to provide its channels on the free-to-view satellite platform, and providing on-air marketing of digital TV on a platform-neutral basis.

Importantly, Ofcom believe that free-to-view digital satellite will play an important part in increasing adoption of digital viewing, particularly with those who do not wish to subscribe to services such as Sky. Ofcom is considering regulatory intervention “to secure a viable free-to-view satellite proposition.”

SwitchCo is the body that Ofcom are suggesting is created to be responsible for managing the switch-over by the agreed date. The suggest that the body is entirely independent and not run by the government, any broadcaster or even Ofcom.

About the Report

The Report