Verizon is ready for a third player in the mobile operating system space, to provide consumers with an alternative to Android and Apple OS. And the telco views Microsoft as a leading contender.

“We would like to see a third provider come to market to give consumers a choice, and also to create some more competition within the space,” Verizon Chief Financial Officer Fran Shammo said Nov. 17 at a Morgan Stanley telecom conference in Barcelona. “So Microsoft is one of those ones where we think could get there. And when they get there, we’ll be more than happy to sell those devices and take them to market. “

Shammo said Verizon has been happy with Apple and with Google, which led the development of Android, but that the smartphone OS market needs some more competition.

Microsoft has historically stumbled in its efforts to effectively penetrate the mobile space. But earlier this year, Nokia signed a deal to sell smartphones using Microsoft software.

Uncategorized: [ Android, Apple, Google, Microsoft, Nokia, Verizon ]

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Verizon revealed a new project late last week that could trigger the death knell for satellite broadband service.

During Verizon’s third-quarter earnings call with analysts last Friday, CFO Fran Shammo discussed the company’s trial with DirecTV of a residential LTE service. DirecTV had already talked about the project, but Shammo provided Verizon’s confirmation for the first time.

Specifically, the project is operating under the name Cantenna, and focuses on an antenna that Verizon deployed on a trial basis in some DirecTV subscriber homes.

“[T]he benefit of this antenna is it operates the spectrum extremely efficiently,” Shammo said. “So if you look at a MiFi card or a dongle, this is very, very efficient, way above those two devices which is why it’s critical to have that bundle with that Cantenna. So when we launch that you’re going to see us go nationally with that type of an offer.”

The Cantenna tests reportedly delivered speeds of up to 27 Mbps downstream and 5 Mbps up. Compare that to the 1.5 Mbps that you generally get from a pricey satellite broadband service, and the choice is clear.

Shammo made no mention on price, nor an official launch date for such service—although DirecTV has said previously that the full availability of residential LTE availability would be several years away.

Home LTE service would, theoretically, replace slower DSL service in areas outside the reach of Verizon’s FiOS network. That becomes increasingly significant given that the company has largely ended its buildout of the fiber-to-the-home infrastructure.

But it also means services such as Wild Blue and Hughesnet could face some insurmountable competitive challenges in the out years unless they can provide a faster service at a better price than the current $80-$100 per month that subscribers typically pay.

4G, Broadband, LTE, Satellite, Wireless: [ DirecTV, Hughesnet, Verizon, Wild Blue ]

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“I messed up. I owe you an explanation.”

So begins an email that Netflix CEO Reed Hastings sent out to customers this morning, borrowing language from an item he posted on the company blog on Sunday. Hastings’ admission refers to the company’s clumsy communication about its need to impose hefty subscription price increase—a step it took in July when it split off its streaming video service from its legacy DVD-rental operation.

Netflix disclosed last week that it is losing more customers than anticipated as a result of the price increases. Hastings’ new mea culpa—along with a newly announced rebranding strategy—is aimed at winning back customer trust and understanding. But the effort seems desperate and doomed.

First, Hastings’ emailed explanation runs for 13 paragraphs—about 12 paragraphs longer than the typical attention span of a typical online reader. (Admittedly, I may have already lost readers of this post, but I digress.)

Hastings goes on to explain—for those patient enough to keep reading—that the price hikes stem from the company’s realization that its streaming and its DVD-by-mail services have two very different cost structures and marketing needs.

Customers don’t care about operational issues. They only care about their monthly fees, which now run as much as 60 percent higher.

Next, Hastings announces that the company is renaming its DVD-by-mail service to Qwikster. (The streaming service will keep the Netflix brand name.) Those who currently pay for both the streaming and DVD services will now see separate Qwikster and Netflix charges on their credit card statements.

Under this new setup, customers will go to qwikster.com to access their DVD queues and choose movies. Additionally, they’ll now be able to order video games.

But the Qwikster and Netflix sites will not be integrated, which will undoubtedly lead to customer confusion—and does nothing to address their anger about the price increases.

Then comes the corny language:  “For me the Netflix red envelope has always been a source of joy. The new envelope is still that lovely red, but now it will have a Qwikster logo.”

Envelopes as a source of joy? Come on! Netflix is losing customers because of pricing, not because of aesthetics.

As a Netflix customer, I want to see the company provide a wider array of content for its still-limited library of streaming content, along with adding additional features and services. Window dressing is not the remedy for a public relations ailment.

Content, Marketing/Promotions, streaming media, Video: [ Netflix ]

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The wild weather of late summer, coupled with endlessly grim economic news, is likely to result in unusually low third-quarter growth of pay TV and broadband service customers for companies serving the eastern United States.

Verizon will experience the biggest slump, not only because much of its footprint lies in the path that Hurricane Irene and several other storms followed in August and early September, but also due to a two-week strike by 45,000 workers. The company is still trying to catch up with a backlog of FiOS orders that the strike and storms delayed.

Time Warner Cable is also warning of a rotten 3Q. At an investors conference Sept. 14, CEO Glenn Britt said economic pressures—particularly idled household formation—are weighing down growth in primary service units (PSUs) for the quarter. In fact, 3Q growth will be the lowest of any quarter this year, he said, adding that a 4Q rebound should help the company end the year on a high note.

No doubt other providers had to delay installations and focus on repairs as a result of the storms. And many of the repairs were delayed because of power outages that lasted days after the storms struck. Providers can only hope that fall weather will be mild.

Broadband, ISPs, Market Developments: [ hurricanes, subscriber growth ]

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Google’s surprise announcement of its agreement to buy Motorola Mobility raises new questions about the search giant’s planned role—if any— in the set-top box arena.

Todd Spangler of Multichannel News surmises that the Google-Motorola Mobility deal likely came together in just a few weeks, without much thought to how Motorola Mobility’s Home unit, a major supplier to the cable industry, would be handled.

“In other words: What, exactly, Google is going to do with the set-tops, DVRs, gateways, cable modems, transcoders, etc., appears to have been an afterthought,” Spangler says.

The Google-Motorola Mobility deal occurs as cable operators are migrating more and more to IP-based video platforms, involving advanced set-top boxes and gateways. But will cablecos want to work with Google?

Unquestionably, Google will have to work with the multi-systems operators to integrate robust search and navigation applications into multichannel video services, well beyond the existing Google TV platform.  That’s something pay TV subscribers may really welcome.

But cable operators, particularly smaller companies, remain wary.

“We’re going to review the deal to understand the impact on the cable set-top box market, which has been a frustrating one for small cable operators long beholden to the Motorola-Cisco duopoly,” Matt Polka, President and Chief Executive Officer of the American Cable Association, said in a statement. “ACA members will want assurances from Google that it is both committed to the cable business model and won’t use its market power to run roughshod over smaller cable operators.”

Cable Operators, Content, Hardware, Market Developments, Mergers & Acquisitions, Video, Wireless:

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WiMAX service provider Towerstream is taking full advantage of the landline workers strike that has beset Verizon this week. The company today invited Verizon business-class customers affected by the strike to switch to Towerstream using the company’s Rapid Install service option.

“To help alleviate some of the headaches businesses may be feeling due to the strike situation, we are waving our Rapid Install fee and encourage all affected Verizon customers in a Towerstream market to consider Towerstream’s state-of-the-art service,” Towerstream Chief Executive Jeff Thompson said in a statement.

Towerstream provides 4G service to business customers in New York City, Boston, Los Angeles, Chicago, Philadelphia, the San Francisco Bay area, Miami, Seattle, Dallas-Fort Worth, Nashville, Las Vegas-Reno, and the greater Providence, R.I. area where the company is based.

Towerstream is making the offer as the conflict between Verizon and its unionized landline workers turns uglier by the day. Some 45,000 Verizon employees went on strike Sunday in retaliation for management demands for concessions.

There have been more than 70 incidents of sabotage to Verizon’s facilities and equipment in the region since the strike began, temporarily knocking out service to thousands of customers in all, though it’s unclear who’s responsible, Young said. New York state police said Wednesday they were investigating damage to Verizon equipment that disrupted service in parts of central New York, including 911 emergency calls in two counties.

Some 45,000 Verizon landline workers went on strike Sunday from Massachusetts to Virginia, fighting management demands for contract givebacks. The strike comes amid tension over the role of the company’s traditional but declining landline business in an age of mobile phones.

Verizon has reported dozens of acts of sabotage to its facilities and equipment since the strike.  Those incidents knocked out service to thousands of customers, even disrupting emergency calls in two New York counties. It remains unclear who is responsible for the damage.

4G, Commercial Services, Customer Service, Internet, ISPs, Marketing/Promotions, Telephone Companies, WiMAX, Wireless: [ Towerstream, Verizon ]

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Time Warner Cable is reporting that declines in its Video On Demand revenue growth were driven primarily (over a third) by decreases in adult content buys.  DirecTV has reported similar trends.

TWC Chief Executive Officer Glenn Britt responded to a question by noting, “On in VOD is there’s been a fairly steady trend over some time period now for adult to go down. Largely because there’s that kind of material available on the Internet for free.”

The company has also seen softness in movies on demand, but the executives stated, “We did see a decline in buys. Could that be in part a function of alternative availability of movies? I guess, yes, it also could be a matter of the slate. So I wouldn’t draw any conclusions as yet.”

The rise of VCRs, the triumph of VHS, the rise and decline of traditional pay per view, the ubiquity of webcams … Once again, adult content blazes the trail.

Broadband, Cable, Cable Operators, Internet, streaming media, Uncategorized, Video, VOD: [ over-the-top video ]

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For more than six months, AT&T has faced unprecedented competition from Verizon Wireless in activating iPhone accounts, as Apple signed the latter carrier as its second distributor. But it appears VZW is making no headway in denting AT&T’s iPhone customer base.

During the second quarter of this year, VZW added just 2.3 million iPhone subscribers, compared with AT&T’s 3.6 million new accounts.  And that’s despite an overall solid growth in smartphone accounts on VZW’s part.

VZW’s iPhone activations were up by about 100,000 compared to the first quarter. But keep in mind that the company didn’t launch its version of the Apple smartphone until February 10, meaning its 1Q figures reflect only about half a quarter’s worth of sales.

Meanwhile, AT&T is boasting about its iPhone results in the spring months. The company’s 2Q iPhone activations were on par with 1Q results, but were nearly 13 percent over 2Q10 iPhone sales.
During AT&T’s 2Q11 earnings call with analysts this week, CFO John Stephens attributed the results in part to the company’s GSM network, which—unlike Verizon’s CDMA platform—allows customers to use voice and data simultaneously and use their devices internationally.

devices, Wireless: [ Apple, AT&T, iPhone, smartphones, Verizon Wireless ]

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The new Skype video chat feature rolling out on Facebook has been in development for months, but the timing of the roll out is crucial. Just a week ago, Google launched a rival to Facebook called Google+, which also includes a video-chatting program.

The Facebook-Skype partnership represents the latest effort to topple the almighty Google, with software giant Microsoft throwing in some encouragement behind the scenes.

As tech writer Jay Greene notes on CNET, Microsoft has seen its market influence wane over the last decade as Google helped the Web supplant the PC as the cornerstone of computing. Google keeps stepping into new domains, with social networking being one of its biggest initiatives. Last week, the search titan announced its own Google+ service designed to challenge Facebook’s omnipresence in social networking. That service includes a video-chat function.

But Facebook, Microsoft and Skype are forming a triad to ward of Google’s effort to rule the Web in all its facets. The Facebook-Skype alliance is just one example of this initiative. By teaming with Facebook, Skype will find a whole new audience of consumers primed to try its increasingly popular video-calling feature. And Facebook adds another sticky element to its iconic service.

The ultimate big winner could be Microsoft, which in May announced plans to acquire Luxembourg-based Skype for $8.5 billion. Skype will support Microsoft devices like Xbox and Kinect, Windows Phone and a wide array of Windows devices, and Microsoft will connect Skype users with Outlook, Xbox Live and other communities.

Already, Microsoft has begun including recommendations from Facebook friends into its Bing search engine, yet another attempt by Steven Balmer’s team to challenge Google’s market hold.

With the use of over-the-top communications growing exponentially, Skype stands to be the big weapon in industry efforts to keep Google at bay.

Applications, Video calling, Voice, VoIP: [ facebook, Google, Microsoft, Skype ]

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As reported in Broadband Daily on June 23, Charter Business continues to expand its portfolio of large enterprise and carrier services, adding a long-haul component to its Metro Ethernet service. With the extension of its Optical Ethernet capabilities to include inter-city connectivity, customers with locations in multiple Charter Business markets will be able to create a single Layer 2 Optical Ethernet network or Layer 3 Virtual Private Network (VPN) connecting all of those sites.

The new service is built on Charter’s Multi-Protocol Label Switching (MPLS)-enabled automated routing capabilities, which the company has now extended from its national fiber backbone into its metro-area optical networks. Those metro network comprise more than 55,000 route miles of fiber that connect or pass close to thousands commercial buildings.

Charter Business, like other cable operator commercial services units, does not offer MPLS as a service option to its commercial customers.

The new long-haul capability, combined with the multiple interconnection agreements that Charter Business has established, also allow the operator to begin serving the needs of customers with some sites that fall outside of its core cable footprint, by including access onto Charter’s network via interconnect partners’ facilities.

While leasing access is much less economical for Charter, if the extension of a limited number of leased facilities enables the company to capture or expand the network spending of a large regional customer, the combination will be a powerful competitive enhancement for the operator and is likely to prove a harbinger of similar offerings from its cable MSO peers.

Broadband, Cable, Cable Operators, Commercial Services, Uncategorized: [ Charter Business ]

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