12:06 pm | 0 recommendations | Be the first to comment

A Base Station in Every Home -- The Coming Femtocell Wave

RCR Wireless broke a story last week about AT&T buying millions of femtocells from British company ip.access LTD. According to research and banking firm ThinkPanmure, AT&T plans to offer the devices for as little as $100.

http://www.rcrnews.com/apps/pbcs.dll/article?AID=/20080424/FREE/89561993...

Why is this important? Because femtocells can solve two critical wireless problems -- poor indoor cell coverage for users, and congestion on the Radio Access Network (RAN) for carriers.

A femtocell looks like a typical router or modem, and sends in-home wireless calls via the user's broadband connection, rather than through the airwaves to the nearest cell tower. It's very similar to the popular Hot Spot@Home service introduced by T-Mobile last year, which uses Wi-Fi to transmit calls made at home, and the cellular network elsewhere. But a special dual handset is required, and the Wi-Fi use drains battery life quickly.

Femtocells use the same spectrum licensed to the carriers for all calls. Since a dedicated broadband connection replaces the RAN portion of the signal transmission, call quality is greatly improved and (critically) traffic is off-loaded from the carrier network. So, it's very much in their interest to get these devices in the hands of consumers. Here's a good round-up piece by Business Week from last July (ignore the part about Google possibly using femtocells to offer phone service to consumers):

http://www.businessweek.com/technology/content/jul2007/tc20070730_802787...

The report doesn't say if AT&T is subsidizing femtocells to offer them at sub-$100 prices. But even if the company is, it's a good investment. That is a mass adoption price point. Look for there to be a lot of noise about these devices very soon.

Of course, you can add this service to the list of benefits households don't get to enjoy if they don't have broadband access, whether due to geographic or economic reasons.

09:28 pm | 0 recommendations | Be the first to comment

So the U.S, is Now Top of Internet Class?

European researchers last month issued a report that portrayed the U.S. Internet infrastructure in a positive light. The study was commissioned by the World Economic Forum, and conducted by Insead, a business school near Paris. It ranked the United States fourth, behind just Denmark, Sweden and Switzerland.

This struck me as strange. Turns out the study uses an index of 68 variables, pulling in things like political system and regulatory environment to reach the ranking. Here's an article from John Markoff of the Times:

http://www.nytimes.com/2008/04/09/technology/09internet.html?th&emc=...

Ifound this sentence revealing -- "The Insead assessment offers a stark contrast to other appraisals based on single measures that have portrayed the United States, the nation that invented the global data network, as both lagging and declining in the broadband boom." Some single measures seem very valid to me -- like whether someone can get broadband or not, and if they can what do they have to pay?

You don't have to go far outside of Washington DC to get a picture of the challenges. The Post did a story last December that looked at broadband access in Loudoun county, only about 30 miles from the capitol. Your access to broadband is very limited if you happen to live in the more rural western part of the county:

http://www.washingtonpost.com/wp-dyn/content/article/2007/12/01/AR200712...

I reached out to Drew Clark, founder of BroadbandCensus.com http://www.broadbandcensus.com, for his take. Caught him on the phone and he shared the following:

"First off all I know is what I read -- I haven't reviewed the report. But it sounds like they are incorporating a lot of soft variables in their rankings. Not to say these aren't useful, and a country certainly needs a solid legal and regulatory frameworkto foster productivity. But you really need hard numbers to make relevant comparisons. That's the reason I started BroadbandCensus.com, to provide like-to-like numbers straight from users, rather than filtering data through government organizations. Right now we're focused on the U.S., but some day I'd love to extend it internationally."

I'd love to believe the U.S. is number four in the world. But looking at the variables that really matter -- percentage of population reached, average speed and average cost -- there's no way. Our Internet is #4 the same way our healthcare is #1 -- only if you focus on the haves, and ignore the have nots.

08:03 am | 0 recommendations | Be the first to comment

RIM and Apple Battle for the $79 PC Market

Interesting article in the Times today about the battle between Research In Motion (RIM) and Apple for dominance of the smartphone market. Smartphones are becoming so capable these days I call them $79 personal computers. As the article notes, until the introduction of the iPhone the market was focused on the enterprise, not on consumers. The success of the iPhone has changed that, and the dominant player RIM is trying to adapt.

Brad Stone lays out a compelling simple narrative, as he should for a horizontal publication like the Times. However a few things get missed or glossed over in his straight-forward RIM vs. Apple telling of this story. The focus is totally North American -- it goes unmentioned that Symbian is the most popular OS for smartphones globally by a wide margin, but has very small presence in NA. Here's the link:

http://www.nytimes.com/2008/04/27/technology/27rim.html?_r=1&th=&emc=th&pagewanted=print"

First off, he seems to give RIM an unquestioned advantage in the area of security, and giving enterprise IT departments what they need. Seemed strange to me that he made no mention of the service outages that have plagued RIM as recently as last month. That's a security concern right there to companies that can't afford to lose access. Post from engadget on March outage questioning RIM's explanation:

http://www.engadget.com/2008/02/13/blackberry-outage-shows-that-rim-learned-nothing-in-2007/"

Second, I know from personal experience that some potential customers, primarily government, see RIM's operation of its own Network Operating Center (NOC) as a deal killer for any adoption. Defense agencies in particular need to control their communications, and will not work with a solution that depends on an external, third party network.

Finally, there are new entrants into the market that give enterprises strong and effective security solutions for their distributed workforces, no matter what operating system drives the devices. For all these reasons, better security IMO isn't the strongest factor supporting Blackberry's market leadership here in North America.

Two factors are more important than security to maintaining RIM's lead. One is the exclusive focus on the smartphone market the article mentions - unlike their competitors this is all RIM does. Second and even more important is their strategic decision to work with the major carriers in NA, rather than try to go around them. Of course RIM really has no other choice. But I give their co-ceo Jim Balsillie kudos for being so honest on this point:

<em>R.I.M. makes its alliances clear. “We are sort of polite and amiable and we gently interrelate with the carriers and try to find compatibility,” Mr. Balsillie said. “It may be a better strategy to fight the carrier. We may be wrong. The carrier may get disintermediated, in which case we fade with them.”</em>

Pretty clear-cut! RIM is betting on the carriers and the business model that has been constructed in NA over the past 12 years or so. As long as RIM continues to innovate its offerings to enterprises and provide more features consumers want in their devices (a big caveat I realize), they either dominate or stay a very strong presence.

If Apple and Google succeed with their open network push and disintermediate (big word for go around) the carriers and appeal to consumers directly, RIM becomes a niche player fast.

12:24 pm | 0 recommendations | Be the first to comment

Trends in Government Consulting -- Turbulence Ahead

Friday morning I attended an interesting event put on by the Association for Corporate Growth, National Chapter. ACG National is a who’s who of the DC business community and puts on quality events. I’ve been a member for two years and volunteer on their marketing committee: http://www.acgcapital.org/

On Friday Stan Soloway was addressing trends in government contracting. Stan is President of the Professional Services Council and expert in the areas of government outsourcing, acquisition and procurement. To paraphrase Dickens, right now it’s the best of times, and the worst of times to be providing professional services to the federal government.

It’s the best of times because the market continues to grow. The government services industry is now a $270 billion market, and it will continue to grow because the government simply doesn’t have the program and project managers inhouse to handle ever more complex procurements and implementations. It’s the worst of times because there is a lack of consistency to the market, and in Stan’s view government contracting is becoming a proxy for congressional frustration over the Iraq war.

The lack of consistency has a lot to do with the use of continuing resolutions since Congress and the President can’t agree on budgets. 2009 may be the third straight year, which makes forecasting when contracts happen very difficult. Soloway described three main issues moving forward.

• In January 2009 the new President might have different priorities, but most military dollars are fixed, not discretionary. Iraq is ongoing, BRAC (Base Realignment and Closure) costs have been woefully underestimated, and military healthcare costs are escalating faster than the private sector. In this environment more money will be spent outsourcing, even though the government is growing their internal program managers 15% per year. This just can’t keep up with demand, or backfill federal retirements.
• Policy — there will be a lot more shouting, but the argument against contracting is over. The government can’t do without it. But there is plenty of debate about how to construct the business relationship. Unfortunately, it’s complicated and Congress doesn’t have many members who really understand all the nuances. One recent loss is VA Congressman Tom Davis, who really did understand. According to Soloway every spending bill now has specific procurement language that must be deciphered, and there is a lot of fuzzy language. He predicts there will be a lot of contractor bashing during “show trials” on the Hill to occur in the May timeframe. A lot of the frustration directed at contractors is really caused by the lack of a quick fix for Iraq.
• Competitiveness — perception vs. reality. Soloway cited a lot of coverage that portrayed a big increase in sole sourced contracts. But look beneath the surface, and you see that only “full and open” competes are considered in those percentages. Well, the majority of awards today are either SBA set-asides or task order level contracts, neither of which are open. In fact, task orders are up over 300%. He does think there is a competitiveness problem, however. Because the SBA size limits are too low, contractors have to be either very large, to have a chance at prime contracts, or very small, to get set-asides. This leads to a “balkanization” of the contracting community — there is no support for the mid-size contractor, no seeding of the market with growing companies like in the private sector. The SBA is looking to revise the size definitions, but are very late in doing so.

I’ve seen some of these issues first-hand working for b2g clients at Strategic. We’ll see if the next Administration and Congress can change the dynamic at all.