Saturday, September 15, 2007

iTunes revelations: just 99c for TV episode?

99c videos would definitely catalyze video downloads and give studios back on volume what they lose on individual price. Lets see if Mr.Jobs can revolutionize (or should I say "itune-ise")the digital video business.

The iTunes digital tagging service also looks very interesting and very handy.

iTunes revelations: just 99c for TV episode?
13/09/2007 - by CommsDay

The other shoe has dropped on last week's highly publicized contretemps betweens US broadcaster NBC Universal and digital download giant iTunes. While NBC executives called out for pricing flexibility, Apple warned of its desire to more than double download prices to a whopping $4.99 per episode. Now it emerges that NBC may have been fleeing a future pointed in the opposite direction. A trio of insiders cited by industry rag Variety claim Apple is pushing studios to accept a halving of video download fees to just 99¢ per episode - the same price it charges for music tracks.

Studios have proven reluctant to embrace digital distribution, with anxious critics pointing to the Internet’s devastating alleged impact on music companies. But the runaway success of DVD has proven a boon to studio coffers and bean counters are leery of undercutting that market with lower pricing despite the cost savings. Currently a full season on iTunes costs more than the retail price of a DVD box set; if Apple has its way it will soon cost less.

Video has been something of a black mark for Apple, which claims success with iTunes even though downloads are utterly dwarfed by music sales. Apple head Steve Jobs has found it difficult convincing studios to offer films at his preferred $12.99 price point - only Disney, in which Jobs is the largest individual shareholder - complies. TV shows have faired better, although the selection remains spotty and downloads rank in the thousands.

Jobs believes 99¢ video would immediately goose sales and give studios back on volume what it loses on individual price. It's the same argument Apple has used to quash music label rebellion in the past and the lack of any meaningful competition suggests he might be on to something.

For now studios are closely monitoring a number of nascent rivals, including licensed streaming operation Joost, the Microsoft Silverlight project and NBC Universal's own in-house Hulu portal. Some, including ABC, have already inked iTunes contract extensions, while others hope to persuade Apple to accept variable pricing, according to Variety. An Apple spokesperson declined to comment on the report beyond ruling out a "dramatic price increase."

Jobs is mulling an even more ambitious gambit, according to insiders cited by Business Week. Sources claim Apple is considering a role in a forthcoming US spectrum license bid. The 700MHz airwaves - widely considered the last real chance to grab a significant wireless footprint - are expected to fetch up to $9 billion per license and have attracted other controversial players including Google and eBay.

Investors could respond harshly to a formal announcement, having last week punished Apple for discounting the iPhone at the expense of margins. Wireless services would depress the company's margins even further. Apple has a poor history of attracting network subscribers outside of its iTunes empire - its touted .mac initiative has only drawn 1.7 million paying members.

“Even for companies like Google, the economics are barely intelligible. For Apple, this seems highly implausible,” warned Txtbl CEO Amol Sarva. But on the other side of the equation is media darling the iPhone. Becoming its own cellular player would eliminate Apple’s pesky need for a wireless partner such as AT&T.

Cutting out the carrier would rectify the major complaints about the handset, and Apple could even use its hypothetical airwaves to offer cheap mobile VoIP service designed to lure ever more buyers for the hardware side.

Apple has already separated from AT&T to offer WiFi access to iTunes at Starbucks locations, and operating its own wireless service could make its new WiFi iPods even more attractive to consumers. “With the kind of cash position they have and the kind of push they just made into the handset space, it makes a lot of sense for them,” a former Apple executive told BusinessWeek. “Apple is the most anti-carrier company there is.”

Apple claims to have sold its 1 millionth iPhone just 74 days after launch. Earlier reports had pegged the handset as performing below expectations, including an iSuppli declaration that Apple had sold less than 450,000 units - although other reports indicated the iPhone outperformed any other smartphone.

Last week's decision to slash prices by $200 and discontinue the 4GB iPhone model drove down share prices and sparked analyst muttering. But the landmark 1 million target came three weeks early in the end. Apple hopes to shift 10 million units by the end of next year.

Apple has allied with iBiquity Digital to deploy a digital radio tagging service for iTunes. The offering enables HD radio listeners to press a button on select receivers to instantly flag songs for subsequent purchase as iTunes downloads.

Apple has already inked deals with vendors JBL and Polk Audio to integrate iTunes Tagging buttons on future HD radio receivers, hoping to secure a dominant position in the nascent market. HD radio is crawling with just a few hundred thousand US subscribers, although the HD Digital Radio Alliance recently unveiled a $250 million marketing fund.

AlcaLu Cuts 2007 Outlook by $1.25B

The first of the much touted mega mergers of infrastructure vendors continue to struggle in choppy waters. The combined entity has lost over 36% of its value in the last 9.5 months.

With change in the geographic mix and consequent pricing pressures, I frankly don't see this settling down over the medium term.

AlcaLu Cuts 2007 Outlook by $1.25B
September 13, 2007

Alcatel-Lucent saw its share price fall by more than 11 percent on the Paris stock exchange Thursday morning after it lowered its revenue outlook by up to $1.25 billion for the full year.

Despite reporting disappointing results for its first and second quarters this year, and citing unrelenting pressure from major competitors, AlcaLu's management had, until now, maintained that full-year revenues were set to grow "in the mid single digits," at a constant Euro/US$ exchange rate.

Now, though, the company -- which was formed on December 1 last year following the merger of Alcatel and Lucent -- "expects its full year 2007 revenue growth to be flat to slightly up at a constant Euro/USD exchange rate."

What does that mean? Well, the vendor's pro forma 2006 revenues -– the revenues Alcatel-Lucent would have generated if it had been a merged company for the whole of 2006 -– were €18.3 billion ($25.45 billion). So revenues for 2007 are now expected to be €18.3 billion, or slightly better, compared with the previous guidance of around €19.2 billion ($26.7 billion).
That means AlcaLu now expects its 2007 revenues to be up to €900 million ($1.25 billion) lower than previously estimated.

The company says the revised forecast follows recent discussions with wireless customers in North America. AlcaLu "is now seeing a change in capital spending with those customers in 2007, compared to what it had anticipated. As a result, the company is not seeing the projected volume changes that would have mitigated the ongoing pricing pressures it is experiencing."

A spokesman for the company says that it can't provide "any details on specific customers accounts," or even say whether the impact comes from a small number of large customers.
The vendor's main wireless customers in North America are Verizon Wireless and Sprint Nextel Corp., both of which are large and long-time Lucent CDMA infrastructure customers.

Even before the companies merged, analysts were concerned about the potential of the vendor's CDMA business.

The company adds, though, that in "other regions and businesses, in particular wireline, enterprise and Asia-Pacific, revenue performance continues to be strong."

The news sent AlcaLu's share price down by €0.81, more than 11 percent, to €6.44 on the Paris exchange.

That means the company has lost more than 36 percent of its value during its nine-and-a-half months of operations. When Alcatel-Lucent began its life on December 1, 2006, its share price opened at €10.12.

That slump is bound to put pressure on CEO Pat Russo, who was recently named at the 10th most powerful woman in the world.

She is retaining a positive stance, though. In the company's prepared statement, Russo says: "While the company acknowledges that it is competing in a challenging market environment and executing a complex merger, it remains confident that it has the right combination of people and assets to position the company as a leading player in the industry.”

Better H2 needed

Even at the lower revenue target, AlcaLu will need to up its game during the second half of this year.

Its total revenues for the first half of 2007 were €8.2 billion ($11.4 billion), which means the company needs to generate at least €10.1 billion ($14 billion) in revenues in the second half of the year to match 2006's sales.

AlcaLu says revenues in the third quarter, which closes at the end of this month, are estimated to "grow slightly" compared with the second quarter's €4.3 billion, and that fourth-quarter revenues are "expected to ramp-up strongly over the third quarter," driven by "IP transformation, broadband deployment and associated services."

The analyst team at Dresdner Kleinwort expects the vendor to report third-quarter revenues of €4.47 billion ($6.2 billion) and fourth-quarter revenues of €5.38 billion ($7.48 billion).
The outlook isn't good for profitability either, as the North American CDMA business delivers healthy operating margins of around 20 percent, according to estimates from the Dresdner analysts.

The company says "the change in revenue mix is expected to negatively impact the profitability of the company, especially in the current [third] quarter," and that operating income for the current three-month period is "expected to be around breakeven."

Consequently, the vendor is looking to cut costs above and beyond its restructuring program. It says it's on course to achieve the planned €600 million ($833 million) in savings related to merger synergies, and will now "accelerate the execution of its current restructuring program and... implement additional focused cost reduction plans in markets which require further actions to be taken."

AlcaLu says it will update investors and analysts on its plans when it reports its third-quarter results on October 31.

Wednesday, September 12, 2007

Nokia Revamps its Location-Based Experiences

Maps & Navigation are a part of Nokia's recently launched Ovi consumer internet services. We are seeing a flurry of activity in this field with Google and Yahoo also making forays.

Whats interesting are the search and navigation features.

Nokia Revamps its Location-Based Experiences

Speaking at the Canalys Navigation forum in Barcelona, Nokia's Michael Halbherr shared insights about the current state of navigation and plans for updates and improvements for Nokia Maps. Launched in February of this year, the Nokia Maps mobile application and the Nokia Map Loader for PC's have each been downloaded over 1 million times.

A key point highlighted by Halbherr, head of the location-based experience team in Nokia Multimedia was the evolution of Nokia Maps from the first version, announced in February, to the next phase, which is available for download today. "We have taken a lot of the consumer feedback that we received when we launched Nokia Maps and are feeding that into the next versions of the product," said Mr. Halbherr.

The updated Nokia Maps application has a new streamlined user interface with improved nearby search and detailed categories. "Many people were saying that they didn't know how much data they were using, so we have added a data download counter in the map view. We also added a GPS status indicator so that you know when your device is connected to the satellites."

The updated version also comes with a bonus three-day trial Navigation license free of charge*. "With this trial users can try out the service over a weekend holiday or a short business trip and discover the convenience of having a personal navigation device integrated into their mobile."

"Speaking of streamlining things," added Halbherr, "We are happy to report that we have a new and improved PC Map Loader available for users to download." The Nokia Map Loader is used to conveniently side load maps on to the device before you need them. "The improved Map Loader transfers the maps up to 10 times faster than the first version and enables downloading the voice guidance files."

Tuesday, September 11, 2007

Wiki takes on the world…. from information control to search engines

An interesting concept in the Google dominated algorthmic search world.

Wiki takes on the world…. from information control to search engines
10/09/2007 13:57:00 - by Leila Makki

The founder of Wikipedia, the free online encyclopaedia, is launching a new search engine to rival giants Google and Yahoo! this December.

Jimmy Wales, who launched Wikipedia in 2001, believes that human beings are more capable of sorting the relevancy of search results than computers. His latest project, Wikia Search will retrieve more advanced search results and blow away the competition by 2011, he claims.

The Wiki founder believes that human beings have better “editorial judgement” than computers in choosing which websites are most relevant in searches. “People think of search as some kind of computer function but it’s really editorial – it’s journalism.”

"We have a really great method of doing it ourselves, we just look at the page," he says. "It usually only takes a second to figure out if the page is good, so the key here is building a community of trust.”

Wales continues: “If you consider one of the basic tasks of a search engine, it is to make a decision: ‘This page is good, this page sucks.’ Computers are notoriously bad at making such judgment, so algorithmic search has to go about it in a roundabout way,” he said.

Instead of algorithms that other search engines use to rank websites, Wikia Search will employ a similar method to Wikipedia, by having people around the world volunteer to rank websites. Wales trusts that users will contribute to the for-profit project because it's "fun to share knowledge" and to bring a little healthy competition to rival the dominant search engines.

Although people would voluntarily contribute to his search engine, only Wales will reap the financial benefits. That's because the new search engine differs from the non-profit, Wikipedia in that Wikia Search hopes to turn a profit from featured advertisements on search pages.

Wales has so far received financial support from business partners, including Amazon.com, Bessemer Venture Partners, and the founder of eBay, Pierre Omidya.

In its six years of existence, Wikipedia, ranks among the top ten most-visited websites worldwide and is currently in 253 languages. The online encyclopaedia has a total of 8.2 million articles, of which the English-language website alone contains a quarter of all entries, nearly 2 million articles.

In the UK, there were over 1.3 billion search results in July 2007, according to Nielsen/NetRating. Alex Burmaster, European Internet analyst at Nielsen/NetRatings said, “Research tools, dominated by Wikipedia, receive around four in every five visitors due to search – not surprising, when you consider how often Wikipedia shows up in the first page of Google results.”

“Wikipedia itself says that as it has many links and contains lots of content on a wide range of topics, their pages tend to rank well in search engines and to get a high PageRank on Google. Hence, large numbers of searchers clicking through to Wikipedia across a very wide range of search subjects,” he added.

Elsewhere, the Florida-headquartered company has received a lot of attention in the media lately with WikiScanner, a website that traces the source of edits made to Wikipedia. The contraption developed by computer science graduate Virgil Griffith last month, has exposed controversial edits from government agencies, corporations and public officials editing entries or criticism relating to them.

But so far there's been no word about the prospective search engine’s policy on storing cookies and personal information.

Vodafone Grooves to MusicStation

We again have a derby here - Apple, Nokia and now Vodafone ! And whats even more interesting is the fact that the Nokia N95 8 GB will have both the Apple and Nokia music service applications pre-loaded !

Vodafone Grooves to MusicStation
September 10, 2007

Vodafone UK stole some of Apple Inc.'s thunder in Europe with the launch of an unlimited music download service ahead of the revelation of the iPhone distribution partners on this side of the pond.

Vodafone announced today that it will offer in the U.K. Omnifone Ltd.'s MusicStation service, which provides unlimited music downloads for £1.99 (US$4) per week.

The music service news increases the speculation that Vodafone does not have an exclusive iPhone deal with Apple. Over the weekend, Vodafone CEO Arun Sarin shared his view on the famous device with London's Sunday Times: "It's a 2G phone, not 3G. When it's a broadband phone we will be interested in carrying it."

Vodafone will be the second operator to offer the service after Telenor ASA launched it in Sweden in June. Omnifone claims to have signed up 30 mobile operator partners in Europe, Asia, and Africa.

MusicStation has a library of more than 1 million tracks from independent labels, Universal Music Group, Sony BMG Music Entertainment, EMI Music, and Warner Music.

Vodafone says the service can be downloaded onto 70 percent to 80 percent of its current handsets. And the operator unveiled the new handset range for this Christmas season, which includes several 3G HSPDA handsets, such as the N95 8Gb from Nokia Corp. the SGH-F700V from Samsung Corp. , and the W910i from Sony Ericsson Mobile Communications . The MusicStation service will be preloaded onto these three devices.

Interestingly, MusicStation will compete directly with Nokia's own new Music Store on the Nokia N95 8Gb handset, because it comes preloaded with the device maker's service. So, users will have a choice of which music download service to use on that particular handset.

"We think we have very good insights into how customers want to use content services," says Tim Yates, chief marketing officer of Vodafone UK. "Nokia's is an interesting service, but we have good, in-depth knowledge of mobilizing services."

The MusicStation service will be accessed through the Vodafone Live! portal and billed on the customer's Vodafone phone bill. Tracks are downloaded over-the-air and directly to users' handsets. Subscribers will also be able to create a profile to receive relevant music news and updates and share tracks with other MusicStation users.

"For the first time, we're giving unlimited access to music," says Vodafone's Yates. "[The service] will meet the way customers want to consume music when they're out and about. We don't think anyone else will have a service like this in the U.K., at least for this coming Christmas season."

Monday, September 10, 2007

Linux re-emerging in the mobile arena


What was once a two horse race between Microsoft and Symbian in the mobile OS sector has suddenly turned into a bona fide Derby with no sure-bet winner. In addition to the recent spasm of iPhone-mania, boosting the Apple OS into the arena, there are now persistent rumours of a Google “Gphone” being announced late this summer featuring a Linux-based "Gphone OS".

Linux re-emerging in the mobile arena
31/08/2007 - by Andrew Beutmueller

A new study identifies the Linux operating system is the dark horse in the race to dominate the mobile OS sector.

Indeed Linux is ostensibly set to be the fastest-growing smartphone OS in the market with a compound annual growthrate in excess of 75 per cent over the next 5 years according to a recent study of the market by New York-based research group ABI.

This means 31 per cent or 331 million “smart device” users will have gone Linux during this period. Author of the study and Research director, Stuart Carlaw, claims that “the carrier community continues to identify Linux as one of the few operating systems that it intends to support in its long-term plans.”

Carlaw’s study also points to growing support in the handset OEM community, most notably by Motorola, but also by Nokia. Add to this the rise of mobile broadband and the impact that this has upon device convergence and the format plays into the hands of Linux.

What was once a two horse race between Microsoft and Symbian in the mobile OS sector has suddenly turned into a bona fide Derby with no sure-bet winner. In addition to the recent spasm of iPhone-mania, boosting the Apple OS into the arena, there are now persistent rumours of a Google “Gphone” being announced late this summer featuring a Linux-based "Gphone OS".

According to a recent article in www.endgadget.com, the GPhone has been in the works since 2005 when the search engine juggernaut acquired mobile software company Android, founded by Andy Rubin.

Reportedly Rubin’s team at Google “has developed a Linux-based mobile device OS which they're currently shopping around to handset makers and carriers on the premise of providing a flexible, customisable system -- with really great Google integration, of course.”

Another Silicon Valley company, MontaVista Software has been aggressively flogging the Linux mobile for several years now with its “Linux Carrier Grade Edition 4.0 (CGE)” software, which apparently combines “advanced hard real-time capabilities with Linux offering “the broadest AdvancedTCA hardware support available in the market,” according to a company statement.

CGE 4.0 is designed to address carrier grade class applications focused on open standards and high availability services.

The company’s customers include the top five handset makers.

CTO and co-founder of the Finnish database company Solid Information Technology, Ari Valtanen says, “The telecom market is moving toward interoperability and standards-based designs, giving original equipment manufacturers and telecom equipment manufacturers flexible building blocks to help them create reliable and secure solutions.”

Japan’s ACCESS software company is also in the mobile Linux game in a big way, emphasising the software’s open source flexibility as its ticket to take over the market especially beneficial due to the “flexibility associated with what promises to be a large and diverse ecosystem.”

“Economically, I believe all of the current mobile OS vendors will come to realise that the value in the total offering is in the services and applications not in the OS kernel and, as a result, will shift their offerings to become value added suppliers to the Linux ecosystem,” writes Gerry Purdy,the Chief Analyst for Mobile & Wireless at Frost & Sullivan in a recent paper.

Austrians Dig Mobile Payments

Another NFC showcase...similar limitation - only one handset and lack of a broad based ecosystem

Austrians Dig Mobile Payments

September 05, 2007

Austrian commuters can buy train tickets, and snacks, with their mobile phones thanks to Mobilkom Austria AG & Co. KG 's new mobile payment service that uses near field communication (NFC) technology.

Commuters simply hold their NFC-enabled mobile phone in front of a designated touch pad at the train station and the ticketing system generates an SMS message for the user to accept and send. The charge for the fare is added to the user's Mobilkom phone bill.

Users will still have to send an SMS to make the transaction, but in the next phase of the service, Mobilkom will cut out that step, says the operator's chief marketing officer, Hannes Ametsreiter.

Mobilkom's service is the "sexy" variety of mobile payments, according to Dave Wentker, Visa USA 's vice president of mobile innovations. In a recent Unstrung TV interview, Wentker said this kind of application will take some time to develop, because while the payment terminals are largely in place, there are not many handsets available with NFC capability.

Indeed, Mobilkom is launching its service with just one handset from Nokia Corp., the Nokia 6131 with NFC. Ametsreiter told Unstrung that Nokia had shipped only about a few thousand of these handsets to Mobilkom.

The NFC handsets can be used for purchases at 430 touch points in stations run by Vienna's public transport provider Wiener Linien; 120 touch points in Austrian national railway stations; and 400 Selecta vending machines, which sell snacks and drinks.

"This is another step for the mobile phone to become the device to manage everything in your life," says Ametsreiter, adding that he wants to extend the service to other transactions such as in supermarkets and parking garages.

Purchases are deducted from a user's Mobilkom phone bill. Mobilkom gets a transaction commission from the merchant and revenue from the sent SMS messages. Prepaid users can still use the service by signing up to Mobilkom's PayBox m-payment service for €15 ($20) per year.

Payforit the new PayPal of mobile phones launches in the UK

Finally we see relatively broad industry traction for a mPayment initiative.

Payforit promotes a secure and smooth experience by ensuring the payment process is transparent and consistent with accredited payment intermediaries and governed by a strict set of rules to protect consumers

Payforit the new PayPal of mobile phones launches in the UK
05/09/2007 - by Leila Makki

PayForIt, a new mobile Internet billing scheme designed to take payments for downloadable content and games is turning handsets in the UK into ‘digital wallets.’ The standardised payment service that allows people to make one-off, low-value purchases or set up a subscription service using their phone closely resembles a mobile equivalent of PayPal.

The Lancashire-based company went live on 1 September with the full support of all five major UK operators: 3, O2, Orange, T-Mobile and Vodafone. The service differentiates itself from SIM-based systems, by identifying users from their network connection, regardless of operator or handset.

The growth of premium rate SMS within the mobile industry has generated general confusion and lack of confidence in that billing system. However, the new service is trying to self-regulate mobile payment services by standardising and improving the way purchases are made over mobiles.

Barry Sharples, Joint CEO of 2ergo, the company behind Payforit said: "Payforit will provide a standard mobile payment mechanism for any content or service that consumers wish to buy using their phone, no matter what or who they are buying from, which will greatly increase consumer confidence."

Payforit promotes a secure and smooth experience by ensuring the payment process is transparent and consistent with accredited payment intermediaries and governed by a strict set of rules to protect consumers. According to the company, there is 24-hour system monitoring, engineering support and more than 10,000 automated system checks every hour.

The Payforit system has a standard information screen detailing exactly what has been purchased, where it was purchased, confirmation and the cost of the purchase- for billing transparency.

Furthermore, purchases or subscriptions via a mobile phone are automatically added on to a customer's phone bill or subtracted from a pay-as-you-go balance, and not through inputting credit/debit card details.

Mr. Sharples added, "For mobile internet providers, the payment service offers enhanced brand loyalty, increased customer retention and revenue growth by providing a more seamless and interactive service to mobile portal visitors."

Initially, Payforit allows payments of up to £10 on services such as ring tones, games, train tickets and parking fees, however, it won’t take long before it extends to other goods and services, including general web-based transactions.

Mobile games providers I-play, EA, and Gameloft, mapping company Multimap and mobile phone companies Sony Ericsson and Samsung have already begun offering the service.

Googlephone gossip goes gaga

Would be interesting to see the strategy Google finally adopts for its entry into the hyper competitive mobile phone segment and the target audience it wishes to lure.

Googlephone gossip goes gaga
04/09/2007 - by Leila Makki & Martyn Warwick

Rumours abound that cookie monster Google, is about to launch a cheap mobile phone – the Google Phone or, as it is being dubbed in the blogosphere, the "gPhone."

If you want to know anything about this fabled device, basically just pick your website or blog and make your choice – and there are dozens, if not hundreds, of them.

For example, the gadgets and consumer electronic web magazine Engadget claims that Google will make an announcement about the low cost phone within days whilst India’s Rediff.com declares the announcement at least a fortnight away and that India’s largest telco, Bharat Sanchar Nigam could be one of the manufacturers behind the gPhone.

Meanwhile, the blog, CrunchGear says, " Google is currently assessing over twenty HTC models and refining its final handset design," with a planned launch apparently scheduled for the first quarter of 2008. According to the blog, an "industry insider" says the Taiwanese-manufactured and supplied mobile phone will run on the Linux operating system and will feature integrated Google applications including Google Maps with built in GPS, Google Talk with free VoIP calls, and Gmail, Google's free email service.

There has been gossip about the imminent launch of a Google-branded handset since August 2005 when the company acquired the mobile software company Android, that had developed a Linux-based mobile device operating system. There are also strong and persistent rumours that the cookie monster has also been developing mobile applications such as a search engine for ring tones.

The scuttlebutt became even more frenetic when Google announced its participation to bid in an "open" frequencies auction that will take place in the US next January. The 700MHz spectrum sale will create an open mobile phone network across America that will be accessible to all devices and applications, and without restrictions on handsets typically and tyranically imposed by US mobile operators.

Other "industry insiders" say Google is keen to avoid any comparison with Apple's expensive and super-hyped iPhone and that the company will introduce an inexpensive yet sophisticated phone that will be widely available through multiple outlets and not "exclusively" tied to a particular operator.

According to yet another blogger, Mark ‘Rizzn’ Hopkins, the gPhone will be available to "open" frequencies and will cost US$100. Hopkin’s source, a "Google insider" says the gPhone is more likely to complete with and simultaneously complement Nicholas Negroponte's One Laptop Per Child (OLPC) initiative, "[The phone is] less about beating the iPhone and more about beating the $100 laptop," he says.

Google, as usual, says nothing very much but in a very loud voice. A statement reads, "We don't comment on market rumour or speculation. However, Google is committed to providing users with access to the world's information, and mobile becomes more important to those efforts every day. We're collaborating with partners worldwide to bring Google search and applications to mobile users everywhere. However, we have nothing to announce at this time."

This morning the discovery that Google has filed a patent filing for a mobile phone-based payments service has further stoked the already feverish speculation.

In fact, the patent application for GPay was filed last year, but, serendipitously, has only just been published. Strange that.

The application details how a text message from a mobile phone could trigger a "computer-implemented method of effectuating an electronic online payment". It describes a system whereby a user sends a text message to Google giving details of a payment to a specified payee. GPay would then debit the user’s bank account and credit the payee. It also suggests that a user would not have to keep an account with Gpay as payments would be made externally.

Other mobile payment systems exist but none has yet caught on sufficiently to reach critical mass and thus become a de facto industry standard and operators are very keen indeed to see mobile commerce become much more of a ubiquitous reality.

Commenting on this morning's news a Google spokesperson said: "We file patent applications on a variety of ideas that our employees come up with. Some of those ideas later mature into real products or services, some don’t."

Meanwhile and elsewhere, Google has been defending its advertising strategy.

The company's decision to overlay advertising on its YouTube video clips rather than embed traditional commercials had pundits scratching their heads last week. But Google insists that during recent tests the innovative feature had the effect of keeping around 90 per cent of viewers online and hooked to what they were watching. That figure compares to the massive 70 per cent of users who immediately switch off Internet video when presented with an embedded commercial at the start of the clip.

The interactivity inherent in an overlay - viewers can shut them off at any time - also frees the company to offer tailored advertising for much longer than the typical 10 second maximum favoured by most operators.

Google has tapped a number of major advertisers for its initial round of overlays - including content providers Time Warner and 20th Century Fox. And while marketers won't be able initially to purchase keyword associations, Google promises the eventual ability to link overlays to genre, user demo-graphic and time of day.

The overlays are designed primarily to improve the paltry US$15 million YouTube generated last year – while (allegedly) preserving the "user experience."

Google's media platforms director, Eileen Naughton says,"Ads need to provide value to the user community. We’ve proved over and over again on Google that adverts are really useful information when users raise their hands and engage with them."

Google: Thinking Bigger Than Phones?

So will Google be the new vanguard of the open source Linux platform ? I definitely agree that the bigger game pan revolves around the software (OS & apps) rather than the hardware which is commoditised and likely to be sourced from Taiwanese vendors.

Google: Thinking Bigger Than Phones?
September 06, 2007, UnStrung

It's hard not to get worked into a lather over the prospect of a Google phone. In so many ways, Google's entry into the space would change the competitive landscape.

Symbian Ltd. currently dominates the smartphone market with a 67 percent share, thanks to its strength in Europe. Microsoft Corp. commands a 14 percent share of the market.

If Google can make even a small chink in Microsoft's or Symbian's armour this could be a blow for Motorola Inc. and Palm Inc. Motorola has just introduced a new Linux platform, and Palm is working on one.

While details of Google's phone are scarce, Unstrung has learned from a source in the financial community that the software is actually the really important aspect of the search giant's mobile plans.

Google is said to be working on a Linux-based mobile operating system for phones. This would bring Google directly into competition with Microsoft and Symbian. "I have confirmed it is a Linux mobile operating system Google will be rolling out," the source tells Unstrung.
The source says that Google is working on -- and has been demonstrating -- "powerful tools" for third-party developers that could turn the phone business into a "race between Symbian, Microsoft Mobile, and Google Linux."

Simeon Simeonov, a partner at Polaris Venture Partners , who first hypothesized that Google was working on a BlackBerry-like device that will run Java (and possibly Linux), suggested that the impact Google may have on mobile developers was one of the most interesting aspects of its possible entry into wireless.

For its part, Google hasn't responed to Unstrung's questions about the latest GPhone talk. The firm, however, has been very active in the broader wireless market recently.

The company went toe-to-toe with the Federal Communications Commission (FCC) and major carriers over the 700MHz auctions recently and mostly got its way.

Google also recently hooked up with Sprint Nextel Corp. to work on a Web portal for its XOHM WiMax network. The firm said at the time that it was "exploring other avenues" with Sprint.

Reliance plans Indian mobile banking launch

With the rapid proliferation of mobile telephony in India, there have been a number of mobile payment initiatives in the recent part. Also on the horizon are a number of VC funded start-ups focusing on various flavours of mPayments.

Reliance plans Indian mobile banking launch

India’s Reliance is planning to team up with blue chip bank ICICI Bank in order to launch mobile banking services on subscriber's handsets, with the new service expected to launch by mid-September.

Reliance and ICICI Bank are already understood to have held extensive trials in several major operating circles of the mobile banking service which will enable ICICI Bank customers to transfer up to INR5,000 (US$123) to other ICICI Bank customers accounts. Reliance had about 37 million mobile subs at end-August.

The London Tube tests NFC technology, but where are the handsets?

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NFC technology is still very much in its infancy and there are few mobile phones on the market that support it. Nokia, a long-time fan of NFC technology has introduced the 6131 NFC handset.

Lack of a broad based ecosystem (handsets, readers at retail, etc.) is likely to retard the growth of NFC services. In addition, there are a host of other mobile payment options emerging.

The development of the market for NFC chipsets is being stunted as a result of the lack of an industry consensus on the technology.

The London Tube tests NFC technology, but where are the handsets?
03/09/2007 - by Leila Makki

In the UK, Transport for London (TfL) has just unveiled a trial of Near Field Communication (NFC) technology at the capital city's Blackfriars underground station.

The short-range wireless technology enables communication between devices over a very limited distance, and is expected to find a number of applications in mobile telephony.

The three month-long trial will allow the travelling public to access real-time travel information by placing NFC-enabled mobile handsets on any of 19 'smart posters' located around the station.
The smart posters also have NFC technology embedded in them and will pinpoint the exact location of the passenger and then send to him or her detailed travel information and maps including local attractions and landmarks.

A TfL spokesperson says, "The transfer from one mode of transport to another is the most difficult part of a journey. This system is about providing accurate, real-time information for passengers. It covers all modes of transport near Blackfriars, including the tube, rail, bus and river services."

In essence the posters are technologically similar to the Oyster travel smartcard that uses NFC or "contactless" technology within a range of about 3 inches of sensors on Transport for London and National Rail services within the Greater London area.

The new pilot scheme is part of a larger goal to test the ability of near field technology to transmit travel advice to mobile phones across the entirety of London’s huge underground railway system.

Vortix (Visualisation of Real-Time Transport Interchange) is behind the project and the scheme involves a partnership between TfL, Imperial College London and transport intelligence company Kizoom, with additional funding from the UK's Department for Trade and Industry.
Mike Beizsley, who heads Vortix, says: "This trial is a European first for providing customer in-journey information via NFC.

It is an exciting step for TfL's real-time programme's aim of delivering a new generation of timely, multi-modal and personalised information to its passengers."

However, NFC technology is still very much in its infancy and there are few mobile phones on the European market that support it. Nokia, a long-time fan of NFC technology has introduced the 6131 NFC handset, but so few devices available, critics say the TfL campaign is more of a PR exercise than anything else.

Moreover, ABI Research has cut the percentage of of NFC-enabled mobile phones it expects to be in use by 2011 from 50 per cent of the entire mobile handset base to 30 per cent. Furthermore, just last week the research house said that the development of the market for NFC chipsets is being stunted as a result of the lack of an industry consensus on the technology.

Saturday, September 08, 2007

Google Moves on M-Payments

Interesting to see Google is now making moves to tie-up the mobile VAS back-end (essentially payment gateway).

While there are already many companies positioned to offer SMS-based payments, Google is uniquely positioned and can make a difference with its strong advertising position. This is a form of disruption for the payment business.

Google Moves on M-Payments

September 04, 2007

The publication of Google's patent application for a mobile payment system fans the flames of speculation over Google's real mobile ambitions and the elusive Google Phone. But the search giant's move into payments could jumpstart mobile transactions where others have mostly failed.

The mobile payments patent revelation is the latest addition to the newsflow on Google's mobile strategy.

Google applied for the mobile payment patent in February this year, and the U.S. Patent and Trademark Office published the application last week. The application describes an SMS-based payment system, dubbed GPay.

Here's how it works: A user would send an SMS to the GPay system to make a purchase in a shop, the amount of the purchase is debited from the user's bank account and credited to the shop's account, and an SMS is sent to the shopkeeper to confirm that the transaction has been processed.

If that's not clear, the patent application spells it all out like this:

A computer-implemented method of effectuating an electronic on-line payment includes receiving at a computer server system a text message from a payor containing a payment request representing a payment amount sent by a payor device operating independently of the computer server system, determining a payment amount associated with the text message and debiting a payor account for an amount corresponding to the amount of the payment request, and crediting an account of a payee that is independent of the computer server system.

Google's GPay looks a lot like existing m-payment systems, such as the mobile version of Pay Pal. And there are other companies already providing SMS-based payments, such as Firethorn Holdings LLC , mFoundry Inc. , and Obopay Inc. .

"It's difficult to see what's new in [Google's system]," says Vincent Poulbere, principal analyst at Ovum. "Google's idea around mobile payment is very similar to PayPal's SMS payment capabilities."

While SMS-based payment is common, it is mostly used to purchase digital content that is downloaded to a mobile phone, such as ringtones. Payments are usually added to a subscriber's mobile phone bill. Companies like PayPal, and now Google, aim to get more people making everyday purchases in shops by sending SMS messages from their mobile phones.
But Ovum's Poulbere says that efforts to expand mobile transactions to non-digital purchases have been hindered by lack of interest from users and merchants.

"Initiatives around developing payment of non-digital content have mostly failed," he says.
But this is where Google can make a difference. With the weight of its advertising business, Google can entice merchants to its m-payment system by offering a discount on transaction processing fees in exchange for advertising. Google already does this with its online payment system called Google Checkout.

Poulbere explains: For every $1 spent on advertising with Google within a month, the merchant can get $10 worth of transactions processed for free during the following month. The cost to the merchant to use Google Checkout is a fixed fee of $1.62 per transaction plus 2 percent of the transaction value.

Google launched Google Checkout in the summer of 2006. It is available in the U.S. and U.K. In May this year Google launched the mobile version. But transactions through Google Checkout Mobile only work on merchants with WAP-enabled sites.

Poulbere says he does not know whether Google plans to subsidize Google Checkout Mobile with advertising, but the potential is certainly there.

"There are already many companies positioned to offer SMS-based payments," says Poulbere. "Google is uniquely positioned and can make a difference with its strong advertising position."
"This is a form of disruption for the payment business," he adds.

With Google Checkout Mobile and the potential for the SMS-based GPay system, Google is covering two different ways to make purchases from mobile phones.