Sprint Nextel and Clearwire’s reported $12 billion joint venture to roll out ultra-fast wireless Internet access would be a significant boost to the cellular aspirations of Comcast, Time Warner Cable and Google.

The Wall Street Journal said the two companies have raised $3.2 billion in outside financing, including $1.05 billion from  Comcast, $550 million from Time Warner Cable, $500 million from Internet giant Google and  $1 billion from Intel. 

Cable companies are fretting at the wireless advantage of AT&T and Verizon, both of which have rolled out IPTV service to millions of customers over the last year. This combination, which reportedly will allow them to brand the service as their own, would allow them to add high-speed wireless to their TV, Internet and telephone options.

For Google, the deal helps cement its position as the dominant search provider in wireless in advance of an expected Google phone over the next 12 months.

Intel, which wil merge its broadband wireless services into Clearwire, gets a new breath of life for its data services, which have been sorely underutilized as subscribers flee its service.

According to the Journal, the new service will ultimately be as much as eight times faster than existing coverage.

See Also

• Sprint, Clearwire Deal Near

Posted under Uncategorized

The big winner in Led Zeppelin’s announcement that the band’s songs will be available digitally is Verizon.

The phone giant will get ringtone and similar mobile rights first. On Nov. 13, Verizon will get full digital rights to classic songs like "Stairway to Heaven" and "Money", along with iTunes.

It’s still hard to find a kid who listens to songs on their mobile phone (my son does, but he’s a self-proclaimed geek).

Verizon is quietly building for the future, much as Microsoft takes initial losses against rivals and survives by virtue of its heft to attack again.

Verizon is a triple threat: it sells mobile phones; it sells Internet; and its TV service is expanding into millions of homes. Make that a quadruple threat: it has a mobile TV, service, too.

There are a lot more cellphones in the world than iPods. Led Zeppelin is just the beginning of Verizon’s plans.

See Also

• Led Zeppelin to Make Its Songs Available Digitally
• Mobile Entertainment Summit

Posted under Uncategorized

In case you haven’t noticed, there’s a lot of fear in the air these days.

Intel’s announcement today shows why: its net income rises 43% for the quarter amid solid demand for its chips. And it’s laying off 2,000 employees.

Ericsson lowers its sales and earnings forecasts, calling the health of the once-booming wireless business into question.

See Also

• Intel’s Earnings Jump 43% on Demand for Laptop Chips
• Ericsson Stuns Investors, Warns of Lower Results
• Paulson Says Housing Is Likely to Adversely Affect Economy
• Economy, Intel, Chips, Ericsson, Wireless, Paulson

Posted under Uncategorized

The Apple iPhone rebate keeps the pressure on the wireless industry

Why did Steve Jobs really reduce the iPhone price a whopping $200 only 90 days after its release? Business 2.0’s blog reels off ten possible reasons. Did Apple just pass along reduced costs? Were they detecting slowing sales they needed to tweak. Or was it just simple price gouging of early adopters like me?

But when Steve Jobs responded to iPhoner complaints about having paid $499 and $599 in the past month and a half, the Web exploded in feint praise. Jobs will be giving me, an early buyer, $100 in credit to buy more from him. I am good with that. I had my eye on the iTouch anyway. Om Malik argues that the rebate move demonstrated the power of social networking online and the people’s new ability to wage a class action protest in a number of hours.

Well, yes. But the real message behind Apple’s move is that customer service is worth more to this brand than a $100 or so in lost revenue. When was the last time a major cell phone OEM or a carrier made a similar gesture? From day one, the unheralded lesson of the iPhone was the power of positive conumer experience. I personally went to both AT&T and an Apple store in search of my iPhone, and the difference between the two experiences made me feel embarrassed of the traditional wireless industry. Apple knew how to sell these things, explain these things, and service anyone walking through that door. It is not suprising to me that Piper Jaffray analysts showed how Apple stores were outselling AT&T outlets by 7-to-1.

It is wrong to believe that Apple gains user loyalty from sexy gadgetry alone. The real impact of the iPhone is how frowsy it makes other wireless technology look in its design and its relationship to consumers.

Posted under Michael's Blog

This week the Ministry of Information Industry (MII), China’s telecommunications regulator said mobile phone users exceeded 500 million at the end of June.

A total of 40.56 million mobile phone users signed up in the first half to reach 501 million, an average of  6.76 million a month. But there is still room for growth with 38 out of every 100 people in the mainland owining a phone.

Short message service traffic continues to go gangbusters, up 37.5 per cent to 279 billion messages. These figures also show China Mobile’s dominance continues as it takes the lion’s share of the market. It added over five million users on average each month since March, and 31.1 million users in the first six months. It is dwarfing smaller rival China Unicom, which had 151 million subscribers split across its GSM and CDMA networks. 112 million of those are GSM, the rest CDMA.

China Mobile’s success is also coming at the expense of the fixed-line industry (China Netcom and China Telecom) which is struggling with mobile substitution.  Across China only added 4.86 million users or 810,000 users per month on average in the first six months, adding up to 372 million. 

The lopsided industry where China Mobile’s pre-tax profits accounts for more than China Netcom, China Unicom and China Telecom put together is one reason speculation over industry restructuring fails to go away. It is another reason the fixed line players have been lobbying hard for mobile and IPTV licences.

Of course, broadband continues to be a bright spot for the fixed line carriers with users now reaching 122 million according to latest figures.  

Posted under Michael's Blog

Walt’s story in the Wall Street Journal (see my blog earlier today) is right across from one about Sprint’s CEO searching for a way out of its woes caused by annual subscribers canceling. Bad service aside (and I can personally vouch for that), Sprint’s most interesting prospects for luring new customers may be in new branded services for cable and IPTV companies.

Time Warner, Cox, Comcast and Advance/Newhouse are  quintupling to 40 metropolitan areas the wireless customers they service through leased space on Sprint’s network, according to BusinessWeek. Each service will have the respective cable company’s moniker on the screen and Sprint’s name on the phone.

Sprint’s already is the most enthusiastic endorser of Mobile Virtual Network Operators (MVNOs), hosting the likes of Virgin, Movida and Boost.

There was an AOL Time Warner, once upon a time. Maybe soon there will be a Time Warner Sprint.

See Also

• BW: Sprint-cable venture expands to business
• WSJ (Subscription Required): Sprint’s CEO Seeks Stronger Connection

Posted under Uncategorized