January 2012

A Q&A with University of Pennsylvania professor Joseph Turow.

The promise of the Internet was a digital world in which the consumer was king. But in The Daily You, Turow argues that today’s hypercustomized media landscape is actually minimizing consumers’ power. He talked about the rise of the media buyer and the new data-driven advertising machine.

SNL Kagan reported that both Google and Dish Network have submitted bids to buy T-Mobile now that AT&T’s has ceased its overtures toward the country’s No. 4 operator. But the idea of Google becoming a wireless carrier is absolutely ridiculous.

There’s no arguing that Google has big ambitions to expand further into the wireless space. Not only did it build an overnight sensation with Android, it’s exploring the cutting edge of handset technologies with its Nexus line and will broaden its device scope with the purchase of ailing Motorola Mobility. The search giant is one of the biggest players in mobile apps, and remains a looming presence on the mobile Web. So why wouldn’t it want to complete that dominance by controlling the pipes that the deliver its services? There’s a big difference between delivering applications, services and devices and selling raw connectivity. Nowhere does this difference shine brighter than Google’s relationship with Verizon Wireless. Verizon benefits from the traffic that Android and Search deliver, and Google benefits from all of the Android devices that Verizon sells, but beyond that their common ground disappears, as the recent dust-up over Goggle Wallet shows. As an operator, Verizon has to carefully ration access to its network in the form of data caps and restrictions in order to make its profits. If Google were to buy T-Mobile it would be forced to do the same. As an apps and services innovator rationing bytes and bandwidth is the last thing Google wants to do.

Confirming what has already become apparent in the mobile market, a new study finds that screen size makes a difference when it comes to devices.

The report from research firm NPD In-Stat looked at consumer attitudes toward, and use of, devices including smartphones, portable media players and tablets. The majority of tablet owners have a screen size between 9 and 11 inches -- think iPad and Galaxy Tab -- optimized for sophisticated tasks that require a high level of interaction. “The top uses for tablets are Web browsing, email and downloading and using applications, which are productivity-based uses,” noted NPD In-Stat senior analyst Stephanie Ethier, who authored the study. “The larger screen supports more heavy text consumption and greater user interaction.” By contrast, people turn to portable media players, often identical to tablets except for the under-5-inch screen, mainly for entertainment-focused use like listening to music and watching video. The survey also found that the iPad was the favorite tablet among 652 survey participants, and that smartphones were the device used most often while watching TV.

When you glance at the National Broadband Plan action item website, you will see that it is reportedly at the 80% completion mark as the plan nears its 2 year anniversary. Then, look at the section called “Accelerate Universal Broadband Access and Adoption”—this is where all the “good stuff” on Universal Service Reform/Intercarrier Compensation reform lives—and you will see that the Federal Communications Commission’s goals have largely been achieved. Except for one: the elusive USF Contributions NPRM. According to the action item agenda, “To stabilize support mechanisms for universal service programs, in Q4 2010 propose rules to reform the process for collecting contributions to the USF.” Well, here we are a year after this objective should have been achieved and still no progress on USF contributions reform…and the National Telecommunications Cooperative Association (NTCA) is not letting the FCC forget about it.

NTCA discussed with FCC staff “prompt and effective reform of the contributions mechanism that enables the federal universal service fund.” NTCA argued for a revenue-based contributions mechanisms that “is technology neutral and best captures the value that consumers place on competing services;” “reflects the balance that consumers strike between different service offerings and the evolution of consumer preference;” is the “most equitable means of sharing responsibility;” and “can be implemented quickly with little burden to providers or the industry.” NTCA further argues that a revenue-based mechanism would be stabilizing and not overly complex, unlike a mechanism based on numbers or connections. NTCA believes that the FCC has ample authority to extend the contributions base.