Dial Zero
A look at what's surprising, silly, scary or stupid in telecommunications and data

Tuesday, March 31, 2009

Sprint is still in the toilet, but boss gets big bonus

Sprint Nextel Chief Executive Dan Hesse received a $2.6 million bonus in 2008, 30% higher than his targeted payout, even as the company's subscriber defections and losses mounted.

Hesse's overall compensation package for the year was valued in the company's proxy filing at $15.5 million, including equity grants and a base salary of $1.2 million. Sprint's customer base shrunk by 4.6 million during 2008, and it posted net losses totaling $2.8 billion.

Sprint spokesman James Fisher said Sprint has improved in several areas under Mr. Hesse's leadership, with customer call resolution up, $1 billion in cost-cuts in the second half of the year, and renegotiation of key credit agreements that has given Sprint some breathing room financially.

Fisher noted that the actual value of Hesse's equity awards is much smaller now than when they were granted, given the decline in Sprint's stock price. "The board thinks the most effective approach to executive compensation is to link it closely with our company's performance," he said. Sprint shares, which were trading at $3.43 in afternoon trading on the New York Stock Exchange, have lost more than 70% of their value since the beginning of 2008.

Hesse took the helm at Sprint in late 2007 when the company was already struggling and losing market share to rivals AT&T and Verizon Wireless.

"By most people's estimation Dan Hesse didn't cause Sprint to be in the situation they're in now," said Christopher King, a telecom analyst with Stifel Nicolaus. "And you can see early signs of some incremental progress that's being made."

Still, it appears Sprint did not achieve some of the goals set out in its own guidance on how bonuses are calculated. According to the proxy, one goal in early 2008 was to increase additions of customers on the Nextel side of the business. That unit, acquired in 2005, has been at the root of many of Sprint's problems in recent years. In 2008, the negative trend continued, with nearly 5 million Nextel users dropping the service.

Sprint's proxy does not say what its internal subscriber target was for the Nextel division. After the first quarter, Sprint dropped Nextel subscriber targets from its formula for calculating bonuses. Sprint also did not disclose its target for reducing churn -- the monthly customer turnover rate. Churn was reduced to 2.16% at the end of 2008 from 2.3% of the subscriber base at the end of 2007, but it is still significantly higher than Sprint's rivals.

AT&T's chief executive Randall Stephenson decided to forego a bonus in 2008. AT&T is considered on Wall Street to be among the best performing telecom companies, and its wireless business has taken market share from Sprint in recent years. Stephenson announced his decision after AT&T reported a 23% drop in fourth-quarter earnings and said it would cut 12,000 jobs.

The proxy also highlights the exit package Hesse would receive under various circumstances. If he were terminated without cause, he would get a package valued at $10.1 million. If he left after a change of control -- such as a sale of Sprint to another carrier -- he would receive a package valued at $10.7 million. (info from The Wall Street Journal)

Monday, March 30, 2009

Skype to allow iPhone users to bypass AT&T to make calls

EBay's Skype subsidiary plans to release a version of its Internet-based phone software for Apple's iPhone. The move puts Skype in competition for wireless voice services with network operators such as AT&T and Verizon Wireless.

Skype's free software allows iPhone users to call other Skype users on computers or supported cellphones free if they are in a Wi-Fi hot spot. Or they may call land line phones for a fee, typically 2.1 cents a minute.

Skype already offers software for smart phones using Microsoft's Windows Mobile operating system, which the company says has been downloaded 12 million times since 2005. It released a version of the software in January for the Android G1 phone, a product backed by Google, and says it will introduce a version that works on BlackBerry devices later this year.

Skype uses VoIP (Voice over Internet protocol), which treats calls as data like email messages or Web pages and routes them over the Internet, rather than a traditional phone network. It has more than 400 million users around the world.

Skype's chief operating officer Scott Durchslag said the iPhone product is part of Skype's push toward cellphones, as opposed to the calls from computers, for which Skype is known. Mobile devices are "where the majority of the world's conversations are happening these days," he said.

Skype's move into mobile communications could threaten the business of wireless carriers, which generate the bulk of their revenue from cellphone calling plans. One sign of that tension is that the Skype iPhone software makes calls only when users are connected to a Wi-Fi network, and not over the AT&T 3G data network that US iPhone users already pay to access. Wi-Fi offers short-range wireless broadband Internet access around a "hot spot."

The software would also work with the iPod Touch -- which offers the same Wi-Fi capability as the iPhone without having to buy a cellphone plan -- but would require the user to purchase a microphone.

Durchslag said Apple's terms of service for software distributed through its iPhone App Store forbid Skype from accessing the AT&T 3G data network. In the US, Skype users can make calls over the 3G network on Android G1 on Deutsche Telekom AG's T-Mobile, as well as on the HTC Touch Pro on Verizon Wireless.

AT&T's terms of service for wireless data users don't specifically bar Internet calling on its other devices, but generally prohibit applications that would strain the company's network with too much data traffic.

Mobile data services can be expensive. Verizon, for example, charges about $2 a megabyte on some Web browsing plans, and a Skype call typically requires one to 6.25 kilobytes a second -- translating to about $4 in data charges for a 10-minute call. Such charges might undermine Skype's attractiveness, but users have the option of buying unlimited data-usage plans.

Durchslag said Skype, as a software company, has an advantage over network operators and handset makers in attracting customer loyalty. "We are not tied to a single device. We are not tied to a single network. We are ultimately the most flexible and personalizable vehicle for communication," he said. (info from The Wall Street Journal)

Friday, March 27, 2009

AT&T will warn web customers accused of media piracy

ATT, the nation's largest Internet service provider, will start sending warnings to its subscribers when music labels and movie studios allege that they are trafficking in pirated material. The phone company is joining other major ISPs that either go beyond legal requirements or interpret their duties under the law to mean that they have to forward such notices.

Jim Cicconi, AT&T's top executive in Washington, confirmed this week that the company is looking to expand a trial program it ran late last year with movie studios. It is currently testing a system with the Recording Industry Association of America and will expand the program with other rights organizations.

Comcast, Cox and Verizon already forward such notices, but the approaches differ, and the legal situation is muddled.

Copyright holders such as movie studios can, in many cases, identify Internet users who download or provide pirated material by their Internet address, but cannot match it up with a subscriber name without the cooperation of the Internet service provider. ISPs have previously identified their customers to copyright holders who bring court orders. The copyright holders and their representatives, like the RIAA, have then been able to sue the customers.

But that strategy had been widely criticized, and the RIAA said late last year it was abandoning its policy of filing lawsuits, opting instead to work with ISPs to cut abusers' access if they ignore repeated warnings. At the time, the RIAA said it agreed with several leading ISPs to notify alleged illegal file-sharers and cut off service if they failed to stop.

Cicconi said AT&T's program was not the result of a deal with the RIAA, and the music industry organization was not part of the first trials the company conducted of the notification system last year.

Under the new system at AT&T, copyright holders would send a notice to the ISP that a certain numerical Internet address is associated with piracy. The ISP would then automatically forward the notice to the customer via e-mail, without telling the copyright holder who the customer is.

AT&T and other participating ISPs are doing more for copyright owners than they are legally obliged to, according to Fred von Lohmann, a senior staff attorney at the Electronic Frontier Foundation. However, they do have an obligation to have a policy in place to kick off repeat offenders, he said.

AT&T will only forward the notice and won't threaten its customers with suspension of service or any other sanction, Cicconi said. If copyright holders want to go further, it's up to them to bring court orders, he said.

Cox, the fifth-largest ISP in the country with about 4 million Internet customers, forwards thousands of notices per month and has cut off a few repeat offenders.

There's confusion about the legal obligations of ISPs, von Lohmann said, because "nobody on either side has had the nerve to go to court over it, probably because the stakes are so high, neither side wants to gamble on what the ultimate answer might be."

In Ireland, the association representing RIAA members sued a local ISP, forcing it to disconnect a subscriber after three recorded copyright violations.

Internet lawyers and consumer advocates have pointed out that many reports of violations from copyright holders are inaccurate. Cox and AT&T said that in many cases, the notices have gone out to parents who didn't know that their children were pirating copyrighted material. In other cases, AT&T's Cicconi said, customers hadn't secured their wireless routers, and someone else near had been using them for downloading, so AT&T has helped customers secure their routers. (info from The Associated Press)

Wednesday, March 25, 2009

T-Mobile finally offers laptop service

T-Mobile USA is opening up its new cellular broadband network to laptops for the first time, with today's launch of a USB "dongle" that lets portable PCs get wireless Internet access.

The plug-in device costs $50 with a two-year contract, or $100 if the buyer is signing up for one year. From then, service costs $60 per month for up to five gigabytes of traffic.

The prices are similar to those at the three larger cellular carriers. T-Mobile is playing catch-up to Verizon Wireless, AT&T and Sprint Nextel in building a nationwide third-generation, or "3G" data network.

T-Mobile inaugurated the network last year for the use of a few phones, most notably the G1 "Google phone." The network reached about 100 million people by the end of 2008, and T-Mobile plans for it to cover 200 million by the end of this year.

T-Mobile subscribers using the dongle will get access to the company's network of 10,000 Wi-Fi hot spots at hotels, airports, and Borders book stores. They will also get free access at Starbucks shops, even though AT&T now operates those hot spots. Wi-Fi downloads are generally faster than 3G, and don't count toward the monthly traffic limit. (info from The Associated Press)

Tuesday, March 24, 2009

Union workers approve strike against AT&T

Union workers at AT&T have given their leaders the authority to call a strike as part of negotiations for a new contract covering 112,500 employees.

Several contracts covering workers at AT&T's landline division expire on April 4. AT&T is trying to make the employees pay more for their health care, among other concessions. The Communications Workers of America says 88 percent of members covered by the contracts voted in favor of a possible strike.

AT&T spokesman Walt Sharp says the strike authorization is "expected and routine at this stage in the negotiations." AT&T is the nation's largest employer of union labor. (info from The Associated Press)

Monday, March 23, 2009

Some 911 wackos greatest hits

A call came into 911 because two couples were going to share a hotel room and there weren't enough towels.

A lady called 911 because of a fight going on in a parking lot. When asked to describe the combatants, she said: "There's one man, and he's dressed like Elvis. He's kicking another man who's laying on the ground and screaming "You ain't nothing but a hound dog."

A man called and requested police call gas stations on all exits of I-95 to find out which ones were open.

A woman called 911 to report she had seen a wild mouse in her house.

Someone called 911 to report the parrot got out of his cage and is in a tree outside.

A man broke up with his girlfriend and wanted police to go over to her house and report to him the owners of any cars, other than hers, in her driveway.

A guy called to ask if they delivered dope. When the person answering told him it was the Sheriff's Department, he hung up.

A woman called to request a police officer come to her residence to change the battery in her smoke detector because she couldn't reach it.

A person called to find out the number to the police station.

Dispatcher: 911 What is your emergency?
Caller: I heard what sounded like gunshots coming from the brown house on the corner.
Dispatcher: Do you have an address?
Caller: No, I have on a blouse and slacks, why?

Dispatcher: 911 What is your emergency?
Caller: Someone broke into my house and took a bite out of my ham and cheese sandwich.
Dispatcher: Excuse me?
Caller: I made a ham and cheese sandwich and left it on the kitchen table and when I came back from the bathroom, someone had taken a bite out of it.
Dispatcher: Was anything else taken?
Caller: No, but this has happened to me before and I'm sick and tired of it!

Caller: Yeah, I'm having trouble breathing. I'm all out of breath. Darn....I think I'm going to pass out.
Dispatcher: Sir, where are you calling from?
Caller: I'm at a pay phone. North and Foster.
Dispatcher: Sir, an ambulance is on the way. Are you an asthmatic?
Caller: No
Dispatcher: What were you doing before you started having trouble breathing?
Caller: Running from the Police.

Dispatcher: 911 What is the nature of your emergency?
Caller: I'm trying to reach nine eleven but my phone doesn't have an eleven on it.
Dispatcher: This is nine eleven.
Caller: I thought you just said it was nine-one-one
Dispatcher: Yes, ma'am nine-one-one and nine-eleven are the same thing.
Caller: Honey, I may be old, but I'm not stupid

Friday, March 20, 2009

AT&T will sell you an iPhone with no contract

Starting next Thursday, AT&T will sell iPhones without requiring a two-year contract, but they will cost $400 more. AT&T will sell the phones for $599 or $699, depending on the storage capacity. The two models cost $199 or $299 under contract.

The company had said in July, when the latest version of the iPhone was launched, that it would sell contract-free phones in the US. Such phones are sold in some other countries.

The new phones will still be "locked" to AT&T and won't work with any other cellular carrier unless they're modified. AT&T will only activate them on the regular iPhone plans, which include a $30 monthly charge for data access. Prepaid service will not be available.

Apple, the maker of the iPhone, has been selling the device from its stores and Website, but would not say if it would sell the contract-free version.

Apple is expected to release a new version of the phone this summer. (info from The Associated Press)

Thursday, March 19, 2009

Craigslist busted for prostitution

Craigslist, the giant classified ad website, has antagonized the authorities over the ads in its adult section. Recently the sheriff in Cook County, Illinois called the site the “largest source of prostitution in America,” and filed a civil lawsuit to get Craigslist’s “erotic services” section shut down.

Cook County Sheriff Tom Dart announces at a news conference that he has filed suit, accusing the site of knowingly promoting and facilitating prostitution.

Dart said: “They’ve actually catered their site so it facilitates (prostitution), where you can actually and more specifically and quickly get to what you want.” He continued: “How is that different than somebody who’s aggressively and actively working with a pimp to try to get the word out about the women working for him?”

Craigslist, in a blog post by chief executive Jim Buckmaster, said that it doesn’t tolerate illegal activity on the site and has taken steps to stop it.

While the company thinks the latest complaint is “not well founded in law,” he writes, “we still very much appreciate and commend the good work of Sheriff Dart’s department, and will continue to provide any and all assistance whenever we are called upon to help in their efforts to protect and serve the people of Cook County.”

Responding to government complaints last fall, Craigslist agreed to crack down on ads posted by prostitutes, by requiring posters of erotic-services ads to give a working phone number and pay a fee with a valid credit card. (The adult ads, like most others on the site, were previously free.)

Does the sheriff’s suit have a legal leg to stand on?

Electronic Frontier Foundation senior staff attorney Matt Zimmerman doesn’t think so. “I would be surprised if it went very far,” he said today. Aside from Craigslist already cooperating with authorities, a federal court has already ruled that Websites are immune to liability for what a third party posts, so long as the site doesn’t directly help create that content. And if it ever got that far, constitutional freedom of speech protections likely also apply to Craiglist, he said.

He makes a practical point, too: Shutting down erotic ads on Craigslist probably wouldn’t make prostitution go away. “But wouldn’t one rather have a centralized location where people are posting information about illegal activity,” he asked. Such a database could make the sheriff’s job “a little easier.”

But all of that begs the question: Why does Craigslist have an “erotic services” section in the first place? As anybody who has ever picked up the classifieds section of a local newspaper has noticed, these sorts of ads can be a great source of income.

Craigslist has a more philosophical answer: Users asked for it, so that potentially objectionable ads wouldn’t be mixed in with the ordinary personals. The company says it isn’t interested in the money from erotic ads — it donates 100% of net revenue from “erotic services” ads to charities. (info from The Wall Street Journal)

Wednesday, March 18, 2009

AT&T's 3G network could not handle demand

Over the weekend, hordes of attendees at the South by Southwest Music and Media Conference in Austin, Texas overloaded AT&T's wireless network with their iPhones and other 3G-enabled devices. In response, AT&T doubled its network capacity in the city in a matter of hours.

When the iPhone 3G launched in July 2008, it was pretty clear from the start that there were lots of problems related to its ability to access AT&T's 3G network. Apple -- not AT&T -- took the fall, and in September issued a major firmware update for the 3G iPhone that "fixed" the iPhone's ability to connect to AT&T's 3G network.

In a blog posted yesterday, Om Malik said, "AT&T keeps denying that it has any network bandwidth problems and continued its state of denial in an article in the New York Times this past weekend. Kristin S. Rinne, senior VP of architecture and planning for AT&T, blamed the phones and the chipsets on handsets for some of the problems." At the same time, SXSW was kicking off in Austin. Om continues, "AT&T’s network choked and suddenly everyone was up in arms."

AT&T operates its network in the 850- to 1,900-MHz bands across the United States. Cellphones sold by AT&T can access either band. Between the two slices of spectrum, AT&T has major portions of the US covered, so cellphones will work wherever it has either 850- or 1,900-MHz spectrum.

In Austin, AT&T was using just the 1,900MHz band. In response to the outcry by SXSW attendees, AT&T doubled its network capacity in Austin by firing up the 850-MHz band on eight different towers that cover downtown Austin. This spectrum had been used for AT&T's analog network, and, according to Malik, AT&T will be turning on 850 MHz in San Francicso and New York City at some point later this year to add to its 3G capacity in those markets. Malik contends that AT&T is knowingly selling 3G devices that it doesn't necessarily have the capacity to support. (info from Information Week)

Tuesday, March 17, 2009

Telcos and cablecos oppose Federal financing of competitors

Cable TV companies and big phone companies don't want $7.2 billion in Federal stimulus money set aside for new high-speed Internet lines to subsidize upstarts planning to compete with existing broadband services.

Stimulus money should be used for "extending broadband [service] to unserved areas," the cable industry's lobbying group emphasized in a letter to members of Congress last week. The group repeated those remarks in a paper released Monday. Lobbyists for AT&T and Verizon are spreading the same message, urging regulators to spend the money only on wiring homes in rural areas that still rely on dial-up Internet service.

The definition of unserved, and how that is different from underserved, could be critical in deciding who gets stimulus money to extend broadband services, and where the money goes.

That isn't the only issue overshadowing the Obama administration's efforts to extend fast Internet services to more Americans. Advocates of an open Internet, or net neutrality, are wrangling with big telecommunications companies over what conditions, if any, are attached to grants. Meanwhile, industry groups want the money to be given to companies directly, instead of requirements that they work with local governments on grants. Local officials frown on that idea.

The biggest issue, however, is the debate over unserved areas versus underserved areas. Established broadband providers are concerned that the government not give federal grants to competitors looking to build new -- and potentially faster -- Internet services in markets that already have some form of broadband.

"We believe that the rules that will result here should not overly fund competitors in a market where there are already multiple broadband providers," said Matthew Polka, president of the American Cable Association, which represents smaller cable operators.

Midsize phone companies and consumer advocates argue that some stimulus money should be spent on new Internet lines in areas that already have service. New "middle mile" Internet lines could be used by multiple phone and wireless companies to offer faster service over longer distances, they say, and potentially increase competition.

Last year, a study by the Pew Internet & American Life Project found that only about 10% of Americans still use dial-up service. Upwards of 10 million households don't have any access to broadband service, according to a July 2008 Brookings Institution study, which found most unserved areas were in rural communities that are expensive to wire.

Cable and large phone companies would also like some of the $7.2 billion in stimulus funds to go toward spurring demand by consumers who have access to broadband now but don't subscribe. Incentives for such consumers might include things like subsidized purchases of PCs or discounted broadband access for low-income households, for instance, through an existing federal telephone-subsidy program.

Decisions on rules for the broadband stimulus grants are expected to be made in a few weeks, much faster than the usual government rule-making process. On Monday, hundreds of lobbyists packed in to the Commerce Department for the first workshop, which focused on eligibility requirements for private companies. Later this week, scheduled meetings will focus on issues including how to define unserved areas and how much of a role state officials should play in the grant-making process. (info from The Wall Street Journal)

Monday, March 16, 2009

AT&T wants to cut union wages & benefits. Strike is possible.

AT&T, the largest employer of union workers in the US, is renegotiating contracts that cover 112,500 workers, and seeks to take advantage of the recession to reduce its health care costs. Five regional union contracts expire on April 4. A sixth that expires a few months later is being negotiated at the same time.

The last time this batch of contracts was up for negotiation, five years ago, there was a four-day strike that was seen as a minor victory for the Communications Workers of America. But this time, the economic meltdown has shifted the balance of power decidedly toward the employer.

The contracts cover AT&T's shrinking wired phone business, rather than the growing cellphone division. AT&T wants concessions on health benefits, saying the wireline workers pay far fewer of their health care costs than employees on the mobile phone side. Retirees' health benefits are also likely to be affected. AT&T spends $5.5 billion a year on health care; its 2008 revenue was $124 billion.

UBS analyst John Hodulik wrote last week that a strike is likely, but that the company would come out on top. Management employees have received extensive training to keep the company running if there is a strike, he said, and AT&T could reap large savings on its health care costs.

Not only is the threat of job losses sharper in the current economy, said Sanford Bernstein analyst Craig Moffett, the union war chest is likely also badly depleted by the weak stock market. Unions in general also aren't very popular since they're getting some blame for the troubles of the auto industry. Ford, General Motors and Chrysler have negotiated concessions from their unions.

Since the last contract negotiation, cable companies, with a largely nonunion work force, have grown into a formidable competitor for home phone customers. Comcast announced last Wednesday that it was the third-largest provider of home phone service in the country, surpassing Qwest.

AT&T spokesman Walt Sharp said the workers covered by the expiring contracts pay 8 percent of their yearly health care costs, compared to the national average of 34 percent. Their total health care costs are also higher because the benefits structure doesn't promote responsibility, he said.

Meanwhile, AT&T employees are well paid, compared to the competition, Sharp said. A 2007 survey by the Bureau of Labor Statistics puts the hourly wages of phone company line installers and repairers at $26.80 per hour, compared to $19.50 per hour at cable companies.

Sharp also emphasized that AT&T in general has a good relationship with its unions. Of its 300,000 employees, 160,000 are unionized. It's the only wireless carrier with a large union work force. (info from The Associated Press)

Thursday, March 12, 2009

If you live near a border, don't call 911 with your cellphone

Radio waves don't recognize and stop at municipal and state borders.

Years ago I called 911 from my car to report an accident on the NY Thruway in Yonkers. I connected through a cell tower across the Hudson River and was connected to New Jersey State Police. I hung up and had the same problem two more times. On the third attempt I asked if they could transfer my call to the New York cops. They couldn't transfer, and I couldn't find a phone booth. I hope a cop discovered the crash in time to help the victims.

Now the Staten Island Advance has reported a similar problem:

After Jacyln Massa and her husband moved to Livingston, they got a word of caution from their neighbors: Do not use your cellphone to call 911 because, chances are, the people who pick up will be across the Kill van Kull in Bayonne, New Jersey. The advice also holds true for those dialing from slivers of land along the waterfront in Port Richmond and Mariners Harbor, according to Bayonne officials.

"I'm a nurse myself, and in a situation where it could be life or death, it's really insane to be patched to New Jersey," said Mrs. Massa, who did a test call with her Verizon phone, and sure enough reached Bayonne from in front of her home. "It's kind of scary."

Whereas 911 dialed from a land line will allow the emergency center to locate the caller, the same does not hold true for cellphone calls.

Emergency calls can also be routed to distant centers when one center becomes overloaded. Such was the case on Sept. 11 when Bayonne received dozens of calls from people trapped in the Twin Towers.

Bayonne operators are instructed to answer the 911 calls by saying "Bayonne Police."

But if they forget to make that clear, or if the panicked caller does not hear, precious seconds can be lost before the call gets put through the direct link to New York City 911 dispatchers.

Wednesday, March 11, 2009

ATT will subsidize netbook purchases

AT&T hopes to have the same discount-based sales success with netbooks as it did with Apple's iPhone. By forging marketing alliances with makers of the compact low-cost laptops, it hopes to expand its wireless customer base. With AT&T rebates, consumers can buy netbooks from Acer and Dell for $99 (about a third of the normal retail price), and AT&T is talking with other computer makers.

AT&T boosted demand for the iPhone by providing subsidies to Apple that lowered the device's retail cost to $199. AT&T gained by signing iPhone customers to two-year service contracts. AT&T charges iPhone users $30 a month for data service and garners $40 to $100 for calling plans.

While subsidies cost AT&T in the short term, it gains more high-spending consumers paying for its services. It wants use that strategy with other hardware, starting with the very popular netbooks. AT&T says it will expand its subsidy program to cameras, portable video game machines, GPS devices -- anything that uses lots of wireless data.

"The economics for us are terrific. We're willing to invest to get a customer," said AT&T's Glenn Lurie. "We're very comfortable with the margins we're going to receive on these netbooks, in the deals we're talking about."

The netbooks are equipped with built-in chips for wireless Internet access. AT&T charges netbook users $60 a month for data services, the same as it charges customers who use larger portable computers.

In Germany, wireless service provider T-Mobile began subsidizing netbook sales in September. AT&T's main US rival, Verizon Wireless, offers a $200 rebate for Sony's high-end Vaio Pocket netbook and also offers $100 rebates for some laptop PCs.

Wireless subscriber growth has slowed for AT&T, Verizon and other wireless firms. Also, AT&T is signing up fewer customers for DSL service at homes, another reason to invest in wireless broadband. AT&T spent billions of dollars upgrading its wireless phone network to 3G technology. In December, AT&T bought Wayport for $275 million. Wayport manages 20,000 Wi-Fi wireless hot spots nationwide. (info from Investor's Business Daily)

Tuesday, March 10, 2009

New rivals to iPhone App Store

Apple faces a growing threat to its iPhone business, as renegade stores spring up online to sell unauthorized software for the device.

The developer behind some popular iPhone software plans to open a service called Cydia Store that could potentially sell hundreds of iPhone applications that are not available through Apple's official store. Users must download special software that alters their iPhones before they can run these programs. Another small company plans a store called Rock Your Phone for iPhone users who have not yet modified their devices to make it easier to download and buy unauthorized applications. A third start-up is building an online store that specializes in selling adult games for the iPhone.

The new stores take aim at one of the underpinnings of the iPhone's success, Apple's App Store. It sells thousands of independently developed applications ranging from from games to news and entertainment features. People download them to their iPhones, often for free or as little as 99 cents.

When Apple opened the App Store, it provided building blocks so programmers could create software that worked on its phone. But the company tests submissions to maintain quality control and to protect the user experience. Apple collects a 30% commission from sellers on its store. 2008 sales were estimated to be about $150 million and are projected to reach $800 million this year.

The upstart sites can carry software programs that Apple won't, such as free app called Cycorder, which turns the iPhone into a camcorder. A $29 program dubbed PdaNET lets people use their iPhones as laptop modems to connect to the Internet.

Jay Freeman, who created Cycorder and is behind the Cydia Store, says he decided to open the store so developers like himself have a way to make money from their efforts. A big hurdle the Cydia Store and others face is that the applications they offer typically only work on iPhones that have been modified, or "jailbroken," to allow users to download unauthorized programs.

People have downloaded more than 500 million applications from the App Store, but the App Store rejects some submissions for technical and content reasons. It is also so sprawling that it can be difficult for a new developer to get programs noticed.

Apple appears to be preparing for a fight. While the company hasn't taken legal action against anyone for modifying iPhones or building applications for them, it filed a statement with the US Copyright Office. Apple maintains that use of software to modify iPhones is illegal, according to the Digital Millennium Copyright Act.

Cydia Store's Freeman says he has lined up a lawyer in case Apple takes legal action. "The overworking goal is to provide choice," he says. "It's understandable that [Apple] wants to control things, but it has been very limiting for developers and users." (info from TheWall Street Journal)

Monday, March 09, 2009

Is this something to brag about?

Infinity Publishing provides services to authors who can't or don't want to use traditional publishers.

The company brags about its innovation and technology. They distribute a useful promotional and instructional book aimed at prospective customers.

It includes this pathetic picture. The caption says "Michelle Shane, sales administrator, is seen here receiving an order for a book. She will then oversee the invoicing and sale of the book as it makes its way through our system. It will be shipped in less than 48 hours!"

The ancient CRT monitor on the desk is not the worst lapse of technology.

Poor Michelle's left arm is twisted like a pretzel to hold her telephone handset against her right ear to free her right hand for writing.

She's not even taking advantage of the high-tech shoulder rest that someone stuck onto the handset.

Michelle should be using a HEADSET, not a handset, so both of her hands will be free to conduct business.

And why is she writing on a piece of paper instead of typing on a keyboard?

I suppose her method is better than using a quill on a sheet of parchment -- but just barely. I wonder if Infinity's books are printed on demand, as scrolls, by monks working by candlelight.

Also, the company can't accept uploaded manuscripts, but they will let authors send in a stack of floppy disks. Some computer users have never used a floppy disk, and floppy drives are seldom installed in modern PCs.

Friday, March 06, 2009

New book about phone equipment and services

(press release about my own book)

A hundred years ago, telephones were simple. If you wanted to call someone, you picked up the receiver, cranked the crank, and waited for the nice lady to say, “Operator, may I help you?” Then you said something like, “I want to talk to Daddy,” or “I need the doctor;” and in a few seconds you were connected. You didn’t even need to know the phone numbers.

For equipment, maybe you could choose between an oak box on the kitchen wall, or a metal candlestick model on the hall table. If you lived in a high-tech area, maybe you could get a dial instead of a crank.

Regardless of the telephone style, you would pay to rent it month after month, and there was just one company in your town that you could do business with, and that company owned “your” phone.

Today the choices seem endless. Phones can be analog or digital, rotary or touch-tone, plain or fancy, corded, cordless, or cellular. You can connect through a local phone company, a national phone company, an international phone company, a TV company, a satellite company, a cellular company, or a VoIP company. Phone companies sell TV service. Cable television companies sell phone service. They both sell Internet service.

You can get a phone or phone system or a phone gadget from hundreds of sources, and buy it, rent it, lease it or may-be get a freebie. You can pay someone to install it, you can install it yourself, or you can get something that needs no installation.

An authoritative but easy-to-understand new book, “Phone Systems & Phones for Small Business and Home” by Michael N. Marcus helps people sort out their options. It covers basic phones, multi-line phone systems, add-ons like headsets, music-on-hold, paging systems, backup power and fax equipment — for professional offices, businesses and homes. There are sections on technology trends, telecommunications terminology, tools, wiring, troubleshooting, and much more.

The book will help people pick out the right size phone system, to minimize initial cost, and provide room to grow. It even deals with the important items that people really do need in a phone system, but are often left off sellers’ bids and proposals.

The book also sorts out the various technologies for making phone calls and accessing the Internet: conventional dial tone, ISDN, DSL, cable, fiber, T1 and VoIP.

Marcus’s book includes about 40 detailed hands-on product reviews. Recommendations range from a $12.99 home phone to complex multi-thousand-dollar business phone systems, plus a wide array of add-one to improve communications.

It will help readers avoid the worst mistakes of phone system buyers, and can help them decide if they can save money by installing their own home or business phones. The book will also help people quickly diagnose many common telecom troubles, and often fix them easily and inexpensively or maybe even for free.

Marcus says, “But even if you don’t plan to do your own phone work, by understanding what has to be done, you’re more likely to get the right thing done, and pay the right price. You could save much more than the price of this book.”

Some reader comments:

• Outstanding! An entertaining and sometimes humorous thorough education on phones and telecommunications. It’s a must-read for shoppers as well as salespeople.

• I’ve been in telecommunications for nearly 30 years, but I still learned a lot from this informative and entertaining book.

• After just three minutes I learned that a really annoying telephone problem could be cured for $4, instead of nearly $400. This book belongs in every office and many homes.

• This delightful book makes phones ultra-useful for people who run mini-Fortune 500 companies. Highly recommended.

The illustrated book has 396 pages. It is available from Amazon.com and other booksellers.

This is the third book on communications equipment written by Michael N. Marcus, a writer who has specialized in electronics and telecommunications for over 30 years. Marcus is a successful and popular explainer, known for mixing technology and humor. His humorous memoir “I Only Flunk My Brightest Students: stories from school and real life” was published in December.


If you get a new Amazon.com credit card, you can get a $30 certificate to pay for the book.

Thursday, March 05, 2009

Italy wants to ban texting for Lent, but Pope likes Facebook and uses YouTube

Roman Catholic bishops in Italy are urging the faithful to go on a high-tech fast for Lent, switching off modern devices from cars to iPods and abstaining from using the Web or text messaging until Easter.

The suggestion goes far beyond traditional meatless Fridays, giving a modern twist to traditional forms of abstinence in the five-week period Christians set aside for fasting and prayer ahead of Easter. It also shows the Church's increasing focus on technology's uses -- with many of the Lenten appeals posted on various dioceses' Websites.

Dioceses and Catholic groups in several cities called for a ban on text messaging every Friday in Lent, which began last week with Ash Wednesday.

"It's a small way to remember the importance of concrete and not virtual relationships," the Modena diocese said. "It's an instrument to remind us that our actions and lifestyles have consequences in distant countries." The diocese said the "no SMS day" seeks to draw attention to years of conflict in Congo fueled in part by the struggle for control of coltan mines. The mineral is an essential material in cellphones.

The Turin diocese is suggesting the faithful not watch television during Lent. In Trento, the church has created a "new lifestyles" calendar with proposals for each week of Lent. Some ideas: Leave cars at home and hop on a bike or a bus; stop throwing chewing gum on the street and start recycling waste; enjoy the silence of a week without the Internet and iPods.

Italians have reacted cautiously. Some say Lenten abstinence should be a personal matter, and others contend that people who need technology to work shouldn't be asked to do without. "What does giving up mean? If the use is capricious, then abstinence is welcome, but if technology is needed for work it makes no sense," said Giancarlo Angelo Andreis, a priest in Rome.

The Church is trying to balance an increasing appreciation of modern communication with a wariness of new media. In January, the Vatican launched its own YouTube channel, with Pope Benedict XVI welcoming viewers to this "great family that knows no borders." Benedict praised social networking sites such as Facebook and MySpace for forging friendships and understanding, but cautioned that online networking could isolate people from real social interaction. (info from The Associated Press)

Wednesday, March 04, 2009

SURPRISE! There's some good news in the telecom biz

Most recent telecom news has been doom-and-gloom, but there may be a slightly brighter LED at the end of the tunnel.

Research firm Gartner Inc. said Tuesday that about 315 million cellphones were sold in the fourth quarter of 2008, down 5% from a year earlier, but "we are seeing growth in 2010," a spokesperson said. "It will be very moderate, but growth."

Virgin Mobile USA posted a narrower fourth-quarter loss and returned to customer growth in a sign that more people are considering prepaid wireless plans.

Reversing two quarters of customer defections, Virgin Mobile added 216,000 net new users to end the period with a base of 5.4 million. The company's turnaround underscores the increasing reluctance of consumers to commit to a multiyear service plan given the uncertainty over the economy.

Net service revenue rose 10% to $326.7 million.

Helping Virgin Mobile is the increasing popularity of "hybrid" plans, which offer a set number of minutes at a standard price without a contract. When the plans launched a year ago, they attracted a third of all new customers who signed up. Now, more than half of Virgin Mobile's customers choose a hybrid plan.

The plans have helped Virgin Mobile reverse a trend of declining monthly revenue per user. The average revenue per user in the fourth quarter was $21.14, up from $20.36 a year ago.

The rate of customer cancellations -- typically higher for a prepaid service -- fell to 4.8% from 5.1% a year ago. Virgin Mobile faces stiff competition from Leap Wireless International Inc., MetroPCS Inc. and Sprint Nextel Corp.'s Boost, all of which offer flat-rate calling plans without a contract. (info from The Wall Street Journal)

Tuesday, March 03, 2009

Dish Network gains income but loses customers

Despite a 24% jump in fourth-quarter net income, Dish Network's subscriber base continued to dwindle, as it slipped further behind larger rivals in the pay-TV arena.

Dish is the USA's number-two satellite-to-home video broadcaster and posted net income of $217 million, or 48 cents a share, versus $175 million, or 39 cents a share, a year earlier.

But its customer base shrank for the third quarter in a row while marketing costs climbed. The gains in Dish's net income are primarily the result of raising prices and customers opting for more features. But even with average monthly prices up by 5% in the last quarter, the company hasn't been able to maintain the same revenue growth rate it had previously. Revenue grew 1% to $2.92 billion -- compared with a robust 11% a year ago -- highlighting Dish's increasing difficulty in sticking with its traditional focus on rural and lower-income customers.

Coupled with a wider fourth-quarter loss posted by sister firm EchoStar Corp. -- which also is controlled by Dish Chairman and founder Charles Ergen -- the results are bound to increase pressure on Ergen to find new partners or devise another survival strategy.

Even before the current economic turmoil, limited satellite capacity and other factors constrained Dish's high-definition program lineup compared with larger rival DirecTV. Dish lost more than 100,000 net subscribers during last year's fourth quarter, while DirecTV gained 301,000 net new customers in the same period. Dish also has been losing momentum due to aggressive video and Internet packages offered by cablecos and telcos.

For some time, analysts have viewed Ergen and his management team as treading water until they could find a way to differentiate their offerings from those of rivals. Now, many of the same analysts believe the company must urgently chart a new strategy. Dish's efforts to plot a new course suffered a major blow last month, when Ergen failed to gain control of Sirius XM Radio. The long-term goal, was seen to be combining broadcast spectrum and in-orbit assets to create a truly mobile video network.

Dish was hurt last month when AT&T officially ended its partnership and switched its joint marketing efforts to DirecTV. The AT&T tie-up accounted for nearly 20% of new subscribers in the latest quarter, and no new partners appear ready to make up the loss. (info from The Wall Street Journal)

Monday, March 02, 2009

Supreme Court supports AT&T in old Internet access price complaint

The US Supreme Court rejected claims by Internet service providers that AT&T's Pacific Bell predecessor charged unreasonable wholesale prices for access to the company's phone network. The opinion unanimously reversed a ruling by the 9th US Circuit Court of Appeals in San Francisco, which had allowed the case to proceed.

"We decline the invitation to recognize such claims. Two wrong claims do not make one that is right," wrote Chief Justice John Roberts Jr. He said the Internet companies haven't "stated a duty-to-deal claim" and also "have not stated a predatory-pricing claim."

The justices left open the possibility the Internet-service providers could argue a predatory-pricing claim when the case is reviewed by lower courts, but a majority of the justices said a high bar exists for those claims to succeed.

Now part of AT&T, Pacific Bell Telephone (also known as PacTel, PacBell and Pacific Telesys) was sued by several Internet services providers in 2003, including Linkline Communications, Notelog and In-Reach Internet.

By law, Pacific Bell is required to sell the service providers wholesale access to its telephone network. But the companies allege the prices were too high for them to effectively compete with the phone company's own Internet service. (info from The Wall Street Journal)