The death knell for Nokia, Motorola and iPhone is spelt Chinese Android.

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A few weeks ago we ran an article about Microsoft being the most pirated software in the world as being an indicator for the success of the company.

ACTA was drafted to ensure that cheap “clone” copies of the world’s leading brands are not made by the East and dumped on the west undercutting the local manufacturers investment in their brand.

Chinese mobile phones were developed for the Chinese people in the first instance. The aim was to put a handset into the hands of every person in China.

With the average manufacturing price coming out at $17-$24, the Chinese “clone” handsets were affordable and subscriber numbers boomed.

To the extent, where on a worldwide basis, last year, Internet access via Mobile phones exceeded that of dial-up, ADSL and Cable subscribers.

The problem of course only arose when the “clones” were offered to the West complete with Windows mobile as the operating system.

Microsoft jumped up and down about their software being used for free on the Chinese “clones”.

A year is a lifetime in the technology world.

Windows mobile is no longer the OS of choice.

Google may have abandoned China, but the Chinese think-tanks have certainly not abandoned Google and Android is now available on a whole plethora of new phone offerings from the East.

Traditional phone manufacturers have to be careful how they implement “features” copied from other phone manufacturers.

Intellectual property is ignored largely by these manufacturers who use lawyers to draft the feature list to ensure that no patent claims are lodged.

Chinese manufacturers on the other hand haven’t quite bothered with this nicety.

They merely take the best of the features of all phones and churn out the new “clone”.

Which, surprise, surprise, surprise, is a clone no longer.

Want two standby Sims? Analogue TV ? Two earphone jacks for togetherness listening …. A real 3” screen, front and back cameras, video and still photography?

The Odyssey AU$120.88 or for 20 or more for AU$104.52 each

Chinese Odyssey Mobile Phone

At that price, you could afford to lose half a dozen before equaling the current cost of comparable leading “brandname” phones.

This particular phone runs the Nucleus [pdf file] RTOS OS from Oregon (USA) based Mentor Graphics.

Which according to Wikipedia,  boasts a Nucleus install base of over 1.6 billion mobile devices, as of mid-February, 2010.  (Our story on MS-Dos/win-95, XP etc quoted Microsoft as selling only 1,5-2 billion operating systems all up.).

That certainly puts Mentor Graphics in the top three of mobile operating systems.

However, we have been informed that Chinese vendors are readying the next generation Odyssey and it [and it's cousins] will all be loaded with Android.

DIGITAL DIVIDE

per capita

Industrialized

World

Emerging

World

Total
Banking account unique holders 950,000,000 79% 1,250,000,000 22% 2.2 B
Internet users incl PC, shared & mobile 775,000,000 63% 925,000,000 17% 1.7 B
Mobile phone subscriptions 1,600,000,000 3,000,000,000 4.6 B

Source: Tomi Ahonnen’s 2010 Phone Almanac

According to Comscore in the USA, the most popular phone in February this year was the Blackberry, followed by the iPhone with Android near the bottom but growing fast.

Top Smartphone Platforms
3 Month Avg. Ending Jan. 2010 vs. 3 Month Avg. Ending Oct. 2009
Total U.S. Age 13+
Share (%) of Smartphone Subscribers
Oct-09 Jan-10 Point Change
Total Smartphone Subscribers 100.0% 100.0% N/A
RIM 41.3% 43.0% 1.7
Apple 24.8% 25.1% 0.3

Source: ComScore MobiLens

American coverage is still spruiking the Blackberry RIM OS.

The Blackberry holds the lead because of it’s adoption across the business world. Instant emails, wherever is an important business tool – fifteen years late, but nevertheless, a handy option if your business life depends on rapid communications in writing.

However the nextgen phone users may be changing all that, with facebook updates, Tweets, and simple SMS taking over from email as the preferred method of what passes these days as deep and meaningful conversation.

“Wanna hook-up l8tr?”  does not require the RIM operating system.

And – have you seen this yet ? http://bit.ly?someaddress will work on any phone OS browser. Very Gay!

Twitter and sms have supplanted normal communications and created a windfall for the telecommunication companies.

Developers though are choosing sides and whilst application developer’s currently prefer the iPhone OS, unilaterally there is a move towards the Android platform for longer term projects.

Major name manufactuers are also following suite…

Android Smartphones

According to a recent international study by British Telecom, “Western business is not fully prepared for the imminent impact of emerging markets.  While more than six out of ten (64 per cent) directors of large American, British, French and German corporations accept that emerging economies will “reshape” the global business landscape, many seem to have only a rudimentary knowledge of their business environments.

Even though a clear majority (61 per cent) of respondents admit it is “crucial” their business is able to work with the economies of Brazil, Russia, India, China and South Africa – the so-called ‘BRICS’ nations – to succeed in the long term, many of them demonstrate worrying ignorance of the realities of those countries

http://www.itu.int/ituweblogs/treg/ct.ashx?id=e595ae2f-02fb-4f19-b95f-33a55bbe2e95&url=http%3a%2f%2fwww.bt.com%2fglobal%2fcollaboration%2fBRICS%2f

With Chinese phone factories (preferring the FREE Android operating system) churning out an estimated 400,000 phones per month, it will not be long before there will be two types of non-business related (RIM) phones in the world.

iPhones (24% of the population) and everyone else with Android. As iPhone users learn what the Android users can do with their “unlocked” non-proprietary operating system phones, the iPhone population will decrement accordingly.

References:

Comscore Phone Platforms Data

http://www.comscore.com/Press_Events/Press_Releases/2010/3/comScore_Reports_January_2010_U.S._Mobile_Subscriber_Market_Share

Growth in North America key for RIM as Apple, Android phones appeal to consumers

http://www.winnipegfreepress.com/life/sci_tech/international-growth-expected-for-rim-but-north-american-consumer-growth-key-97003369.html

Building Business With BRICS,  http://www.globalservices.bt.com/static/assets/pdf/white_papers/builiding_a_business_with_brics_new_en.pdf

Imagine downloading 85 movies a minute.

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Can’t be done say the experts.

Well what if a company was going to build out a 1 GB per second internet backbone that would allow you to do so?

Google yesterday announced their intention to do just that.
On their Blog at Think big with a gig: Our experimental fiber network they have extolled the virtues of fast network capabilities as assisting radiographers and home users to receive high resolution 3D images via fibre to the premises.

Initially the network is slated to only be provided to 50,000 to 500,000 Americans but Google are asking for communities of interested persons to contact them for consideration to being included in the first initial “test” rollouts.

There the fantasy ends for me, I live in Australia, the land of slow Internet.

Slow ?

Well, yes, for years Telstra have created an artificial bottleneck with their FDDI rings surrounding each DSLAM at the telephone exchanges.

This bottleneck was initially designed to add lag into the VOIP network so that they wouldn’t loose too much money from their voice operations.

Thankfully, Telstra have now learnt that there is more money in Data than there is in telephones. However they have learnt it fifteen years too late.

In a paper I wrote in 1996, I stated that Telstra Data income from international destinations was already exceeding their facsimile revenues and that VOIP would overtake traditional voice by 2000.

I was wrong about VOIP. Because Telstra built a special feature into their networks.

I call it the FUVNF, (sorry, you will have to decipher the acronym without my assistance – this is a family orientated publication).

Essentially, every time a packet is switched somewhere it requires an extra 34 milliseconds for the switching to occur.

VOIP becomes unusable at greater than 350-500 msec delay. Therefore to create a network on which VOIP cant be used, one just circulates the packets amongst a few switches before allowing it to go on it’s merry way.

Historical Flashback – 1997.

Here’s an explanation of Telstra’s actions and pricing model I wrote in June 1997 (An update to the 1997 paper).

In July 1996, Telstra increased the cost of Wholesale Internet from $0.02 cents per megabyte to $0.195 cents per megabyte. This increase was claimed by Telstra to be necessary to cover the cost of the trans
Pacific data link.

At the same time, Telstra announced that it was upgrading the Internet Network to “streamline” data flow. This streamlining was the construction of several core networks with a triumvirate egress network. Each switch (router) adds several milliseconds (approx 34 ms) to the length of time required for a packet to transit from A to E. In the diagram below, a packet traveling from A to E takes a minimum of 68 milliseconds whereas a packet traveling from A via B, C, D to get to E takes a minimum of 170 milliseconds.


For Example; a three minute call to the USA Telstra prime rate IDD (International Direct Dial) charges are $1.28 per minute to the USA The Telstra network is provisioned at 64 Kb bandwidth Therefore a 3 minute call to the USA would utilise 11.5 Megabits. The actual calculation of the cost of each kilobyte would be calculated in the
following manner:

60 seconds x 64 Kb x 3 / 1.28 = Data charges

11,520 Kb divided into $3.84 = $ 0.00033 per kilobyte.

(At off peak, this would cost $2.73 or $0.00023 per kilobyte.)

Telstra Internet Charging Model $0.195 per Megabyte.

Therefore, a 64 Kb conversation conducted via Internet Phone (Iphone) used to cost at anytime, 11,520 Kilobits (11.5 Megabits) @ $19.5 per Mb = $ 2.24 or $0.003 per packet.

One question that we have never heard asked in the Federal Parliament.

How much did Telstra’s artificial bottleneck cost Australia in :

  • International trade opportunities ?
  • E-Commerce Trade Opportunities ?
  • Foreign Investment in Australia ?

… and because Director’s, shareholders and our legislators are only interested in short term results (i.e.: this years bonus cheque) we never will hear the question asked in Parliament.

Back to the current Future……

So what will a world where a Gigabyte a second is normal, look like?

I can’t even hazard a guess. However the old Telstra model of building additional switching into a network to slow down the traffic will no longer work.

The Conclusion

Man lives for an average of seventy-five years (or thereabouts).

Most of us don’t actually start watching the tube until we are two or three years old.

So if we say that we spend three hours per day, every day of our lives watching ninety minute feature films, then we will be able to watch 54,750 movies and (on Googles new service) it will only take 21.72619 hours to download the whole lot.

If the content industry think they have a problem now with content, what will there future look like when citizens can download their entire lifetimes entertainment requirements in less than a day.

Let’s hope they find a solution to their P2P problems soon, just to ensure that they keep on making movies.

Postcript:

At OGN we fixed the “Telstra” problem by tunnelling direct links to ISP’s (to carry VOIP traffic) via the AUIX a nationawide NAP. But that’s a story for another day.

SMS Power beats Hollywood, Radio, Videogames & the Music Industry.

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Or – The Havenots become the Haves.

Preamble

It’s a well known fact that when placed under restricting circumstances, all animals will look for an escape or release from the restriction.

“The Internet treats censorship as a malfunction and routes around it.” – John Perry Barlow.

——————————————————————————————————————————–

The Article

IRC stands for Internet Relay Chat. It’s been around since I was a little boy. OK – It’s been around since 1988.

For those that are not familiar with IRC, it’s the same (in principle) as MSN chat, Yahoo chat, Skype chat – in fact all of those programs allow you to type messages to each other – via the internet – FOR FREE.

In fact in the early nineties, I, with a number of BBS sysops in Australia set-up a chat link called Ozlink and we connected our BBS’es to other BBS’es all over Australia.

I was connected to the Internet so we found like minded Sysops in other countries like like Florida Frankfurt and Colorado
to which we connected the Australian Ozlink chat.

It was fun, chatting to people on the other side of the
country or world. (This was BEFORE MSN/YAHOO etc.)

I fell in love with the technology because I saw it as a way for people to communicate with lots of other people, cheaply and as an economist, I just knew that had to be good for the economy.

Fast forward to 1996 and Telstra attempting to defend their voice traffic by attempting to implement a ”B” party charging regime for incoming VOIP calls via the internet.

Well we stopped that one with concerted activism which I believe for the first time in Australia had thousands of consumers sending faxes to their MP’s. (The power of the Net…)

Telecommunications companies in the early days of the Internet were moaning and groaning about losing revenue. Every one of those groaning, complaining Telco’s, are still with us today, stronger and more profitable than before the internet.

They observed, they learnt, they entered the ring and started boxing… and it rather looks like they have won the game. In most countries, it is the large Telco’s that control access to most of the internet infrastructure.

That accounts for approximately one fifth of the worlds population, mainly what we like to call the industrialized world.

The other 4.8 billion (the emerging economies) are still hunting with bows and arrows.

Or so I thought until I received an email from Tomi Ahonen today. It contained the summary of his 2010 Mobile Phone Almanac.

We started talking about messaging programs on the Internet.

Here are some bullet points from Tomi’s Almanac Cheat Sheet.

  • The mobile telecoms industry grew subscribers, services and revenues even in economic downturn
  • The ‘mobile internet’ browser service use (including WAP) now has more users than legacy PC based internet
  • The mobile phone is the only device that 30% of the world’s population carries Digital content revenues on mobile are four times as large as those on the legacy PC based internet
  • Mobile is considered the ‘first media’ in the emerging world, only medium able to reach half of the population
  • Mobile messaging revenues $153B are bigger than radio, Hollywood, videogaming & music industries combined


Source: TomiAhonen Almanac 2010

Sorry folks, I just have to say it again. WOW.

The phone companies – in a recession, increased their revenues to 153 Billion which combined is larger than all the revenues form Hollywood, Videogaming, the Music business and Radio combined.

And here is the interesting bit…

They didn’t need to sue their customers for using MSN/Yahoo or IRC.

They didn’t need to turn our courts into their personal employees.

They didn’t need to lobby our politicians for unworkable legislation.

The Telephone companies achieved their 12% revenue increase in the middle of a recession, the old fashion way.

By providing a service and billing for it.

Let me spell that out in large letters for the folk that don’t quite understand how this works.

If you are a mobile phone consumer and wish to send a message – first you have to be located within a service area, and you need a mobile phone.

If there is no Cellphone tower within range, the Telephone Company don’t get your business.

So of course, Telephone companies build infrastructure to make sure that there’s a cellphone tower close by, in case you want to send an SMS.

If you cant afford to buy an expensive handset, they offer you whichever handset you want on a pay by the month plan; just to ensure that they have your business.

SMS messaging in Australia started in 1995. Billing for the messages commenced in 1996 at $0.25 per message.

Now the cost of SMS varies between three cents and eight cents (at the wholesale level) and twelve cents to twenty cents at the retail level.

According to Tomi’s data, 3.6 billion people used messaging services of whom 2 billion were from emerging nations. )(OK so bows and arrows and cellphones….)

So now persons in emerging nations are able to afford to send a message to others for a few pennies/cents.

Obviously low cost messaging with availability of service equals windfall revenues for the carriers.

Can those emerging nations afford to buy a Blu-Ray copy of this years movie? – Nope.

Can they buy it from Amazon if they don’t live in the USA?
– Nope.

Is there any legal affordable manner for them to obtain the content legally ? – Nope.

What choice do they have?

They can download it from the Net or not watch it.

That’s not a choice, it’s a Technical Meme waiting for some software to make it happen.

Oh the software for mobile phone P2P downloads already exists?

Sure has done since 2004.

But only for people from the industrial countries surely.

Nope, its available to anyone with a data connection.


Source: TomiAhonen Almanac 2010

And as can be seen from Tomi’s connectivity data, the communication crossover between industrialized and emerging has occurred.

DIGITAL
DIVIDE per capita

Industrialized World

Emerging World

Total

Banking account unique holders

950,000,000

(79%)

1,250,000,000

(22%)

2.2 B

Internet users incl PC, shared & mobile

775,000,000

(63%)

925,000,000

(17%)

1.7 B

Mobile phone subscriptions

1,600,000,000

3,000,000,000

4.6 B

There are now more people connected from the emerging nations than the industrialized nations.

The moral of the story is that the industry that provides the ability for it’s customers to :

a) Acquire the content (get connected)

b) Use the content (send/receive a billable message)

c) Economically (cheaply)

Appears to be leaping ahead of the industry that makes the content

a) hard to get – if you happen to live in the wrong country.

b) too expensive

c) encrypted and too hard to use

d) self destroying DRM rental overnight digital copies

e) sues their customers

f)  wastes money lobbying Government to enact prehistoric legislation.

g) When it does make the content available – it is usually not in a timely manner.

In other words what would happen if when you wanted to send an SMS, the Telephone company operator came on the line and said – I’m sorry sir, but SMS service to your destination party will be delayed for three to six months from the time you send the message.

When you ask why…..

The operatior replies….

Well our boss is on the board of Warner Bros Studios and it’s a new thing they’re trialling. Three month Delayed SMS. Do you think it will catch on?

The Telcos with their agressive and suportive marketing plans have made a success of harvesting increasing revenues from countries who it seems only last decade were on our foreign aid recipient list.

We wonder if the content industry can learn to do the same.

After all, look at the money they made out of a lousy billion people. How much could they make our of selling that catalogue to five billion more?

Hint – A Bluray video that sells for $25.00 on Amazon is not going to sell too well in Burundi where the average income is $120.00 per annum.

(Of course I’m assuming that unlike Australians, Burundians will be able to purchase Video content from Amazon and not be told – I’m sorry the country of your IP address is not yet authorized to purchase that content…..) AAaaaaargh!

Disclosure:

I have purchased Tomi Ahonens 2009 Almanac. I have no other connection with Tomi or his products. I do however happen to like the way he presents his data and findings.

References:

Tomi Ahonen “Tomi Ahonen Almanac 2010″

[Tomi Ahonen presentation and slides on The Next 4 Billion]

http://fora.tv/2009/09/24/Mobile_Phones_The_Next_4_Billion_with_Tomi_Ahonen