VoIP Over WiFi WILL Disrupt the Cellular Industry
“What if, instead of burning up minutes on your cellphone plan, you could make free or cheap calls over the wireless networks that allow Internet access in many coffee shops, airports and homes?” asks Matt Richtel.
The Times has recently discovered what you probably already knew, The next generation of cell phones have WiFi access built into them. Although there are some nasty non-technical details to be worked out, these phones can go online via a hotspot as easily as they connect to a cell tower.
But, here’s the rub for the cellular industry: when these phones log on in a hotspot, they can become VoIP phones as in free or very cheap calling, as in Skype. Telco have invested their typical borrowed billions in wireless frequency auctions and in so-called 3G services. These investments were made on the premise that wireless prices for voice and some services would stay astronomically high compared to landline and Internet connections. Whoops. You can hear the write-offs and bankruptcies coming!
I don’t usually give investment advice and I should never be believed in the short-term because I get notoriously ahead of the markets (called poor timing). Nevertheless, I am avoiding investing in any company whose income growth depends on traditional wireless – even sold some mutual funds which were too heavily invested in the sector. This includes most major telcos – many of which are now being touted by analysts again.
My guess if that the complete disruption of this industry will take five years (see note above on market timing). This disruption may require that mobile phones support some varieties of WiMax as well as WiFi for nearly universal coverage.
Here’s a bunch of specific predictions:
- WiFi support in mobile phones will wipe out the distinction between the mobile phone and the home phone (about time!). When you are in your house, your phone will be logged into your home WiFi and become your home phone.
- WiFi support in mobile phones will shift the balance of power from the big wireless operators to the cellphone hardware and software makers. Phones will be purchased independently of calling plans just as computers are purchased independent of Internet connectivity arrangements. Coupons for access may be included with phones instead of phones being included with calling plans. Why? Because voice calling will be too cheap to meter and hardware will still cost something.
- The about-to-happen incredible growth of the WiFi mesh will benefit from the savings in cellular costs it enables; and the incredible growth in WiFi availability will hasten the day when traditional expensive cellular connections (an the price paid for them) are obsolete. A true virtuous circle.
- Existing cellular infrastructure will be used as LOW-COST wireless access to the Internet (EVDO does this today at a fairly high price). This is exactly analogous to the use of today’s legacy copper network to carry DSL over which VoIP functions. Problem for the owners of this infrastructure (at least owners of the frequencies and radios – towers will be good) is that the rates they’ll be able to charge in competition with WiFi and WiMax won’t pay the interest on the debt incurred to build those networks. So bankruptcies will be required to lower the cost basis of these assets and make them affordable.
Telco history is particularly repetitious. Here’s another excerpt from the NYTimes article:
“A spokesman for Verizon Wireless, Jeff Nelson, said the company was looking at Wi-Fi service but had no plans to offer a product in this area. ‘At this point, we don’t see a great application for customers,’ he said.”
The Times also says that carriers think use of public WiFi spectrum will degrade quality so consumers won’t want that.
You may remember that these are the same reasons telcos ignored VoIP ten years ago. And why AT&T sold all rights to it mobile technology a generation before that. Their consultants told them no one would use a service with the poor quality and the insecurity of radio as opposed to the (illusory) security of wireline.
The telcos are afflicted with the incumbent’s dilemma: they could embrace the new technology and hasten the death of their traditional wireless cash cow. They might survive better that way. But they’ll be worse off next quarter and the quarter after that. And might have to write-off the assets currently on their books if they recognize the disruption.
That’s why upstarts who enable the disruption won’t have to worry about marketplace competition from the incumbents early on. Regulatory “competition”, of course, is another story.
Unauthorized Charges on Your Local Phone - Utility Bill? R2
ReplyDeleteFCC fines Verizon over 'mystery' fees $25 million and $52 million in refunds – 10/28/2010
How to Find Them, Eliminate Them & Get Your Money Back!
If your business still gets its phone service through the old "AT&T and Verizon, etc" local phone company (as opposed to one of the newer competitive phone providers) then you need to double check your phone bill each and every month for charges you did not authorize. You may not know it but the local phone company allows other companies to bill you through your local phone bill. And while the local phone company allows other businesses to bill you through your local phone bill, the local phone company does not verify that the charges being billed to you by the other company are valid. When these unauthorized charges fraudulently appear on your phone bill it's called "cramming". Unfortunately you as the business owner or manager are the only one that can spot the unauthorized charges and if you don't comb over your bill every month to spot these unauthorized charges - you'll pay for them.
Customers get crammed when a dishonest company puts charges on their phone bill (landline or wireless) for services that were not wanted or authorized.
Why does the local phone company allow other companies to pass charges onto your phone bill? "Third-party billing" is supposedly a great convenience in that you only have to pay one bill instead of separate bills for obvious authorized phone related charges like yellow-page advertising in the "real yellow pages", 411 information calls and long-distance calls from your chosen long distance carrier. Over the years though, some less-than-scrupulous companies have realized that most businesses rarely scrutinize their local-phone bills. To take advantage of this, these companies have come up with elaborate schemes to place unauthorized charges on your phone bill that you'll end up paying for without even thinking. Unauthorized charges you can end up paying for include charges for unwanted (and unused) email accounts, web sites, directory information calls, directory advertising in obscure publications, voice mail accounts and other services.
In theory, before these charges can be placed on your phone bill, the company that is originating the third-party billed charges is supposed to have a verification of the order like a voice recording. In reality though, all the company needs to do to initiate the charge is submit your name and phone number to the billing entity. The verifications are only required to be produced if a complaint is filed.
YJ Draiman
By Benjamin Franklin
ReplyDeleteConstitutional Convention of 1787
I confess that I do not entirely approve of this Constitution at present; but, sir, I am not sure I shall never approve of it, for, having lived long, I have experienced many instances of being obliged, by better information or fuller consideration, to change opinions even on important subjects, which I once thought right, but found to be otherwise. It is therefore that, the older I grow, the more apt I am to doubt my own judgment of others. Most men, indeed, as well as most sects in religion, think themselves on possession of all truth, and that wherever others differ from them, it is so far error. Steele, a Protestant, in a dedication, tells the pope that the only difference between our two churches in their opinions of the certainty of their doctrine is, Romish Church is infallible, and the Church of England is never in the wrong. But, though many private persons think almost as highly of their own infallibility as of their own sect, few express it so naturally as a certain French lady, who, in a little dispute with her sister, said: "But I meet with nobody but myself that is always in the right."
In these sentiments, sir, I agree to this Constitution with all its faults --if they are such -- because I think a general government necessary for us, and there is no form of government but what may be a blessing to the people if well administered; and I believe, further, that this is likely to be well administered for a course of years, [the institution of the federal reserve and Income Tax (1913) was the kiss the death for Liberty and Justice in America] and can only end in despotism, [we're here people!] as other forms have done before it, when the people shall become so corrupted as to need despotic government, being incapable of any other. I doubt too, whether any other convention we can obtain may be able to make a better Constitution; for, when you assemble a number of men, to have the advantage of their joint wisdom, you inevitably assemble with those men all their prejudices, their passions, their errors of opinion, their local interests, and their selfish views. From such an assembly can a perfect product be expected?
Life Is a Gift from God
ReplyDeleteWe hold from God the gift which includes all others. This gift is life -- physical, intellectual, and moral life.
But life cannot maintain itself alone. The Creator of life has entrusted us with the responsibility of preserving, developing, and perfecting it. In order that we may accomplish this, He has provided us with a collection of marvelous faculties. And He has put us in the midst of a variety of natural resources. By the application of our faculties to these natural resources we convert them into products, and use them. This process is necessary in order that life may run its appointed course.
Life, faculties, production--in other words, individuality, liberty, property -- this is man. And in spite of the cunning of artful political leaders, these three gifts from God precede all human legislation, and are superior to it.
Life, liberty, and property do not exist because men have made laws. On the contrary, it was the fact that life, liberty, and property existed beforehand that caused men to make laws in the first place.
What Is Law ?
What, then, is law? It is the collective organization of the individual right to lawful defense.
Each of us has a natural right--from God--to defend his person, his liberty, and his property. These are the three basic requirements of life, and the preservation of any one of them is completely dependent upon the preservation of the other two. For what are our faculties but the extension of our individuality? And what is property but an extension of our faculties?
Life Is a Gift from God
ReplyDeleteWe hold from God the gift which includes all others. This gift is life -- physical, intellectual, and moral life.
But life cannot maintain itself alone. The Creator of life has entrusted us with the responsibility of preserving, developing, and perfecting it. In order that we may accomplish this, He has provided us with a collection of marvelous faculties. And He has put us in the midst of a variety of natural resources. By the application of our faculties to these natural resources we convert them into products, and use them. This process is necessary in order that life may run its appointed course.
Life, faculties, production--in other words, individuality, liberty, property -- this is man. And in spite of the cunning of artful political leaders, these three gifts from God precede all human legislation, and are superior to it.
Life, liberty, and property do not exist because men have made laws. On the contrary, it was the fact that life, liberty, and property existed beforehand that caused men to make laws in the first place.
What Is Law ?
What, then, is law? It is the collective organization of the individual right to lawful defense.
Each of us has a natural right--from God--to defend his person, his liberty, and his property. These are the three basic requirements of life, and the preservation of any one of them is completely dependent upon the preservation of the other two. For what are our faculties but the extension of our individuality? And what is property but an extension of our faculties?
Honest government is a must
ReplyDeleteThroughout our history, the American people have demanded that their government reflect our nation’s highest ideals of openness and honesty, transparency and integrity and -- above all else -- a clear commitment to protecting the interest of the American people, not powerful special interests.
When the excesses of a corrupt establishment have gone too far, the American people have risen up and reformed the political process to correct our course -- because ultimately it is the people who must lead.
Today, to achieve and maintain power, the leaders of our country have built a system where money not only buys influence, but the right to govern. Special interests and their lobbyists not only buy access, they buy results -- on any issue, no matter the public interest. This culture of corruption prevails through all levels of government.
Our leaders have made the terms of the deal very clear. Those who make an investment in keeping dishonest leaders in power will see a huge return on their investment in the form of corporate welfare, no-bid contracts and favorable regulation -- at the expense of the public interest.
This corrupt cycle must be broken. When our elected officials bend government to serve their own interests or those of their friends, our democracy is at risk.
Today we should be unveiling an ethics reforms package that will clean up our government so the American people can have the honest leadership they deserve, and so our government can get back to the work of the people for the people.
Honest leadership is not a partisan goal -- it is the key to a stronger Union. It is time to put progress ahead of politics. Together, we can change our government and rebuild trust with the American people. We call on all American’s to join the efforts in restoring honest leadership to all levels of government. The American people deserve nothing less.