IT industry disrupts network value-chain

IT industry will disrupt equipment providers

As IT Telecom technologies are converging, the two industries practice co-petition. A good example was the impact of development of VoIP solutions in my own organization : HP OpenCall business Unit.

The new service development approach
Until 2000, the business unit had mainly supplied network equipment providers (NEPs) who then supplied telecom service providers (SPs) with integrated solutions. Prestigious customers such as Alcatel, Ericsson, Nortel, Nokia purchased from HP the real-time databases and signaling hardware to deliver intelligent network (IN) applications such as mobile pre-paid, #800 and Voice VPN services.

Enters Cisco with the VoIP wave promising a next generation telecoms and service infrastructure and outsourcing the service development to partners. Together with HP they launched the International SoftSwitch Consortium (later IMS forum) attracting many new software start-ups such as Netcentrex. And service providers like France Telecom / Equant or Fastweb requested that HP, not a NEP, leads the delivery to them an integrated solution. And for Cisco, working with integrator and systems vendors, the model was "business as usual". That's how HP delivered in 2000 a VoIP VPN to Equant, designed to serve corporate customers worldwide and scale to millions of subscribers. Another residential VoIP and IP TV deployment was to a new service provider, Fastweb who reached over 600'000 subscribers in 4 years. For these projects we assembled HP OpenCall service controller, Netcentrex and Radvision signaling elements, Kasenna media management and set-top boxes, Atos Origin custom service design and of course Cisco's IP PBX, VoIP gateways and MPLS backbones. As communication applications move to IT, the new world is fragmenting.

Managing the new value-chain
What has been the impact on OpenCall business unit. Well it has been forced to pursue a dual way to market : selling technology to industrial partners (the NEPs) as well as competing with them to sell to their customers (the SPs). This obvious channel conflict has been discussed by Benoit Sarazin from Farwind in his "Competing with your own channels" blog. He described how HP was able to grow faster than the market with this dual strategy. For the moment, the channel conflict only in the emerging applications market, where a significant market risk exists and players are willing to co-pete. And most importantly, innovation in communications requires new smaller players from the software space to enter the value-chain. And of course there is still plenty of room to cooperate on the infrastructure business. But when price pressure will come, both IT and NEP industries may want to commoditize each other.

Mobile video in Korea, May, 2005

As Korea was preparing to launch it's mobile video broadcasting services, I visited to understand the state-of-art and present HP's development in 3G video.

The best host in Seoul is my colleague Sung-Man Yoon who manages to do teleconferences, take care of his charming kids and run through a hectic program. Sung-man.yoon@hp.com

Sung H Park, President CEO FeelingK
I met also David Kim, Director Business Development to discuss fun call scenarios (probably best implemented later using 3GPP R05 for mid-call session establishment). FeelingK is one of the developers on HP’s OCMP media platform focusing on video portal solutions.

Kyoung-yong Jee , Researcher, ETRI

I attended his presentation at ExpoComm on terrestrial T-DMB wich has just been launched in May (1 test emitter).
Specifications :
. video = 5” 352x288x30fps H.264;
. audio = MPEG4 BSAC;
. spectrum =174-216 MHz .
Applications :
.5 TV channels + location data services.
. Voice control (ASR) Voice
EPG (XML) program guide.
Streaming text / images for advertisement.

On their demos I spotted an amazing 3D screen with polarized displays. Right frame encoded with ½ resolution. The whole thing is muxed / demuxed.

Joon-Mo Koo CEO, M Cube Works
I also met at their office Tony Oh planning and marketing , Yonho Chang , COO platform and services; Joon Ho Chang , Server development manager; Albert Kim Planning and marketing. Theie main product XEPEG works with SKT June and KDDI mobile VoD and S-DMB. Specifications :
. Video= MPEG-4, H.264 Baseline
. Audio=MPEG-4 AAC +
. Clients for ARM, Intel, TI, licensed to Qualcom and Nokia.

Young Soo You, Director Kicos
Very kindly invited me for lunch and gave me insights. Currently focused on radio and other innovations but took notice of my 3G video interest.

Pixtree

A visit at the Korean broadcasting exhibition to see the DMB infrastructure.
PixDMB-E100H encoder
. Video MPEG-4 part 10 AVC / H.264 Baseline Profile L1.3; CIF, QVGA, QCIF 1-30 fps
. Audio MPEG-4 part 3 BSAC
. Mux MPEG-2 part 1 / MPEG-4 part 1

PixDMB-P100 player
MPEG-4 AVC/H.264, BSAC decoder
USB-T-DMB receiver (~10x3 cm)

Jin-Sung Choi, SVP mobile communications R&D, LG Telecom
Discussed specification of handsets . Feature phones with video are 52% of shipments in 2004. Currently H.264 / MPEG4 decoding, moving to H.264 coding and MPEG7/21. DMB handset. Besides video, LG focuses on music with a download service musicON and phone clients. Competes with SKT music service but covers all service providers.


Sangho Chae, R&D manager for applications SKT
Also met Lee Joong Yun, application development team at Amiga. Amazing presentation of NATE 3G services. 2005 wireless data ARPU is 21% = 28$/month and 3G (1xEV-DO) subscribers generate 2 X ARPU compared with 2.5G. All phones support MPEG-4 QCIF 8-15fps, AAC, G.723.1; Current phones H.264 QVGA, AAC+, AMR, EVRC. For DMB, electronic program guide links back to NATE URL for back channel activation.
We discussed extensively environments that would mix SMIL and Video. SKT does not see text/logo inserts being the solution as the software in handsets is SMIL based and so are WAP clients. What is needed is client software that would control video frames in the right window. On the Macromedia Flash Lite they would like to see a royalty-free (or low) licensing. Agreed to send an e-mail with HP thoughts on the topic (Scott McGlashan, Paul Burke and others).


Seungho Lee, R&D manager Softeleware
And Michelle Park mjpark@softeleware.com Service business manager Softeleware is one of the developers on HP’s OCMP media platform focusing on video portal solutions.

Minnie Hong, manager business team, Thinmultimedia
TMI provided m-VoD to SKT (1st generation), Reliance, Cellcom, TIM, T-Mobile USA. TMI is also ASP for SKT
. thinAV client for ARM9, TI OMAP, STM and Symbian, Java, Brew OS – 17 million installed base
. Video MPEG-4 , H263 , H.264, TCM3*, TCM4*,(* proprietary) SQCIF, QCIF, QQVGA, QVGA
. thinsserver : download and streaming, content management
. thiin Creator : PC authoring tool 1-35fps all 3GPP 3GPP2 formats
Services :
VoD, MoD, monitoring (phone cam), advertising, 1:1 / 1:M chat,


Philipp Hyung-Seok Han, Manager Marketing Nextreaming
Nextreamer™ server for 3GPP/3GPP2
.Video MPEG-4 visual SP L 0-2; H263 P0, P3 L10,45; H.264 Baseline P L1b
. Audio MPEG-4 AAC Low, MP3; HE AAC (AAC+)
. Speech AMR-NB, WB, 13K QCELP, EVRC
. Transport RTSP
. RTP interleaved RTSP/TCP
. Other .3gp, .3g2, .mp4, .k3g
. HPUX, WinXP, Solaris 2.7, Linux Redhat 7.0 kernel 2.2.1

Kevin Kim, Director, Global Product & Partnership Widerthan.com
Ztango is now part of Witherthan USA and has partnership with Verizon for ring-back tones. The focus is on music services e.g. MelON at SKT. They see musical video ring-back a natural extension of this in 2006.

i-mode Business Strategy: Trip in Tokyo

This Japan trip report is very close to the discussion we had with Peter Vesterbacka on the rise of "social media", with mobile blogs replacing many traditional information sources.
i-mode Business Strategy: Trip in Tokyo

Meeting with Peter Vesterbacka, Helsinki

This is a small comment by voice call about a good discussion with Peter on "social networks". I had subscribed to the service from Hexia a few days ago and wanted to try it. It's fun.



Sent by Claude Florin

Powered by Hexia

They use HP OpenCall Voice XML software for this.

WSJ.com - Elisa Launches Two New Services For Mobile Phone TV

WSJ.com - Elisa Launches Two New Services For Mobile Phone TV: "SnadiTV is a multimedia message service for the residents and visitors of Helsinki. SnadiTV operates on the same logic as the short message service chats on TV, but in addition to text one can also include a picture taken on a camera phone in the message. The messages, inserted on a map, can be viewed on a mobile TV almost real-time, Elisa said"

WSJ.com - Vodafone's 3G-Subscriber Goal Is 10 Million by March 2006

WSJ.com - Vodafone's 3G-Subscriber Goal Is 10 Million by March 2006: "In 2000, Vodafone spent about $26 billion or on licenses to operate 3G networks globally. Mr. Sarin conceded that the rollout of 3G business would be expected initially, to boost revenue but not net profit, because of the higher costs associated with providing the service."

WSJ.com - Orange CEO - Sees UK Growth On Back Of 3G Success

Orange UK forecasts 1.5 million to 2 million 3G subscribers in by the end of 2006. This is 10-15% of 2G subscribers.

WSJ.com - Orange CEO - Sees UK Growth On Back Of 3G Success That is 10 to 15% of the current 2G subscribers moving to 3G in one year !

The last 3GSM Congress in Cannes

Galina Guyot, HP demonstrates a video portal and videomessaging by Voxsurf

3G Video calls are starting
So what's happening with 3rd generation mobile ? Using CDMA20001xEV-D0 and WCDMA/UMTS mobile broadband, commercial networks are providing service 30 million paying subscribers. One of the killer applications is mobile video, particularly mobile TV to access streamed content - some analysts forecast 250 million subscribers by 2008. At the 3GSM congress, my colleagues at HP demonstrated video messaging and video contact centers on live 3G networks, this generated a lot of attention, including from those of us who burned their fingers on previous hot technologies. Are we going to see the growth of personal video communications ?


Yann Stefan, HP, demonstrates video blogging

CTIA and iHollywood, New Orleans, March 2005

Mobile entertainment The event organized aside of CTIA by iHollywood Forum was oversubscribed, perhaps 600 attendees.

We discussed mobile video directions with analysts Jessica Sandin , head of mobile portofolio, Informa, Atte Mietinen, CO, End2end, Peter Vesterbacka, founder hpbazaar, and Julie Ask, Research director, Jupiter , Ted Cohen SVP Digital Development EMI Music , Frank Chindamo, President Funlittlemovies

Audience poll
25% believe Mobile Video is happening now !
40% mobile music
Business case :
4B$ for ringtones, at least this for video content !
Mitch lasky, CEO Jamdat
There will not be total consolidation of content and games – id did not happen with the US box office market split among 7 majors movie studios. The US content industry is definitely driving the market which should explode once 3G is deployed.
Julie Ask, Jupiter Research
Why would I pay for the coolest mobile phone but the tiniest clunkiest broadcast experience ?. Answer : to get TV when you want to kill time waiting for bus. It is a unique personal experience, self-centric, personal top of the list program guide.
Kurt Sillen, VP Mobility World, Ericsson
Key issues for video messaging are
1. MMS interoperability
2. Content customization
3. Service providers acting as retailers (consumer aware, not technology focused)
Motorola
Mobile is the 3rd screen, need end to end solution for all 3
1. TV at home
2. PC at work
3. mobile on the go
Richard Hurring, Vodafone UK
Brands mobilize content
- Video short codes extremely popular in UK
- Video attracted 10% of subscribers
Look at handset as a “friendly character” not a small IMAX .On-demand small 1 min clips 1 min convenience
Content depends of market : Japan commuting culture 6-12 min, US car drivers 1-2 min sport and news
CRM applications will also be driving video
CTIA exhibition
Verizon Vcast Subscribers pay $15 / month for 300 daily updated videos. The service requires hansets from LG, Samsung and UTStarcom. Content providers include : MTV, VH1, Comedy Central, News Corp./20th Century Fox and NBC news. Verizon 's 3G EV-DO network offers 300-500 kbits/s and will cover 150 million people in 2005. Verizon invested 1.6 B$ for network in 2005.
Qualcom MediaFlo
MediaFLO was designed specifically for multicast of multimedia to mobile devices, it claims better features than DVB-H and DMB which are technology evolutions. MediaFLO can support: 20 channels in 6 MHz to 27 in 8 MHz with 300 Kbps allocated bandwidth /channel with statistical multiplexing. It uses IP with support for light weight streaming media protocol.
Motorola
Motorola was displaying a service using the Ojo phone. It’s a really cool little device with a good video and audio quality for IP communications. Motorola was listing applications such as video messaging, video calls. The devices is expensive ~800$, especially that you have to buy paris as it does not list interoperability with other devices.
 NTT Docomo
Met Koji Ono, SVP sales & marketing NTT DoCoMo USA. They are operating a WiFi access network and considering a mobile services ASP. On their booth they demonstrated :
Video Avatars “Chara-den” to display favorite character in place of your face, during video calls or as greetings. You can modifiy the avatar's facial expression by pressing keys.
Video conferencing 1:1, 1:many.
 Comverse
Met Daphna Steinmetz, asociate VP CTO office and Dan Olschwang, GM Fun division (music and video). They were demonstrating :
Video mail messaging
Video outgoing messages + video recording
Push to show live video transmission “one click” establishment,
Video fun dial
Voice mail to MMS with Veepers (animated clips)
Mobile Video Portal
Video prompts enable easy portal navigation (VoiceXML video IVR).
Live TV broadcasts
Traffic monitoring, site monitoring
Movie trailers
Video greetings
Video dating
Content management platform
Billing and reporting
User Management
Brand and segment management
Partnerships
Arcsoft, plan-b media (D), Bongiorno Vitaminic, Emblaze, mobile streams,Mobicell, Mobilitec, Uniper, Videomedia