Reality Check: All I want for Christmas…part two

Editor’s Note: Welcome to our weekly Reality Check column. We’ve gathered a group of visionaries and veterans in the mobile industry to give their insights into the marketplace.
With holiday shopping in full swing, and an early snow to boot, it’s time to complete the list for the telecom industry.
To round out the top 10 Christmas wish list (click here for part one), again in no particular order, here are the next five ideas:
6. No-skimp storage on all new smartphones. If I’m going to shell out $200-$300 for a new smartphone/ handheld computer, with a 3+ megapixel camera and video capabilities, but only 512 megabytes of internal memory, don’t “Scrooge” me with a measly 2 gigabyte SD card. Here are the retail prices of the SD cards from my friends at Tiger Direct (www.tigerdirect.com): 2GB = $8; 4GB = $12; 8GB = $18; 16 GB = $40. That’s one person buying one card, not 100,000 or a million. Verizon Wireless has a 16GB SD card pre-installed on all Droids (which, for a 5-megapixel camera with HD quality video, is an excellent move). Sprint’s high-end video device, the Instinct HD, includes a 4GB SD card (4GB = 3-4 hours of very high quality video H.263). If you want me to use applications that use more client-stored and less cloud-stored data (or at least the option to trade off performance), it’s time to either a) include more storage, or b) sell the storage at Tiger Direct prices.
7. Pandora – college sports edition. While I had exposure to Pandora in my Sprint life, I had not used it extensively until the Thanksgiving holiday. Our Rhapsody over iPhone 3GS ran out of 3G network just over an hour into Kansas (the “map” does matter for streaming music, and Sprint’s streaming of Pandora all the way across Kansas and Colorado was impeccable – better than Rhapsody over the iPhone 3GS in Topeka). The Pandora app has been downloaded to more than 13 million smartphones for a total user base of 38 million. However, Pandora lacks one very important element – live sports. What would my Depression-Era mentality dad have given to hear the Knoxville version of the Tennessee/Kentucky football game while driving from Denver to Kansas City – “at least $5, maybe more.” That’s for one episode. I suggested this idea to Pandora, and received a curt response (paraphrased for brevity): “We do music. We don’t do sports. Thanks for your suggestion.” Give me the Davidson College package – $36 per year – all sports – two clicks to live audio – with a 4G version, live video – and I’m not only buying, I’m selling it for you (all big givers to the college would get a year for free – a huge opportunity for Pandora to expand demographics and for schools to reinforce alumni ties). If not, license your platform to someone who will (e.g., www.sportsnation360.net) – please – for the sake of Lane Kiffin loyals who live in the Midwest.
8. The “App of the Month Club.” To go with the comments last week about application profiling, the next logical step in the evolution of applications is to suggest applications that a) work well together, and b) are likely to improve your productivity based on your preferences and needs. This service could be provided by Apple, Google, Microsoft (some apps well integrated into Windows would be good), or even the carriers (business applications will require BlackBerry and Apple at a minimum). In our “everyone wins until no one wins” culture, it might seem overbearing to “pick winners,” but Oprah Winfrey did it with books (she creates popularity, as opposed to merely listing it), Harry & David did it with perishable fruit, Amazon non-so-subtly suggests similar items every time I log on, and Pandora combs through data to create a better music experience. The growth of wireless applications systems integrators could spark a new value stream for the industry, but it will require more “conversion kits” (Apple to Android to Blackberry) and more inter-application interfaces (which Windows can help facilitate). Oh yeah, it could drive up revenues and customer satisfaction.
9. Special access reform – Patterson style. As most of you know, I headed up access for several years at Sprint, and lived through the WorldCom access fraud debacle (including the subsequent bankruptcy settlements), and the 2005 Memorial Day Massacre of UNE-P (UNE-P stands for Unbundled Network Element – Platform). I bet some of the LEC negotiators who were afraid of AT&T’s UNE-P progress would have thought differently about their product had they foreseen the entry of Comcast, Cablevision, and Time Warner. It would be a big gift to the broadband world if the FCC would issue the following rule: “If the physical facility (fiber/ copper) to a wireless tower has been used by at least one provider at that tower site for 120 months, all subsequent pricing of that facility will be at least 70% lower than current market rate or achieve a 15% return, whichever is lower.” This effectively allows for unbundled network elements for both copper and fiber after the tenth year of service for that facility. Once fiber is installed to replace copper, the clock starts over with pricing if the copper is removed. As we have pointed out in this column previously, the LECs enjoy super-normal returns on special access, and growth to wireless sites has led the way. A 10-year clock from the original service date allows for some stability in current earnings (although there would be some immediate rerating), but encourages fiber deployment by both the LECs and their competitors. There is no universal service requirement for cell towers, and subsidizing idle wireline plants on the backs of wireless users will not help dig the country out of a prolonged recession. It’s a focused, simple proposal that’s easily verified and managed. And no one except the craftiest LEC accountant can prove that a LEC is in a negative cash flow position after the 10th year of installed revenues at current rates. The FCC has taken activist stances over far lesser things – this one is past due.
10. User-controlled multi-profile synchronization. Those are the big words for what Mobile Symmetry becomes – a collection, controlled by you, of your identities – how you want to be known as opposed to how someone else wants you to be known. This is most noticeable in December at the Patterson household – we have a different identity for iTunes, Talbot’s, Pop Cap Games, Harry & David, McGonigle’s (steaks), White Flower Farm, J. Jill, Amazon.com, Rhapsody, Real Arcade, Wall Street Journal online, Lego.com, Tiger Direct, SimpleTeas, the American Red Cross, Convoy of Hope, Davidson College and Wheaton College. We have credit card companies, afraid of fraud, trying to assemble the financial parts of our identity without our participation (until our card gets shut off). Google and Microsoft are trying to use our on-line search (and, with Google Voice, calling) habits to create an individualized profile for potential advertisers. Social networks use high-level demographic data to attract advertisers as well. Why not “tag” your behavior, own your own identity, and provide this information (for a reasonable fee, of course – yes, cash in your pocket) to the same folks who are trying to derive it? For example, Amazon.com (until now) has no clue that I like the alternative group Switchfoot. But if my iTunes, Pandora and Rhapsody profiles were incorporated into my Amazon profile, they’d know that I can’t get enough of them. I don’t want Amazon to do this if I can do it myself. It needs to be simple, fun, and rewarding. But, “who am I?” can best be answered by me and no one else. In fact, everything else is “Bi
g Brother.”
Next week, we’ll start to recap the 10 most important events of 2009 in the telecom industry (nominations, please!).
Jim Patterson is CEO & co-founder of Mobile Symmetry, a start-up created for carriers to solve the problems of an increasingly mobile-only society. He was most recently President – Wholesale Services for Sprint and has a career that spans over eighteen years in telecom and technology. He welcomes your comments at [email protected].