If you’re in the big-deal camp, then you’ll like a new survey from Deloitte, which finds that a staggering one in five U.S. residents say they have either cut the cord or are thinking about doing it. The breakdown: Nine percent of survey respondents say they’ve recently cut the cord and are getting their shows from Netflix, Hulu, iTunes, etc. And another 11 percent say they might do it. (Click image to enlarge.)

To repeat: The Deloitte survey is asking people about cutting pay TV — Comcast, Verizon, Dish, etc. Not cutting back on certain channels like HBO (that would be cord-shaving) or simply never signing up in the first place (that would be the “cord-nevers” we’ve started to hear about).

How can that possibly square with the pay-TV industry’s reported results, which show that overall subscription levels remained basically flat last year? Even if you allow for a significant margin of error, things don’t add up: If the pay-TV business had lost a single percentage point of its customers in the last year, it would be a huge deal.

But Deloitte is reporting that approximately nine million people say they’ve recently stopped paying for TV. That’s the entire population of New York, plus another million or so, vanished. Can’t be.

I’ve asked Deloitte if they’ve got any insight on the gap, but haven’t heard back. But my hunch is that — for now, at least — cord-cutters are like vegans: They’re real, and they’re out there. They’re particularly notable in certain places like New York, the Bay Area and college towns. And they over-index at certain Web gathering places, like this one. But McDonald’s sales are still chugging along.

In recent weeks, Apple executives have discussed their vision for the future of TV with media executives at several large companies, according to people familiar with the matter.

Apple is also working on its own television that relies on wireless streaming technology to access shows, movies and other content, according to people briefed on the project.

Read the rest of this post on the original site »

The two companies say the service will go into a “brief beta trial” and will then be available to all Time Warner Cable subscribers (again, as long as they’re also HBO customers), “in the next month.”

Depending on how you look at it, the agreement either extends the reach of Time Warner’s “TV Everywhere” program, or fills an embarrassing hole. Time Warner and Time Warner Cable are two separate companies that split up in 2009, so programming deals between the two aren’t automatic, by any means.

But that explanation didn’t do much to appease Time Warner Cable customers who wanted the service. The cable company has 14 million subscribers, making it the country’s second-biggest cable provider after Comcast.

Time Warner rolled out HBO Go this summer to very positive reviews; Time Warner says users have downloaded five million apps for Apple’s iOS and Google’s Android devices. Earlier this month, Time Warner CEO Jeff Bewkes said that HBO Go users watch up to 50 percent more of the channel’s programming.

The largest U.S. cable operator and its peers have struggled with stalling industry-wide growth in pay-TV subscribers as consumers cut back on services and the weak housing market means fewer people signing up for services when they move into a new place. Comcast, though, has improved its TV customer retention of late while also accelerating growth in broadband subscribers.

Read the rest of this post on the original site »

While New York City was largely spared — though Staten Island and Queens were whacked fairly hard — surrounding states, especially Connecticut and New Jersey, got a good thumping. As many as 700,000 people in Connecticut and 600,000 in New Jersey are without power in the wake of Irene, and many will go without for as long as a week.

Power outages in others states, in no particular order: Vermont is reporting another 50,000 residents without power, and at one point or another, every single road in that state, except for Interstates 89 and 91, were closed due to flooding.

Another 700,000 are without power in Massachusetts; 160,000 are without power in New Hampshire; power is out for 171,000 in Maine; and power is out for 284,000 in Rhode Island.

Power outages were still being addressed this morning in Maryland, Virginia and North Carolina; another 20,000 or so are without power in the District of Columbia. Delaware has 39,000 without power, and a tornado touched down there; Pennsylvania, including the Philadelphia area, has about 400,000 without power. The total number of homes and businesses without power up and down the East Coast was in the neighborhood of six million.

An estimate of the cost of damage to insurers, conducted by Kinetic Analysis, a firm that predicts storm damage, is about $3 billion, down from an earlier estimate of $14 billion. The death toll so far is 25.

Flooding is by far the biggest threat. The city of Troy, New York, is threatened by a swelling Hudson River and a fragile dam holding it back.

Overall, communications infrastructure held up pretty well — except in those places where it didn’t. In a conference call on Sunday, the Federal Communications Commission said that 130,000 wireline subscribers lost phone service, while nearly 1,400 cellular telephone sites were out of service. Another 1,093 cell sites were running on backup power, and 500,000 cable TV subscribers lost service. The agency warned the tally could get worse, as power outages remain and battery backup systems fail.

All the stock exchanges in New York will open normally, though lots of traders who typically come into the city on Metro North may have trouble getting to work.

Did I say New York was largely spared? By the storm, mainly, but not by slightly panicked officials. The Metro Transit Authority is scrambling to get the subway system back up and running normally. Having for the first time shut the entire system down, it was limping back to life as of 6 am Eastern time. While the Long Island Railroad is running a nearly normal schedule, Metro North is not expected to operate at all.

New York area airports are re-opening as of 7 am Eastern time. Traffic at Logan International Airport in Boston is still snarled, as is Amtrak’s Acela service. Flights into and out of Baltimore and Washington, D.C., were slowly getting under way.

Another casualty: Local public radio station WNYC suffered damage to its AM transmitter because of flooding in New Jersey, and directed listeners to its Web stream, though its FM transmitter was fine.

For all the trouble Irene caused humankind, a more fragile creature emerged unscathed from the storm’s path. USA Today has an interesting story about a rare whimbrel, a type of shorebird, nicknamed Chinquapin by wildlife scientists in Georgia, who tagged it with a radio tracking device and spotted its signal on the Caribbean island of Eleuthera. The bird had flown through the most dangerous northeast section of Irene when it was still a Category 3 hurricane. Whimbrels typically spend their summers in Canada and then fly south to Brazil to breed. That’s one tough bird.

Fifteen years after their initial Comcast investment, Microsoft’s vision of a Windows-based gateway to the television still hasn’t materialized. Now it is Google’s turn to storm the fortress. And, like Microsoft before them, they have decided to do it from the inside.

Bernstein Research’s Craig Moffett, in a note (reg. required) savaging the notion that buying Motorola will allow Google to disrupt the TV business. Moffett does see a role for Google in helping cable operators measure and target TV advertising, though. For a less pithy take, read AllThingsD.

You won’t find out on Curiosity.com, which Discovery Communications is unveiling today.

But you will find lots of other answers, some of which come from famous people, like musician Wynton Marsalis and Google “evangelist” Vint Cerf.

Q&A sites are a Web staple — see Answers.com, Yahoo Answers, and Quora, for starters — but Curiosity is an interesting take: Rather than providing crowdsourced answers to user-generated queries, the site relies on experts to respond to a selected set of questions.

Some of the experts are famous people the site has recruited, and who contribute their answers via text and video. The rest of the stuff is sourced from other Discovery networks and sites. The answer to “Can frogs fall from the sky?” for instance, comes from Discovery Channel. (Answer: Yes, more often than you’d think.)

The fact that this isn’t crowdsourced means that Curiosity will never have the search-friendly volume that sites like Answers generate, though Jeff Arnold, who built the site for Discovery, figures it will still get plenty of inbound links from Google.

The bigger idea, Arnold says, is to attract “learners” — people who will want to noodle around on the site and come back to it over time — instead of one-and-done searchers.

If Arnold’s name is familiar, there’s a reason: He’s the former CEO of WebMD and also the man behind HowStuffWorks, which he sold to Discovery in 2007. Most recently, he launched Sharecare, a Q&A site for health care, and is using the same engine to power Curiosity.

Here’s a start-up that wants to change that: Bamboom says it will let you watch live broadcast TV anywhere you can get a Web connection, on whatever device you want.

We’ve seen versions of this before. FilmOn and Ivi both offered something similar last year, and both tried to argue that they had the same right to distribute broadcast TV signals that cable companies did. And both have been slapped down by the courts.

But Bamboom has a Rube Goldberg-like approach that might hold up to the inevitable legal challenge: The company will assign a tiny broadcast antenna to each customer, and will move the TV signal from the antenna to the cloud, where it can move it to any device with a browser. One customer, one stream.

That seems laborious and expensive, but it’s the same legal construction that Cablevision has used to provide a remote DVR service for its customers, and the Supreme Court has signed off on that idea. (Not coincidentally, that one customer/one use idea is the same one Amazon and Google are using to provide cloud-based music lockers without sign-off from the big labels.)

The company hasn’t discussed pricing yet, but BTIG analyst Rich Greenfield (registration required) thinks it may try a freemium model, where the company offers the broadcast stream for free but charges for a DVR option.

So what does that mean if this works? For Bamboom’s users, depending on the cost, the service could be a nice way to catch live sports and programs like “American Idol” on the go. Nice to have, but not crucial.

But as Greenfield points out, if Bamboom takes off, it could cause big problems for the established TV business.

That’s in part because the service could encourage cord-cutting, though I think that risk is rather minimal–Bamboom’s system can only deliver broadcast TV signals, so dropping your cable subscription still means you won’t be able watch anything on cable TV.

The bigger issue is that over the past few years broadcasters like CBS have been able to get cable providers like Comcast to shell out a lot of money for the right to carry their programming. But if Bamboom is doing the same thing without paying a penny, that’s going to destroy their leverage. Which is why the start-up, which has raised $4.5 million from FirstMark Capital, First Round and others, says they’re saving much of that money for legal fees.

Within a few years, the used market could account for a fifth of all cellphone sales in the U.S., says Stephen Manning, chief executive of ReCellular Inc., one of the largest U.S.-based cellphone refurbishers.

ReCellular resold or recycled 5.2 million cellphones last year, up from 2.1 million five years earlier. ReCellular sells about 60 percent of its phones in the U.S. and the rest mostly to dealers in Asia, Africa, Latin America and Eastern Europe.

Until recently, the privately owned company acquired phones only in bulk, getting them from charities that held collection drives and retailers or others with returned merchandise. Now ReCellular advertises on cable TV that it is willing to buy phones one at a time from individuals via the Usell.com Web site.

Read the rest of this post on the original site

So this week’s news from Time Warner Cable should have a familiar ring to it: The company lost 155,000 video subscribers, but said it couldn’t “identify any increase in cord-cutting.”

Instead, like Comcast, it said the economy was primarily to blame, as well as competition from the likes of newish video offerings from Verizon and AT&T. That is, it can’t find evidence that people are replacing cable with Hulu, Apple TV, Netflix, etc.

And, like Comcast, Time Warner Cable said that many of the video subscribers it did lose were less attractive, anyway. That’s because they were “basic” subscribers, instead of the ones who get the company’s higher-end, higher-margin offerings.

So I’m just going to lift an entire paragraph from last week’s post, and hope that at some point we’ll be able to say something new:

So we’re still stuck where we’ve been for a while: Lots of people–many of whom are the kind of people who read sites like this one–say that cord-cutting is either here or inevitable. And the incumbent cable companies say they see no sign of it.

“I can’t control what people think this was. I can only tell you my intentions. This was not a rally to ridicule people of faith or people of activism or to look down our noses at the heartland or passionate argument or to suggest that times are not difficult and that we have nothing to fear. They are and we do. But we live now in hard times, not end times. And we can have animus and not be enemies.

But unfortunately one of our main tools in delineating the two broke. The country’s 24 hour political pundit perpetual panic conflictinator did not cause our problems but its existence makes solving them that much harder. The press can hold its magnifying glass up to our problems bringing them into focus, illuminating issues heretofore unseen or they can use that magnifying glass to light ants on fire and then perhaps host a week of shows on the sudden, unexpected dangerous flaming ant epidemic.

If we amplify everything we hear nothing. There are terrorists and racists and Stalinists and theocrats but those are titles that must be earned. You must have the resume. Not being able to distinguish between real racists and Tea Partiers or real bigots and Juan Williams or Rick Sanchez is an insult, not only to those people but to the racists themselves who have put in the exhausting effort it takes to hate–just as the inability to distinguish terrorists from Muslims makes us less safe, not more. The press is our immune system. If it overreacts to everything we actually get sicker–and perhaps eczema.

And yet, with that being said, I feel good–strangely, calmly good. Because the image of Americans that is reflected back to us by our political and media process is false. It is us through a fun house mirror, and not the good kind that makes you look slim in the waist and maybe taller, but the kind where you have a giant forehead and an ass shaped like a month-old pumpkin and one eyeball.

So, why would we work together? Why would you reach across the aisle to a pumpkin assed forehead eyeball monster? If the picture of us were true, of course, our inability to solve problems would actually be quite sane and reasonable. Why would you work with Marxists actively subverting our Constitution or racists and homophobes who see no one’s humanity but their own? We hear every damn day about how fragile our country is–on the brink of catastrophe–torn by polarizing hate and how it’s a shame that we can’t work together to get things done, but the truth is we do. We work together to get things done every damn day!

The only place we don’t is here or on cable TV. But Americans don’t live here or on cable TV. Where we live our values and principles form the foundation that sustains us while we get things done, not the barriers that prevent us from getting things done. Most Americans don’t live their lives solely as Democrats, Republicans, liberals or conservatives. Americans live their lives more as people that are just a little bit late for something they have to do–often something they do not want to do–but they do it–impossible things every day that are only made possible through the little reasonable compromises we all make.

Look on the screen. This is where we are. This is who we are. [points to the Jumbotron screen which shows traffic merging into a tunnel]. These cars–that’s a schoolteacher who probably thinks his taxes are too high. He’s going to work. There’s another car-a woman with two small kids who can’t really think about anything else right now. There’s another car, swinging, I don’t even know if you can see it–the lady’s in the NRA and she loves Oprah. There’s another car–an investment banker, gay, also likes Oprah. Another car’s a Latino carpenter. Another car a fundamentalist vacuum salesman. Atheist obstetrician. Mormon Jay-Z fan. But this is us. Every one of the cars that you see is filled with individuals of strong belief and principles they hold dear–often principles and beliefs in direct opposition to their fellow travelers.

And yet these millions of cars must somehow find a way to squeeze one by one into a mile long 30 foot wide tunnel carved underneath a mighty river. Carved, by the way, by people who I’m sure had their differences. And they do it. Concession by concession. You go. Then I’ll go. You go. Then I’ll go. You go then I’ll go. Oh my God, is that an NRA sticker on your car? Is that an Obama sticker on your car? Well, that’s okay–you go and then I’ll go.

And sure, at some point there will be a selfish jerk who zips up the shoulder and cuts in at the last minute, but that individual is rare and he is scorned and not hired as an analyst.

Because we know instinctively as a people that if we are to get through the darkness and back into the light we have to work together. And the truth is, there will always be darkness. And sometimes the light at the end of the tunnel isn’t the promised land. Sometimes it’s just New Jersey. But we do it anyway, together.

If you want to know why I’m here and want I want from you, I can only assure you this: you have already given it to me. Your presence was what I wanted.

Sanity will always be and has always been in the eye of the beholder. To see you here today and the kind of people that you are has restored mine. Thank you.”

*Note that this isn’t coming from the most obvious sources: Viacom’s own Daily Show site, which carried a live stream of the event but doesn’t have any record of it anymore, or C-SPAN, which is running a loop of the rally, but doesn’t have a handy way to excerpt the three-hour event. Too bad Hulu can’t help here….

[Image credit: Cliff1066]

The agency tweaked its so-called “CableCard” rules to make it easier for consumer electronics makers to make cable-ready TVs and other devices and for consumers to install them.

Cable-ready TVs and set-top boxes have been around for years, but consumers haven’t been able to use them to see some cable programming (like On-Demand movies) because of some technical protections cable companies installed to prevent piracy. The FCC changed its rules slightly to make it easier for consumer electronics makers to produce devices that access all cable channels.

Read the rest of this post on the original site

At least seven of the ten largest subscription-TV providers in the U.S. are building new tablet-computer applications that offer select TV shows and movies to their existing subscribers, often for little or no additional fee.

The efforts are going head-to-head with a handful of existing video applications from TV networks and online video services such as Netflix Inc. (NFLX) and Hulu LLC, hoping to compete by offering more content and features that integrate with home TV service.

Comcast Corp. (CMCS) is testing a free iPad application that allows existing subscribers to search for and watch some TV shows on the go, and plans to release it by the end of the year. The company says it already has content providers lined up for the service, but declined to specify which ones.

Verizon Communications Inc. (VZ) plans to release an app for renting movies on devices than run Google Inc.’s (GOOG) Android operating system in the fall. The app will be targeted at its 3.2 million Fios TV subscribers, but it will eventually be available to nonsubscribers, said Shawn Strickland, Verizon’s vice president of consumer strategy and planning. He said the company also aims to launch the service for other devices like the iPad.

Read the rest of this post on the original site

The company, which serves about three million homes in the New York area, said Wednesday it plans to launch the service as a trial in June in the cable industry’s latest attempt to keep customers from dropping cable-TV service in favor of an Internet-only subscription.

The rise of quality online video poses a long-term threat to the cable industry’s business model as many observers foresee a day when consumers will get all their home entertainment in interactive and on-demand form through the Internet. That prospect could wreak havoc in the television industry, which is largely sustained by revenue that comes from pay-TV subscriptions.

Read the rest of this post on the original site

The proposed service by the maker of iPhones and iPod music players could, in at least some scenarios, offer access to some TV shows from a selection of major U.S. television networks for a monthly fee, according to people familiar with the discussions. Apple is pushing to complete licensing deals and hopes to introduce the service in 2010, some of those people said. It is unclear whether any networks have signed on yet.

Spokespeople for Apple, CBS and Disney declined to comment.

Read the rest of this post on the original site

Comcast did have reasonably good news to deliver this morning. It signed up more new customers than Wall Street expected, though it had to cut prices to do so. We’ll see if that mollifies investors, who really have been salty–look what’s happened to CMCSA shares since news of the GE (GE) transaction broke:

Since Comcast barely addressed the NBCU deal during its earnings call this morning, it had more time to tackle other topics. A recurring theme: How would increased Web video consumption affect the company?

The answer: No one knows, exactly.

On the one hand, there’s the threat that consumers will be less likely to pay for cable TV if they’re getting their shows over the Web, whether it’s through illegal streams or legitimate “over the top” services like the one Apple (AAPL) is trying to assemble.

That’s why Comcast CEO Brian Roberts described his company’s “authentication” efforts, which are in a beta test now but are scheduled to go nationwide next month, as an effort to make sure that people who consume Web video do so “in a way that secures the existing model.”

That is–he’d like them to keep paying Comcast for a TV subscription even though they’re watching shows online. Tough sell.

On the other hand, even if you stop paying for cable TV, you still have to pay someone to connect you to the Web, and it’s very likely that company will be Comcast. And if you’re not paying Comcast for TV, there’s a very good chance you’ll pay more for your Internet connection.

“I’ve been saying for a long time that I think video over the Internet is more friend than foe,” Roberts said this morning. Let’s see if Wall Street agrees.

Is Hulu putting up a pay wall around its Web TV site? Nope.

Does Hulu want to charge people to watch Web TV? Yes.

Confused? Don’t be.

It’s pretty straightforward: Hulu, the joint venture between News Corp.’s (NWS) Fox, GE’s (GE) NBC Universal and Disney’s (DIS) ABC, doesn’t plan on charging people to watch the stuff it’s currently airing on the site–a mix of first-run shows from broadcast TV, a limited number of cable TV shows and a smattering of movies. But Hulu is trying to figure out how to create some kind of premium offering where you’ll pay for stuff that isn’t on the site right now.

That’s what Hulu’s backers have been saying for months, so it’s a little puzzling that News Corp. COO Chase Carey’s comments got folks worked up yesterday. Meanwhile, multiple sources familiar with Hulu’s plans tell me that…Hulu doesn’t actually have a plan yet, but it is trying to piece one together.

There are some pretty obvious ways to go here. Hulu could sell movies or TV shows on a pay-per-view basis, or it could sell subscriptions to shows it doesn’t offer now or to a deeper offering of shows it already has. You could call it “Hulu Plus” (no charge for that one, guys).

If you’re a fan of Fox’s “Family Guy,” for instance, Hulu is only of limited help: The site only has the most recent five episodes. So how much would you pay to watch the rest of them?

If you don’t have an answer for that, don’t worry–Team Hulu doesn’t know, either. Nor can they tell you if airing free shows on Hulu has cut into other revenue streams like broadcast TV advertising or DVD sales, even though “we’ve done a thousand regression analyses on this,” says an industry executive involved in the site.

Do bear in mind that this was a problem Hulu’s backers didn’t really envision when they were dreaming up the site; at the time, they were most concerned with building a video site that would allow them to barter with Google (GOOG) and Apple (AAPL).

Now they own one of the biggest video sites on the Web, one they say is performing ahead of plan. And Hulu is selling enough advertising that it’s coming close to reaching break-even, according to executives I spoke to this week.

But at the very least, adding a pay component to Hulu helps mollify those who fear the site is cannibalizing their existing businesses. Or who simply want another revenue stream. And a pay element dovetails with Hulu’s interest in joining up with the “authentication” movement pushed by cable guys like Comcast (CMCSA) and Time Warner (TWX).

Meanwhile, here’s the use case for Hulu that its backers originally envisioned–“catch up viewing.” I was on a plane when last night’s episode of the “The Office” aired, but I can watch the whole thing–with ads I can’t skip–on my laptop today. And so can you:

Boxee has a small but passionate following of some 600,000 users, and it’s gotten a lot of attention this year, much of it via a fight with Hulu, which doesn’t want its video showing up on Boxee browsers.

But Boxee doesn’t have any revenue, or much of a concrete plan to generate any in the near term: The software is free for consumers, and while CEO Avner Ronen thinks there could be some rev-share possibilities with Web video providers down the road, they’re…down the road.

So what’s the appeal for company’s backers, which also include Union Square Ventures and Spark Capital, which put $4 million into the company eight months ago and participated in this round as well? It’s pretty straightforward: The $70 billion TV business is in the first steps of a massive reordering, and perhaps Boxee can play a role in it.

The chief appeal is that Boxee can function as an “over the top” alternative to cable TV, giving users the ability to get their favorite programs on a big screen without having to pony up to the likes of Comcast (CMCSA). Ronen wants to use some of his money to ramp up efforts to strike deals with consumer electronics companies like Sony (SNE) and LG, which are pushing Internet-connected TVs, and Microsoft (MSFT), whose Xbox game console is increasingly functioning as an entertainment hub.

But there are plenty of other players jockeying for similar positions, from services like ZillionTV to device makers like Roku, and even Apple (AAPL). And Boxee’s status as a potential disruptor has a downside as well: It’s the reason that Hulu, backed at the time by News Corp.’s (NWS) Fox and GE’s (GE) NBC, sought to prevent the service from accessing its shows earlier this year.

That said, there hasn’t been much saber-rattling from either side in recent months. Perhaps this has to do with Disney’s (DIS) ABC, which had previously enjoyed friendly relations with Boxee, coming aboard the joint venture.

Here are a couple interviews I’ve conducted with Ronen this year: The first one was taped at the Consumer Electronics Show show in January, when his start-up was soaking up the first wave of attention from the TV industry; the second was taped in March, after Boxee had attracted Hulu’s ire.

]]> http://allthingsd.com/20090812/web-video-darling-boxee-gets-another-6-million-are-zero-revenues-and-big-plans-worth-25-million/feed/ 0 http://allthingsd.com/20090527/randall-stephenson/ http://allthingsd.com/20090527/randall-stephenson/#comments Wed, 27 May 2009 15:17:09 +0000 John Paczkowski http://d7.allthingsd.com/?p=223

Randall Stephenson is just two years into his tenure as CEO of AT&T (T) but he faces challenges that have been decades in the making. Among them: remaking AT&T amid the steady decline of its landline business, future-proofing its business as our appetites for bandwidth grow, competing with the likes of Comcast (CMCSA) in the cable TV market and fending off the proponents of Net neutrality, who don’t care much for the idea of a two-tiered Internet.

Beyond this there is the issue of continuing to build out AT&T’s wireless business, which–if not iPhone-dependent–is certainly nursing a hell of a habit. In its fourth-quarter AT&T added 2.1 million wireless subscribers. 1.9 million of them were iPhone accounts. Astonishing. But AT&T’s exclusive deal to peddle the Apple iPhone in the U.S. expires next year. The company is obviously eager for an extension. But what is it willing to do to get it?

Incidentally, we had a fairly big announcement from AT&T this morning. The company said it is upgrading to High Speed Packet Access 7.2 technology. That means considerably faster mobile broadband speeds. The upgrade is slated to begin later this year, with completion expected in 2011.

Session Highlights

Live Blog

• After some brief introductory remarks from Wall Street Journal Managing Editor Robert Thomson, who jokes about implementing an 18-second delay for expletive-fond Yahoo CEO Carol Bartz, and a welcome song from Jill Sobule, Walt welcomes Randall Stephenson to the stage and the second day of D7 begins.
• For a first question, Walt, referring to poll data, asks Stephenson why some folks might not be interested in buying an Apple iPhone because of AT&T. Stephenson notes that AT&T is improving network quality and reducing churn.
• Walt says he gets frequent reader mail complaining about AT&T service coverage. Stephenson says the company is way down the road in terms of the level of data traffic on the networks. Behavior changes radically. He says AT&T is a year ahead of other carriers in terms of network management, managing the volume and behavioral changes from adoption of new devices.
• Walt: Let’s talk for a moment about the iPhone. It’s a data-intensive device. You weren’t ready when you first launched the iPhone 3G. What happened? Stephenson says the company wasn’t quite ready. “But we’re improving.”
• Walt asks the audience how many people use AT&T. Many hands raised. How many had it before the iPhone? A fair bit. How many are satisfied with the service? Also a fair bit. Clearly, AT&T’s service must be getting better.
• The level of data volumes we are seeing on our networks is changing customer behavior dramatically, says Stephenson. This is challenging, but the company is addressing it.

• Walt: If we project out farther past the iPhone, are the mobile networks we have going to be able to handle these new data-intensive devices? Stephenson: The answer is clearly no. That’s why we’re buying more spectrum and moving toward LTE. What’s so good about LTE? Speed levels of 20 megs plus, for one, says Stephenson, who admits that real-world performance will be somewhat less than that.
• Stephenson says AT&T is more than doubling the theoretical speed of the network. Does this mean the speed of our handsets will also double, asks Walt. Not on current handsets. But on future ones, which will all be backward-compatible.
• When you upgrade the network to 7.2 will it have any negative impact on the network as data demands grow, asks Walt. Stephenson says no. “It’s all network management….We’ll have a whole new capacity.”
• Walt: In a world where both you and Verizon (VZ) go to LTE, will I be able to take my handset and switch to Verizon’s network? Stephenson says the LTE standard is consistent and should permit that.
• The conversation shifts to Wi-Fi. Walt asks about AT&T’s Wayport efforts. “When we look at the world today and the world of the future, the fixed-line bandwidth requirements are not slowing. Then you move to the wireless broadband world, where bandwidth requirements are not slowing either. You need a bridge between the two.” That bridge is WiFi, adds Stephenson, noting that the company sees extraordinary WiFi usage among it smartphone users.
• Stephenson talks for a moment about automatic authentication and says AT&T is working to implement it. “The current system is kludgey. People want it seamless.”
• Walt asks about the company’s broadband business. Stephenson says it’s doing well. Notes that it is doing nearly as well as Verizon’s FIOS business.

• Walt asks how the economy is affecting AT&T’s various businesses and the advance of the company’s capital spending plans. Stephenson says the board business has obviously been affected. Business is slowing especially in enterprise and the consumer phone business. Interestingly enough, people are more apt to disconnect the home phones than they are broadband. So AT&T continues to aggressively invest in mobile apps and in wireless infrastructure. He notes that the company is really pushing hard to build out its U-verse network. “I’ve been through a few of these recessions in my 20 years in this business, and it will turn. So you must continue to invest and prepare for the day when it does.”
• What about competitors? What are they doing? In wireless, says Stephenson, competitors also investing. A lot of capital is coming into the wireless business. In broadband, cable guys have not slowed down. Telecom structurally in a good place. Regulatory structure continues to bring in capital.
• Back to the issue of the iPhone. Was it worth it to sign the deal with Apple (AAPL)? How has it worked out? “It’s worked out terrific. We have no complaints.” He notes that the company incurred dilution, but has benefited by getting the premier customer in the space–one with high data usage and low churn. “I’m very pleased with the deal.”
• Walt asks if the company has suffered from the iPhone’s fixed data charges. It’s not a variable charge. How does that offset the dilution that AT&T has to pay? We made a bet, says Stephenson, that the industry was heading toward smartphones, and that was a good bet. Now we’re seeing dramatic uptakes in usage, so the pricing model must change. And it will change. The market will dictate that change more than anything else. But right now the economics of the iPhone are very good for us.
• Walt: Have you ever called Steve Jobs and just asked him to put a keyboard on the iPhone? Stephenson chuckles. No. “If Steve wants to put a keyboard on the iPhone, I’m sure he will.”
• Walt: Are all these new operating systems arriving at market problematic for AT&T? The iPhone, Palm’s (PALM) WebOS, Android? Would it be easier if there were fewer platforms? Stephenson: Do I want to see fewer platforms? Yes, it’s better for my business. Will I see fewer platforms? I don’t think so. So we need to take advantage of it and use it as an opportunity.

• What about the Palm Pre? “Would I like to see the Pre on our network some day? Of course I would,” says Stephenson. “We obviously talk to all the handset manufacturers. We want a broad selection of devices in the lineup. That’s important. Devices right now are what’s driving the customer adoption as much as anything.”
• Stephenson says he’s seeing dramatic uptakes in data usage. Pricing models will change over time, he says. How it changes will depend who you are. He notes that costs are variable in wireless–every new bit has a direct cost tied to it, unlike wireline business. AT&T margins are 40 percent-plus in Q1 on wireless business.
• Walt: Can you foresee a day when you’re not running retail stores? Why do you want to run stores when you’re really a network company? Stephenson says distribution is changing. But a retail presence is always going to very important, and I always want to have a part of that.
• Moving on to the Q&A: How do you transform wireline customers into wireless and broadband customers? Integration is very important, says Stephenson. If you already have AT&T Wireless, it’s a natural step to add broadband and even wireline if it’s offered as a bundle.
• Why can’t we have data roaming on LTE from the beginning and avoid the mistakes of the 3G networks? Stephenson says the LTE network will have similar roaming agreements as those on the current networks. “It’s in all our best interests.” The industry always evolves to a point where broader coverage is needed and these agreements become necessary. You’ll see that with LTE as well.
• Question about SlingBox on 3G network being rejected: Who decided that? Stephenson says that terms of service agreement for the customer do not allow customers to move live stream video over the wireless platform. Not like the fixed line side. If you start congesting network with data, voice quality goes down. We have to maintain some quality, so it’s not allowed under terms of service.
• Responding to a question on warrantlessly providing data about customers to the government, Stephenson says AT&T will act within the law in all regards to customer information and privacy. “We will comply with the law, absolutely,” he says.

A note about our coverage: This liveblog is not an official transcript of the conversation that occurred onstage. Rather, it is a compilation of quotes, paraphrased statements and ad-lib observations written and posted to the Web as quickly as we were able. It was not intended as a transcript and should not be interpreted as one.

• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 

]]> http://allthingsd.com/20090527/randall-stephenson/feed/ 13 http://allthingsd.com/20090123/nbc-our-local-stations-are-killing-us/ http://allthingsd.com/20090123/nbc-our-local-stations-are-killing-us/#comments Fri, 23 Jan 2009 11:49:13 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=3443 Local television stations used to be money machines for the big media conglomerates. No more.

GE’s NBC Universal says its revenues dropped three percent and that its operating profits were down six percent for the last three months of 2008, primarily because of weakness at its local TV stations. [Update: NBC says local station revenue was down 25 percent and operating profit down 55 percent, according to paidContent's David Kaplan, who listened to the morning earnings call.]

Look out below: Meredith Corp. (MDP), which owns a handful of local stations in major markets, says its ad sales are down 40 percent this quarter.

The upside: Cable TV was strong, GE says–because cable systems operators have to pay cable networks like NBCU a fixed fee for each subscriber, regardless of the ad market.

And the real upside: GE shareholders don’t really care that much about NBC’s performance–they’re much more concerned about the company’s huge finance business. The one exception here would be Vivendi, which has already said its going to be writing down its stake in NBCU.

]]> http://allthingsd.com/20090123/nbc-our-local-stations-are-killing-us/feed/ 0 http://allthingsd.com/20090115/wall-street-beats-up-sumner-redstone-rupert-murdoch-a-bit-more-downgrades-for-viacom-news-corp/ http://allthingsd.com/20090115/wall-street-beats-up-sumner-redstone-rupert-murdoch-a-bit-more-downgrades-for-viacom-news-corp/#comments Thu, 15 Jan 2009 15:24:00 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=3155 You don’t need a particularly good crystal ball to foresee that big media are in for a bad year (at least). But Wall Street singled out Sumner Redstone’s Viacom (VIA) and Rupert Murdoch’s News Corp. (NWS) for special treatment this morning, by whacking estimates for the next few quarters.

The short story: The lousy ad market will be even worse than people think.

The longer story: Pali Research’s Rich Greenfield has chopped his estimates for News Corp. (owner of Dow Jones, which owns this site). He expects operating income for the company’s fiscal 2009 (which wraps up this summer) to be down 22 percent; he’d previously pegged the number at -18 percent.

Dragging down the business: The company’s international newspaper and domestic TV operations; he thinks their operating income will drop a staggering 39.6 percent and 60.4 percent, respectively.

And Barclays Capital’s Anthony DiClemente takes a similar whack at Viacom: He had previously forecast that Viacom’s operating income would drop by 1.9 percent in 2009; now he figures the decline will be eight percent.

DiClemente predicts that advertising at Viacom’s cable networks, which power the majority of the company’s financials, will drop seven percent in the coming year. That’s worse than the three percent drop he thinks that cable TV in general will see, in large part because MTV’s target audience has been disappearing as of late.

Check out the following chart from Barclays, which tracks ratings for the core demographics at Viacom’s biggest cable channels (click to enlarge):

Notice that MTV’s 23.9 percent decline has happened amidst tons of press for its reality shows, notably “The Hills,” which is supposedly a sensation among the kids these days (that’s some of the cast, at the top of this post). (UPDATE: An earlier version of this post reproduced inaccurate data that Barclays sent out regarding Viacom’s Noggin channel; Viacom points out that the channel registered a 64 percent increase in its core demo from the fall of 2007 through the fall of 2008).

Meanwhile, did you know that MTV has followed up “A Shot At Love With Tila Tequila,” a reality show/dating game hosted by a bikini-wearing bisexual pin-up girl, with “A Double Shot At Love,” which is…well, you can probably guess.

If you need it spelled out, here’s a promo clip:

]]> http://allthingsd.com/20090115/wall-street-beats-up-sumner-redstone-rupert-murdoch-a-bit-more-downgrades-for-viacom-news-corp/feed/ 0 http://allthingsd.com/20090112/boxee-webtv-that-makes-sense-is-that-good-or-bad-for-big-cable/ http://allthingsd.com/20090112/boxee-webtv-that-makes-sense-is-that-good-or-bad-for-big-cable/#comments Mon, 12 Jan 2009 18:19:56 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=3053 This year’s Consumer Electronic Show, like every year’s CES, was peppered with big talk about merging your PC and your TV, led by a new widget initiative from Yahoo (YHOO). And my reaction was the same one I have every year: Why?

No need to go on about my lack of interest in this forced marriage, which the consumer electronics business has been trying to make work for more than a decade (see the 1993 Time cover to the right). Slate’s Farhad Manjoo has done it for me. If you’re pressed for time, the title will do: “I don’t want my Web TV.”

Here’s what I do want: The ability to use my TV to watch all the great video the Web makes available–actual TV shows and movies like “The Office” on Hulu, “Lost” on ABC.com, “No Country For Old Men” on Netflix’s (NFLX) on-demand service. Which is where Boxee comes in.

The New York-based start-up makes elegant software that cobbles together offerings from all of those services, plus many more–with whatever media you have stored on your hard drive–and serves it up to you on your big screen, with a minimum of fuss. Right now it’s a niche product–it only works on PCs running Linux, or Apple’s (AAPL) Mac mini and AppleTV boxes–but that should change soon.

It’s slick stuff, and when you get a chance to watch it in action, it’s the first time that all those anecdotal stories about people dropping their cable TV subscriptions and just watching Internet video finally make sense: Why pay for cable stations you don’t want when you can watch just about everything you do want, on demand, for free?

This is also why I’m not sure how long the big cable companies will allow Boxee to operate unfettered. As the recent dispute between Time Warner Cable (TWC) and Viacom (VIA) illustrates, the cable operators are increasingly dismayed about paying the cable networks big fees for their content, only to find them giving it away online. And with Boxee providing customers with a real opportunity to drop cable TV in favor of a broadband connection, I worry that it’s a matter of time before they find some way to throttle the company.

Technically, the cable guys (and the telcos, who are also in the TV business) aren’t supposed to be able to do anything about Boxee. They’re just supposed to act as a dumb pipe serving up high-speed Internet access and keep their mouths shut. In the real world, I don’t think that’s going to fly. See: The many bandwidth caps the cable guys are starting to experiment with, which are aimed at heavy Web video users.

Boxee founder Avner Ronen disagrees, of course. He thinks the cable guys will want to work with his company (he plans to make money by licensing his software to gadget makers and extracting fees from content providers like Netflix, but that’s all down the line). And maybe he’s right: When I dropped by his CES booth on Friday, he was being swarmed by emissaries from CableLabs, the cable guys’ tech consortium. They were the third group of cable execs to visit the company that day.

I’ll let Ronen make his case in the video below; and I’ve also included a brief demo video from the company. But that clip doesn’t really do Boxee justice. Ask one of the 100,000 super-early adopters who are using the software themselves. Or any of the nervous cable guys who saw it last week.

[ See post to watch video ]

quick intro to boxee from boxee on Vimeo.

]]> http://allthingsd.com/20090112/boxee-webtv-that-makes-sense-is-that-good-or-bad-for-big-cable/feed/ 0 http://allthingsd.com/20081031/washington-post-turns-in-another-lousy-quarter-but-it-could-have-been-worse/ http://allthingsd.com/20081031/washington-post-turns-in-another-lousy-quarter-but-it-could-have-been-worse/#comments Fri, 31 Oct 2008 13:26:45 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=388 MediaMemo worries that it is going to be writing grim stories about layoffs at media companies for many months. So it’s going to try very hard to find some good news whenever it can.

Take the Washington Post Company’s (WPO) Q3 report card, for instance. It’s bad. But it’s better than the last one the troubled newspaper and education company earned.

And yes, you have to be in the media business to look at a seven percent yearly decline in revenue, which is what Wapo’s newspaper group recorded, as a positive. But that decrease is better than Q2, when newspaper revenues were down 13 percent.

And there are more lemonade-from-lemon stats available:

• Online ads are up 13 percent year-over-year, an acceleration from the four percent growth they recorded in Q2. And given that most publishers saw decreasing growth this summer, that’s a decent achievement. Display ads were up 32 percent. (Flipside: Lucrative online classified ads were down eight percent).
• Print ads declined 14 percent y/y, but that’s better than the 22 percent decrease last quarter.
• Revenues at WPO’s magazine group were down four percent, but that’s better than Q2′s 15 percent decrease. And ads at Newsweek were down 13 percent, but last quarter they declined 21 percent.

Meanwhile WPO’s Kaplan education unit, which now accounts for more than half of the company’s revenue, did just fine. And its cable group did well, too.

There. Doesn’t that feel better?

Alas, MediaMemo does have to point out that the company’s local TV group did poorly, just like most local TV groups have been doing.

The unit’s revenues were basically flat at $78 million. But if you strip out one-time boosts from political and Olympic-related ads, it’s down some 8.5 percent, which is worse than last quarter’s six percent decline. Happy Halloween!

[Image Credit: cliff1066]

]]> http://allthingsd.com/20081031/washington-post-turns-in-another-lousy-quarter-but-it-could-have-been-worse/feed/ 0