if connected

While the new Apple iOS5 beta lacks Facebook integration (it only has Twitter) everyone else is building Facebook into their mobile phones. So far, INQ’s Cloud Touch has the most impressive interface: Facebook replaces the main screen with a completely Facebook-centric experience.

But HTC is creating phones with more visible Facebook branding, that makes advertising easier, they’ve included  a ‘post to Facebook button’ on the front of the phone.

Here’s a launch advert in the UK, and, like so many other recent UK smartphone campaigns I saw this on the side of a phone box. I love this combination of smartphone advertising and last century’s pre-mobile phone boxes:

Read the rest of this entry »

This video is a reminder that Apple is not the only company with a controversial business model and practices. Here’s the Onion’s absolutely wonderful take on Google’s ecosystem. It’s not new but this is a must watch for anyone interested in smartphones.

Apple focuses on delivering the best customer experience but with tight central control, while Google offers much for free — Chrome browser, Android, Gmail, search, Picasa, docs — in return for supporting an advertising-based business model.

New Google Phone Service Whispers Targeted Ads Directly Into Users’ Ears

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Info on the ruling.

Unlimited broadband = 12 minutes – My take in April on the detail of this traffic management scheme.
As I’ve said before, it is in the broadband industry’s interests to be clearer and less ambiguous on the way they market broadband and broadband speeds.

Otherwise if the market is opaque and confusing, no ISP will be able to charge a premium for faster, quality, broadband as no consumer will be able to tell which service is better. Result: all ISPs will suffer declining revenues as consumers opt for the cheapest services.

I’ve been mulling over some new UK and European consumer data on attitudes to speed which makes for extremely scary reading for ISPs (clients please ask). It will be published in a forthcoming report.
In the meantime, have a browse of some of my earlier analysis of broadband marketing, the ASA and VirginMedia. As you will see, I’m not even slightly surprised about this ASA ruling!

VirginMedia is far from alone in stretching the truth, but this is the first major ruling that has gone against them. Most of the previous ASA rulings have focused on VM’s competitors.

VirginMedia’s traffic management, which is what the current ASA ruling that VM lost is about.
VirginMedia and a previous ASA ruling which VM won.
What Ofcom is doing from an industry perspective, as like me, Ofcom realise it’s in everyone’s interest to sort this out.

Ofcom is introducing a voluntary code of practice on how ISPs should market broadband speeds.
This is something I have been advocating for some time (see here on the ‘ISP prisoner dilemma’ where, back in 2006, I advocated regulator intervention to make speed marketing clearer, or here, or more recently here on the issues with VirginMedia’s broadband marketing).
There are clear benefits for ISPs as well as consumers with more transparent and comparable descriptions of different broadband services. Consumers will be able to compare services and make a rational decision about whether one ISP, or one package, is worth additional spend. This should help quality ISPs boost broadband revenue per customer, enable ISPs to pull out of the tailspin to the bottom that is current broadband pricing, and through higher revenue per customer support future business cases for fibre network investments.
Ofcom however, has only gone half way. The code is still too focused on communicating the peak, or best, broadband speed a consumer is able to receive on their line, rather than actual broadband speeds supplied by an ISP (depends on number of users and the capacity of the ISP’s network).
Already the difference between high theoretical speed and much much lower actual speeds is very marked. The worst examples are VirginMedia’s HFC network — which rates excellently on theoretical peak speed but has some of the most stringent speed throttling policies of any UK ISP — and the emerging mobile broadband services which offer peak speeds of 7.2Mbps (similar to DSL) but normal usable speeds under 2Mbps (much lower than most DSL ISPs).
The key paragraphs in the statement from Ofcom are these:

20. Different ISPs are likely to vary in their throughput speed performance as a result of a number of factors such as the level of investment in their network capacity. By having more information on ISPs’ respective performance, consumers would be able to make a more informed choice between ISPs and would also have a much clearer idea about what speed they should expect in practice.

21. Ofcom’s aim is to develop a methodology and process which is sufficiently robust to accurately assess ISPs’ average throughput speed performance. To this end, Ofcom is undertaking a research programme to look at this issue in more detail and to assess the role that each of actual and average throughput speed measurements can play. Ofcom will consider revisions to the Code in the light of this research.

So, this is still a work in progress, and in my opinion is unlikely to greatly alter the broadband market now.
However, Ofcom’s intervention is a welcome move. Once this additional piece on actual speeds is in place, it will help consumers choose the right broadband service for the right price, and will help the ISP industry to charge more for quality broadband products and increase revenues.

So, net neutrality is bollocks? Virgin Media’s CEO Neil Berkett sounds like he’s a little out of his depth here. In Europe, bus lanes help buses go faster, as the lanes are less congested with other traffic, and not slower as he implies.
Worse, there is a knotty communications conundrum for ISPs here: For consumers, boosting one company’s content delivery speeds, will look just the same as slowing or blocking others. Consumers will just see the difference in relative speeds. They will have no idea whether one content site is being degraded, or the other boosted, or whether both processes are taking place.
Also, taking payments from the content industry for higher quality and higher speed content delivery, damages ISPs’ goal of being seen as just a mere carrier that is not responsible for what passes over their networks. This is a pandora’s box of future problems for ISPs…
VirginMedia looks to have decided to go down this path: it’s talking to Phorm on behavioural targeting; open to payments from content companies; is traffic shaping users heavilly to control its bandwidth costs; and is the lead UK ISP advocate of three strikes bans for persistent file sharers.
The problem for VirginMedia, is that these actions are at complete odds with its strategy of differentiating from other ISPs on broadband speeds as well as sitting extremely ill at ease with the Virgin brand.
VirginMedia is rapidly gaining a reputation as the friend of large companies, rather than the consumer champion that other Virgin-branded businesses have successfully positioned around in the past. So much store was placed on the Virgin name when ntl and Telewest switched brands in February last year that it’s a travesty not to play to the brand’s strengths as the consumer’s friend.

Phorm’s model is yet another example of ISPs looking for revenue sources beyond the consumer, as consumer broadband prices have been falling. This is a further example of the net neutrality debate, although the various articles about Phorm haven’t used the ‘n’ words.

I’ve held off writing about Phorm until I had the time to speak to the company and delve a little deeper into how it works.

John and Nate are both right that there is nothing inherently wrong with advertising using behavioural targeting. But there are several key differences that make ISP-level monitoring more scary and intrusive for consumers than the existing approaches of companies like Google:

• An ISP is able to use behavioural modelling to track every site a consumer visits, not just a selection of sites.
• Consumers are often locked in to 12 or 18 month broadband contracts. So, there is a considerably greater switching cost for consumers than there is for current behavioural tracking where consumers may simply choose not to use a particular search engine.
• As we identified in the net neutrality report, the consumers that care most about the performance of their Internet connection are both high value and very vocal.

For these reasons, ISPs that seek to exploit this new advertising revenue opportunity should deploy it differently to the current approach of Phorm and its partners:

• ISPs that are positioned as quality brands, such as BT, must ensure that targeted advertising models do not tarnish their brand. Running a series of trials with tens of thousands of live consumers, without their consent, was a stupid thing to do and should not be repeated.
• ISPs should consider deploying Phorm-style behavioural tracking on lower priced broadband package tiers rather than on higher priced products or on all products. If the ISP has a quality positioning this differentiates the tiers and will assist the ISP in up-selling consumers. ISPs positioned around value and low pricing, such as Carphone Warehouse, are the natural ISP partners for Phorm.
• Opt-out is inherently more scary for consumers than opt-in. The problem for the ISP is that this is a scale business and with an opt-in model, Phorm will need to improve the consumer carrot from its current anti-phishing functionality. ISPs that differentiate on what they do based on package tiers will be better placed – ISPs could have opt-out on lower priced broadband package tiers, and opt-in on quality tiers.
• ISPs need to reconcile different parts of their package and remove contradictions.There is little point in stressing and supplying for free online security and privacy products as part of the bundle on the one hand, and yet separately deploying Phorm-style behavioural modelling which may create privacy worries.

update 7.12pm – This is even worse. Now VirginMedia are claiming “The UK’s fastest broadband is fibre optic and it’s only available from Virgin Media.” !!!!! and: “Virgin Media is the only place to get fibre optic broadband, and the good news is more that half the homes in the UK can get it.” !!!!!!
Reality: Half the UK’s home are reached by HFC (see below), no homes are reached solely by fibre outside of a very small scale trial. Note to ASA – JupiterResearch has very reasonable consultancy rates.
[original post is below]
I’m astonished that VirginMedia has escaped sanction by the ASA this time. (read my original blog entry on the advertising here: Truth, Lies and Broadband, which includes a photo of one of the misleading adverts).
Virgin’s Hybrid Fibre Coax (HFC) network — the standard cable network tech used worldwide — is not fibre, despite Virgin’s advert’s strong implication, and regardless of the ASA ruling. The ‘coax’ part of the name means that the data traffic of their customers passes over a shared capacity coax cable along the street on the way from a home to a street cabinet which greatly reduces performance at busy periods, unlike DSL (where the last mile connection from a home to the telephone is not shared with anyone else and so is actually superior in that regard to HFC).
Plus, as everyone in the UK ISP industry knows, VirginMedia has had a tight usage policy and has had explicit traffic limitations during peak evening periods (latest)whereby consumers that exceed a given usage limit see their speeds reduced by VirginMedia’s equipment (plus several outages, and more).
If consumers are (mis)led by adverts now, and believe Virgin that Virgin’s network is really “super duper fast fibre-optic broadband” then there is no way that those consumers will understand the difference when a UK ISP finally launches a real fibre network (as is happening elsewhere in Europe now).
The ASA is just increasing opacity in the market, making it harder for consumers to understand what packages deliver good or bad broadband, and so whether the price represents value for money. This opacity benefits no ISPs in the medium term: The result will be that consumers will continue to be price sensitive, they will continue to opt for the cheapest broadband deal available, resulting in lower broadband revenues and profits for all UK ISPs, including, ironically, VirginMedia.
And, as a result, UK consumers will have to wait even longer for true fibre as low broadband revenue per user will make the business case for fibre investments much more difficult.