Viodi View – February 16th, 2005 Issue – Go to Viodi.com and Viodi.tv for current posts

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Viodi View Newsletter – February 16th, 2005

Local Content Workshop

Greetings from the Riverwalk
Beware of the Unseen Competitor
NCTC Moratorium on New Members???
FCC Rulings; Digital Must-Carry, Intercarrier Compensation, etc.
Can MAC Save USF?
MPEG-4 – Coming On Strong
Industry Calendar, IP Video @ Supercomm & VON
The Korner: Adding Some Bling Bling to the Ring Ring

Greetings from San Antonio, the largest city in the United States that is not home to a major league, baseball team [read below to find the next largest city without a baseball team]. NTCA held its annual meeting this week in San Antonio and, ironically, used the baseball metaphor of the “triple play” as its theme. The panel, The Telco of the Future, provided a good snapshot of the conference, as the panelists discussed the impacts of regulatory, market and technology developments on independent telcos. Click here to read some of my observations of this five day event.

Beware of the Unseen Competitor

One of the oft repeated comments at the Annual Meeting was that independent telcos need to prepare for the competition that will come from out of the blue, to use the cliché. Retail companies, such as WalMart and Starbucks, and brands, such as ESPN and Virgin, represent new competitive threats and opportunities. I just penned a column for Telephony’s new magazine, The Independent, as to the importance of preparing for these new threats. If you get a chance, check out this excellent magazine. In the meantime, you can see my comments about the retail opportunity/threat by clicking here.

NCTC Moratorium on New Members???

For the past month, I have heard reports that NCTC has stopped accepting new members. At NTCA’s annual meeting, these rumors were the talk among many telcos. Based on my email correspondence with Dan Mulvenon, VP of Public Relations for NCTC, these rumors do not reflect what is really happening. Like any rumor, this one had an element of truth that got exaggerated, as it was repeated.

Mulvenon explained that, “as we have done on several occasions in NCTC’s history, we periodically review the membership requirements, initiation fees, etc. We did put a temporary hold on approving all new memberships until the review process is complete. I anticipate that review will be complete within the next week.” I will follow up with Dan and report any changes that could impact the Viodi View readers.

FCC Rulings; Digital Must-Carry, Intercarrier Compensation, etc.

The FCC has been quite busy since the last issue of the Viodi View. The Annual Report on competition in the Multichannel Video Distribution business has been released, the Superbowl came and went with only a handful of complaints, the FCC ruled that cable companies will not be required to the “Digital Must-Carry” the extra digital programs of broadcasters and released for comment seven different proposals regarding intercarrier compensation. To read my thoughts as to how the Digital Must-Carry decision could be a positive development for independent telcos, please click here [Club Viodi members only].

Can MAC Save USF?

While I was at NTCA’s Annual Meeting, I mentioned to a telco friend the concept, advanced in these virtual pages of the Viodi View last summer, of charging a Federal fee for any device with a MAC address. [links to those articles are below]

http://www.viodi.com/newsletter/040902/#usf

http://www.viodi.com/newsletter/040801/article1.htm

http://www.viodi.com/newsletter/040801/article2.htm

The theory is that any device with a MAC address, whether it is a toy or a tool, could have the potential to be used as a communications device and, as such, would burden the physical network infrastructure in some way. The fee would fund USF, ensuring the U.S. maintains a state-of-the-art network infrastructure in urban, suburban and rural areas.

So much for the funding problem, now I think I may have a proposal for the disbursement problem, which could work in today’s political environment, strengthen competition and provide for improved infrastructure. And, if you believe those bold claims, I have some beachfront property in Nevada I want to sell you. Seriously, if this idea has any legs after a few more weeks of superficial study, it will be published here in the Viodi View.

MPEG-4 – Coming On Strong

Tandberg’s announcement yesterday that they have been picked to be DirecTV’s headend supplier is significant to the independent telco industry, as DirecTV’s entry into the market should give the MPEG-4 effort increased credibility. DirecTV needs to be aggressive as they need MPEG-4 to expand their High Definition offering. MPEG-4 seems to be moving along in the independent telco industry.

In my whirlwind tour of NTCA’s show floor, I noticed that both Tut and Skystream had MPEG-4 demonstrations that looked pretty impressive. Set-top availability seems to be somewhat a limiting factor and support of full 1080i resolution is not there yet, but indications are that we could start seeing complete solutions sometime this summer.

Industry Calendar, IP Video @ Supercomm & VON

I finally posted an industry calendar that will be kept up to date on a fairly regular basis. While it won’t have every event in every industry, it promises to have a unique listing of events that, hopefully, crosses the boundaries of traditionally unrelated industries. Some of the events to note, include the National Cable Show (a great one to attend to visit to meet the elusive cable programmer), NTCA’s ISP Conference, OPASTCO’s Legislative and Regulatory Conference and USTA’s Small Company Caucus.

Regarding USTA, I am pleased to announce that Viodi is co-producing the IP Video @ Supercomm with USTA. This year promises to be even bigger than last year’s event as it will span two days, June 6th and 7th in Chicago. We have another excellent list of speakers lined up, including folks from Disney, SBC and a number of independent telcos that have been deploying video for years. To see the detailed agenda, click here.

There are some interesting supplier conferences not listed on this calendar. Turin Networks, in conjunction with Motorola and other suppliers, will be discussing the challenges of transporting video from the headend to the home. Zhone Technologies and its ecosystem partners has a one day seminar, 13 weeks to Video, that looks to be a good primer for telco interested in video.

Lastly, in early March, I am honored with the opportunity to speak at the VON conference, which will be held in the second largest city in the U.S. that does not have a baseball team; my home town of San Jose. The cities have more than that in common as, thanks to the strike, neither has NHL hockey.

The Korner – Adding Some Bling Bling to the Ring Ring

For those of you who are still looking for something unique to give a loved one for the just passed Valentine’s Day, I have found the perfect gift that some might even describe as techno-jewelry. On a personal note, jewelry has never been one of my things. I used to consider it completely frivolous and unnecessary. And I am not the only one who feels that way, as for years my brother-in-law kept suggesting that the engagement ring I bought my wife could have been the new boat that we never bought. Over the years, however, I have come to realize that some pieces of jewelry may actually have some function and usefulness.

For instance, when I first saw the flame-colored blue-tooth headset, pictured here, I thought it was some sort of 21st century piece of jewelry; something out of a science fiction movie. Upon closer examination, I realized that this earpiece is actually a blue-tooth wireless headset. This headset is very functional as it features voice activated dialing, as well two microphones which provide excellent audio quality. The manufacturer designed a very functional and appealing package.

It was the work of an artist in the heartland, however, that turned this clever communications interface into a fashion statement. This artist, who will remain unnamed, works for an independent telephone company. He uses an airbrush to apply his custom designs, such as the flames, to these high-tech earpieces.

Clearly, fashion is becoming a bigger part of the technology equation, as evidenced by the designer shells that can be purchased for cell phones. This headset takes the idea of technology as fashion a step further, as it is not too hard to imagine people purchasing different headset designs to match their various wardrobes. I can imagine a version with a built in hearing-aid for those too vain to wear a traditional ear piece. There is even talk of embedding jewels in these things, meaning bling-bling may soon meet ring-ring.

The point is that people are willing to pay a premium for accessories that somehow augment their looks. Independent telcos will increasingly have to live in this world where products are as much about fashion as they are function. The other point is that artists and other creative types already live in the worlds of the independent telco and these folks can be great resources in helping telcos to create products that will provide differentiation from competitors that have a national presence.

One last point; the fact that this middle-age, white guy from the suburbs used the term “bling-bling” to describe jewelry shows the influence of the hip-hop/rap on the mainstream. A year ago, I had never even heard that term and now I am using it as smoothly as another famous rap entrepreneur, Snoop Puppy Pup. As Vince Vittore pointed out in his talk at NTCA, your next competitor, in the form of the very successful Russell Simmons of Def Jam records, may come from this community.

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