Fueling Growth in Online Video Advertising

What's the meaningful business impact of online video adoption on digital marketing investments in 2009? Apparently the growth trend has caught the attention of mainstream marketers.

Marketers in the U.S. will take a closer look at online video in 2009, according to a survey conducted in December 2008 by PermissionTV. More than two-thirds of respondents said they would focus their budgets on online video this year.

More than one-half of respondents also expected to be implementing or extending an online video project in Q2 2009. However, less than one-third said they were doing so currently.

eMarketer estimates that spending on online video advertising will grow to $4.6 billion in 2013 -- representing a more than sevenfold increase from the $587 million spent on the format in 2008.

More than four out of five Internet users will watch online video advertising in 2012, eMarketer projects, up from the two-thirds who did so in 2008.

Online video ads are expected to change the nature of online video inventory as well. As ad-supported video grows, the balance of the inventory will tilt toward longer-form content, according to a Diffusion Group study.

This supports the view that more full-length TV content will be viewed online with ad support. The study projected that in 2013, long-form video will represent 69.4 percent of ad revenues, up from 41.6 percent in 2008. In the same timeframe, the share of short-form video will decline to 28.7 percent from the current 54.8 percent.

The Fixed-Mobile Convergence Hype Factor

The fixed-mobile convergence (FMC) outlook is now suspect, as most telecom operators have failed to deliver the mass of subscribers they promised. Despite this fact, Informa Telecoms and Media forecasts that over 190 million subscribers could be FMC users by 2013.

The propensity to hype new FMC services is an unfortunate characteristic of the mobile phone service industry, which leads to the services themselves being downplayed when they do not live up to expectations.

FMC subscribers are expected to increase by 2013 -- but these subscribers are only forecast to equate to around 5 percent of the global market, states Paul Merry author of Informa Telecoms and Media's report.

More seriously, mobile operators have failed to monetize FMC, continues Merry, "Within such an environment the justification for starting along the path to FMC becomes a real issue."

Of the subscribers forecast the majority will be device-based users, FMC subscribers who use a dual-mode capable device to access services, although femtocell subscribers will quickly grow to deliver 46 percent of the total FMC subscribers forecast by 2013.

Approximately 30 percent of device-based FMC subscribers will use data services in conjunction with voice in 2009 rising to 42 percent by 2013.

In order to identify the true value proposition of FMC one must look deeper at the changes FMC brings to the telecommunication service provisioning process. By looking at these changes one can identify the true value of convergence -- to a telco's internal business processes.

For example, FMC creates a number of efficiencies in the provisioning, management and quality of telecoms services offered delivering cost savings and providing tools to reduce churn and improve customer satisfaction.

The key to these improvements comes in the offload of data traffic from expensive cellular network platforms to fixed network infrastructure. The level of cost savings can be substantial with savings forecast to amount to approximately $5.3 billion by 2013 if operators deploy femtocell solutions in a wholesale manner.

The second major opportunity that FMC provides is as an anti-churn device with bundled service offerings acting as powerful incentives to lock-in customers. Bundled service offerings also allow operators to effectively compete through discounting with losses recouped by the increased use in other services.

Online is New Imperative for Gaming Industry

There are now signs that the consumer electronic (CE) sector has been negatively impacted by economic pressures, according to the latest market study by In-Stat. Shipment growth in 2009 will be slowed down across a number of CE segments -- and video game consoles is expected to be one of these markets.

In 2008, total video game console unit shipments reached approximately 48 million worldwide, up 17 percent from worldwide unit shipments in 2007. Growth occurred over this time period for a number of reasons.

Consumer demand for the Nintendo Wii was very strong and outpaced demand for both the Xbox 360 (Microsoft) and the PlayStation 3 (Sony). Also, the video game console market did not see an impact from the declining economy until late October 2008.

Even then, the market survived the remainder of the year, and experienced continued demand over the crucial holiday season. However, for 2009, the market is expected to fall almost 2 percent to 47.5 million unit shipments worldwide.

The video game console business is costly as it is, and coupled with a dismal economy, the three main vendors have turned to online gaming to generate additional revenue or to promote brand loyalty.

However, there are clear differences among the three vendor strategies.

Microsoft is trying to create a number of revenue streams through its Live service, including its subscription service, paid casual games, and additional paid content. Sony is following a model similar to that of Microsoft, except it doesn't offer a subscription service. Nintendo is limiting its revenue to paid downloads for Nintendo and partner games. Other services, including multi-player gaming, news, weather and Internet access, are free.

Since the Wii has been selling so well, it would appear that it is not Nintendo's priority to develop an online gaming strategy that makes money. However, online gaming is shaping up to be an imperative part of the gaming industry overall.

In-Stat believes that it would be in each vendor's best interest to develop and hone its online gaming approach over the next year in an effort to create new revenue streams in a dismal economy.

Ready for Next Generation Remote Controls?

The traditional infra-red remote control device used to command consumer electronics (CE) equipment -- including TVs and Pay-TV set top boxes -- is somewhat limited. Even universal remotes that control multiple devices are quite one-dimensional and poorly designed, from a usability point of view.

If some major CE manufacturers have their way, the next generation of remotes will be based on Radio Frequency (RF) technology. The growth curve for these products is just beginning, but is forecast to show a 55 percent compound annual growth rate (CAGR) through 2014.

According to senior analyst Jason Blackwell of ABI Research, the first such products are already appearing in Japan. "RF remote controls are starting to ship with a few high-end Japanese TVs such as Sony's premium Bravia models. Companies like Sony hope to start with early-adopters, then ramp up volumes, drive down costs, and move these remotes into more mainstream products."

IR remotes perform the basic task, so why move to RF? The reason is interactivity, which is becoming prevalent in today's digital home.

As more devices add Internet connectivity and the ability for two-way communication and greater interactivity, RF remotes offer the prospect of better communication with devices -- they can sense the status of the devices they control, for example, and report that back to the user.

Users can also input information through more evolved interfaces. There's no need for the line-of-site required by IR, so an RF remote could control a set-top box or audio receiver in another room.

The move to RF remotes is being driven by major OEMs, not by consumer demand. But, adds Blackwell, "If vendors can make consumers aware of the benefits, that will drive consumer adoption. And, if manufacturers can offer a remote that works with a wide range of devices, RF adoption becomes that much easier."

To that end, a number of manufacturers are currently working on new technical standards for the RF remote modules. ABI's latest report analyzes the market for OEM and aftermarket universal remote controls.

Remote control shipments and revenues are forecast by region and major market segments. A forecast for the penetration of RF technology in the remote control market is also presented.

Chinese Internet Audience Outranks the U.S.

comScore reported that total global Internet audience has surpassed 1 billion visitors in December 2008. The actual distribution of those users may surprise many in the "developed" Western nations.

The Asia-Pacific region accounted for the highest share -- by far -- of global Internet users at 41 percent, followed by Europe (28 percent share), North America (18 percent share), Latin-America (7 percent share), and the Middle East & Africa (5 percent share).

"Surpassing one billion global users is a significant landmark in the history of the Internet," said Magid Abraham, President and Chief Executive Officer, comScore, Inc.

China represented the largest online audience in the world in December 2008 with 180 million Internet users, representing nearly 18 percent of the total worldwide Internet audience, followed by the U.S. (16.2 percent), Japan (6.0 percent), Germany (3.7 percent) and the U.K. (3.6 percent).

The most popular Web property in the world in December was Google Sites, with 777.9 million visitors, followed by Microsoft Sites (647.9 million visitors), Yahoo! Sites (562.6 million visitors).

Facebook.com, which has grown a dramatic 127 percent in the past year to 222 million visitors, now ranks as the top social networking site worldwide and the seventh most popular property in the world.

Dramatic Slowdown of PC Shipments in 4Q08

Despite market optimism early in the fourth quarter, the pace at which the economic environment unraveled, and the extent to which Personal Computer (PC) purchases were affected, was faster than anticipated.

Following roughly six years of growth, with the last five averaging 15 percent increases, worldwide PC shipments were down 0.4 percent year on year in the fourth quarter of 2008 (4Q08), according to IDC's latest global study.

The dramatic slowdown was enough for a sequential decline of 2.5 percent from the third quarter in place of an expected increase for the holiday season.

The weakening economic environment, including falling home and stock values, deteriorating credit, and implications for trade and consumer spending, was clearly the dominant factor limiting growth.

Low-cost portables, vendor competition, and holiday promotions were simply not enough to overcome the economic tide, even with the market for mini notebooks (also known as netbooks) taking off.

Growth of portable PCs was cut roughly in half from nearly 40 percent year on year in the first three quarters of 2008 to roughly 20 percent in the fourth quarter. Meanwhile, the pressure on desktop PCs pushed volume down roughly 16 percent from a year ago after only a small decline earlier in the year.

Mini notebook volume is estimated at near 5 million units in the fourth quarter, bringing the total for 2008 to about 10 million, accounting for nearly 7 percent of total portables, with shipments expected to double in 2009.

Despite the dramatic slowdown in fourth quarter shipments, annual volume was up 10.5 percent in 2008. This was on par with 2006, when some vendors struggled with the accelerating transition to portables and replacement rates dropped with economic uncertainty and the pending launch of Vista.

"For all that's been said about this recession being different than 2001, the drop in PC growth from mid-teens the preceding year to near flat growth in the most recent quarter shows that the impact of this crisis looks similar to the last time around," said Loren Loverde, program director for IDC's Worldwide Quarterly PC Tracker.

It is tempting to argue that international markets will be less affected, or that low prices and the transition to portables will limit the impact, but the market has taken a serious hit and the competitive environment along with a race to low-cost portables could easily undermine profits from mobile computing.

ZigBee Wireless Sensor Network Application

Broadband services continue to be in high demand, attracting millions of new subscribers worldwide each month, and enabling new applications, according to the latest In-Stat market study.

In-stat projects that Automatic Meter Reading (AMR) and smart energy will be the leading applications for 802.15.4 and ZigBee wireless sensor networks. Other growing application segments include consumer electronics, building control, industrial process control, and residential automation.

ZigBee, through its impressive marketing efforts in the U.S., has owned the largest mind share in the wireless sensor networking space for the past several years.

However, a host of proprietary software stacks are being used in applications where ZigBee offers more than what is required by the specific applications, the high-tech market research firm says.

"A large number of technologies are being used for countless applications, with ZigBee usage becoming more focused on the fast-growing smart energy application," says Brian O'Rourke, In-Stat analyst.

"On a global basis, utilities and governments are leveraging these technologies to provision, monitor, and bill customers more efficiently while also benefiting the environment."

In-Stat's market study found the following:

- 802.15.4 node and chipset units will reach 292 million in 2012, up from 7 million in 2007.

- Only one-third of 802.15.4 chips include a ZigBee stack, demonstrating the fragmentation among competing sensor network technologies and software stacks.

- 802.15.4 is emerging in consumer electronics markets through efforts by RF4CE.

Virtual Worlds Venture Capitalists Retreating

Virtual Worlds Management released a report tracking the virtual worlds-related investments of 2008. More than $594 million in 63 virtual worlds related companies in 2008.

The year has seen a steady decline in investments from 2007's burst of over $1.4 billion. In Q4 2008,we saw $101 million invested in 13 virtual worlds related companies. This was down from $184 million in Q1 to Q2's $161 millions to Q3's $148.5 million and now the most drastic drop.

"The year wasn't bad for all sectors," said Christopher Sherman, Executive Director, Virtual Worlds Management.

Nineteen youth-oriented properties received over $70.47 million over the course of the year. The bulk of that was in Q1 and Q3. As more and more youth worlds came to market over the course of the year, spectators worried that the space was overcrowded. Others have seen it as a sector for opportunity, and it appears as if venture capitalists are still somewhat interested.

With the youth world space on its own getting more and more jam packed, third parties are looking to help monetize them. And that's an area where investors are certainly looking. Five companies with interests in monetizing virtual worlds, either through advertising, payment methods, or virtual goods, received $64.7 million.

That's not including the June acquisition of PayByCash (which provides alternative payment methods) by PlaySpan, which runs virtual goods marketplaces. PlaySpan went on to bring in its own $16.8 million investment in November (included in the above sum).

"For developers aiming at adults with virtual worlds, though, the year was a little slower," said Joey Seiler, Editor, VirtualWorldsNews.com. "While big money seems readily available for developers creating massively multiplayer games, companies aiming with more traditional worlds raised over $47.721 million for 11 companies.

"With investment already dropping off in 2008 across the board, both within the virtual worlds industry and without, and predictions for further and increased slowdown in 2009, we may see a continued slide," added Sherman.

Without more cash flowing into the industry, the crowded space that has scared off some investors will likely start to see more shrinkage in 2009, whether through simple closings or possibly mergers and acquisitions as developers look to consolidate audiences, services, and strategies.

GPS Chips in Smartphones add Applications

Shipments of GPS-enabled mobile phones will hit a speed-bump in 2009, but will still manage to post year-to-year unit growth through the current economic downturn, according to a new market study by ABI Research.

While global handset shipments are expected to drop by 4—5 percent in 2009, GPS-enabled phones will climb to 240 million units -- an increase of 6.4 percent over 2008.

This surprising performance will be driven by the ongoing demand for feature-rich smartphones. Although slowing slightly in 2009, demand for smartphones, a group that includes the Apple iPhone 3G, RIM's BlackBerry devices, and Nokia N series phones among a growing list, will increase at an average annual unit shipment rate of 19 percent through 2014.

During the period, GPS chipsets will continue to penetrate this segment -- nine of every ten smartphones will contain GPS ICs in 2014, compared with one in three in 2008.

Falling component prices and increasing consumer awareness of handset location capabilities will keep demand for GPS-enabled phones healthy, in spite of the slumping global economic picture.

Other factors that will continue the trend toward the inclusion of GPS functionality in handsets include the spread of open source operating systems such as Google's Android which provide application specific interfaces (APIs) that allow software developers to create location-based content for mobile devices, and the continuing emergence of navigation and map-based applications for handsets.

"As the quality of positioning technology in handsets improves and the cost of including it declines, GPS location technology will approach the status of a standard device feature," says senior analyst George Perros.

"We are approaching the point where location awareness will be synonymous with smart devices, a point where personal navigation, social spatial knowledge, and location-specific contextual information will be assumed handset capabilities."

Mobile Operators Offer Personalized Service

A new market study by Parks Associates finds worldwide growth in the number of 3G subscribers will motivate service providers, under pressure to maintain customer satisfaction and build revenues, to expand on traditional voice offerings to include converged fixed-mobile services.

Their report predicts that the number of 3G subscribers will exceed 2.5 billion worldwide by 2013, with over one billion in Asia alone.

The tremendous expansion of this large service population will catalyze the development of fixed-mobile convergence (FMC), creating new service options where users can access video, audio, and community offerings via mobile devices once limited to traditional voice applications.

"Service providers have to offer personalized services that fit individual needs, instead of uniform sets of services," said Jayant Dasari, Research Analyst, Parks Associates. "Consumers rely on their mobile phones for communications and for entertainment and social networking."

Demand for personalized services will expand mobile services from traditional voice to multimedia applications. Parks Associates predicts operators will rely on femtocells to realize FMC as these devices enable them to better monetize their 3G infrastructure.

Fulfilling such needs used to be impossible because carriers' networks and business divisions operated separately. By moving voice and data to a single IP-based network, service providers can now put together the required infrastructure and associated back-office frameworks to provide truly converged services.

The report entitled "Fixed-Mobile Convergence: Consumers and Business Models" examines the current state of 3G deployments worldwide and the drivers for fixed-mobile convergence.

Wi-Fi and VoIP Migrating to Mobile Phones

In the next five years, the nature of mobile phones will change radically, according to the latest market study from In-Stat. Increasing availability of mobile broadband, operator support for data-intensive devices, and improvements in usability for mobile devices brought about by the influence of the Apple iPhone will evolve the designs of handheld devices.

"Consumers are nearing their limits adjusting to the added complexity of converged mobile phone devices," says David Chamberlain, In-Stat analyst.

Feature proliferation is impinging on usability. Handset vendors and mobile operators must carefully evaluate the drive toward increasingly converged devices with features and functions that add direct value to consumers.

The In-Stat research covers the worldwide market for cellular devices. It includes in-depth consumer research based on the results of ongoing consumer surveys, conducted primarily in North America reflecting changes in attitudes toward a number of handset features and functions.

In addition, there are recommendations for dealing with the increasing complexity in cell phones that is increasing costs without substantially increasing value to end-users.

In-Stat's study found the following:

- Wi-Fi will become increasingly available in mobile phone handsets; In-Stat forecasts more than 300 million Wi-Fi-enabled cellphones will be sold in 2012.

- Annual smartphone sales will double over the next five years.

- By 2012, annual sales of handsets able to receive video content will exceed a half-billion.

- According to a survey of over 1,500 individuals from In-Stat's technology adoption panel, almost 60 percent of respondents indicate some level of interest or already use Wi-Fi for VoIP using a cellphone.

Why Newspaper Advertising Model is Broken

According to the latest market assessment by eMarketer, the outlook for newspaper publishers in the U.S. is downright dismal. They estimate that American newspaper advertising revenues declined 16.4 percent in 2008 to $37.9 billion.

The forward-looking story is equally bad. By 2012, spending will slide to $28.4 billion.

"The current economic situation is making things tough across all media, but newspaper revenues are falling more than in any other major medium," says Carol Krol, eMarketer senior analyst. "Even the former bulwark of newspaper revenues, classified advertising, is plummeting due to Craigslist.com and other online alternatives."

The Newspaper Association of America tracked two consecutive quarters of declining revenues for newspapers online for Q2 and Q3 of 2008 -- the first time that has ever occurred since it began tracking online figures in 2003.

For 2008, eMarketer estimates online newspaper advertising revenues declined by 0.4 percent overall compared with 2007, to $3.2 billion, and forecasts they will drop further into negative territory in 2009, down 4.7 percent to $3 billion.

"The challenge for newspapers is continuing to make money while they transition to online," says Ms. Krol. "But they face the same transition problems that plague other traditional media, such as broadcast TV, and so far they have not been able to crack the code."

The "State of the News Media 2008" report, published by Pew Research Center, described the dilemma as a decoupling of news and advertising: More and more it appears the biggest problem facing traditional media has less to do with where people get information than how to pay for it -- the emerging reality is that advertising isn't migrating online with the consumer.

"It's like changing the oil in your car while you're driving down the freeway," Howard Weaver of McClatchy told Pew researchers. Clearly, that's a sobering analogy for investors who are hoping for any sign of an industry turn-around. Perhaps their advertising model is truly broken, and beyond repair.

New Momentum for 3D Cinema Technology

It's predicted that 2009 is set to be the year for 3D, a reality that was apparent across the breadth of the recent Consumer Electronics Show, with many key players in the industry ready to showcase their capabilities.

With a myriad of competing technologies and 3D concepts out there, Futuresource Consulting announced the launch of a new market study outlining opportunities and challenges for 3D in cinema, broadcasting, TV display equipment, gaming, video content delivery and the outdoor advertising and digital signage industries.

Hollywood's ultimate goal is to bring 3D Cinema into people's homes to fully maximize this revenue stream, as only 25-30 percent of the revenues a studio earns from a blockbuster film come from the box office.

"Crucially, much of the backbone technology has arrived and is already in many people's homes, without them even realizing it," says Sarah Carroll, Director Strategy Consulting & Continuous Services, Futuresource Consulting.

Within the next five to ten years we're going to see 3D prevalent across the home entertainment industry, with 3D technologies increasingly installed in households.

Consumer 3D TV displays are available to view with and without glasses -- however, issues still remain regarding quality of image, viewing experience when wearing glasses -- though many 2D displays currently installed in consumer homes are already capable of displaying 3D content if connected to a suitable 3D video feed.

Despite the technical and standards issues that still need to be resolved, there is a lot of excitement regarding the potential for 3D from the broadcast industry, consumer and professional electronics sectors, gaming and advertising industries, optical disc replicators and the retail trade, as well as Hollywood.

Carroll adds "Here at Futuresource we're taking a holistic approach, examining the global opportunities and also putting them within the context of the prevailing economic downturn. In particular, research has shown that unfavorable market conditions are more likely to influence consumers to retreat into their living rooms."

With a roadmap stretching out over the next ten to fifteen years, the report from Futuresource will examine current usage of 3D technology in consumer applications, assess the technologies and standards that are being developed and quantify the market potential for the hardware, software and service industries, both now and as this technology penetrates the living room.

Fiber Optic Communications Global Upside

At the end of 2008, fiber optic communications (FTTx) had firmly established itself as a third viable and scalable global fixed broadband technology alongside DSL and Cable.

Despite economic problems, operators will continue to build new networks, and the number of global FTTx subscriptions will almost triple between now and the end of 2013. But operators face some key challenges.

While FTTx will experience some growth between now and 2013, many consumers are still unwilling to pay an excess for new FTTx services. In addition, most operators do not know if, how and when they will make a return on their investments.

According to Informa Telecoms & Media, there were 49 million global Fiber-to-the-home (FTTH), Fiber-to-the-building (FTTB) and Very high speed DSL (VDSL) subscriptions in 2008. This represents 11.6 percent of all fixed line subscriptions.

While such figures may seem impressive, subscriptions are clustered in only a few countries and fiber is still not a reality for consumers in most countries (including the United States).

The majority of FTTx subscriptions, unsurprisingly, are in Asia Pacific. Pioneering fiber nations Japan and Korea have 13.4 million and 7.0 million FTTx subscriptions respectively.

But, it is China that actually has the greatest number of FTTx subscriptions. Chinese operators have been aggressively upgrading their legacy networks to fiber, and there are now 16.6 million FTTx subscriptions in the country.

By 2013, Informa predicts there will be 145 million subscriptions, just under one in five of all global broadband subscriptions. Much of this growth will be fuelled by Europe and North America. With the exception of a few alternative operators, FTTx growth in Western Europe has been sluggish to date.

But greater regulatory certainty and wider acceptance of the benefits of fiber mean that by 2013, there will be 21.6 million FTTx subscriptions, representing total household penetration of 10.5 percent.

Central and Eastern Europe, not currently thought of as an advanced broadband region, will have a FTTx penetration rate comparable to Western Europe by 2013. It will have 10.6 million subscriptions by 2013, representing 13.2 percent of all subscriptions in the region.

Operators in Central and Eastern Europe are taking advantage of a high proportion of multi dwelling units (MDUs) and a lax regulatory regime to quickly roll out FTTB in the region.

North America may, hopefully, see significant growth. As a result of aggressive roll-outs from both AT&T and Verizon, there will be 24 million FTTx subscriptions in North America in 2013, making up 22 percent of the total market.

Conversely, some of today’s lead fiber markets will see some slowdown in growth towards the end of the forecast period as they approach saturation. Growth of FTTH and FTTB in Japan, for example, will have a compound annual growth rate for fiber of only 7.9 percent over the forecast period.

The big concern for most operators is how they will profit from their rollouts. With a few exceptions, most operators with advanced FTTx rollout plans have not made money from their new networks.

Some will try and charge more for FTTx but others, including alternative operators Fastweb of Italy, France's Free and Sweden's Bredbandsbolaget are charging the same or even less for their premium services as their legacy services.

UltraWideBand Technology Consolidation

Apparently 2008 was a difficult year for UltraWideBand (UWB) technology adoption, according to the latest market study by In-Stat. There are now four fewer UWB chip makers than there were in the middle of 2008, the high-tech market research firm says.

A market recap: Focus Semiconductor declared bankruptcy; WiQuest shut its doors; Intel stopped its program; Artimi and then Staccato Communications merged at the urging of their venture capitalists.

"This consolidation has been expected, but in combination with continued slow UWB device shipments, it raises the specter of the failure of UWB technology in the marketplace," says Brian O'Rourke, In-Stat analyst.

On the bright side, UWB-enabled mobile PCs showed impressive percentage growth, albeit from a very low starting point. Another positive development in 2008 was the settling of the worldwide regulatory structure and the consequent development of worldwide UWB chip stock keeping units (SKUs) from a number of chip makers.

The In-Stat research covers the worldwide market for ultrawideband technology, both WiMedia and proprietary versions. It provides forecasts for UWB penetration in major product categories, UWB-enabled cards and dongle shipments, UWB network port shipments, and UWB-enabled device shipments through 2012.

In-Stat's market study found the following:

- PCs are the leading UWB segment in 2008, with 265,000 devices expected to ship.

- Aftermarket UWB hubs and adaptors comprise all of the UWB peripheral shipments in 2008.

- The first UWB-enabled digital televisions shipped during 2008 in Japan.

Global IPTV Market Forecasts Still Upbeat

Riding on the wave of high-speed broadband connectivity in leading markets within Asia-Pacific and Europe, plus the evolution of business and user requirements, television is no longer what it used to be.

Trends are showing that interactive bi-directional television is increasing at the expense of legacy TV formats. According to new pay-TV market data from ABI Research, IPTV will grow by an estimated 32 percent annually over the next six years to nearly 79 million subscribers globally by the end of 2014.

Satellite and cable TV are among the oldest and most important pay-TV platforms in many countries, and they are likely to retain their footholds in those markets for a long time. However, their growth rates will slow as IPTV gains momentum.

ABI Research industry analyst Serene Fong observes that, "Some telecom operators which are faced with thinning margins are deploying high-speed access networking technologies to challenge incumbent satellite and cable operators."

They do so by offering compelling alternatives via existing broadband infrastructure, thereby making service subscription easier and more convenient compared to the traditionally more cumbersome and costlier legacy television alternatives.

IPTV usage should be robust as prices of high-speed broadband fall, in line with the competitive Asia-Pacific and European markets, and more users start adopting multimedia services.

According to Fong, "Usage will initially be concentrated in countries with established high-speed Internet technologies such as France, the Netherlands, South Korea and Hong Kong. But as technology progresses and matures, developing countries such as China will rapidly catch up in subscription numbers."

In fact, China already has more broadband subscribers than the United States.

Operators will continue rolling out IPTV as part of their multi-play strategies, and the right set of technology deployment and consumer-friendly price plans will become increasingly vital.

However, Fong cautions that, "While we expect to see greater momentum in the telco TV segment in the years to come, this new television alternative is unlikely to completely replace legacy pay television services immediately."

Outlook for All Advertising Good for Google

According to a Fitch Ratings market assessment, advertisers now have more options in the current economic environment than at any other time, and they are scaling back traditional high Cost Per Thousand (CPM) "impressions" oriented advertising campaigns.

Even profitable marketers will use increased bargaining power to attain better rates and associated concessions from big media companies. The study offers trends and outlooks for several advertising sub-sectors, as follows:

Newspapers
Newspaper industry revenue growth will be negative for the foreseeable future as both ad pricing and linage will be under pressure within each of the four main components of newspaper revenue streams. More newspapers and newspaper groups will default, be shut down and be liquidated in 2009 and many cities could go without a daily print newspaper by 2010.

Yellowpages
Few markets will be able to support more than two print directories and most markets will eventually only be able to support one book. Another year of accelerated declines in yellowpages advertising could significantly pressure the solvency of the two pure-play incumbent directories companies.

Terrestrial Radio
Radio is non-unionized, and converts a higher percentage of EBITDA to free cash flow. Listenership is likely to continue to fall, though available inventory should remain relatively stable, and pricing could be up on some advertisers. Internet streaming provides additional day parts to sell. High definition (HD) radio in automobiles could provide some growth to listenership.

Magazines
Fitch expects the larger players to rationalize available print advertising inventory through consolidation and closing down titles. Several categories that used to have multiple titles will likely have advertising bases that can support only one major title. With limited catalysts for growth in the core print product, some magazine publishers have become more proactive online.

Outdoor
The potential negative effects of increased inventory from digital roll-outs should be tempered by increasing appeal to national advertisers, as well as decreases in price per unit. Cost structures should benefit from digital signage, as displays can be centrally managed. Low CPMs and better networked national sales pitches, better position outdoor advertising companies.

Cable Networks
Cable industry ad inventory has grown, causing a deceleration of the decades-long increase in ad dollars. Cable continues to be a targeted medium, at a lower price relative to broadcast TV. Cable will continue to gain share from broadcast. Cable networks to continue to embrace VoD and digital strategies, which could provide some modest revenue growth.

Online
Online could be affected by legacy advertisers scaling back experimental use in favor of traditional mediums. Search is more healthy than display ads. Remnant advertising will see a shakeout in the ad network space. Online video and social networking will growth. Regulatory issues could be a factor in behavioral targeting. Online advertising will continue to capture share from all traditional media.

Tech Buyers Favor Social Media Marketing

Marketers of technology products and services have good reason to explore social media marketing techniques. Now eMarketer reports that corporations are finding that blogs can be instrumental tools for building solid relationships and gaining meaningful influence with their customers.

Clearly, blogs are increasingly popular with both online consumers and people involved in business related procurement. According to an August 2008 study by BuzzLogic and JupiterResearch, there has been 300 percent growth rate in monthly blog readership over the past four years.

In fact, nearly one-half of the online population reported reading blogs.

The study also found that blogs have more impact on purchasing decisions than social networks. One-quarter of readers said they trust ads on a blog, as opposed to 19 percent who trust advertising on social networks.

In addition, 40 percent of blog readers -- and 50 percent of frequent blog readers -- have proactively taken an action after viewing an ad message on a blog.

Aside from technology-related purchases, for which 31 percent of readers said blogs are helpful, other categories for which respondents say blogs are influential included media and entertainment (15 percent); games, toys and sporting goods (14 percent); travel (12 percent); automotive (11 percent); and health (10 percent).

Apparently, marketers increasingly view blogs as a key part of their marketing plans. An October 2008 study by the Marketing Executives Networking Group (MENG) found that more than 66 percent of executives employ blogs in their marketing efforts.

However, based upon the way that most large companies utilize micro publishing tools, such as blogs, I believe that many marketers confuse blogging with the legacy process of press release production and distribution. Ironically, blog posts are often reviewed an edited to ensure that they mimic the corporate marketing speak rhetoric of communication from a bygone era.

New Study of Consumer Video Consumption

The Center for the Digital Future announced results from the latest Visual Networking Index (VNI) Pulse Survey, designed to assess worldwide consumer video behaviors and attitudes.

The study highlights consumer video "consumption" and attitudes about video in the United States, urban China, Germany, and Sweden.

Survey respondents answered questions about their level of access to media technology, the devices they used for "viewing" video, the amount of time they spent watching video on different devices, and the reasons they watch video content.

"Our research identifies the innovative ways people are choosing to communicate, discover entertainment content, and access video information in different locations on multiple devices," said Jeffrey Cole, director of the Center for the Digital Future.

"Video is being added to more and more applications and showing up in more and more locations. We see a common thread that people are using video to remove global boundaries, build intimate relationships faster, and have collaborative interactions across distances."

More than 1,000 consumers from each of the four target countries completed online or telephone questionnaires about their "video usage" during the month of November 2008.

Key findings of this market study include:

- U.S. consumers watch the most TV: an average of 3.8 hours per day. Germans watched 2.9 hours on average; Swedes, 2.1 hours; and urban Chinese, 1.8 hours.

- Urban China has the largest percent of users who watch online video via their PCs, at 97 percent, with the U.S. following at 81 percent.

- The U.S. has the largest percentage of users watching video on a mobile phone, at 23 percent. U.S. respondents who watch video on their mobile phone spend an average of 36 minutes per day doing so.

- Eighty-five percent of the German respondents are interested in viewing Internet video on their TV sets, compared with 55 percent of Swedes, 54 percent of Americans, and 35 percent of urban Chinese.

- U.S. respondents watch 2.5 times as much professional video content (TV programs and movies) as they do user-generated video content on their PC or laptop. German respondents watch twice as much user-generated video on their PC or laptop as they do professional video content.

- On average, American respondents who use a PC or laptop to view video spend 1.5 hours per day doing so. They are well ahead of the Swedes (who spend 0.7 hours per day), equal to the Germans (1.5 hours per day) and slightly below the Chinese (1.9 hours per day).

In my opinion, this insight really must be balanced with a study of consumer and prosumer video production and distribution data -- because that's the untold story that is more indicative of the changes that are fragmenting the visual news and entertainment landscape.

In the bygone era of highly concentrated Big Media, that's based upon closed monopolization, all the emphasis was on the consumption of content from a finite list of content producers. In the Web 2.0 era of increasingly fragmented Micro Media, that's based upon open participation, the emphasis now shifts to the rapidly growing list of diverse content producers.

Pocket Video Camcorder for Web 2.0 Apps

The camcorder market remains one of the most complex and dynamic Consumer Electronic (CE) categories, despite witnessing fairly modest unit growth in recent years. Now, the emergence of a new breed of low-cost, back-to-basics, pocket video camera (PVC) is connecting with consumers.

"With the death knell sounding for traditional tape-driven camcorders and DVD giving way to HDD and Flash-based devices, it's the pocket video camera segment that's really leading the charge," says David Watkins, a senior analyst at Futuresource Consulting.

Accounting for just 5 percent of total U.S., Japan and Western Europe camcorder shipments in 2006, they expect this to swell to 40 percent by 2010, equating to more than 7 million units shipped across the three regions next year.

A range of factors is driving this step change, including the ever-increasing popularity of Web 2.0 sites with video upload capability -- as PVCs simply plug into a computer and the video can be uploaded direct to web.

America, the world's largest video sharing population, with more than 50 video uploads per minute to YouTube alone in the first half of last year, is the biggest market for PVCs -- with the UK and Germany leading the way in Western Europe.

In addition, low price points, durability and point-and-shoot functionality mean these devices appeal to a broad cross-section of the population. Sports enthusiasts and extreme sports participants, young parents, teenagers, bloggers, vloggers and online social networkers are just some of the groups utilizing the PVC.

With embedded or removable flash memory and a stripped-down feature set, PVCs are small enough to qualify as highly portable everyday video camera devices. Non-traditional camcorder brands such as Pure Digital, Aiptek and DXG are currently dominating the PVC segment.

I personally use a Pure Digital Flip Ultra camera.

British Eager to Switch for Faster Broadband

Speed is more likely to influence British customers to switch Broadband Service Providers (BSPs), according to a recent market study by Strategy Analytics.

The study found that, despite high self-reported customer satisfaction levels, seventy percent of UK subscribers would gladly defect to another service provider for a higher speed offering.

This survey was conducted in the fourth quarter of 2008. Strategy Analytics polled 500 UK broadband decision makers on the "three pillars" of customer churn -- customer satisfaction levels, propensity to churn and perceived obstacles to defecting.

Respondents were presented with various broadband speed and price scenarios to gauge sensitivity. Sky Broadband customers had the highest overall satisfaction levels, with 87 percent reporting to be "very" or "somewhat" satisfied with the operator.

"The study results underline the importance of access speed to the UK broadband consumer," said Ben Piper, analyst and Director of the Strategy Analytics Multiplay Market Dynamics service.

This is particularly relevant in light of Virgin's recent launch of its 50 Mbps product. In order to stay in the game, competitors will need to quickly and nimbly match or beat the Virgin offering.

Another key finding from this study was the weight customers placed on perceived barriers to switching. The hassle of scheduling installation was viewed as a gating factor for the majority of respondents.

Clearly, companies that focus on minimizing customer disruption and inconvenience during switchover will go a long way toward increasing their subscriber base.

Their recent survey includes data from the top UK BSPs, including BT, Carphone Warehouse, Virgin Media, Sky, Tiscali, and Orange, among others.

Tech Marketers Under Pressure for Results

Laura Nurzynski, group vice president of IDC's Global Go-to-Market and Sales Enablement Services, will present insights and innovations in tactical marketing best practices at IDC Nordic Directions.

IDC research shows that tactical marketing efforts will become one of the largest program allocations by technology companies by 2010, and for good reason.

Nurzynski's presentation will explore ways to leverage that investment with marketing and sales best practices in the currently changing world of shifting budgets and reordered investment priorities.

Additionally, IDC research demonstrates that there is a big gap between what you -- tech marketers -- are communicating to your audience, and what your audience needs from you to do their job.

"Your prospects and customers have a message for you," said Nurzynski. "That message is 'When you ask for my time to hear about your solutions -- be credible and be relevant'."

With constrained marketing budgets and a continued focus to improve efficiency, effectiveness, and prove ROI, tech marketers and sales need now, more than ever, to focus on tactics that yield results.

"Reaching the right target, at the right time, with the right information is critical to marketing and sales program success. Understanding the roles and needs of your myriad target audiences, and adjusting your messaging, offers, and programs to better serve each audience and to become a trusted advisor to your prospects and customers is critical," said Nurzynski.

This requires change and coordination across the entire go-to-market chain, from the market research that is conducted to how the sales team is enabled. That said, what a great opportunity to distance yourself from the crowd.

Asia-Pacific Market Could Save Mobile Data

The global mobile phone handset market went into a tailspin in October and November, which will result in a nearly 5 percent year-over-year decline in unit shipments in Q4. While 2009 is likely to see more stormy economic weather, there are a few rays of sunshine.

"The number of WCDMA and CDMA2000 mobile handsets sold -- currently 39 percent of the total -- is expected to exceed 50 percent in 2009," says ABI Research Asia-Pacific vice president Jake Saunders.

Much of the brunt of the economic downturn will be experienced in the 2G categories. WCDMA handset shipments are projected to grow from 258 million in 2008 to 725 million in 2009. By 2013, more than 67 percent of all mobile phone handsets shipped will be 3G/3G+ capable.

"Another robust segment is smartphones," adds practice director Kevin Burden. "Smartphones captured 14 percent of the 2008 market and are expected to grow throughout the challenging period of 2009 and comprise 31 percent of the market by 2013."

Smartphones are among the most coveted pieces of prosumer electronics.

ABI believes that cellular modems will also be a high growth sector in 2009, driven largely by USB modems which will account for 80 percent of the shipment volume. Market volume is expected to increase by more than 55 percent in the coming year as Asian vendors push forward with low-priced modems.

Mobile operators continue to be creative with broadband plans to entice new users, offering options such as a free month with a modem purchase, as well as daily and weekend plans and per MB fees.

"For as long as operators aggressively price and promote mobile broadband plans, cellular modems will continue to be a hot category with considerable potential in SOHO and SMB segments," concludes Burden.

Frankly, I'm not convinced that the upside for wireless data will reach the U.S. market in particular. Regardless, perhaps the Asia-Pacific market may have additional growth potential in reserve.

Wireless Data Services Vulnerable to Cuts

Apparently, 2008 was a growth year for the cellular modem market, as many wireless operators aggressively increased their 3G data service offerings.

Consequently, 3G modem manufacturers enjoyed an upswing in demand with shipments reaching 20 million units in 2008, according to the latest market study from In-Stat.

Two big trends are the move in form factor to USB modems and the growing emphasis on embedded modems, led by Ericsson and Qualcomm.

Embedded shipments will overtake external modem shipments by the end of 2011. The result is increasing price erosion for external clients, especially in Western Europe, where Huawei has become a strong player.

"Clearly, here is an instance where CAPEX investments in good times are paying dividends in lean years" says Daryl Schoolar, In-Stat analyst. "Operators continue to move forward with their mobile data subscription initiatives even as the economy suffers. This has put cellular modem manufacturers in a really nice place to be."

However, relatively speaking, these services are still considered expensive by mainstream users -- unless, of course, you don't personally have to pay the service fees. Therefore, in a down economy, the employer-pays model makes wireless data services very vulnerable to budget cuts.

In-Stat's market study found the following:

- The peak of the external modem market will be in 2010 when revenues crescendo at over $2.6 billion.

- USB has become the dominant form factor, overtaking PC cards in annual shipments in 2008.

- According to a survey of 504 individuals from the In-Stat Technology Adoption Panel, most users have their mobile broadband service paid for by their employer.

Video Users Want Open Access on their TV

TV browsers and applications such as rich media widgets were hot themes at this year's Consumer Electronics Show, but according to a recent Strategy Analytics market study consumers see open and flexible Video on Demand (VoD) services as the most valuable features of Internet TV.

The research, carried out for Oregan Networks by the Strategy Analytics Digital Home Obervatory, also found that downloading widgets and customizing TV screens with skins were seen as the least valuable features.

The study concluded that users expect TV browsers to be video-centric and offer quality equivalent to regular television.

Despite concerns about privacy, 91 percent of respondents wanted to be able to access any multimedia website via their TV browser. Seventy four percent of respondents indicated a preference for these sites to be specially adapted as TV web channels.

According to David Mercer, VP Digital Consumer Practice, "It's perhaps not surprising that TV viewers want to be able to watch video and TV on the big screen. But many of today's early web TV services are focusing too heavily on what they perceive as hot internet technologies such as widgets. Our research suggests these are a low priority for many consumers."

Apparently, Strategy Analytics believes that developers should focus on bringing TV viewers the total wealth of video content that is available on the web.

Perhaps, it's time to let the consumer customize the selection of content and the associated viewing experience -- essentially creating their own personalized open-access channel guide.

The survey was conducted in the U.S. in December 2008 with 500 mid- to high-tech consumers. Each respondent was given an introduction to the capabilities of TV-based browsers, including screen shots of the applications.

Shifting Away from Legacy Marketing at CES

According to Reuters, Hollywood Studios are cutting back on their investment at trade events -- such as the annual Consumer Electronics Show -- as studios seek cheaper or more effective ways to sell movies and television programs.

The shift has occurred as new alternative marketing strategies have displaced the old methods. Viral campaigns and digital marketing techniques, using videos and other rich media online, are creating the forward-looking momentum. Perhaps, more along the lines of the mystery-filled Web promos for the 2008 sci-fi movie Cloverfield.

"As part of our larger cost containment initiatives, we're curtailing travel unless it's really critical for business reasons and I'd imagine that fewer people are going to conferences," said one studio executive, referring to CES as well as the Sundance Film festival and the National Association of Television Program Executives conference in Las Vegas.

"Some of these shows have grown less relevant as programmers find different ways to market their material," said another interviewed executive from a different major studio.

Meanwhile, technology's role in advancing economic development in emerging markets, and predictions for the next big trends in technology, were the focus of day two at the 2009 International CES.

Intel Chairman Craig Barrett delivered a keynote, as part of the Technology and Emerging Countries Program (TEC) at CES. Barrett discussed a number of technology initiatives that are key in advancing economic development in emerging regions: access to inexpensive technology, network connectivity and content.

Following Barrett's address was the TEC panel, "Reaching the Promise of Universal Access to Technology: Creating the Global Tech Ecosystem," in which industry leaders discussed the importance of technological innovation as a catalyst for advancement in developing countries.

John Chambers, Cisco Systems CEO, delivered the closing TEC keynote address. He outlined five key pillars of strength for a country -- education; infrastructure; high-speed broadband to allow information to be shared; innovation and market transitions and a supportive government.

"The Great Rewrite: How Digitization and Changing Consumer Behaviors are Revising the Entertainment Industry's Script," featured a panel discussion on data from Deloitte's State of the Media Democracy Survey. They revealed results showing how consumers between the ages of 14 and 75 are interacting with media across five international markets.

Sony Introduces CES Seven Key Imperatives

The 2009 International CES opened with the world's largest debut of consumer technology products, and keynote addresses from industry leaders. The world's largest tradeshow for consumer technology, runs through Sunday, January 11 in Las Vegas, Nevada.

Sony's president and CEO, Sir Howard Stringer, kicked off his opening keynote address at the 2009 International CES by unveiling the "CES Seven" -- key imperatives for creating the critical user experience.

These included the concepts that products should interact seamlessly across industries, be service-based, multi-functional, support open technologies, advance the new shared experience, create new value chains and be green.

Stringer said that Sony intends to create the total Sony experience so that by 2011, 90 percent of Sony's product categories will connect wirelessly to the Internet and to each other.

To help illustrate Sony's cross-platform entertainment strategy, offering content and services at home and on the go, Stringer was joined onstage by a variety of entertainment stars, including Tom Hanks, Usher, Jeffrey Katzenberg, Reggie Jackson, Dr. Oz and John Lasseter.

In addition, Stringer announced a host of new Sony products, including the Wi-fi Cyber-shot camera which allows people to send photos to a networked Bravia TV, as well as to websites, blogs and photo sharing sites and a new Internet-enabled alarm clock, created in cooperation with Chumby, that provides personalized content, including news, sports, weather, music, videos and Internet radio.

Stringer also announced a partnership with MTV Networks to deliver 2,000 hours of programming for Sony's Video Delivery Service, a new line of Eco TV products that are 40 percent more power-efficient than current models and the new Sony Vaio P series Lifestyle PC, a full-featured lifestyle PC that fits in a jacket pocket, is wireless and has built-in GPS.

Microsoft's Ballmer Sets the Mood at CES

The keynote address from Microsoft's Steve Ballmer, his first at this event, no doubt set the mood on the eve of the 2009 International CES. Produced by the Consumer Electronics Association (CEA), it's still the world's largest tradeshow for consumer technology.

"The pre-CES events created an incredible buzz throughout Las Vegas and around the globe as the world waits in anticipation for the innovative products that will launch this week from the International CES," said Gary Shapiro, president and CEO, CEA.

With 2,700 exhibitors, including 300 new technology companies, spanning 1.7 million net square feet of exhibit space, the products introduced at this year's CES are likely to further change the shape of the CE industry.

During a market research presentation on Tuesday afternoon, CEA released the Global CE Sales and Forecast. According to new data from CEA and the Gfk Group, CEA projected worldwide revenue for consumer electronics will grow more than four percent to reach $724 billion in 2009.

The pre-CES media event was launched Tuesday evening, which hosted more than 900 media people. With 56 exhibitors, including AMD, Boxee, Lenovo and Phoenix Technologies, "CES Unveiled" showcased the latest products and technologies in home networking, text to sign language technologies, gaming keyboards, embedded technologies, and digital imaging.

CES exhibitors making product announcements included LG, which announced a wireless wristwatch phone with video chat and text messaging capabilities; NETGEAR, which introduced an Internet TV player and a 3G Mobile Broadband router and Panasonic, which unveiled the world's thinnest Plasma TV, measuring one third of an inch thick, with NeoPDP technology.

Ballmer's keynote outlined three opportunities that lay ahead for the consumer technology industry -- the convergence of the PC, phone and TV; a more natural consumer interaction with devices that will incorporate speech and hand gestures and the connected experience between devices. Updates on the status of Zune and Vista apparently were not discussed.

Robbie Bach returned to the CES keynote stage to discuss the latest in Microsoft gaming. Bach announced the upcoming release of two new Halo titles, Halo Wars in February, and Halo 3ODST in the fall.

New Fixed and Mobile Service Convergence

The 2009 International Consumer Electronics Show (CES) is held in Las Vegas this week. The annual trade show event features more than 2,700 consumer technology exhibitors in 30 product categories. Given the current state of the global networked economy, the show will likely have lower attendance.

Consumers are growing more sophisticated in their purchasing habits for electronics and services, even as they rein in their total spending, according to the latest market study by Parks Associates.

"By 2013, there will be over 140 million U.S. consumers paying for mobile broadband, which will extend video, communication, networking, and support services to all sorts of devices," said Kurt Scherf, vice president, principal analyst, Parks Associates.

Parks Associates forecasts 4.5 billion mobile phone users worldwide by 2013, with many people using these devices as gateways for entertainment services, community information, and social networking.

The increasing importance of the mobile phone will affect other product and service sectors. For example, over 100 million femtocells will be shipped worldwide in 2013, cumulatively serving over 300 million subscribers.

The CONNECTIONS Summit at CES this week features ten sessions, including Wireless Networking; Advanced Video Services; Customer Support; Social Media; The Changing CE Purchase Decision; GPS Technologies; Connected Consumer Electronics; Digital Photo Frames; Connected Game Consoles; TV 2.0; and Home Systems.

Unfortunately, I'm unable to attend CES events this year, but will report any noteworthy major market research related announcements from the show.

Global UC and IPCC Market on the Rise

According to Infonetics Research, the IP contact center (IPCC) market will finish 2008 up 37 percent over 2007, with many vendors reporting robust sales, particularly in Asia Pacific.

The Infonetics' report shows sales of unified communications (UC) products will end mixed in 2008, with unified messaging platform sales up and communicator software sales flat.

Because of the deterioration in economic activity worldwide, enterprise spending on telephony products is expected to slow in 2009, which will also pull down the overall UC and IPCC markets, although the IPCC and communicator segments will weather the economic downturn better than others.

"The communicator market continues to be fluid, with growth not yet following established patterns and market share positions shifting one period to the next as PBX vendors battle each other and Microsoft," said Matthias Machowinski, Infonetics Research's directing analyst for enterprise voice and data.

It's an exciting market to watch, and one that should thrive in 2009, even as the overall enterprise telephony market declines due to the economic environment. Similarly, the IPCC market will slow down in 2009, but should do relatively well as customers find IP contact centers, self service, and automation cost effective ways to deliver on customer service.

Highlights from the Infonetics report include:

- In 1H08, over a million IPCC seats were sold worldwide.

- Avaya still leads the IPCC market by far in 1H08, but lost share to Cisco and Alcatel-Lucent.

- Nortel takes the lead in unified messaging license market share in 1H08, while Avaya maintains its lead in revenue market share; Cisco is now a close 3rd for both.

Trillion Dollar Mobile Sector Continues Growth

Despite turmoil in world financial markets over the last year, the trillion dollar mobile industry continues to confound expectations with accelerating growth, according to a new market study by Portio Research.

Their new report reveals that over half the world now uses a mobile phone and predicts that 80 percent of the world's population will be doing so by the end of 2013 -- a staggering 5.8 billion people.

The report provides a comprehensive analysis of worldwide mobile markets, growth forecasts plus network operator and handset vendor market shares.

Among the top 20 growth markets ranking list (2007-2013) there are few surprises. China wins the top spot, just ahead of India. These two countries are expected to contribute over 1 billion additional subscribers during this time.

Brazil comes in a distant third with 132 million additional subscribers over the same period. Africa, the Middle East and Latin America, are also expected to experience high growth estimated at CAGR 13.3 percent, 10.7 percent and 9.9 percent, respectively.

Meanwhile, despite rising worldwide mobile voice and data revenues Mobile ARPU continues to decline and is predicted to fall from $23.2 in 2005 to $15.8 by the end of 2013, largely because additional subscriber growth is likely to come from low per capita income markets worldwide.

The study provides a comprehensive breakdown of mobile handset market share, with news that Nokia is still king shipping over 437 million handsets during 2007, while Samsung has displaced Motorola from the number 2 spot. In the first two quarters of 2008 LG displaced Sony Ericsson from the number 4 spot.

"In 2006 we predicted that over half the world would be using a mobile phone by 2009 thought by many to be wishful thinking at the time," said John White, Business Development Manager at Portio Research.

"Despite this, the mobile industry achieved this milestone early in 2008 and continues to be a beacon of good news amid the daily gloom and doom of the last year. This report suggests that this will continue," remarked White.

U.S. Switch to Digital TV Reduces Coverage

The switchover to digital television (DTV) broadcast transmissions will reduce coverage, and therefore viewers, within many markets of the United States. People are unaware of the consequences of this transition -- including most TV advertisers.

The Federal Communications Commission (FCC) released two reports that show changes in the coverage of the nation's full-power television stations as they prepare to transition from analog to digital broadcasting on February 17, 2009.

The FCC initiated this side-by-side comparison to proactively identify the changes associated with the switch to digital broadcasting by TV stations and share the information with consumer viewers throughout the country.

"It is critical that broadcasters use the information in these reports to inform their viewers about how changes in their coverage may affect them," stated FCC Chairman Kevin Martin. "We expect broadcasters to make this information readily available and include it in all of their DTV educational materials."

The DTV transition is the result of planning that began more than 10 years ago. Although the Commission encouraged TV stations to replicate their analog coverage area as closely as possible, TV stations were not required to do so.

The first report found that approximately 89 percent of stations (1,553 stations) will experience an overall net gain in the population that can receive their signals. Approximately eleven percent of stations (196 stations) will have an overall net loss in television viewers.

The second report contains maps and other information for the 319 stations where more than two percent of the population covered by their analog service will not be covered by their digital service -- essentially predicting where the viewer loss will occur.

An additional seven percent (or 123) stations are predicted to experience "some" existing population coverage loss of two percent -- when including both losses due to changes in coverage and as a result of technical differences in their digital signal.

The Commission released a "Notice of Proposed Rulemaking" that would create a new replacement DTV translator service to permit full-service television stations to continue to provide service to those areas with coverage loss. Again, the key word here is permit, not require.

Why Most Vendors are Not Trusted Advisers

Marketing and sales executives in technology firms aspire to develop a meaningful relationship with the CIOs in their target enterprise accounts. But, according to a Forrester Research market study, most CIOs believe technology firms remain "just another vendor to deal with."

Why, you may ask? Because the marketing messages and sales methodologies assume the CIO thinks just like a target buyer. Apparently, the very nature of the CIO position, and their views of success and failure, put vendors in a very different perspective.

Forrester says that vendors can improve receptiveness to their CIO message if they understand how these executives measure a company's offering benefits, gauge its fit with their existing organization, and perceive how a relationship will benefit them.

Clearly, this perspective raises questions about all those vendors who like to believe they're "trusted advisers" to their business technology customer base.

Forrester believes a typical CIO will evaluate a product or service from the perspective of the one responsible for the whole IT organization and for the business benefits that organization brings to other stakeholders.

CIO motivations are more about the risk of a wrong or poorly thought-out decision -- not about the features and benefits of the product or service. Their personal level of comfort is a function of perceived risk and rewards.

Vendors usually have a clear picture of their target buyers but are often sketchy about the decision stakeholders that those target buyers need to satisfy. The CIO can be one of these elusive stakeholders that vendors misunderstand.

Every IT salesperson knows the result -- sales opportunities that look like a sure thing but then drag on or mysteriously go cold. Forrester says vendors that want to build a CIO partnership should do the following:

1) Create CIO personas, based on actual clients, to tune marketing and sales techniques. 2) Incorporate an understanding of IT archetypes in sales training. 3) Go beyond just products and services to address the CIO's "What's in it for me" needs and concerns.

Forrester concludes: once a vendor can evolve its image to include its interest in helping its clients be successful, then it will differentiate itself in the CIO's perception. Networking opportunities, information exchange and access to peer-level guidance are the best means to accomplish this objective.

Happy New Year -- if you are searching for a trusted adviser, then I hope that you find that special vendor who is proven to be worthy of your business.