DigIn! Blog

Verizon Withdraws MT Price Rise (Temporarily)

by Limor Schafman

Content owner and distributor hue and cry have temporarily caused Verizon to back away from its 3 cent/per message price increase for MT messages. 

The company says that the statement they issues was just a draft, a work in progress, nothing they really intended to push forward on.  While a major content owner I just spoke with and which has a close connection with Verizon, did not receive any indications from Verizon that this price increase was going to take place, I have also spoken with a significant messaging aggregator and they received the contract from Verizon requiring signature and the November 1st start date.

We have not heard the last of this from Verizon, nor from the other carriers.  As the content owner said, if any price increase takes place, this will cause a change in their pricing (from free to premium), cause their advertising rates to increase, and/or cause a shift in what they offer and how they do business. Companies pushing MT messages need to be vigilant and continue to pressure the carriers not to increase fees, and at the same time, these same companies need to take a hard look at their business models and prepare to adjust to and find solutions for a cost increase in the current way they do business. 

We'll keep an eye out for what comes next... 

Verizon Knawing Off Hand That Feeds It With 3 Cent MT Fee Increase

by Limor Schafman

Those of us in the marketing, branding, mobile, content business are delighted that text messaging is outpacing voice in usage numbers.  But wait!  It seems a company wants to bank on this at a time when "banking" is getting a bad name.  Verizon has decided to increase its MT transaction fees by 3 cents per transaction for all content owners.

Bottom line on what this means: "It will kill most people's business - this will have huge imact!", says Terry  Hsiao of HookMobile, an MMS aggregator. 

Why this dramatic statement?  There are two levels of SMS/MMS messages - one is MO or "mobile originated" message which is when you or I, consumers, send messages out from our mobile phones.  We pay for these through our text messaging plans or per message.  MT or "mobile termination" messages are those that come from content owners.  These are paid for by the content owner.  The rates they pay depend on the aggregator they work with and the fees those aggregators charge, often sliding scale per volume of messages.

Verizon is suggesting that as of November 1, each single MT message will cost at least 3 cents, on top of the usual charges they and the aggregators charge.  The bottom line cost impact is enormous both on content owners and the mobile marketing ecosystem as a whole.  Some of the companies which will be affected:
- Advertiser or brand companies that use SMS/MMS to targets and communicate its offerings: Coca Cola, Target, Ikea, etc.
- Banks doing mobile reminders or other customer contact transactions
- Political campaigns pushing messages out to constituents
- News, sports, horoscope and other similar types of content owners [note: these are some of the most successful uses of text messaging]
- Social Networks like Facebook, Twitter

Fundamentally, any company trying to build brand connectivity, invite transactions or provide customer service to their consumers will be penalized by this rate increase.

What are some of the market implications:
- Mobile marketing as we know it will shift.  SMS is currently the most advanced form of mobile marketing - it may diminish significantly as a medium, disappear, or used only when customers will perceive a real value in the message being delivered to them [ie a bill payment alert].
The mobile marketing landscape may change as a result with other forms such as WAP or client based applications taking a lead. There are significant negatives to both these forms that do not compare with SMS for certain functionality so they do not fully fill the void of diminished SMS messages.
- Content owners will push the price increase to consumers.  Consumers may agree to this if they see value, as written above, but otherwise, consumers will be forced to pay more for text and the question is, will they want to do this?  And for receiving advertising messages? 
- Content owners will diminish the amount of mobile marketing they do.
- Content owners which have smaller revenue potential will go out of business [ring tone companies].
- Advertising companies focusing on helping companies do mobile marketing will see a significant decrease in campaigns and revenue.
- Consumers may ultimately not receive the services and content they now expect.

Rumor has it that AT&T is considering raising MT message costs by 1 cent.  Has the cost of delivering MT increased.  I think not.  This move to increase fees is a taking an overreaching  advantage of a market phenomenon of exponential increase in text messaging and of a just budding mobile advertising marketplace to - effectively - kill it off.

Maybe it is Verizon's gambit to create such an outcry that when they lower the MT fee increase to 1 cent or half a cent, the content owners will be grateful and buy into it more readily. 

Whatever the reason, Verizon,  is gnawing, ripping into, and stripping the hands that are feeding its network and hurting the companies attached to those hands as well.  The market will respond - and I hope it will use its power - particularly that possessed by the large content owners [banks and brands] - to tell Verizon "No!" in no uncertain terms.

If your company is in this ecosystem, speak out loud and strong.

p.s. - if Verizon pursues this increase - this will be a huge opportunity for other carriers who do not do an increase to grab significant marketing and advertising dollars, content dollars and new consumers.
 

Live Streaming Video With A Twist

by Limor Schafman

I attended AUSA [Association of the U.S. Army] Conference today to see what some of the latest technologies are.  The conference is fascinating - it covers everything from boots, to Oakleys, to camouflage netting, to head mounted displays, water proof paper, and Bradley assault vehicles.

One very interesting technology was a fully integrated system of data feed to a mobile command center and soldiers in the field, each being able to interact and see in real time live streaming video and have situational awareness that was shared among them.  Mobile laptops, head mounted displays, video capturing telescopes all interfaced and fed one another seamlessly.  Potentially quite effective.

But the technology that really got me - perhaps because it is powerful for both commercial and military uses - was Video Flashlight(tm) by Praetorian a subsidiary of L3 Communications.  This technology takes multiple streams of video, all streaming live and scalable to any number of cameras [50, 70, 100, more], and makes accessible on demand as overlays to a 3D model.  The result is a 3D immersive display that gives a real time video look at what is happening on the ground (or in the air for that matter).  Imagine Google Maps' Satellite view on steroids. That if you clicked on a part of a map, instantly that section would come alive with streaming video, which could be manipulated from various angles.  That is what this system does.

The streams are layered onto a 3D visualization model of a terrain, for example.  The 3D terrain of anything and can be well defined, or not, it doesn't matter.  Wherever you put your cursor within that 3D model, the live streaming video from the appropriate camera automatically streams and layers real world action on the model.  If you zoom in and shift to the right, the appropriate camera will pick up and start streaming that particular angle that would be viewed if you were actually in that location.  If you zoom out to a bird's eye view, you then can choose which parts of a building you want to see, for example.  You can see where your security personnel are located, and where infiltrators or burglars are located.  All with a click of a mouse.

The technology also can be activated to act intelligently so that if someone is loitering, or an unexpected package is sitting too long in one location, or there is motion where there should be none, or someone is approaching a secure area, that relevant video stream will automatically pop up and become central so that security surveillance teams can see what is going on.

I can tell you that I have seen quite a bit, and this technology blew me away.  It was streaming, live, seamless, immediate, comprehensive, and scalable to a significant  number of video inputs.  OK, they were selling and I bought it hook line and sinker.

Oh, forgot to add that the technology works with existing CCTV systems, and can link to Microsoft Windows PCs, and PDA's. 

Current uses are in the military, large public facilities like the Meadowlands, and, I can't wait to be able to write about this one, they are doing something truly innovative for the Redskins.  I am sworn to secrecy until they launch, but it will make that revived team even more exciting to watch.

DigIn! Radio Launches

I am very excited to introduce DigIn! Radio.  On this show we will continue our coverage of high tech, business, and the people that all make it happen. 

We kicked off the show with two segments: the first with Linda Feinholz, consultant speaker and creator of The Spark.  We spoke about how important it is to have a clear vision of yourself, how that impacts ones business, how this builds into defining your business and then to driving profits.  Honesty was the key message of the day.  Honesty in assessing oneself, ones desires, and ones strengths and weaknesses.  And then this moves to an honest assessment of ones company, co-workers, the fit of offering to market need, and many other questions.  The show gave important foundational information on how to build from your core.

Today's segment with Judy Bradt of Summit Insights focused on winning government contracts.  In our economic downturn, the government can be a profitable source of revenue.  Beware of eyes to big in the search for greener business pastures.  As Judy repeatedly emphasized, pursuing government contracts is not for the faint of heart.  One needs money for marketing, the patience for waiting out the 18 months to two years before a contract is won, and then money again to run the company and the project until completion when finally payment comes [yes, this schedule depends on the contract].  She gave us valuable lists of websites for finding opportunities, conferences to attend, and associations to belong to.  If you are considering entering the government marketplace, give a listen.  You may find some golden nuggets. 

DigIn! Radio is on every Tuesday at 11am, and we will be building from there.

if you want to hear certain topics, have a story or info you want to share by being on the show, and/or want to sponsor, contact me.  I plan to keep growing this and invite you to become a part of it.

Your show host,
Limor