Dramatic Disruptions Sandy Teger and David Waks Co-Founders, BroadbandHomeCentral.com & System Dynamics Inc. FENG Teleconference May 18, 2006 Copyright.

Dramatic Disruptions

Sandy Teger and David WaksCo-Founders, BroadbandHomeCentral.com

& System Dynamics Inc.

FENG Teleconference

May 18, 2006

Copyright © 2006

Copyright © 2006 Slide 2

About Us: Professionally

• Sandy– 18+ years with AT&T; multimedia strategy director

• Dave– 13 years with Prodigy Services Company; founder and R&D director

• Together as System Dynamics Inc.– 10 years as specialists in residential broadband

– Consult for companies affected by residential broadband• Strategy, business economics, competitive analysis

– Operate www.BroadbandHomeCentral.com as industry resource• "100 BEST Undiscovered Web Sites" PC Magazine, 4/20/04

– Free monthly Report on the Broadband Home

• www.bbhreport.com

• Subscribers in ~100 countries

– Broadband Home Labs• Integrated in our lives

• Test new products

http://www.bbhcentral.com/



http://www.bbhreport.com/


Some Major Disruptions

• Context– Everything Digital– Widespread Broadband Penetration

• VoIP Makes Phone Calls Free

• Broadband Anywhere

• TV Being Transformed

• Convergence: A “Virtuous Circle”


Everything Is Going Digital (2002 View)

AudioPlayers

VideoPlayers

StillCameras

Camcorders

SatelliteTV

CableTV

BroadcastTV

Telephone

New CE

1992 2002 2012

??


US Digital TV Transition Poised In the Wings

• Original date for DTV transition: Yearend 2006– 1,500 TV stations were to cease analog broadcasts, continuing only

in digital– Widely believed it wouldn’t happen

• New deadline of February 17, 2009– Free up spectrum for services such as mobile broadband

• Likely to be real “end of analog TV”– DTV sales increasing rapidly– Warning labels on analog TVs

• Impact on owners of older TVs – Millions rely on Over the Air (OTA) analog broadcasts that go away– Forces them to make a decision

•Obtain a (subsidized) digital-to-analog set-top converter box •Buy new digital TV receiver•Subscribe to cable or satellite


Broadband Way Past “Tipping Point”

• US Has Major Broadband Penetration ~ 44% HH (Source IGI, May 06)

– 48 million HH, was 20 million YE 2002

• Broadband is growing globally (Source: Point Topic)

– Measured by broadband lines per 100 households, US ranks 15th

•Leaders are in Asia (Korea, Hong Kong) and Europe (Denmark, Netherlands, Finland)

– Measured by total number of lines, US ranks first •China is second and catching up fast

• Broadband being deployed by more than telcos and cable companies– Satellite services – WildBlue– Municipal broadband – especially Muni Wi-Fi– Community fiber– Broadband over powerline (BPL) in many trials– Broadband wireless will be next big growth area


Internet Telephony Makes Phone Calls “Free”


Evolving Consumer Expectations: Broadband Available Any Time, Any Place

Fixed Nomadic Portable Full Mobility

Home or

Office

Coffee ShopHotel

Walking aroundtown

In a car

Train orplane

Increasing mobility


All Applications & Content on Portable Devices• Telephony, PTT

• IM, SMS, MMS

• E-mail, Web

• PIM

• Location Based Svcs

• Media Player

• Camera

• Games

• Audio/Video– Radio, TV– Streamed– Conferencing

• Presence

• Service Integration• E911

• Wallet

• …

Source: Qualcomm


LAN MAN WANPAN

Wi-Fi WiMAX3GUWB/

Zigbee/Bluetooth

A Spectrum of Wireless Technologies

Optimized for different distances & speeds


Broadband Wireless

• Broadband wireless will be next big growth area– Muni Wi-Fi – examples: St. Cloud, Florida; Philadelphia– Cellular companies deploying early “broadband” services with 3G,

but limited in coverage and speed– Mobile WiMAX likely to trigger growth spurt

• Cable operators may play a role– Deal with Sprint for voice services: enable “quadruple play”– Sprint/Nextel running trials with several “pre-WiMAX”

technologies– Sprint & Nextel have strong 2.5 GHz spectrum holdings, FCC

requires them to “use it or lose it”

• FCC starting new auctions– 3G cellular– Broadband wireless – WiMAX or other technologies– McCaw (Clearwire) is key insurgent player– Will MSOs partner with Sprint for broadband wireless , or acquire

their own spectrum?


TV Is Being Transformed

• “Any Content, Any Device, Any Place, Any Time”

• Time Shifting– Control over when to watch particular programming– Examples: TiVo, PVRs

• Place Shifting– Watch your TV programming from any place in the world– Example: Slingbox

• Device Shifting– Transporting content from one device to another – Examples: Mobi TV from Sprint, “Lost” at abc.com, TiVo To Go

• Content Shifting– Content created for one device, appears on different one– Example: Accuweather: personalized, interactive content with

local TV weather broadcast• ICTV blends interactive content with live video streams

• Impacts all stakeholders– Consumers, Service Providers, Content Providers, Advertisers


Cable and Telcos Competing Directly

• Dueling video ads

“Cable Innovates”“TV Freedom”<cable-innovates.com/trailer_content.html><www.ustelecom.org/index.php?

urh=home.news.multimedia>

http://cable-innovates.com/trailer_content.html

http://cable-innovates.com/trailer_content.html


Broadband -- A Self-Perpetuating Cycle

Broadband Growth

PC/CE growth /

proliferation

Home network growth

Content / services growth

More homes with broadband access

More devices capable of

sharing

More “eyeballs”

More reasons to get broadband


New Technologies Reinforce Growth -- and Foster Disruption

Broadband Growth

PC/CE growth /

proliferation

Home network growth

Content / services growth

DSL, Cable, Wi-Fi, WiMAX, 4G

Viiv, Vista

802.11n, HomePlug A/V

Movielink, Vongo, ABC.com, VoIP


Questions?

www.BroadbandHomeCentral.comsandy @ bb-home.com

dave @ bb-home.com

For More Information:


For More Information

• Links to some articles we’ve written on these topics – "End-to-End IP" - How Will The Telcos Survive? Part 1 (

BBHR 9/26/2000) and Part 2 (BBHR 10/26/2000) -- “End-to-end IP" as a disruptive technology

– Broadband: Are We Reaching "The Tipping Point"? (BBHR 5/23/2002)

– IntelligentCities 2002 (BBHR 10/8/2002) -- the impact of Community Networks

– Disruptive Technology in Action (BBHR 5/14/2003) -- impact of IP communications on voice services and high-speed Internet

– Broadband Anywhere: The Extended Broadband Home (BBHR 8/21/2003) -- the spread of wireless broadband

– Convergence Is Back (BBHR 5/23/2005)

• Topical Index to our Website

• Magazine articles and conference presentations

• Subscribe to our free newsletter to stay up to date


Broadband Penetration - Country Comparison

US

China

Japan

S. Korea

Germany

France

UK

Canada

Italy

Spain

BB Lines Per 100 Population Top 10 countries by lines

Dramatic Disruptions Sandy Teger and David Waks Co-Founders, BroadbandHomeCentral.com & System Dynamics Inc. FENG Teleconference May 18, 2006 Copyright.

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