My 2009 Wish

Somehow, since I started writing down my New Year Wish List last year, I might as well continue on with this tradition. Just like last year, I will be specific with my wish list. I will start with the most important thing that anyone can give to me:

From ANYONE who knows me (family, relatives, friends and online buddies--here and abroad), if you ever think of me this New Year, don't buy me a New Year card or gift (**sigh**), instead I encourage you to do any one of these:

-- give a bag of groceries to a less fortunate family in your neighborhood

-- sort out your closet and gather up the clothes and shoes you don't wear anymore and donate it to an institution or orphanage

-- or simply give a cash donation to a foundation of your choice.

This was also my little wish last year, only that I added the last bit about a cash donation to a foundation of your choice, and only that it is now first on my wishlist.

Honestly, I am not yearning for any material thing this New Year wish. I'd rather that we do a good deed and make someone happy this season and that will be enough for me.

Now from Myself

The gift of learning - one of my goals this year is (was?) to have suitable job opportunities also my passion but I still haven't done it but I really am determined to be more focus as soon as the "hectic-ness" of my life subsides

The gift of inner peace and healing - I have faced so many nerve-wrecking challenges this year and a part of my heart and sanity has been very very hurt so I'm praying that my inner peace comes back and for the healing of my heart.

In terms of material thing, I have no idea what to give to myself. It has been my tradition to reward myself something during New Year but as I've said, I'm not yearning enough for something to push me to buy anything for myself. 

So there, my wishlist.

Advance New Year! Hope all your wishes come true! 

Sociopathic Checklist

Just wondering, after reading a health magazine -- here is a list from a professional diagnostic about sociopathic disturbances. Sociopathy is very rare. Many proplr exhibit one or two of these symptoms on occasion, but in an innocent or testing way. Any cluster or habitual set of them should send you looking for professional help immediately.

-Talks about things that are scary or disgusting

-bullies children (hits, bites, shoves…)

-has no child friends; perhaps a sadistic imaginary friend

-Swears

-hurts animals on purpose

-ritually and intentionally disfigures dolls/figures

-has strange habits (i.e. tries to strangle self, repetitively draws strange symbols) is violent towards caregivers

-threatens

-has an eerie sense of humor/happiness is precocious about destructive themes, strategies

-concocts pretend plan to kill parents/sibling, set something on fire, steal, etc.

Next question: is that YOU?!!

Asian Currencies Fallen!

These days, most of headlines discussing about financial market distress in the US is ushering in a new reality to the Asian markets. True, Asia’s banking systems are by no means facing nearly as severe a situation as those of the US or Europe. But even so, the impact of events in the US is likely to have important implications on Asia’s foreign exchange market and monetary policy.

Somehow, in Asia’s currency markets, developments in the US are likely to affect forex rates in two ways. On one hand, the turmoil in the US financial markets should spell a weaker US dollar; this would imply Asian currencies should be under pressure to appreciate. On the other hand, weakness in the US economy in the coming quarters, owing to tighter credit market conditions, will take its toll. The latter should lead to a further deceleration of exports from Asia to the US and the rest of the world. This suggests depreciation pressure will push down Asian currencies. A weaker US financial industry is also likely to lead to a selloff of Asian equities and assets in the US and elsewhere. 

Again, the turmoil in the US financial market and sharp decline in oil prices are likely to change the monetary policy landscape in the rest of Asia. Before recent events, I had thought the dominant monetary policy stance in Asia would be tightening through end-2008. However, expected weaker exports and an increasing negative wealth effect have stepped to the fore — these certainly put pressure on economic growth, although the banking system remains sound across Asia. Elsewhere, inflationary pressure is seen losing momentum as the two biggest contributors to the CPI inflation rate — oil prices and food prices — are likely to start to moderate within the next few months.

With these developments, most Asian monetary authorities should now be changing their stance from tightening to neutral. This policy change should be followed by monetary easing around end-2008, when the market is likely to clearly see that exports are decelerating.

Next question: Rough road ahead?

Why Do Homeless People Keep Living?

I've been thinking lately about why homeless people continue to live.  To be clear, I'm not talking about someone who is perhaps down on their luck, maybe even for a few years.  In that case, I guess there is some clear hope that he or she can get back to it. I'm wondering about the people who go say 5+ years and seem to either go deeper into the hole or stay where they are with no upturn in site.  I've seen people like this around my neighborhood, there never seems to be hope.  Somehow, they wake up every morning with nothing and often nobody but they keep going.

I wonder what keeps them going.  My presumption is that they are not particularly happy and unlikely to be happy in the near future.  So, it's a life of sadness that perpetuates itself. There's got to be something inside that keeps them going because it appears that there is no great reward outside for them.  Who knows maybe they really are happy? (although I doubt it)

An interesting possibility may be that it doesn't matter whether they are happy or sad, that life is not necessarily meant to be a vectored journey towards happiness.  That's certainly a challenging point of view and would make the issue make some level of sense.

One thing's for sure, a meaningful % of us that have something want to try to get those who don't out of it.  Then again, we don't really care do we?  If we really did, I feel like it would be solved on a larger scale than it is now.

Next question: What is it?  What keeps them going?

Price War in Mobile Industry

What is “price management”? In mobile communications, headline ARPU and MoU can be misleading because in many markets there is high double-counting of users.RPM (revenue per minute) is often more useful than ARPU; and in practice we see changes in RPM as the best guide to how efficiently operators manage voice prices.

Where MoU (strictly speaking, MoU adjusted to avoid the effects of double-counting) rises by more than RPM falls, there is positive elasticity of demand and it makes sense to cut prices. Where MoU rises by less than RPM falls, there is negative elasticity and cutting prices does not make sense unless it also boosts subscriber growth.

Sample for Indonesian operator, in the wake of a price offensive launched by no.2 operator Excelcomindo, Indonesia’s mobile market is showing the highest elasticity in Asia: steep declines (50% or more) in RPM have driven increases in adjusted MoU of 200-300% or even higher. I think this strong growth in usage can be sustained. Excelcomindo (owned by Telekom Malaysia International) should be the primary beneficiary, but leading operator Telkomsel (owned by PT Telkom and SingTel) also stands to benefit over time.

Next question: when we will know how to reach for the right price?

Again, mPayment Case

The current market penetration of mobile phones in conjunction with an expected growth of mCommerce still offers a high potential for the growth of mPayment over the next few years. Current analysts have predicted that mPayments will gain a significant foothold in coming years with growing development in high-speed data services. A wide variety of mPayment technologies are available today, but the value of such services is not clear. Why?

Services launched have seen both success and failure and therefore service providers need a realistic vision of the future. MPayment is already in use in many parts of the world, including Europe and Asia, even though not significantly as yet. Taking the failures discussed so far (especially the case of Paybox), I am consider that we are still in an early stage of an innovation process (of TRUST) so we clearly expect the diffusion of mPayment to lie ahead. With the Asian markets showing an enormous take-off and the European market indicating a state of stagnation and towards decline, therefore I just simply conclude that next future research approach should be redirected to these emerging markets.

Next question: Do you think it will be another "Chicken and Egg case" again-and-again?

How to Become A Salesman?

Honestly, role of any salesman is highly demanding (and totally sensitive task that I always trying to avoid, although I couldn't). Somehow, company's management demands such high revenue growth rate - that everyday of work starts to look like running a championship race. At the same time, the accountants in the finance department are reluctant to increase any expenses thus curtailing potential investments needed to achieve the required sales targets. This creates a situation where it appears that its almost impossible to succeed in sales - but there will be few who always seem to achieve their targets with ease. These are people who are known as "Born Salesmen" - but in reality a good salesman is a good drill master who knows the sales drill down to the last details - which can be learnt.... but how? 

Next question: Ask yourself when you’ve been persuaded by a good salesman and think about what happened. Were they honest? 

Somehow, You Shouldn't Need An MBA to Be Expert About Business

Again seeing global economy, it could be argued that although inflation was not appearing in CPI figures, it was already visible in asset markets as artworks, equities, bonds and property all performed well from 2003 to 2006. Central bank monetary policy remained benevolent with tentative rate hikes since policy markers targeted growth rather than the latent inflationary pressure. Paradoxically, Asian central banks kept interest rates extremely low in real terms given their mercantilist backgrounds, and stoked inflationary pressure by running food and fuel subsidies at home.

Current macro economy is now facing the prospect of the triple shock of an extended credit crunch, high inflation and slowing growth; the very three objectives central bank policy is designed to overcome. Meanwhile asset prices are under pressure from not only the unwinding of the goldilocks period as central banks continue to lift short interest rates but also from rising long-term rates as governments see a diminishing of their current account surpluses due to high oil prices and a reduction in capital flows due to increased risk aversion and deleveraging. 

Next question: Do you optimistic for all of this?

Seeing Indonesia from Outside

This is my personal comment about Indonesia, with inflation rising above 10% (and likely to go to 15% as fuel price subsidies are reduced), this is one of the riskier inflation-prone markets in the region, in my view. Central bank reacted by raising its reference rate to 8.5%, but it will have to do considerably more to bring down excess demand. With both
presidential and parliamentary elections due next year, I think it will find it politically difficult to act decisively.

For longer term, I can see the attractions of this market. GDP appears to be growing fairly sustainably at around 6%. The commodity-based economy throws up a number of stocks that stand to do well as long as the global resources boom continues. Valuations are not stretched (as they were last summer), with PE now down to 12x.

Next question: Until the inflation risk is under control, what can we do in Indonesia?

Nowhere to Hide!

Current Asian stock markets having experienced their worst six months since 2000, it is tempting to think things cannot get much worse. But, while a summer rally is likely, I just think the bear market is far from over. Too many headwinds are pushing Asia back: rising inflation, the risk of the Fed tightening, political upheaval, and continued foreign selling. The next set of worries may come from the corporate sector: margin pressure and higher interest rates mean analysts’ forecasts of 6% EPS growth this year and (especially) 15% in 2009 look pie-in-the-sky. I see markets continuing to drift off until early 2009 at least... or more? *sigh*

Next question: Is there no sunshine after the rain?

Global Balance?

Well, current focus switches to inflation From news, Fed's success in stabilising the financial situation has let the markets think that the massive growth risks have receded and that inflation is the next monster on the horizon. From my view, its continuing surge in commodity prices has compounded these inflation concerns. World inflation should rise to around 5% in 2008 after 4.2% in 2007.

I think, current original real economy event that triggered the liquidity crisis, like US housing collapse, has not yet run its course. Moreover, just because financial market stabilisation has been achieved does not mean the same is true for the global real economy. In Asia, the effect of the continuing US consumer slowdown will be felt with increasing force.

In China - from news I have heard that, the return of "hot money" flows, as risk aversion and financial stresses related to the subprime crisis fade, appears to have dulled the authorities’ appetite for a faster pace of yuan appreciation. A key risk would be that the panic hoarding of rice may drive a spike in inflation which would be very hard to control.

Next question: Wondering, how much capital was transferred between oil or energy consuming countries and the producing countries due to the surge in energy prices? *errrrr.... some countries become rich and richer - vice versa*

China Telecom Industry Review

Executive Summary
Continuing my early review about 3G Global Development, for past 2 months - I have begun to review significant growth after restructuring in China’s telecom industry. Current five service-providers have now been reduced to three full-service telecom service-providers. Birth of these providers suggests that there will be a new market-share pattern in China’s telecom industry. Which company gets the bigger piece of the pie and which gets the smaller will depend on the customers’ choice of service provider in China’s ‘3G’ era. In view of the over 1.4 Billion populations and low penetration, I believe there is ample room in the market for every operator to make a differentiating position and restore growth momentum in the long run.

From news, I have seen that Chinese Government would impose asymmetric regulations on dominant market players for 2 to 3 years to help new entrants catch up. This would prompt the three providers to reposition themselves through differentiation in market, services and/or customers. As the Government has been intending to stimulate competition instead of creating a price war, this would help in cultivating a healthy and sustainable industry development going forward.


China Mobile
I have seen China Mobile, current market share leader, faces development constraints. The mobile phone service provider will inevitably face fierce price wars and high capital expenditure in the next 2 years. The best way to determine which operator acquires the most market share will be by looking at customer flows. Therefore, new additional subscriber numbers will be a good indicator as to which of the three is building the most successful operation going forward. Again, I believed China Mobile should be able to make differentiation in the rural mobile market and high-end individual mobile users market in urban areas.

China Unicom
Another big player, new China Unicom is better than new China Telecom. After restructuring, China Mobile’s business development will be constrained in coming years due to the maturity of TD-SCDMA technology and the possible influence of some un-favorable regulatory policies. My review on the product front, its upgraded CDMA 3G version will be no better than WCDMA. New Unicom will focus on developing G-net after shedding the burden of C-net. I believe that the upgraded WCDMA has the strongest array of products and will be the top choice of China 3G customers in the future.

Additionally, I have heard from news (Financial Times) that Telefonica plans to buy 10% stake to become new strategic shareholder for China Unicom. Currently, Telefonica owns around 5% stake in Netcom; post-merger it would be about 3% of the enlarged China Unicom. In my view, the latest development is positive for China Unicom, at least from a technical standpoint, as any purchase in the open market would support China Unicom’s share price. Arguably, from a fundamental standpoint, Telefonica’s more serious involvement could help the new China Unicom in a number of areas including: 1) lower costs in equipment purchases,
2) more technical know-how and
3) commercial know-how in 3G planning and marketing.

China Netcom
I have my limitation to review China Netcom, just my key concerns on China Netcom are long-term competitiveness in a three player market. For comparison, China Mobile - it faces the largest and strongest mobile operator as above note, while China Telecom has a fixed line footprint twice the size of China Netcom. Facing the fact that fundamentally on the core business than China Telecom — given China Netcom operates in provinces with relatively lower affordability, I expect the impact from mobile substitution, lower mobile tariffs, etc, to be more material than for China Telecom.


Overall Review for Telecom Industry in China
I believe it will be a strong mobile usage growth continues in following year although it will not as fast as past years. From many reviews it says that China added 87 million mobile subscribers in 2007; mobile penetration just hit around 40% with 530 Million mobile subscribers by the year end.

From this point, I estimate China will add an additional around 180 Million subscribers in the next two years with the total of mobile subscribers approaching 700 Million by the end of 2009 and mobile penetration of around 52%. With industry restructuring allowing fixed line operators to participate in mobile operation would accelerate this process.

What next: South Asia Round-up?

Asia Pacific Telecommunication Round-up

Based on personal view, I still favour the Asian telecoms industry, given low economic sensitivity, continued growth in emerging and certain developed markets, and healthy finances. The future for mature telecoms markets is quad-play strategy. In less developed countries, it is better to service the different parts of the telecoms market individually. I believe the best time for restructuring has passed, due to depressed mobile tariffs and the lack of a pro-competition environment (China). Wireless operators’ earnings should rebound from here, driven by lower capex, ARPU improvements and cost-cutting (Korea). Somehow, I saw Singapore as an ideal market for fibre-to-thepremises; an FTTP-based NBN project can yield high positive NPV (Singapore).

Rough Asia-Pacific Telecoms round-up - again I still favour the Asian telecoms sector, given low economic sensitivity, growth not only in emerging markets but also in developed markets like Hong Kong and Singapore, and strong finances. I am recommending a telecoms bucket that reflects the sector’s attractions. This originally included SK Telecom, Taiwan Mobile, PCCW, DiGi, Telekom Malaysia, SingTel and StarHub. Also, may be DTAC in Thailand. I think DTAC has a good chance of winning a 3G licence by mid-2009; it is performing well operationally, and should deliver strong profit growth this year (ref. to their performance)

For China’s restructuring and other developments - current key story so far in 2Q is the announcement of the long-awaited restructuring of China’s telecoms market. I see this as too little, too late; and it will be very hard to reverse China Mobile’s huge market dominance. In Southeast Asia, I have saw forecasts for Telekom Malaysia, the new pure fixed-line operator, plus reports on TM International, the new pure mobile operator.

Anyway...what next?

Oil Shock!!

Again...oil issues! Somehow, current strength of oil prices, and to a lesser degree food prices, is weighing on our emerging market outlook. Until recently, current pace of emerging market growth tended to outperform our expectations, boosting global demand, commodity prices and, thereby, inflation worries. In the future, though, signs of weakening domestic demand, generally tighter monetary policy, and continued high oil prices imply that aggregate emerging market economic growth is likely to be generally slower. It is also likely to be more disparate as the effects of high oil prices impact producers and users differently.

A large portion of rising commodity prices is likely due to growth in emerging markets, which proved more robust than we, or the market generally, expected. Seeing Asia for sample, latest indicators of industrial production in China and India also show deceleration in year-toyear growth, as does production in the broad Asia-Pacific region. These trends are consistent with modest deceleration in emerging market growth and waning pressure on commodity and oil prices.

From my point of view, there are wwo other factors may have been at play, but their contribution to commodity prices is uncertain and highly debated, which are: (1) less assurance in markets over the timing of supply increases in oil (implied in the upward slope of futures prices); and (2) increased demand for oil and other commodities, spurred by low global real interest rates and financial innovation that facilitated access to commodities as assets.

Next question: Do you think there is an alternative oil price paths?

We’ve Been “Running Out of Oil”

Aside from potential concerns about the stability of oil supplies from a geo-political perspective, the rise in oil has in part revived concerns that peak world oil production rates have been reached. Once global oil production begins an inevitable decline, demand must similarly be reduced, if necessary by ever increasing price levels. “Peak oil” is more than a theory. A limited quantity of hydrocarbons does exist in the ground, and at some point, those supplies will be uneconomic to recover. However, a history of oil reserve estimates shows that technological advances and real price increases – which should drive the willingness to explore in more difficult to reach areas – can stretch available supplies.

Oil producers, for example, have used technology to roughly double potential yields from existing deposits over time, and technology is not known for standing still. The last estimate would represent nearly 100 years of daily supply at the current global demand pace, and excludes very unconventional supply resources. But these supply estimates are controversial, disputable, and unobservable until realized by actual production. Leaving issues of global climate change completely aside, I believe political factors might be playing a bigger role in determining available oil supplies than the level of the world’s unconsumed reserves.

Next question: how long we can stay without oil?

Global 3G Development

I have begun to see significant growth in 3G device adoption over the past 18 months. Based on my analysis, there were more than 306 million subscribers globally using 3G devices as of end-1Q/08 — both Wideband Code Division Multiple Access (WCDMA) and Evolution-Data Optimized (EVDO). However, in spite of the recent growth in 3G device adoption, my estimation that there is still significant upside potential, as 3G still accounts for only around 9% of the total global mobile subscriber base of 3.3 billion.

At present, there are 293 3G network operators globally, which include 211 based on High-Speed Packet Access (HSPA), 26 based on WCDMA, and 82 based on EV-DO. I believe that most of the remaining WCDMA networks will upgrade to HSPA within the next 12 months owing to the relatively low cost of upgrading to higher speed wireless technology — and the potential revenue upside from an enhanced user experience for wireless broadband.

In my view, much of the incremental growth in 3G is being driven by WCDMA, which accounted for roughly 68% of the total 3G device base as of end-1Q/08. Again, my estimation that mobile operators are adding around 22 million new WCDMA device users, per-quarter, globally versus an average of eight million per quarter for EVDO. Going forward, somehow, I expect this gap to widen as WCDMA growth accelerates.

Although 3G accounts for only around 9% of all mobile devices, non-voice applications have continued to become an important source of revenue for wireless carriers (mainly in the form of SMS and ring tone and other downloads). In the developed markets in Asia, Europe, and North America, non-voice revenue accounts for 20%–35% of the total average revenue per user (ARPU).

In Japan, the most developed 3G market in the world, 76% of all mobile subscribers use 3G devices, and non-voice revenue represents more than 30% of total ARPU. In order to encourage greater data usage, DoCoMo first introduced unlimited data packages for its subscribers in June 2004. With more than 45% of Japan’s 3G subscribers on unlimited data plans, average data usage has increased to 19 MB/month in 2007 from 0.96 MB/month per month in 2003. However, I believe that these unlimited data plans seem to have capped some of the potential upside for data revenue growth. DoCoMo reported that 75% of its subscribers had data ARPU of about JPY4,000 per month (US$38) and remaining 25% had data ARPU of around JPY1,200 (US$12) in 4Q/07 (ref. DoCoMo report).

I believe that many of the key factors that have contributed to the migration of 3G in Japan will also help accelerate 3G adoption in other developed markets throughout the world.

In Asia Pacific, I saw that there were 122 million 3G subscribers in the region as of end-March 2008. However, a majority of 3G subscribers in this region are still concentrated in Japan (64% of all 3G subscribers). The second-largest 3G subscriber base outside Japan is Korea, with more than 26 million subscribers, and the third-largest is Australia, with around 7.4 million subscribers.

Even though 3G has only started to gain traction in the Asia-Pacific region, data and value-added services are already an important source of revenue for many carriers in the region, with many of them reporting non-voice ARPU of above 20% of total ARPU — including some developing markets such as China and Malaysia.

Going forward, I believe that wireless data will remain a major source of revenue for carrier in the region. In fact, wireless broadband could become the major, means to access the Internet in developing markets where the fixed line infrastructure is not robust. Thus, I believe that carriers have been considering WiMax and HSPA/LTE to provide wireless broadband in the region.

In Europe, my estimation that there were more than 80 million 3G subscribers in Europe as of end-March 2008, with 3G penetration in excess of 20%. Unlike in the US and Asia-Pacific regions, all 3G networks in Europe are based on WCDMA technology. My analysis that SMS is still the largest component of non-voice revenue, accounting for 14% of total ARPU in FY07. However, as 3G brings a more robust user experience, I estimate that data revenue will increase from 8% of total ARPU to 12% of total ARPU by 2010, while SMS will fall to 11% of total ARPU. Overall data ARPU will increase to 24% of total ARPU by 2010, up from 21% in 2007.

As demonstrated by the estimated incremental ARPU from data (up only 3% from 2007 to 2010), again, I believes that the upside from wireless data for European telecom carriers remains limited. In fact, the potential upside from data might not justify a significant boost in capex and opex to roll out the services.

In United States, my review estimate that the US had more than 60 million subscribers using 3G devices as of end-March 2008, including 11 million subscribers with WCDMA devices and over 50 million subscribers with EV-DO devices. This represents about 23% of the total number of mobile subscribers. The growth in 3G has helped wireless data to become an increasingly critical component of wireless carriers’ service revenue. For instance, wireless data accounted for approximately 23% of retail ARPU, or US$11.94 per user per month, for Verizon Wireless in 1Q/08. Among 3G subscribers that use mobile data applications, that monthly data ARPU is nearly twice the average data ARPU for 2G subscribers. I also believe that the introduction of unlimited data plans in the US by all the major carriers will also help to stimulate wireless data usage.


3G development in Asia Pacific

At the end-March 2008, I saw that there were 122 million 3G subscribers in nine key markets of the Asia-Pacific region. This represents around 36.5% of all mobile subscribers in countries/territories in these markets.

Wireless operators in Asia-Pacific region have launched 3G services in 12 countries/territories, which include Australia, Brunei, Hong Kong, Indonesia, Japan, Malaysia, New Zealand, Philippines, Singapore, South Korea, Sri Lanka, and Taiwan. I expect Thailand and India to issue 3G licenses over the next 6-12 months.

Most 3G subscribers in region are concentrated in Japan (around 64% of all 3G subscribers). DoCoMo had 44 million WCDMA subscribers (or 82% of the company’s subscriber base) in Japan as of end-March 2008. The second largest WCDMA operator was SoftBank Japan, with around 14 million 3G subscribers (75% of its subscriber base). WCDMA subscribers accounted for 57% of all mobile phone subscribers in Japan. If I include KDDI’s 20 million EVDO subscribers, the total number of 3G subscribers in Japan rises to 78 million, or about 76% of all mobile subscribers.

Excluding Japan, I think there were around 45 million 3G subscribers in the Asia-Pacific region as of March 2008. The second largest 3G subscriber base outside Japan is Korea, with 26.4 million subscribers, and the third largest is Australia with 7.4 million subscribers.

Data is becoming a key driver of wireless revenue growth

3G is likely to play a vital role in meeting the demand for data services, going forward. For the four largest wireless carriers in US, revenue from mobile data services topped $6.2 billion in 4Q/07 and $22.0 billion in 2007, up from $4.2 billion in 4Q/06 and $14 billion in 2006, respectively. For both AT&T and Verizon, data revenue accounted for around 55% of the year-on-year increase in revenue in 2007, and has been instrumental in stabilizing and even growing monthly ARPU.

This trend in data revenue growth will continue in the US due to the following:
(a) increasing adoption of mobile data services by mobile subscribers,
(b) enhanced coverage of 3G networks, and
(c) rising proportion of the subscriber base using more feature-rich handsets, PDAs, and laptop PC wireless data cards.

I think that Apple’s iPhone (which is just a 2G device at this point), has the potential for rapid adoption of data services beyond just SMS, when the device has a simple interface for data applications. M:Metrics reports that iPhone users are 6x more likely than the broader base to use a browser for news, 10x more likely to do a web search, 6x–20x more likely to view various types of video content, and 100x more likely to access a social networking site.

Around 57% of subscribers were data users in 2007

I estimate that 57% of the subscriber base of the big-four wireless carriers comprises data users, up from 47% in 2007 and 40% in 2006. In addition, data revenue per user has been rising with increasing penetration, which suggests higher data uptake, going forward.

Higher data speeds from HSPA to enhance user-experience and encourage usage

Somehow, HSPA is likely to drive Internet browsing in particular and mobile data in general in 2008. Although 3G handset penetration remains relatively low in US, I think the natural replacement cycle to improve penetration levels. In my view, higher 3G adoption will likely help data revenue growth, particularly for GSM carriers such as AT&T and T-Mobile, where current penetration levels are around 20% and almost 0%, respectively. I expect, AT&T to migrate its handset portfolio, as much as possible, to 3G by the end of 2008.

Also, there are several 3G ‘touch screen’ devices to be introduced in 2008, including a Nokia model code-named ‘Tube’, a 9,000 series from RIM, and the Samsung Instinct, which I believe could be the next catalyst for data growth. AT&T noted recently that 3G devices drive 20% more ARPU than 2G devices, while integrated devices (i.e., QWERTY) drive nearly double the ARPU of traditional subscribers.

Next question: what next?

New e-Life Trend - Food Portal

Back after seeing e'Life-Style', I know a little about food portals - on the international front, one of the most popular food sites is "Epicurious". The top-level classifications include: Recipes, Features, Cooking, Drinking, Restaurants and Shop. Its Advanced Recipe Search feature allows a search based on ingredients. Recipes also have reviews and ratings by readers. Its seemingly endless array of culinary information includes interviews with star chefs, slide shows of favorite dishes, book excerpts and reviews, culinary travel guides, comprehensive coverage of beers and liquors, buyers' guides, newsletters, glossaries, discussion forums, an enormous shopping area, TV and magazine tie-ins, and around over 10,000 recipes. Bur, there are plenty of other excellent international food sites: AllRecipes, FoodNetwork, and Recipezaar are a few examples.

As I browsed through these sites, I was duly impressed. Their depth and breadth is great, but I could not help but think that these are, still built for the first generation of the Internet. The question I am thinking is: how would we redo these sites (or create new ones) keeping in mind the next Internet? Maybe these sites are more than good enough having created strong brands amongst their users. Or maybe, there is potential for a disruptive innovator. Anyway, I will keep my focus on the Asian food space, since I know it better and also am a direct consumer (as are probably most of us). So, put the thinking caps on: how do we build the Next Great Asian Food Portal?

So, plenty of ideas to build a new food portal ? leveraging existing expert and user-contributed content, with enhancements in the form of formatting for mobile phones, RSS feeds to provide alerts, videos of the cooking process, personalisation, and more. But what is the business model? How does a site like this make money? Here are a few ideas:

Subscriptions: A part of the site could be available only to subscribers. I think the video content should be made available for the equivalent of tens of rupees per download. So, users can get the recipe details for free, but if they want to actually see the entire cooking process on-demand, then it is available for a fee.

Mobiles: Given the growth of cellphones in Asia, they can be tapped as a source for revenue. Food-related information could be a useful "value-added service" for cellphone users.

Advertising: The food industry is quite big and growing. Many Asian foods companies are still not advertising online in a significant way. But the more interesting opportunity could come from neighbourhood restaurants, who can even provide deals if they have space to fill. Non-intrusive contextual text ads could be a useful source of revenue.

Commerce: Selling ingredients and cooking-related appliances could be a potential source of revenue. Making books out of the content that exists on the site is another possible financial source.

Food is a very important part of our lives. A new food site done well could be financially lucrative. The time is right for leveraging a mix of content and technology to create richer user experiences. More importantly, it would also create a platform to build other vertical sites along similar lines.

Next question: Any investors?

Next Generation of "Bill Gates" in Asia

After reading news about Bill Gates and his idea about next generation of digital world, again, really open my eyes to think more - about - what is terminology of "an idea"? Well, you can find out yourself from internet, for sure! Anyway, an idea of my thought experiment was to think on how new technologies can help build better and more interactive content experiences, and at the same time also provide potential advertisers with targeted segments. Many times our legacy prevents us from thinking out of the box. Our habits change much slower than the relentless march of technology. And at the same time, it is the technological innovations which create new opportunities. The first ten years of internet in our lives have been a source of great value. May be next five will probably see even more innovation as content producers start seeing the power of the changes and extensions in internet's infrastructure.

In Asia, we have an opportunity to leapfrog and embrace much of this change. As the foundation of low-cost access devices (be it cheaper computers, thin clients, cellphones, TVs) leverage the communications base that is being built, any need will be for a new generation of services which go beyond the content that is in prevalence today. This is the opportunity for any Asian entrepreneurs (may) envision new services and applications for next hundred billion internet users.

Next question: are you?

Oil vs USD

After seeing oil prices leap to USD 116 per-barrel, and fluctuation that happened in forex index – really open my eyes – what the hell is going on? Anyway, correlations tell me very little about what is driving what. Whether, USD driving oil prices, or is it oil driving USD – and impact other forex?

The first thing to note is that some of the correlation between oil prices (which denominated in USD) and USD itself, has to do with accounting. And this ‘accounting correlation’ becomes clearer if (somehow) I think about this scenario: Assume that the global oil price were stable against a basket of global currencies (GDP weighted or weighted according to where oil is produced). In that situation, if EUR/USD appreciates, that would also means that the price of oil in USD terms would go up (to counter the effect of lower oil prices in EUR terms), and this would generate an ‘accounting correlation’ between EUR/USD and oil prices denominated in USD terms. But this ‘accounting correlation’ is hardly all there is to it. Honestly, I am confused as well …

All bankers and analyst told, there are good reasons to think that a good portion of the causality in the oil vs USD correlation is running from oil price moves to USD particularly in relation to the USD/Europe.

Next question: how about Asian index? (RMB, YEN, SGD, etc)

Dilemma of Implementation Mobile Number Portability in Indonesia

I just read Indonesia mobile operators review. I saw an interesting note about Mobile Number Portability in Indonesia. It said that Indonesian Telecom regulatory (BRTI) recommended the implementation of nation-wide mobile number portability from 2008 onwards in a phased manner. They have also sought Department of Post and Telecommunication (DPT) nod to review operators for providing and operating mobile number portability solutions, and my question: wondering how?

Mobile number portability offers cellular subscribers the freedom to change service providers while retaining their numbers. The regulator has also forwarded the draft request for proposal to DPT for the review of current operators which will be implementing, controlling and management of mobile number portability. BRTI had earlier set up a steering committee to deliberate issues pertaining to implementation of mobile number portability in Indonesia. Based on the interim report of the committee, the regulator has now come out with draft guidelines for appointment of a central agency. It was this steering committee which helped the regulator put together its interim report on certain key issues for this implementation. And the regulator has also clarified that telcos would have bear the cost of upgrade of their networks for the implementation of multiple number portability.

BRTI also said that in case of prepaid subscribers, they would not be able to avail credit transfer when the number is ported. This implies, pre-paid users will not be able to carry their balance to the new account, but will have to either consume the balance amount or forgo it - this will bring Indonesian Consumer Watch (YLKI) shouted!

From my review, there will be ‘break before make’ arrangement for completion of porting process i.e. connection from donor network to be disconnected first and then connection with recipient network will be made. However, efforts should be made so that break period should not be for more than certain short times...otherwise...

When I was in local operator, market surveys have shown that up to around 50% of all mobile users in Indonesia are unhappy with their operator, and are willing to switch to another service provider if allowed to retain their number. Number portability has so far been introduced in Australia, Korea, Japan, Canada, the US, UK, most of Europe and Pakistan, among other countries. And according to reports, its introduction has been followed by up to 50% subscribers switching operators in some of these countries.

Next question: is it possible in real implementation without sacrifice current subscribers?

How to Make Money in Current Uncertain Year?

2008 market by nature are uncertain. I saw current news headlines make them appear even more uncertain. In these uncertain times, there are heads-I-win-tails-you-lose opportunities available. An alternative to above issue is available in the markets, where the downside is completely eliminated and the full (and sometimes more than the full) upside is captured.

So where is the catch? There is no catch other than taxes. If the markets were to go up, long-term capital gains in equity would be tax free, where as long-term gains in equity options may not be. Further bank interest would be subject to taxation. A question may arise as to why these opportunities are available in the market. The reason is that market participants have very short memories and tend to extrapolate recent events far into the future. Just as demand for earthquake insurance goes up immediately after an earthquake, currently there is huge demand for put options (implied volatility of 40%-50% for the academically inclined). In such a scenario, call options are being sold at ridiculously low levels (implied volatility of 0% !!!), right?

Therefore for someone who is not bothered about paying taxes on the gains, this 2-cents tip would be heads I win, tails you lose.

Next question: Wanna bet?

Again, Mobile Commerce: Trend, Event or Threat?

After seeing growth users of e-Commerce in Asia, now turn a question about mobile commerce in general. While m-commerce vendors remain upbeat that phenomenal growth for the sector is just around the corner (since a while ago), industry analysts caution that corner may be a little farther down the road. Many research and studies over last several years predicted a booming market for m-commerce, but now? My personal comment, however, look for slower-than-expected m-commerce growth. Common issues, such as lack of unified processes and security standards are two factors delaying m-commerce implementation, in mostly everywhere. User apathy toward wireless data services is another.

Anyway reviewing again what is the technology, much like the concept of e-commerce, a type of business conducted 100% electronically through computer networks; m-commerce is a concept of buying and selling goods and services via wireless networks with a mobile device. Mobile payment is a key component of m-commerce and it has several different models, such as premium SMS, WAP based portals, and embedded devices/smart clients.

What I have seen in past experiences, major limitations of m-commerce, as viewed today, are small screens on wireless devices, limited processing power, modest memory, restricted power consumption, poor voice quality, low-speed data transmission, non-ubiquitous coverage, unproven security, scarce bandwidth, and possible health hazards. In light of the fact that m-commerce is just at its inception,the real potential has yet to be visualized, let alone tapped.

Again, nothing that the highly-personalized, context-aware, location sensitive, time-critical applications are the most promising applications in m-commerce, there are many m-commerce applications envisaged to become very widely popular in the world.

In development of next generation of network, like 4G technology with more security, higher speeds, higher capacity, lower costs, and more intelligent infrastructures and devices will help realize m-commerce applications. With improved wireless security and privacy through data encryption and user education, on the one hand, and with the wide deployment of 4G technology, on the other hand, it isanticipated that m-commerce will, inescapably, become themost dominant method of conducting business transactions.

Next question: How to make this moving faster?

Quantum Leap? Going Ahead to 4G Development

Next wave of new generation of technology never stop for development -- basically what is 4G, ref to many teminology reviews, this technology suppose coming to market between 2008 and 2010 (which is NOW?). This technology provide TV in real time, and video download at high speed. Also, it might support automatic roaming to non-mobile network - such as WiFi and satellite.

Since I am in China currently -- just want to add some comment about China’s telecom sector, which has longed for its own, independent set of intellectual property rights for industry standards, is pinning its hopes on the success of future R&D for 4G standards. But they’ve had similar hopes for years.

Back dated around 2001, for example, an effort geared toward 4G project. Main participants at the time included some universuties (supported by government, off course) and variant network technology vendors (ie. Huawei, ZTE, Datang Technologies etc). According to its public report, was aimed at overseeing China’s 4G research and completing the standardization through a three-step strategy, with pre-commercialization set for 2010. And reviewing developed technical roadmap, they said a TD version of LTE was to be presented at the end of 2007 (but I haven't found any articles about that yet), a TD-LTE test network was to be set up by 2009, and LTE was to cover hotspots by 2010.

Somehow, nowhere is this seen more clearly than in mobile data services. The emergence of 3G High Speed Packet Access (HSPA), and soon Evolved HSPA (?) and next-generation standard LTE (a.k.a. 4G) access, that is enabling an entire new class of mobile broadband services and generating traffic volumes that are unsustainable using the classic hierarchical network architectures originally designed for mobile voice and low-speed data.

Next question: --- again, is it cheap?

Where is the Money Flow?

Expert people says; Population + Rapid Growth = Global Investing In Asia!

Well...somehow, big story is in Asia, which has both a huge population -- around almost 3 billion people in countries that are rapidly enriching themselves, or are already rich, and rapid productivity growth. And this wasn’t always true in the past. With Europe growing slowly, Japan slowed in recession since 1990 and the rest of Asia still small, the past more than 10 years have been pretty good for investors in United States, which even managed to slightly increase its share of the world economy.

Again, being optimistic -- the future will be much, much different...

After read financial news - another wakeup call says: "Wall Street is well aware of the global growth to come. Indeed, they’ve known about it for years, and their clients have been profiting nicely at every step along the way. But “retail investors” - those who lack a $10 million portfolio - have been left in the dark. And now, with the real global growth still to come, those uninformed retail investors are going to get left in the dust".

My comment for this, well, it doesn’t have to be that way! Needless to say, now that we’re “in” on the global investing “secret,” and we have an immense competitive advantage over investors who are still in the dark. But even that’s not enough.  For me, simply -- I will follow the money, no matter where in the world it travels and no matter what form it takes.

Next question: -- same as this topic: BUT where is the money flow?

Amazing e-Commerce Business in China

I just reviewing some online commerce website in China and give me an idea to write down a new topic in here. Anyway, ref to China Internet Research Centre (in Beijing?) there are 55 Million of China’s Internet users shopped online last year for a total turnover of around RMB60 Billion (amazing!). Also some news said that by 2011, online spending will hit around RMB400 Billion as more of China’s Internet users turn to online shopping. Although, I have read that level of online spending remains modest: last year it was about RMB1,000 last year per consumer, or around 0.6% of total retail spending in China.

Somehow, growth in its e-commerce has lagged due to consumer concerns about reliable online payment methods and counterfeit goods. Nevertheless improvements in technology have meant that online payment systems are now safer and the challenge for Internet firms is to win over consumers’ confidence.

Next question: How?

I just try to review that another challenge of Internet companies in China face is the small number of credit card users, with around 75 million credit cards (ref State China Banking Media report) in circulation by the end of 2007. Although credit cards are becoming more popular (they even try me, although I am foreigner in here), their still low penetration rates along with quality controls and infrastructure issues explain why online sales in China last year made up little more than around 6% of that in United States.

Sample that I have seen showing, to overcome this issue, online business-to-business portal like Alibaba has been relatively successful with "Alipay", a system which allows users to pay in escrow only once the product has been received (they just like a virtual BANK!)

Next question: Central Bank policies?

Also, Taobao.com, a subsidiary of online portal Alibaba.com, in which Yahoo! invested around 1 Billion dollars in 2005, is China’s dominant Internet retailer, somehow accounting for around 80% of the country’s e-commerce turnover (vs Amazon or eBay?). This site had sales of around RMB40 Billion in 2007; most of it in consumer-to-consumer transactions, but its profitability remains in question as it does not charge buyer or seller a transaction fee.

Next question: Any service fees regarding debt issues?

After IPTV now China enters mobile-TV

Seeing China launched their 3G for retail customers, its very interesting to see what will be their product and services, especially for incoming Global event like Olympic in August 2008. From my personal review as telecom companies and broadcasters around the globe rush to offer television services over mobile phones, China is taking steps to ensure that its domestic players don't miss out on the potentially massive market (nationwide and soon regional market).

From news, I have seen that China broadcast authorities announced they will launch their own technology standard for mobile TV. Somehow, Chinese standard is still in early stages of development (wondering?). In here, regulators didn't suggest the domestic standard would be the only one allowed in China. But the existence of a Chinese standard could ratchet up competition between companies in the scramble to develop a dominant global standard for mobile TV. Nokia, SonyEricsson and Samsung, for example, have already invested heavily in deploying mobile-TV services in other parts of the world.

I just want to quote an email from my friend in IDC says "China government wants to spin off as much homegrown technology as possible."

Again, China has tried this homegrown approach to technology standards before. It has been working for several years to develop its own standard for so-called third-generation wireless networks -- the high-speed networks used to deliver games, video clips and other data services to mobile phones. But with alternative 3G approaches advancing more quickly in other countries, Chinese standard -- not yet launched commercially -- isn't the only one being developed in China. Mobile operators and broadcasters world-wide are trying to settle on the technology and business models behind providing video content on cellphones. And amazingly, China is the world's largest mobile phone market, and analysts think its consumers may be particularly receptive to mobile-TV services, since few have existing pay-TV subscriptions, and because cellphone services beyond voice are extremely popular in China.

As part of my experiences, one option for delivering video to mobile phone is to stream or download video clips over advanced 2.5G and 3G networks. And personally, I have read and seen, like Shanghai Media Group has begun trials providing its content to cellphones with this technology. Another option is to broadcast video with a technology that works the way digital radio does.

South Korea was the first country to roll out such a service, since 2005 (may be before?), using satellite and terrestrial versions of a Samsung Electronics-backed system called Digital Media Broadcasting. In US, a company like Qualcomm Inc. has launched a proprietary mobile-TV service called MediaFLO. In Europe and Asia, an industry group that includes Nokia has been touting a standard called DVB-H. More than 50 million DVB-H phones are expected to be sold globally by 2010, ref from Research firm Informa.

And Chinese standard (as I have heard from my friend in Gartner), which bears the ungainly name GY/T220.1-2006, could help local telecom providers, such as China Mobile and China Netcom, by reducing the amount of money they have to pay in royalty and intellectual-property fees to foreign companies. And this standarization have feedback from both Nokia and Motorola that the announcement would have little impact on their plans to expand mobile-TV services in China and the rest of the world.

Next question: Who want to watch TV in mobile phone?

US vs China or China vs US?

Just read some emails and very interesting - somehow I could have easily missed it. If it weren't for the credit crunch and Bear Stearns (as what I saw in Bloomberg) going under and all the US election hooplah in the news and the screech of the wheels on the US economy grinding to a halt, *sigh* may be I need to heard more about it.

Chinese yuan Renminbi (RMB) hit a milestone last week when it traded under seven RMB to the US dollar for a while. The dollar used to be worth something. Somehow, IMF is pointing out what everyone else already knew about the rising Yuan (RMB). Again meanwhile, China needs to fight inflation and a rising yuan does just that, making imported goods cheaper in China.

Next question: But is the stronger Yuan (RMB) having much impact on the US economy?

Dreaming of Mobile Commerce in China

Some research journals noted that around three billion people are expected to own mobile phones in the globe by 2010. Mobile commerce is a natural successor to electronic commerce. The capability to pay electronically coupled with a website is the engine behind electronic commerce. Electronic commerce has been facilitated by automatic teller machines (ATMs) and shared banking networks, debit and credit card systems, electronic money and stored value applications, and electronic bill presentment and payment systems. Mobile payments are a natural evolution e-payment schemes that will facilitate mobile commerce.

A mobile payment or m-payment may be defined, for our purposes, as any payment where a mobile device is used to initiate, authorize and confirm an exchange of financial value in return for goods and services (ref from Au and Kauffman, 2007).

Mobile devices may include mobile phones, PDAs, wireless tablets and any other device that connect to mobile telecommunication network and make it possible for payments to be made (ref from Karnouskos and Fokus, 2004).

The realization of mobile payments will make possible new and unforeseen ways of convenience and commerce. Unsuspected technological innovations are possible. Music, video on demand, location based services identifiable through mobile handheld devices – procurement of travel, hospitality, entertainment and other uses are possible when mobile payments become feasible and ubiquitous. Mobile payments can become a complement to cash, cheques, credit cards and debit cards. It can also be used for payment of bills (especially utilities and insurance premiums) with access to account-based payment instruments such as electronic funds transfer, Internet banking payments, direct debit and electronic bill presentment.

Security is still a major concern. two-thirds of users (as my past experiences) were worried about transmitting sensitive financial information, while more than 60% were worried about being exposed to scams and fraud and rest were worried about what would happen if they lost a phone containing personal financial information.

Sometimes ago (may be around year 2000) China's largest mobile network operator China Mobile began offering mobile banking services throughout some major provinces and municipalities. Basically, users will be able to access their banks via mobile phone for transactions such as checking bank balances, paying phone bills, and transferring funds between accounts. It was collaborated initially with three leading banks, they are; Bank of China (BoC), Industrial and Commercial Bank of China (ICBC), and China Merchants Bank (CMB) - and China Mobile providing these services to some half million subscribers in the initial phase (don't know how many currently). From the local news its noted that the retail e-commerce sales of China are anticipated to increase at a CAGR of 17.45% from 2006 to 2010, and there is a believe also that mobile banking will be the future of Chinese banking sector.

There is a journal from Wang Guang Yu, IT Specialist in Banking & Finance, Headquarter, The Industrial & Commercial Bank of China, and I just want to quote his note:
"ICBC created the most advanced capital clearing system, with 37,106 electronic outlets with coverage of over 97%. Its tele-bank service has been opened to 261 cities and the function and scale of it's 95588 tele-bank has leaped to first place in the industry. It has released services such as company online banking, individual online banking, B2B online payments, B2C online payments, bank securities transfer, foreign exchange, etc. ICBC also established in Beijing, Shanghai and Tianjin subsidiaries transaction websites which have been promoted to 185 developed medium-large cities. All of these provide the firm foundation for the development of ICBC's mobile banking business".

My perspective overseeing this mobile commerce in China, have several views:
1. From public and market situation itself in China, mobile commerce is still fresh for most of the Chinese people who are less interested to trying to take on board this type of services, even internet banking. Next question: education and campaign issues?
2. From banking sector, somehow, China's mobile banking or commerce didn't get the general attention of commercial banks and less push promotions are launched (ref from my limited experiences since past years in China)
3. From mobile operator value added services, again - personally, I just saw some campaign only from pushing just SMS, let alone WAP mobile banking.
4. From technology perspective, with the development of 3G (just now) and WAP, the future mobile commerce must demand mobile operators upgrade their current products.

Anyway, lots of challenges are to be overcome for a successful implementation of mobile commerce to be widely accepted as a mode of payment. Businesses, merchants and consumers have to come forward and make value-producing investments. A regulatory framework and widely accepted standards will be the pillars on which mobile payment applications will be built.

Next question: from around more than 1.5 Billion people, who will take this homework?

YouTube in China

After saw a clip of 'Fitna' and other related videos like 'Tibet news' in YouTube, somehow, my view is that the deal highlights the importance of social networks and community - freedom of speech. It also brings out the coming age of video on the Internet, well, not that obvious in China since there are a lot of IPTV channels locally. As I have often said in the past, there is an opportunity for the next YouTube - or Google - to come from emerging markets like in China. Instead of looking at what companies in the developed markets are doing, the focus needs to be on the needs of the large user base in the domestic markets. If there is one key takeaway for entrepreneurs from the YouTube-Google deal - it's a great example of how and why a focused startup can compete with the big guys. Google not only had a video product that was a competitor, they started it before YouTube existed. Then YouTube came along and kicked their butt into paying through the nose for them. One game is over, new ones are ready to begin.

In China itself, apart from the fact that the deal needs to close, Kai-Fu Lee and the team over at Google China are wise enough in the ways of the Middle Kingdom to know that YouTube in the form that it operates in the U.S. would not fly with the Chinese authorities. A website that plays videos but is not a licensed broadcaster? That's a no-go: we know that from the way the IPTV trials are being handled. A foreign website? Playing foreign videos? Or worse, self-produced videos from local Chinese? Even worse, owned by a foreign company with huge resources?...China is not the only place Google is likely to face challenges as it makes plans to take YouTube global. In Singapore and in other countries where Google does business, there will be authorities who take issue with the concept of a video sharing site, and Google will face a choice: don't launch YouTube at all, or launch a localized version that operates in accordance with local laws and sensibilities. I'm betting on the YouTube Local approach, especially in non-English-speaking territories.

Next question: China Government Policies vs Freedom of Speech?

Wireless Backhaul Grows?

I just read some technology reviews and emails from my friends, and interesting topic related with wireless technology. Somehow, with increasing wireless mobile phone users along with more sophisticated wireless devices such as the Blackberry and iPhone chewing up bandwidth, the need for wireless backhaul technologies is increasing.

I am reminded of my past experiences when I built network architecture using NMS AccessGate, a wireless backhaul platform, that aggregates T1/E1 communications onto a common backhaul between the cell site and the MSO. It also performes statistical multiplexing which suppresses idle frames and idle channels for 2G services, making the most of backhaul bandwidth. It achieves a bandwidth savings ratio of up to 2:1.

I'm going to steal my introduction here (copy from the internet)

"Optimizing bandwidth utilization has become more critical even though simultaneously technology is evolving to improve bandwidth throughput — whether it’s wireless, over copper (DSL, T1, E1, etc.) or fiber. The reason is simply cost and the resultant margins. In an increasingly competitive telcom/datacom landscape, keeping your costs low with the highest possible profit margin is critical. In most wireless networks, operators bear the recurring cost of traffic backhauling in order to connect geographically dispersed cell sites with their core networks. As access networks have been built out to support wireless services, each newly deployed service has required additional dedicated transmission equipment (such as leased lines, satellite trunks, or microwave links) between the base station and the base station controller. This backhaul cost can represent up to 20–30 percent of total network operating expenses (OpEx). By reducing the number of these connections, operators can eliminate a significant portion of network OpEx".

Anyway, here's a teaser from me - wireless service providers migrating their mobile offerings to packet-based 3G and 4G/LTE/WiMAX technologies are facing a significant increase in bandwidth demands (up to 20 times today’s rates by 2012) over their wireless backhaul networks, whether their own or leased from ILECs or alternative access providers. To provide this level of capacity in a cost-efficient manner, wireless backhaul is migrating to Ethernet from T1 TDM private lines.

Next question: free communication?

China Now!

A copy from my journal in Facebook: --

It was about 10 years ago in March 1998 that I packed my bags and traveled 1st time to China after a stay of almost two years in Brussels. I was fortunate to have an exceptional education - in Vrije Universiteit Brussels and then at University of Chicago (1999). When I went to the US, my father had only one thing to say to me: "I grew up with hard working environment. If I could come back then, you have no reason to stay there any longer than necessary". For me, the decision to return and staying to Asia was made before I left.

China has been the flavour of the year internationally in 2007 and that looks likely to continue in 2008 forward. The past year has seen very favourable write-ups in many international publications. Outsourcing to China companies continues to grow rapidly - in software and other areas. Many companies are expanding their presence in China. China companies themselves are looking to grow globally. The China stock market performed spectacularly (before global impact recently).

Almost every investor and senior executive has started to think about China. For some, it is about leveraging China's cheaper skilled labor. For some others, it is about capitalising on China's growing domestic consumption. And for investors, it is about China's attractive returns on investments (still).

Whether it be the steady stream of investment announcements in China as companies grow their operations or the flow of visitors seeking to "discover the new China", there is now little doubt that China is starting to get factored into the plans that companies are making. The outsourcing and services story is well-known. But as incomes start to rise (and salaries are indeed rising rapidly in the white-collar sector), domestic consumption is starting to take off. (These two factors are the principal drivers behind the real estate boom in China big cities)

This is a journey which needs many travellers - explorers, astronomers, scientists, financiers, engineers, economists, and others. Some will make it to the finishing line, others won't. The joy for everyone has to be in the journey.

China is the flavour of the day. But we need to make it more than that. China needs a few decades of sustained development to make up for all the lost time. We have the world's biggest population. If we are not to disappoint and lose this generation, we need to work on building the China of tomorrow. We may not be easily able to change our politicians and policies, but I firmly believe that we can use our innovation and entrepreneurial abilities to bring about change. We have to do this not between two generation, but between two elections. The China Rising story needs to not become a chapter but a book.

There are many opportunities - to both catalyse (do good) and capitalise (do well) on China's development. The road ahead does not have any maps. Instead, all we have is a compass. There are slippery rocks. And as we navigate through, we have to, in the words, "like the feeling to be a China-man"

Next Question: Can I?

Risk Analysis - Trend of Corruption in 2008

Buzz word of corruption always in the news since past decade. The persistence of corruption in some of big countries may reflect the presence of immigrant communities in these countries, in which barter and other forms of reciprocal dealing based on (and constructing) relations of trust, extended family relationships, clan ties, and the like continue to organize significant economic activity and make it natural to think of public officials as "selling" public services to their friends and relatives. Again, problem of corruption in 2008 underscores the importance of the legal framework to economic development. An honest, incorruptible police, criminal law enforcement machinery, and judiciary can increase economic efficiency by greatly reducing the amount of corruption (as well as in other ways), though it is equally important to have a commitment to free markets and a workable legislative and regulatory machinery to prevent economic activity from becoming encrusted with inefficient restrictions.

My personal comment I concentrate on corruption that on balance is bad. Obviously, if governments strongly regulate many activities, then companies, unions, and other groups that are regulated can do better if they can "bribe" officials to overlook or relax these regulations. So the wider is the reach of governments, the greater is the corruption potential. Somehow, other than narrowing the scope of government and strengthening legal institutions, what can be done to reduce (bad) corruption? One simple step is to improve the incentives of officials to act honestly. The incentive to be honest would be stronger when officials are better paid, and if they are fired from their well-paying jobs, and sometimes also punished rather severely if they are caught engaging in corrupt behavior. A few studies do support this conclusion that corruption thrives more in environments where officials are badly paid, such as policemen in most of Asian counties (name it - Indonesia? China? India?).

In a role - corruption is reduced by greater competition between separate political jurisdictions and stronger competition for political leadership. This implies that corruption is lower in decentralized political systems compared to centralized systems. Various studies do indicate that democracies generally appear to have less corruption than totalitarian systems, although some of the corruption in totalitarian systems like the Soviet Union may be of the good kind because the laws are so bad. And, corruption is reduced when information is more easily disseminated to the public. That is why a free press is such an important protector against greater corruption. The press is more effective in better educated societies, and various studies have shown that corruption is lower when education is greater. Education also helps cut corruption by improving political institutions, so part of the positive relation between the amount of corruption and the weakness of institution is the result of the positive connection between education and good institutions.

Next question - Can we stop this?

Network Load vs Ported Mobile Phone Numbers

Based on my experience currently in Malaysia, Telekom Malaysia (TM) launched their new Voice Network Query service that enables Celcom (mobile operator) to route voice calls to mobile phones directly to destination operator, minimizing network load. Now that regulations force Celcom to allow customers to port their mobile phone numbers, this introduces some network traffic issues. Of course, I should mention that you can port your traditional landline phone number to a VoIP providers, but that introduces its own series of number portability problems. In any case, this service which will allow major telecoms carriers to route voice calls to mobile phones directly to their destination network operator. The new service overcomes the issue of onward routing of voice calls to ported mobile numbers, thus reducing the issue of excess network traffic generated by voice calls misrouted due to mobile number portability.

When a mobile user switches network but retains their current phone number, calls have traditionally been routed via the user's former operator's infrastructure, which then routes calls to the operator which now provides service to the customer. This double handling of calls generates additional network traffic and transmission costs which, ultimately, are passed on to subscribers. With TM's Voice Network Query, TM customers can check the actual network of a mobile number before routing the call, thus routing the voice call directly to the correct network and avoiding unnecessary network traffic.

TM is able to offer this service by leveraging its SS7 connections into the global mobile network. Using their access directly into mobile operators (ie. Celcom), TM can query any mobile number to establish its home network, whichever operator that number might have originated on.

Somehow - my personal statement says - mobile Number Portability is a great thing for consumers but has caused huge amounts of problems in the routing of voice calls and lack of tariff transparency for the subscriber. Because mobile numbers are attached to a particular operator, when that number is ported onto a customer's new operator, the routing process can become hugely complex. Voice Network Query overcomes that problem with a simple and elegant solution - by 'asking' the phone what network its sitting on before routing the call it's possible to connect directly to the right network without the hassle and cost of unnecessary connections through intermediary operators.

Next question - How they market this 'easily' to us?

Changing Landscape in 2008

Again, I want to share about Technology Trends for 2008. First in mind, technology touches us all - in every aspect of our life. Our digital lives have been transformed in the past ten years. Computers have digital representations of our personal and work lives embedded in our emails and documents, cellphones connect us instantaneously with family and friends, and websites assist us in the search for information and to complete transactions. Technological change continues to accelerate, providing the visionaries with an opportunity for that little extra competitive advantage which can make all the difference between market leaders and the also-rans. As we look at the various technology trends last year, it is important to understand the underlying forces of change and their evolution in the years to come. This is how new opportunities and business are created. Since change is happening across many dimensions, it is also important to get a who-listic view of the world around us.

In addition, there is a need to develop a perspective that centres around emerging markets. These are the next big growth markets and need solutions which are likely to be different from the developed market. Increasingly, many of the world's largest technology companies are looking to create specific emerging market groups and solutions. The developed world has seen computing and communications evolve through many sequential revolutions: personal computers, local area networks, client-server computing, enterprise software, Internet, next generation of network, mobile phones and broadband. Next questions - what happened in the developed markets over two decades is being compressed in the emerging markets in a few years. This means that more than just technology innovation, there is a need for agility, speed and localisation to tap into the opportunities by technology's newest customers. Is it expensive?

To put this context, take a look at China and the changes that are underway. Cellphone adoption is growing, even China Mobile just announced over the course of the quarter, they added 17.3M new customers, and the phone is morphing from just a voice device to both a possible alternative to a computer and is becoming a fashion statement. Computers are becoming a wee-bit more affordable with the likes of AMD vs INTEL making inroads with cheaper processor. Broadband access is starting to become available at reasonable price points. Open-source software creates an alternative to piracy and non-consumption. Internet e-commerce is starting to pick up again with services like airline ticket booking which remove a pain point in daily lives. Technology is no longer a decision to be just made by the management in the company. It is increasingly going to get embedded in multiple aspects of our lives. It is a weapon that needs to be leveraged by top management not just in the marketplace, but also across the extended enterprise. In this context, it is helpful to step back and take a look at ten key technology trends that we are seeing around us and understand their impact for our personal and business lives.

2008 Trends:
1. Digitisation
Fundamental driver across the technology landscape is digitisation - once things move from atoms to bits, or analog to digital, it becomes possible to do a wide array of transformations which previously were not possible. For example, digital music. For a long time, as the industry has shifted to digital content, it has become possible to not only time-shift consumption via customised playlists on devices like Apple's iPod, but also to distribute it via the Internet for nearly zero-cost, fundamentally undermining the business model of the industry. Something similar is happening in telecom with voice-over-IP. Traditional telcos are realising that the ability to digitise voice and transmit it not over proprietary networks but over the Internet threatens their core business and customer relationship. The digitisation of information and business processes means that countries like China can use their low-cost advantage to offer outsourced services to global organisations.

The process that began with the availability of the personal computer a quarter-century ago is now cutting across the value chain, creating an end-to-end integrated digital flow. From our homes to enterprises, digitisation is the starting point for many disruptive innovations as part of "creative destruction", driving significant changes across industries, bringing not just change but also opportunity in a world that's becoming smaller and smaller. Next Question - cost and security?

2. IT Commoditisation
Back to 2007 - silicon, Storage and Bandwidth are available in plenty. Processing power doubles every 18 months, storage capacity every 9 months and available bandwidth every 12 months. This has been happening for some time now, and is likely to continue for the foreseeable future. The result is there for us to see. Google has built a massive platform with more than 1Mio commodity computers and is in a position to offer free services like email with a storage capacity of 1 GB email. The cost of 1 GB disk space has fallen to just about $1. In countries like Japan and Korea, bandwidth of the order of 30 Mbps is available for about $50... great huh?

Global investment in technology continues. There are more than a billion cellphones around the world, with 2007 seeing sales of more than a billion phones which provide all kinds of functionality ranging from digital cameras, multimedia messaging, FM radio, TV and even some basic computing functions. Again, even in China has wireless data networks in hundreds of major cities with connectivity costs of in minumum (China Mobile vs China Unicom). Seemingly, technology is ubiquitous and everywhere. Or is it? But again - in countries like China, adoption of IT still leaves a lot to be desired. Only the very top of the pyramid uses technology. There are four barriers which need to be overcome for these countries to benefit from the commoditisation of IT: the information barrier, on what technology can really do; the desirabaility barrier, through the availability of relevant and useful software and applications; the manageability barrier, so that IT can be easily deployed and leveraged; the affordabaility barrier, which makes it available at prices that local users can pay.

3. TCO Issues
What is TCO? Term of Total Cost of Ownership - as spending on IT has increased in enterprises, there has been an increasing attention being paid to the TCO in technology. It is not longer just the upfront cost paid for hardware and software that needs to be taken into account, but the overall cost that goes into administration of the systems deployed. As growth has slowed, increasing attention is being paid to the TCO of technology in organisations -- new terminology is 'managed services'.

4. Real-Time Application
The dream of the real-time enterprise (RTE) has been there since the earliest software systems were written. Success has been achieved to varying degrees by different organisations. The challenge is what fuels the various business software companies and the looming consolidation in the industry (considering Oracle's bid for Bea recently). In business, the differentiator is increasingly not in the machines used for production, but in the processes that make up the information refinery. An example of a real-time enterprise is Cisco, which is known to be able to close its books every day. Service-oriented architectures are helping glue the various information silos within the enterprise to create an event-driven platform, built around business processes.

Now, the increasing availability of affordable high-speed network connectivity and its derivatives is letting certain functions within the enterprise interact in real time. The business drivers for RTE technologies continue to drive adoption: Reducing the amount of time it takes for information to be transmitted between functional areas within an enterprise and its supporting supply chain will yield significant business benefits.

5. Security
If there is one single word that is uppermost in 2008, it is security. The proliferation of viruses, spam and spyware have caused headaches aplenty. In addition, the ability to connect various company locations via a virtual private network (VPN) over the Internet also means that data needs to be sent securely. Firewalls, Intrusion Detection, Encryption have all become part of the technology vocabulary. If anything, the emphasis on security will continue to increase in times to come. What we consumers need is a simple, unified protection plan to counter all of these threats. And the computer, software and Internet industries have badly failed us in this regard. They would rather dump the security mess in the laps of users than solve it at the level where a solution really belongs: in the operating system, or the hardware, or the online provider's servers. Next Question - so, anyone up to it?

6. e-Business (raise of dot-com?)
Again, Internet has become a key ally in doing business. A company that neglects its website may be committing commercial suicide. A website is increasingly becoming the gateway to a company's brand, products and services - even if the firm does not sell online(?). Again sample in China (although I don't understand their language), I am seeing an increase in online commerce. The world of e-business is here in full force. And, if we take a look back in the late 1990s when the Internet hype was at its peak, the belief was that the Internet would change everything. Every industry would be transformed. If something wasn't on the Internet, it didn't exist. Then, reality set in. There are many businesses which the Internet has made a difference too. By reducing transaction costs, it has helped consumers get lower prices and forced producers to become more efficient. By bridging geographical barriers, it has allowed companies to open up new markets. Search engines like Google have allowed small businesses to reach out to potential customers far more cost-effectively than other media. Electronic marketplaces like eBay have seen many build businesses around them.

As with any new infrastructure, it takes time for its full potential to be realised. Increasing broadband availability will only accelerate the trend. As the ecosystem around the Internet gets put in place, we are moving closer to the future where e-business and e-commerce become synonymous with business and the commerce, and the "e"-prefix simply disappears. Next Question - when?

7. Collaboration
Productivity emerges from teams of people working together to achieve a common goal. Making groups more productive is the next big challenge that is being tackled by many companies. The focus now has been on tools that make writing - individually and in teams - easier. One of the key requirements - really a very simple one to have, but something so sorely left out in the current system, is a presence indicator. Much like in current IM systems - telling us who's available, who's logged in and therefore present in the office, who I can ping for a query, and ensuring that a response is received. In the case of his organisation, currently, they'd send an email, wait for a response, followed by more emails as reminders, and finally in sheer frustration, pick up the phone and make a call - which can be expensive if outstation (as is the case very often in their line of business) and does not always ensure that they will get a response - what if the person is away from the office? Well, somehow - we aren't there yet, but getting close. A combination of new technologies are coming together to make it easier for us to work together in groups - be it in the workpace or among friends and family.

8. Always "On"
I am trying to make sample in Asia biggest nation, China - around five years ago, it would have been hard to imagine that Chineses people would be buying cellphones at the rate of nearly 2 million a month. Similarly, today, it is hard to imagine a broadband China? but that is exactly what we are about to see. The next couple years will see Chinese consumers and enterprises enveloped in ubiquitous, high-speed connectivity from multiple sources - wireless, DSL, cable and satellite (hopefully, not only in big major cities). Complement this with WiFi-enabled laptops and smartphones, and the always-on world is at hand. This will necessitate a change in the not just employees work, but also the interactions between enterprises and customers.

In China, China Mobile and China Unicom (well, only 2 big players *sigh*)'s data services have become very popular with laptop users as they provide instant access from anywhere. Year 2008 will see cellphone sales of nearly next billion. Each cellphone makes its owner instantly connected to a worldwide network. As more and more features are packed into cellphones, they are becoming cameras, radios and TVs, gaming devices, and even computers. Smart radios are being embedded into all kinds of devices. Also, microchips embedded in products are creating an 'Internet of things'. Also, a mix of broadband and wireless technologies are providing bandwidth aplenty anywhere and everywhere. From WiFi to WiMax, Zigbee to Ultrawideband, Mobile-Fi to 3G/HSDPA or even 4G(?), there is no space which can remain unwired and no device which can stay unconnected. Backhaul networks on fibre are creating a world where it is now even more economical to carry voice over packet-switched IP networks. It is a world where, according to one of the Skype co-founders, telcos will become software application providers (hahahaha...)

The world of always-on in a natural manifestation of the convergence of various industries - computing, telecom and consumer electronics. It is a world which telecom- and computing-poor infrastructures like in developing countries can leapfrog to, with the right vision and will. Just like South Korea and Japan has done.

9. Advanced Outsourcing
Since 2007, outsourcing is a fundamental trend, and there is little any US government is going to be able to do anything about it. What is clear is that companies globally are relooking at their cost structures and leveraging the commoditisation that has taken place in IT as well as services to focus on what they do best. It is hard to overlook a 30-70% cost savings for certain processes, but that is just the start. What outsourcing also allows is to also fundamentally redesign business processes. This is what companies like IBM, PwC, KPMG, etc; are onow offering the global majors.

Somehow, the goal is not to replace people. The people are where the creativity comes from. But you take the repeatable, standardizeable pieces and put them in software that we deliver either as products or as specialized services. The humans can apply more of their creativity to the piece that only humans can do. The emergence of Web services is the technological base and the lingua franca that makes the idea of a services stack possible. You have to somehow bridge the world of software to the world of business processes.

10. New Emerging Market as Drivers
Overviewing first phase of the technology revolution over the past few decades has touched the lives of the top of the global pyramid of consumers and enterprises. It is only in the past few years that technology has started making its way into the lives of businesses and families at the bottom of the pyramid - in the emerging markets. Because of the lack of legacy and an inherent need, adoption of some technologies has turned out be extremely rapid. Sample that I have read, in China, about a million computers are purchased every month, as compared to 5 million cellphones. Now imagine what would happen if computers were available at the price points of cellphones. We will then see annual computer sales at 20-25 million for many years to come, making China among the top three markets in the world. What does that mean for the global technology players for whom China has so far been a rounding off error in their revenues and profits? Emerging markets, by virtue of their large numbers, have the potential to be the hotbed for disruptive innovations. They are the new markets which can ignite growth at technology companies. But at the same time, they need solutions which need to be at different price-points from what the developed world has been paying. This is both a challenge and an opportunity.

End of the story - in the world of technology, like time, does not stand still. Innovation and change are the only constants. In Asia, place that I am currently staying, have the opportunity to leapfrog by simultaneously leveraging many of the new innovations that the technology industry is making available. The force of digitisation is at once a threat and an opportunity. The choice is for each one of us to make.Next Question - do you?

Another Flashback

Another copy from my journal in Facebook:

Suddenly, I just got flash in my mind... Take a look at Singapore airport from the air to see how to do it right. (The design is probably not just limited to Singapore itself but most good airports in the world.) There is a terminals area in the centre away from the check-in and arrivals area. The terminals area thus has plenty of parking space for aircraft on all its sides. Every aircraft thus can be connected to an aerobridge. The terminals area itself is connected to the arrivals / departures area with an underground tunnel. The arrivals area is on the lower level, while the departures area is one level above.

Now take a look at the hodge-podge that is Singapore's airport. In the infinite wisdom of the planners, they built common runways but had two separate terminals for domestic and international travelers which for years were connected only by getting on the crowded roads. A couple years or so ago, wisdom dawned and they finally used the inside roads to train passengers back and forth between the two terminals.

The new terminal (terminal 3) that has been created for some of the airlines (replacing the old one) forces every traveller to be carted in a bus and connecting train. There is no provision for any aerobridge. Which era are we willing in? The terminals area and the arrivals / departures area is in one cramped building limiting growth. A significant part of the airport has been overrun by squatters limiting the expansion of runways.

Somehow, we pay a price every day for these kind of inefficiencies in the system. Many of these decisions could have been done right the first time around - and we did not need to be rocket scientists for that. We just had to look at best practices that people have followed before us. But being one of history's oldest civilizations, we think we have all the answers. Luckily, the rest of the world doesn't seem to think so. What do you think?

Business Review: Cost of Triple Play

Interesting survey from net that I thought I'd share regarding Triple Play expenditures. They said, application and content service providers are really starting to ramp up their spending. These providers around the globe see triple play services not merely as a means of increasing top-line revenue, but as a means of self-preservation. Network operators are redefining and realigning themselves to be the one-stop shop for all things digital for residential and enterprise subscribers, and they believe triple play services will give them the competitive edge they need to succeed.

From the review, majority of service providers in the study plan to further increase capex spending in the next 12 months on IPTV equipment, broadband CPE, broadband aggregation equipment, and voice over broadband equipment, and they expect revenue growth in all areas of triple play services in the next 12 months. And a big chunk of revenue it is: The average percent of total company revenue from triple play services ranges from around 40% to 50% in 2006 to 2007. Again, they said - with nearly 40% of their capex budgets going to triple play service infrastructure, service providers are sending a clear message that the combination of voice, data, and video services is a long-term differentiator for them, and carriers are demanding complete interoperability, full standards compliance, and an open and flexible architecture from their suppliers to ensure the content and services they provide will work right out of the box and far into the future.

IP voice is a big draw for triple play providers, but it's video that's really the newest, most exciting, and most technically challenging part of triple play services, and IPTV is where all the action is. In fact, most of Asian service provider already offer IPTV, and that one offers it by 2007-2008 (I believed).

My review from findings in this industry (ref.Asia):
- Key drivers for most of service providers deploying triple play services are
1) increased broadband revenue per user
2) new revenue streams

- And most of them rate vendor interoperability a key technical challenge when rolling out triple play services

- The most pressing business challenge triple play service providers face is securing broadcast and on-demand video content; acquiring content is also a challenge

- iTV (interactive TV) is the fastest growing video service offered by service providers, bringing Internet capabilities directly to the TV screen, including instant messaging, shop at home, click to call and click to purchase capabilities, and, most significantly, online gaming services.

Next question: How much it will cost for us?

What is Google Android?

Again another fiesta that I have heard about Google from Youtube.com - first, I should point to a funny parody of the supposed Google Android on Youtube, which takes the concept of Google Adsense (ads based on keywords on the webpage) and extends it to speech-recognition of words spoken on the phone to "speak" relevant ads.

Well then, as you know, Google Android aka Dream Phone is a mobile phone platform based on the Linux operating system and developed by the Open Handset Alliance. There have been many rumors about what it will ultimately look like, with several parodies of it circling YouTube, especially this one:

http://www.youtube.com/watch?v=naUnXplUtrQ

I decided to check out the URL. Sure enough it had two fields - one for entering in your phone number (From) and another field for the destination number (To). Further, the top of the page boldly claims "Google dream phone, android, gphone... whatever its called. Here's a live demo! demo1.0" I was skeptical to say the least, but figured I'd try this anyway.

The preview they gave for speech phrases the demo would recognize often were based in Mountain View, the headquarters of Google, such as "weather for Mountain View". Even asking "what are we doing tonight" was answered with movie times for Mountain View. Trying so hard to associate Google's HQ location made me even more skeptical this was legit. Speech recognition and the ability to conference in two legs of a call is nothing new.

I will say there are plenty of existing technologies that can do what this preview that they just did. Though perhaps this is a legit sample of Google Android. Perhaps Google and their partners just doing something? Who knows? If I had to make a prediction on this 2008, I'd say this is a hoax. But still pretty fascinating to be on a call and then have advertisements or information injected into the call depending on what you say. Be afraid... Be very afraid!

Meaning FREE CALL!!