Cable / Broadcasters Holding Their Breath

Just like toddlers who threaten to hold their breath until they get what they want, the cable operators and broadcast station owners seem to be doing the same thing.  Almost every week brings another example of these legacy services trying to hold back the advance of technology and the desires of their audiences.  Also, almost every week there are industry developments that bode ill for the status quo.   Until they see the error of their ways it looks like we as consumers are in for frustration.

Case in point.  You might remember I wrote extensively earlier in the year about a new company called Aereo.  The company provided local TV stations to subscribers wishing to watch these stations on a computer, smartphone or tablet.   I was an early subscriber and it was great to be able have that flexibility. I could take my iPad out on the deck and watch my favorite program.  The cable and broadcasting community thought otherwise and eventually sought an opinion of the US Supreme Court to put Aereo out of business.  Aereo lost the case, ceased operation, and just last week announced they would seek Chapter 11 bankruptcy.

So now you and I are left with Time Warner’s wimpy app that allows only some of the channels we pay for each month to be viewed on an iPad, computer or smartphone.  Of course, not all the cable channels are available and none of the local broadcast stations.  Viewing the latter requires me to use my TV set.  If I leave the confines of my house the number of channels available on my iPad decreases even further.  Right now the BBC and Aljazeera America are about the best of those offerings. Standing on the sidelines and watching these old media companies try to figure out how to hold on to their grip on TV entertainment is both comical and frustrating. 

Even companies that advise broadcasters are struggling in this new environment. Nielsen, the leading TV audience measurement service, continues to refine their survey process at a time when measuring an audience for a single program episode is no longer just a matter of counting people watching at one specific time.  Time shifting, first with the help of VCRs and more recently with slick new digital options and online streaming, has made the audience reports suspect at best.  Even large sophisticated media savvy companies like P&G have questioned Nielsen’s numbers.

We consumers are in for more frustration as slowly but surely the keepers of all things TV, the cable operators and broadcasters, move into the 21 century and abandon business models developed in the 1950s when we had three or four TV channels.   

Another Option Connecting To the Internet

There has been much in the news lately about the Internet.  Last week I wrote about the relatively slow access speeds we have in the United States.  President Obama weighed in on the Net Neutrality discussion and there were reports about hackers continuing to wreak havoc on our financial institutions.  Solving these issues is well beyond the purview of most of us.  We are more concerned with finding a reliable and affordable ISP (Internet Service Provider) to get us connected.  Think of an ISP as the on-ramp to the information superhighway.

For most of us at home or in small businesses there are few ISP options.  The phone company and the cable company are usually the only games in town.  For large corporations, universities and government there are several more robust options.  One that has been around for a long time but which is extremely expensive and somewhat clunky for home users, is satellite delivered internet service.  You see examples on roof tops of gas stations and big box stores. Small dishes abound. While satellites do allow access almost anywhere, its high cost has put it out of reach for many home users.  A new company, Exede.com www.exede.comis trying to change that.

Exede.com has started to advertise on TV and radio, offering an affordable option to the hard wired ISP.  I have not tested out the system but have done some research on what they offer.  Based what I have found, I think it may be an option for those seeking high speed access to the internet, but who live in locations not well served by traditional providers.  But, like with all introductory offers, it is wise to look at the fine print.

Much like satellite-delivered TV, Exede.com installs a small dish on your roof that receives and transmits a signal to an orbiting satellite.  Both incoming and outgoing data are sent via satellite.  This makes Exede.com different than some earlier satellite ISPs which used the satellite for incoming data only (downloading) and your telephone line for outgoing data (uploading).

The company offers three bundles that have monthly fees based on the amount of data you actually use.  This is a big difference from the traditional wired ISPs that most often provide unlimited data usage for home computer use.  Deciding what bundle you need requires you to examine how you use the Internet.  If you daily use email, surf the web, use social media, and watch a few videos, the basic package providing some 15 gigabits per month will serve you well. The introductory monthly fee for this service is $49 ($39 if you bundle with their phone service). If, on the other hand you watch lots of movies and TV on Netflix or Hulu Plus, you may need to sign up for the premium package costing about $100 per month.

Exede.com promises speeds of about 12 mb/s for downloading, which is better than most of us have with our wired ISP.  But there are some restrictions on when you use the service.  Use in the early mornings (3AM thru 8AM) is free while use during the heart of the business day is metered, and counts against your monthly allowance.

For those who are not able to get good service from a wired ISP, Exede.com might be a good option.  Be sure to read the details  so you don’t get locked into a plan with a hefty exit clause like some mobile phone plans.

For those who are not now able to get good service from a wired ISP, Excite.com might be a good option.  Be sure to read the detailshttp://www.exede.com/documents/master/exede-disclaimer.pdf so you don’t get locked into a plan with a hefty exit clause like some mobile phone plans.

Internet Just Not Fast Enough?

When it comes to technology, the USA would seem to be a world leader.  We have iconic tech companies like Apple, Intel and Microsoft.  People both young and old, rich and poor, rural and urban regularly use the latest smartphones, tablets and GPS devices.  Even our cars are replete with every new digital device known to man.  We have access to hundreds of channels of television in our homes and in our palms.  Indeed, the USA is a leader in the development of these new technologies.  But we are significantly behind the rest of the world in the state of the networks that link all of these devices and services together.

The Global Internet Report issued in early 2014 shows the USA 30th in the average network download speeds available to consumers.  Hong Kong leads the world having average internet access of almost 60 megabits per second.  This is more than 3x the average speed available in the USA.  Ahead of the United States are large counties like France, United Kingdom and Russia, as well as smaller states like Estonia, Iceland and Ukraine.

How can it be that the country that wrote the book on the Internet, the PC and the smartphone can lag behind on such a basic necessity of digital life in the 21st century?  The answer is a bit complicated.

First of all, the networks that serve the US have been around for decades.  That means that while they are ubiquitous and reliable, they are also old.  Also, many of the networks we use for getting on to the Internet were not initially designed for that purpose.  Many of us still get our Internet connection from the local cable company, whose networks were designed to deliver TV content—not bi-directional high-speed data.

The Comcasts, Time Warners and AT&Ts of the world have invested billions of dollars building out these networks.  They would much rather reap the profits than invest in new expensive higher speed networks.  There is no competition from others with better service because they are the only game in town. .

Thirdly, in most of the rest of the world the networks are operated by the government.  The networks are considered the same as any public resources like roads, water, sanitation and electricity.  As such there is not a requirement to make a profit.

As more of us Americans use the Internet and the networks that connect us to it for services aimed at both leisure and business, the current speeds available are going to pose a real impediment.  A combination of the public and private sectors will be forced to address the issue.

  

You might be interested in the speed you have at your home. Just point your browser to www.speedtest.netand find out.  Then compare the results with the average speed in Romania.   

Apple Pay Gets Some Pushback

A few weeks ago Apple launched its new electronic payment system utilizing the iPhone 6 called ApplePay.  Many consumers and retailers, increasingly concerned about credit card fraud, looked closely at this new way of paying for items.   Apple Pay is promoted as a much more secure method of paying for everyday items and services than traditional credit or debit cards alone.  While your traditional credit card or bank account does indeed get charged for your purchases using Apple Pay, the retailer never actually gets your card number.  For each purchase you make, Apple Pay generates a unique single-use code that your iPhone sends wirelessly to the retailer’s cash register.  That code is used by the retailer to retrieve payment from your account.  Again, this code is only for that specific purchase and does not contain your real credit or debit card account information, password or account number.

When first announced, Apple listed several major stores that would accept Apple Pay and listed as partners most of the major credit card companies and large national banks.  It looked like Apple may have again scored big with another game changing product.

Well, another 800 pound gorilla had yet to weigh in.  Last week Walmart and a few other large national chains have formed a consortium that is pushing another mobile payment system that is not compatible with the Apple system.

I guess it was inevitable that there would be more than one player in the billion dollar electronic payment industry.  Merchants for years have bridled under the charges that the major credit card companies, e.g., American Express, MasterCard and Visa, have levied on customers’ purchases.  Fees of 2 percent or more are customary.  With many big box, high volume stores operating at single digit profit margins, these fees are painful.

Led by Walmart, some large national chains like Best Buy, CVS and Target, are promoting a new mobile service called CurrentC to be launched next year.  It will not use the Near Field technology employed by Apple and some Google payment systems.  Rather it will use QR codes, and more importantly be platform agnostic.  In other words, you won’t need an iPhone.

It is much too early to predict which one of these competitors will win. It may be that both will co-exist.  There may well be one or more other entrants into the fray since billions of dollars are on the line.

If the stores behind CurrentC can establish a new payment system that is not dependent on Visa or MasterCard, that does not require fees paid to these thirds parties and that opens up a trove of consumer behavior information, the Holy Grail of retailing will have been found.

In the end it the consumer will decide.  I remember many years ago when certain retailers and restaurants would only take one credit card.  So if you had a Visa and the store only accepted MasterCard, you were out of luck.  Other than some major events like the Olympics and the Super Bowl, where only one card is honored, most places take most any plastic you can provide.  The same will be true for competing mobile payment systems.  Much to their chagrin, the McDonald’s down the street or the gas station on the corner will have to take your money whatever way you want to give it to them.