(Carlsbad, CA) Martha Stewart walked up to a microphone when there was a call for audience questions after Sony CEO Howard Stringer’s remarks at the Wall Street Journal’s “D: All Things Digital” conference. I had just asked the previous query about the CableCard stalemate between the consumer electronics and cable TV industries, and Sir Howard had aggressively replied that the cable industry has “very fierce negotiators;” but he enthusiastically opined that the two sides would eventually find common ground, even though he pointed out that Sony is “the only holdout of the CE industry.” Sir Howard also brooded that it would be a “nightmare for the TV industry” if TV sets became merely monitors, controlled entirely by other vendors’ boxes.
Now it was the Domestic Diva’s turn, and Stewart advanced carrying a white shopping bag. From it, she pulled black cords and electric power blocks plus a camera, a mobile phone and other gizmos. She complained that she had to carry so many incompatible cords and power supplies - and she needed even more for her several homes and for her cars.
Couldn’t Sir Howard do something about the compatibility, she begged.
Moderator Walt Mossberg suggested that Stewart might weave the assorted cords into a macramé welcome mat, and Sir Howard good-naturedly suggested, “You need a native bearer” to help her carry so many electronic tools. He also sympathized that he’d see what he could do about such consumer problems.
The entertaining digression actually reinforced Stringer’s message throughout his hour on stage, during which he offered a mea culpa for Sony’s poor software background and admitted that “we’ve had a great problem with applications software.” (The lament was a counterpoint to his glee about the box office success of Sony’s hit movie, “The DaVinci Code.”)
Sir Howard waxed enthusiastically about Blu-Ray technology and PlayStation 3, providing a morning-after response to Bill Gates’ gloat at the previous evening’s session. In particular, Sir Howard insisted that Sony is trying to find as many applications as possible for the PS3.
Earlier, Comcast COO Steve Burke (substituting for CEO Brian Roberts) said that he expects the MSO to have more data and voice customers than video subscribers - possibly in the next five years. He forecast up to 25 million data and voice customers, well above the current 21.5 million video subscribers. Burke also said that by the end of this year, he expects Comcast to offer TiVo technology integrated into its set-top boxes. On the topic of network neutrality, Burke said that showing preference to selected content suppliers “would be one of the dumbest things we could do.”
Disney CEO Bob Iger talked about the need to develop multi-platform distribution, noting that consumers are already showing that they want to see - and are willing to pay for - content on various media. Iger cited the 7 million streams of ABC TV shows served since Disney launched its video iPod service. And he predicted that a new process for timing distribution windows will emerge as producers better understand the revenue potentials. There will be a new distribution model, Iger predicted, which may be a blend of existing models.
His pronouncement of the need for multi-platform strategies was echoed throughout the day by Discovery Networks’ Judith McHale, Yahoo’s Terry Semel (who also got caught in a defense of his company’s China initiatives), Martha Stewart OmniMedia’s Susan Lyne and other speakers.
Gary Arlen, president of Arlen Communications Inc., can be reached at GaryArlen@columnist.com
Posted by Gary Arlen at 9:40 PM | Print | Comments (0)
In a bit of a family feud, Time Warner-owned cable networks CNN and Cartoon Network have sued cable operator Cablevision Systems over that company’s plans to roll out a network DVR. In the wake of a similar, if not exactly the same, suit filed by four Hollywood studios (including Time Warner) and three broadcast networks, CNN and Cartoon Network filed their complaint last Friday in the U.S. District Court in Manhattan, alleging that the centralized DVR function that Cablevision plans to offer is a violation of the copyright laws.
The family feud part: rarely do cable networks, particularly those owned by a company that also owns cable systems (as does Time Warner), sue a cable operator. Moreover, sister company Time Warner Cable is watching the Cablevision DVR experiment closely in the hopes that it might be able to roll out its own version of a networked DVR.
Speaking at a conference in March, John Martin, chief financial officer at Time Warner Cable said, “If over time, this proves legal and if over time this proves to be something that consumers want to do, we have the ability to bring that to them and that’s what I think is sort of exciting and important.”Posted by Cynthia Brumfield at 7:06 PM | Print | Comments (0)
Ten days ago I posted an item about what appeared to be an organized campaign of blog commenters who always oppose net neutrality regulations and who use vaguely similar language. I wondered if these commenters were in fact paid shills for broadband providers or their PR firms.
Since then, a host of other bloggers have written about this phenomenon. Mark Glaser has this piece at MediaShift. Matt Stoller posted this piece.
Today Cog at Abstract Factory has this more in-depth item about the phenomenon of robot-like, yet all-too-human blog commenters. Cog did a little research on an anti-net neutrality commenter called “Net Chick” and concluded that she’s probably a paid shill.
Ladies and gentlemen, we have been defaced by a comment spammer. Not your garden-variety p*rn/drugs/gambling comment spammer, who would have made certain to include at least one link to an advertising-supported website somewhere in either the post or the profile page. Nor is this the work of a mere desperate narcissist spammer, who would have made some link to a personal blog available.
No; “Net Chick” is an astroturf comment spammer: an astro-spammer, if you will.
Tim Lee at The Technology Liberation Front picks up on Cog’s comments by noting that he too has received these strange comments.
The posts almost never make substantive arguments, and they’re often made days or even weeks after a particular post is made. Moreover, the comments consistently appear only on pages related to network neutrality.
Mike at TechDirt wraps the whole thing up by noting that it’s not surprising that the telcos (?) would hire people to go around making blog comments against net neutrality. What is surprising is just how bad a strategy this is.
To be honest, it’s not at all surprising that some PR firm or whatever would think it’s a good idea to waste money hiring people to do this — but it’s really impressive just how bad they are at it, and just how easy it is to spot the comments.Posted by Cynthia Brumfield at 3:18 PM | Print | Comments (1)
(Carlsbad, CA) For more than an hour, Bill Gates talked tech (Vista operating system, Xbox, network-based software), markets (social networks, search engine competition, entry into the health care category) and a few other matters (philanthropy, Microsoft management). But never did the opening session at the “D: All Things Digital” conference delve into policy or heavy-duty communications issues. Interviewers and hosts Kara Swisher and Walt Mossberg of the Wall Street Journal, which is hosting this fourth annual event, played to their geek-centric audience - which is understandable given the interest in Microsoft’s competitive position and product plans.
But I came here with policy on my mind, so a few minutes after the early evening session ended, when I saw Gates near the poolside pastry/dessert table, I inquired about his latest thinking on net neutrality.
“I’m in the middle,” he admitted, acknowledging Microsoft’s feet in camps on both sides of the issue. As a major supplier to AT&T’s IPTV initiative and portal partner (via MSN) to Verizon’s DSL services, he recognizes the telcos’ stance. Yet MSN generally aligns with other portal suppliers in seeking assurances that content suppliers and packagers will be assured of access to the net.
“Ivan wants to give them hell,” Gates said, referring to Verizon feisty CEO Ivan Seidenberg. When I asked him about AT&T’s Ed Whitacre, Gates characterized his customer’s position as more moderate, willing to give and take as the process evolves. Gates diplomatically noted that his long-time lieutenant Craig Mundie, a versatile Microsoft executive, is heading the company’s tight-rope walk through the policy evolution - and then Gates was whisked off by Washington Post Co. CEO Don Graham, another D attendee. I spotted Gates later at the other end of the pool/dining area espousing on Digital Rights Management, but could not get close enough to hear his words.
The Microsoft chairman had addressed copy protection issues earlier, during the Mossberg/Swisher interrogatory. In several fleeting references, Gates acknowledged the challenges of downloading services - and admitted that he has become a fan of YouTube.com, saying that he recently was watching Harlem Globetrotter clips on that popular site.
“If we did YouTube, we’d be in a lot of trouble,” he joked - admitting that many of the shows are in questionable copyright territory. “Rights models are very complex,” he added before turning to other issues.
The wide-ranging discussion touched on long checklist of issues that are on Microsoft’s agenda, including:
TV on the Internet: It “blows away the broadcast model,” Gates said, predicting that “this is the year all the pieces” will come together and eliminate the “dividing line between TV and the Internet.” Asked about the traditional broadcast model, he bluntly pronounced, “It’s gone. It was a hack.” He offered a variety of vague references to the emergence of an on-demand world but acknowledged that the current linear process may still survive in some form because “the marketplace will demand that.”
Reality acquisition and an “augmented reality viewer”: Obliquely admitting that Microsoft is working on a portable media player - a device that may compete with video iPod, mobile phone and portable game machine - Gates discussed the importance of this kind of always-on connectivity tool. He bantered with Mossberg about the poorly kept secret that Microsoft is creating such a device as part of its ramped-up hardware initiative, but offered no timetable or details about the project.
Social networks: Gate waxed rhapsodic about social networks and user-generated content several times through his comments, plugging Microsoft’s “Spaces” site. He said that consumers and companies must get their “relationships defined in a concrete way” and said that there is a “lot to be learned in social network space.”
Search: Admitting that Google remains strongest in this category, Gates jibed that his competitor “has done less in the way of innovation than I would have expected a year ago.” He also joked that since Microsoft remains an also-ran in this category, “There is more upside than downside.”
Games: Gates spent a great deal of time on the success of the Xbox 360 and its competitive position against Sony’s Play Station. He bragged that Xbox will not change for the next four years, emphasizing the stability of the device itself and the opportunity to add content to that platform. Unlike recent presentations (such as his remarks to the E3 conference in early May), he did not talk about cross platform play between Xbox and PC users.
Office and other core businesses: Office 2007, the next generation of Microsoft’s core software suite, will debut by year-end - slightly sooner than the delayed new Vista operating system. It is a “big release,” Gates said, demonstrating some features of Word (which Mossberg noted are already available in rival WordPerfect), PowerPoint, Outlook and Excel.
That opened a riff on the future of network storage and integration with desktop applications. Gates envisioned the “Petabyte in the sky,” a reference to the economics of storing some applications and content in the Internet cloud itself.
“We’ll have a variety of services,” Gates said elusively - a fitting tease for the opening session of a lively D event. The agenda continues through Thursday, featuring discussions with a media-skewed line-up including Disney’s Bob Iger, Comcast’s Steve Burke (substituting for Brian Roberts), Sony’s Sir Howard Stringer and Current TV’s Al Gore.
Gary Arlen is president of Arlen Communications Inc., a Washington research company. GaryArlen@columnist.com
Update: For live blogging on the D conference (which I thought was prohibited), check out Blogging Stocks…Cynthia B.
Posted by Gary Arlen at 9:49 AM | Print | Comments (0)AT&T Chairman Ed Whitacre spoke this morning at Sanford C. Bernstein and Company’s Strategic Decisions Conference and raised more questions than he answered. Along with the usual optimistic assessment of the company’s future, Whitacre addressed two hot-button topics for AT&T.
The first was the giant telco’s IPTV efforts, known as Project Lightspeed or AT&T U-Verse. Skeptics question whether AT&T’s fiber-to-the-node (FTTN) architecture will deliver enough bandwidth for the long-term. This blueprint allows for the switched channel delivery of content, voice and data services at a typical capacity of 25 Mbps, not enough, some say, for multiple channels of HDTV, very fast broadband and multichannel video, not to mention VoIP.
When pressed on this possible bandwidth limitation, Whitacre said he’s not worried…but offered little else by way of reassurance. He did say that in some spots (and they surely can’t cover wide areas), the FTTN architecture is getting 50 Mbps, enough for every conceivable service. Other than that, Whitacre addressed this critical question by saying “I suspect as this technology moves forward, we will be able to get more and more speed.” He also added “If you have 25, 35, 40 or even 50 Mbps capability, I’m not really worried about that.”
On the other hot-button topic, net neutrality (or as the Sanford analyst questioning Whitacre called it “packet prioritization services for content providers”), the AT&T Chairman was downright confusing. He didn’t say much, but what he did say is a head-scratcher.
Here’s what he said:
We’re not going to do anything to affect the Internet - nothing, zero, no packet prioritization there.
Huh? Is this the same man who said
The Internet can’t be free in that sense, because we and the cable companies have made an investment and for a Google or Yahoo! or Vonage or anybody to expect to use these pipes [for] free is nuts!
What does this mean? Is this just a misstatement? Has AT&T given up on its plans to create “fast lanes” on the Internet? Or was Whitacre just promising not to mess with the Internet as frozen at a given point in time, while something new will happen in the future, like private content connections that don’t have anything to do with the public Internet?
Posted by Cynthia Brumfield at 8:57 AM | Print | Comments (2)
Lesson-learned for Vonage: don’t try to sell your company’s overpriced stock to customers that you need to retain in order to bolster your stock price. As this piece by the New York Times’ Ken Belson and Matt Richtel attests, some customers who purchased Vonage stock in the “directed share program” opted not to pay for the stock once it started sinking.
Vonage won’t, however, dun those customers.
Vonage said in a statement given to the “Squawk Box” program on CNBC: “While all avenues are available to us, we cannot imagine alienating our customers in that way.” The company added that if some participants in the program did not pay, “we expect to repurchase the shares from the underwriters if necessary.”
Only about 10,000 customers chose to buy the stock, so that’s not the real problem. The real problem is the perception that customer anger will further drive up churn, a big potential weakness for Vonage.
Pali Capital’s Richard Greenfield raised this red flag yesterday in a research note. He also wondered if Vonage would extend the same repurchase option to other investors who bought the stock.
We also wonder whether institutional shareholders will be offered the same “repurchase” option as DSP, institutional and retail investors all bought the same class of shares in Vonage?Posted by Cynthia Brumfield at 7:40 AM | Print | Comments (0)
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