Jawed Karim, the very wealthy grad student who was one of YouTube’s co-founders, has posted a video of an hour-long talk he gave two days ago at his alma mater, the University of Illinois at Urbana-Champaign. I’m watching it now and Jawed is basically providing a detailed history of how YouTube came about, the sites that paved the path for YouTube (remember Hot or Not?) and presumably much more to come.
Take a look (here’s the link for our feed readers).
Posted by Cynthia Brumfield at 11:42 PM | Print | Comments (0)
AT&T issued its Q3 06 earnings report this morning, showing continued slippage in revenues but robust growth in net income due to continued cost-cutting at the incumbent telephone giant. Revenues dropped 5% year-over-year and 1% sequentially to $15.638 billion, while net income soared 25% year-over-year and 20% sequentially to $2.165 billion.
AT&T released real news during its earnings call: in late June 2006, the telco achieved 10% penetration of the homes marketed for its U-Verse IPTV service. During the call, CFO Rick Lindner said that AT&T had garnered 3,000 paying customers during its limited commercial launch of the fiber-to-the-node (FTTN) multichannel video service in San Antonio, out of a total of 30,000 homes marketed with the service. In some pockets, specifically multi-dwelling units, penetration of U-Verse reached 25%.
U-Verse achieved this level of penetration despite the fact that high-definition TV service wasn’t fully available to the potential and actual customers. The picture quality of the service, a subject of much concern given the relatively tight bandwidth that the FTTN architecture delivers, is “excellent,” Lindner said, and “the word of mouth in the San Antonio community is good.”
| AT&T U-Verse Homes Passed (in mil.) | |
| Homes | |
| 1Q06 | 0.1 |
| 2Q06 | 0.5 |
| 3Q06 | 1.3 |
| 4Q06 | 2.4 |
The launch has been deliberate, Lindner said, with targeted and narrow marketing efforts. Part of the reason for the slow pace and limited marketing is the fact that high-definition service was not, until recently, part of U-Verse. “We didn’t want to put too many customers on the platform before we had the HD capability,” Lindner said. As it is, “we’ll need to go back in to our existing customers and we’ll have to replace set-top boxes, customers will lose some of the programming on the DVR,” he added, noting the increased costs of retrofitting existing customers with HD capability.
HDTV will, however, be a part of AT&T’s upcoming launch in Houston, slated for late-November. Lindner claims the company is still on track to launch 15 markets by year-end, which, in essence, means that AT&T will launch 14 additional markets in the month of December.
As of the end of Q3 06, AT&T had passed 1.3 million “living units,” or homes, with the U-Verse option, although clearly only a small fraction of those homes were marketed. AT&T plans to push the U-Verse option past 2.4 million homes by the end of Q4 06.
Meanwhile, the telco’s DBS pact seems to be paying off with incremental growth in video customer counts. At the end of Q3 06, AT&T served 586,000 video customers with its Dish Network bundled option, which represents a gain of 53,000 video customers over Q2 06 levels.
Wireless voice and DSL are the other two growth products for AT&T, with the company’s Cingular voice service adding 1.358 million net new customers during the quarter, and DSL advancing by 374,000 net new customers. Although DSL made gains, the growth rate over year-ago levels slowed, with the number of net new DSL additions down 29% from the record-breaking 529,000 net new DSL adds during Q3 05.
The company’s traditional voice service business continued its downward spiral, particularly in the residential market. The number of access lines served by AT&T dropped 6% year-over-year and 2% sequentially to 47.1 million. Lindner tentatively predicted that line loss would level off next year as the pace of new cable VoIP rollouts cooled.
AT&T is on the cusp of completing its merger with BellSouth, although the FCC has yet to sign off on that deal. The Commission is expected to hold a November 3 meeting to approve the merger, but doubts run high that the deal will clear this last regulatory hurdle on that date. Lindner said little about this last-minute monkey wrench, but did say “we would like to get the deal done and in trying to expedite the approval we’ve made some proposals that are very pro-competitive and very pro-consumer,” referring to a list of conditions that AT&T agreed to meet if the FCC approves the deal.
With that potential speed bump aside, the company is hoping that 2007 will mark the year it returns to top-line revenue growth. “The revenue trends we saw this quarter, particularly in wireless, and in business…those things add to the confidence we have in revenue outlook,” Lindner said.
| AT&T Key Statistics* | |||||
| 3Q05 | 4Q05 | 1Q06 | 2Q06 | 3Q06 | |
| Total access lines (mil.) | 50.2 | 49.4 | 48.8 | 47.9 | 47.1 |
| DSL customers (000) | 6,496 | 6,921 | 7,432 | 7,774 | 8,148 |
| % growth | 9% | 7% | 7% | 5% | 5% |
| % of total lines | 12.94% | 14.01% | 15.24% | 16.23% | 17.30% |
| % of consumer primary lines | 23.70% | 25.50% | 27.70% | 29.50% | 31.30% |
| Quarterly adds (000) | 528 | 425 | 511 | 342 | 374 |
| % chg. in quarterly run rate | 47% | -20% | 20% | -33% | 9% |
| Video Customers (000) | 419 | 457 | 491 | 533 | 586 |
| Net Adds | 15 | 38 | 34 | 42 | 53 |
| Wireless Voice Customers (000) | 52,292 | 54,144 | 55,810 | 57,308 | 58,666 |
| Net Adds | 850 | 1,852 | 1,666 | 1,498 | 1,358 |
| Total operating revenues (mil.) | $16,468 | $16,279 | $15,835 | $15,810 | $15,638 |
| Net Income | $ 1,729 | $ 1,862 | $ 1,445 | $ 1,808 | $ 2,165 |
| *Financial data normalized to include AT&T Inc. and AT&T Corp. | |||||
Note: With the exception of the table at the end, this posting is a reprint of an article I posted over at IP Media Monitor today.
Posted by Cynthia Brumfield at 4:31 PM | Print | Comments (0)The UK’s Telegraph has this astonishing article in which AOL CEO Jonathan Miller reveals that Time Warner is probably kicking around the idea of selling its still-ailing online service AOL.
In an interview with the Sunday Telegraph, Jonathan Miller, chief executive of AOL, admitted that the Time Warner board is already mulling over a break-up of the giant conglomerate. Asked about the possibility of AOL separating from Time Warner, Miller confirmed that the issue is now on the agenda following the sale of the group’s broadband businesses in Europe.
He said: “It’s possible, going forward. It’s not a discussion that Time Warner has a problem with understanding or engaging in. Until we were on this present course, it wasn’t even the right discussion. Now it becomes more interesting.”
Clearly pumping up the purchase prospects for AOL, Miller goes on to say that AOL “would be bought as fast as we could draw up the papers.” Hmmm…I doubt it. Who would buy a dying service that failed to navigate the transition from narrowband to broadband and has been deteriorating ever since?
It’s possible that MSN or Yahoo or some other big Internet giant might pay something for the subscriber lists and the content deals in place (although those contracts would undoubtedly have to be renegotiated). But I doubt if anyone would pay top dollar for AOL.
Like an overpriced and overbuilt house that has been sitting on the market too long, AOL is a white elephant that’s going to be hard to move. Had Time Warner not messed around for so long in trying to improve AOL, it could have undoubtedly made a better sale.
As it is now, AOL will continue to see its sales shrink for the next two years, Miller told German newspaper Die Welt. (Miller’s obviously scoping out AOL’s sale of its European properties). In a bit of a contradiction, Miller told the German paper that a sale of AOL “doesn’t make much sense.”
Posted by Cynthia Brumfield at 9:38 AM | Print | Comments (0)The New York Times’ Tom Zeller Jr. has this piece today about how North Korea, however technologically advanced it may be in nuclear weaponry, is in the dark ages when it comes to the Internet.
Cell phones were banned in the country in 2004 and computer connectivity is strictly internal — very few institutions can connect to the worldwide Internet. No wonder that North Korea has been judged to be the “world’s deepest information void.”
As Oxford professor of Internet governance and regulation (what a cool discipline, btw) Jonathan Zittrain notes in the article, “any information leakage from the outside world could be devastating” to the Kim Jong-il regime. But, as the saying goes, information will out and that’s just as true for North Korea as it is for any congregation of human beings.
As Zeller points out, Rebecca MacKinnon has already cell phones are already creeping into the country via a black market forming around the Chinese border. How ironic that information is flowing into North Korea from China, a country with its own free flow of information problems.
Posted by Cynthia Brumfield at 9:19 AM | Print | Comments (0)The New York Times’ Katie Hafner has this interesting piece today about Google’s legal strategy and its expanding prowess in laws that govern the Internet, particularly intellectual property law. Unlike most big companies, Google doesn’t allow its lawyers to snuff out innovation — the company forges ahead in the hopes of establishing new law or new interpretations of the law that enable it to push the Internet’s boundaries.
Any company that is large and successful is going to attract lawsuits, and Google’s deep pockets make it an especially big target. But as it rushes to create innovative new services, Google sometimes operates in a way that almost seems to invite legal scrutiny.
A group of authors and publishers is challenging the company’s right to scan books that are still under copyright. A small Web site in California is suing Google because it was removed from the company’s search results. And European news agencies have sued over Google’s use of their headlines and photos in Google News.
In these cases and others, potential legal problems seem to give the company little pause before it plunges into new ventures.
Google’s legal team now boasts 100 in-house lawyers, plus outside law firms, and the company pushes hard and early to dismiss lawsuits or seeks summary judgment at the outset to avoid having to spill trade secrets during discovery. As is true with its engineering staff, Google hires the best and the brightest young lawyers to fight on its behalf.
It’s no surprise, then, that any legal challenge against Google is going to be an uphill battle.
“We’ve got a formidable legal team, but obviously it’s nowhere near the unlimited resources of Google,” said David A. Milman, the chief executive of Rescuecom, a nationwide computer repair company that sued Google on trademark infringement grounds similar to Geico’s — and quickly lost. The company said that it would appeal the decision.Posted by Cynthia Brumfield at 7:42 AM | Print | Comments (0)
“People say you can’t fight the government,” Mr. Milman said. “Google, in this case, is very similar to the government. They’re the government of the Internet.”
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