Updated: 1/6/2004; 11:10:47 PM.
Jeremy Allaire's Radio
An exploration of media, communications and applications over the Internet.

This is a personal weblog. The opinions expressed here represent my own and not those of my employer.


Friday, April 25, 2003

It's great to see Brian join the world of bloggers. Look forward to your insights!

Brian holds a particular legacy for me personally. Back in 1994, just as the world moved from Mosaic to Netscape, Brian was one of the only people I could find working on Web-based threaded discussion systems integrated with online journalism (at HotWired). My brother JJ and I were working on our first major web application at the same time -- a web-based threaded discussion system for an online media concern (Minneapolis CityPages).

Lots of reverse-engineering of URLs to figure out how applications were being designed, etc.

Brian was extremely active in the early HTTP design lists, driving forward features like Basic Authentication. Even then Brian was pushing for an open standards world:

There is no browser that implements HTTP authentication 100% correctly, unfortunately. Those that don't are working on it. I followed the HTTP spec to the letter in implementing this, and in a fully working browser you should only ever have to type your name and password *once*. Unfortunately there are many browsers which don't follow the specifications to the letter. NetScape is the closest...

Excerpt from www-talk, Nov-1 1994, in response to list traffic after the launch of HotWired.com, one of the first major commercial online magazines.

11:20:15 PM    comment []

Takeshi Natsuno, Managing Director for DoCoMo Strategy

Keynote this morning from NTT executive, talking about i-Mode.

He's showing us subscriber data for wireless Internet in the world. NTT dominates in the world, and then next five are Japan and Korea. Everyone else, including Europe and US are tiny in comparison. For many reasons, this hasn't been repeated in other geographies.

He outlines the functional footprint of the 504 series. Interesting, the Nokia 3650 which is $150 in the US now has more functionality. He's showing powerful Java-based games, it's pretty sweet. He says the game software industry for phones is becomming as big as older game industries.

They just announced the series 505 phones. He's really pushing Macromedia Flash as the major breakthrough for their phones. But these devices have a richer display, 1.3 megapixel camera, memory stick, and bio-metric authentication input device! Phew. The Flash demo's are really nice --- smooth, vector graphics compared to the nastly bitmappy Java apps that he just showed.

38 million active iMode subscribers. More and more iMode has VPN support and can integrate into corporate environments. Therer are over 2,300 official commercial content/service providers in their network, with over 62,000 voluntary iMode sites. His 38 million number means that they are the biggest ISP in the world, now bigger than AOL.

Consumers pay for devices and access because they've made it safe and easy for content providers to provision services into their network. It becomes a virtuous circle as subscriber growth happens more content companies and higher quality content comes online.

They went from zero subscribers and content to this world given three key strategies:

1) Technology. Selected best available content technology -- real HTML (cHTML), MIDI, Java, Flash.

2) Business model. Designed business model around content service providers, not for the needs of telecom operators or handset manufacturers. Micro-payments model, user friendly portal for content selection, easy install and use process.

3) Marketing. Drove marketing around ordinary people, appealing to a mainstream audience not techies.

What he's not noting is the degree to which a) their incredible centralized control enabled the rapid and easy establishment of standards, and b) the advanced nature of their installed network technology enabled them to move much faster than US and European markets.

More data. Aggregate ARPU has stayed strong only because of iMode. Voice ARPU has continued to decline while data ARPU has made up for that decline.

Two years ago, strategic decision was made to add Java to the phones. They now have 17.4 million active Java subscribers, with over 600 Java app suppliers. There is also a market for Java-based corporate applications. There are 6,000 independent Java content/app sites available over iMode. Despite Sun, they made Java in devices successful.

As a result, they say significant packet usage boosted by Java handsets, in addition to higher value/priced applications where they get a commision. Latest Java phone subscribers are using 4x the packet usage than normal phone users.

He expects that with the introduction of Flash in their phones, they'll see a very significant boost to packet usage beyond Java.

Overall, digital content marketplace on iMode is about $1B in 2002, and the percent of customers paying for digital content is about 53% of subscribers.

He's comparing Japan versus other markets. He says it's fundamentally about a content-centric value chain all the way through the model. In other markets, the fragmentation in operator, handset vendor and content value chain makes coordination difficult. Operating a controlled but dynamic eco-system is the basis for NTT's success.

Going forward, always trying to improve the evolution in the handset and network capabilities; in content capabilities; evolution of the core user experience. But these evolving dimensions need to be synchronized.

What about 3G and Broadband?

The network speed component is only one dimension of the value-chain. The entire eco-system needs to evolve with it, and that can only happen when enough user critical mass is available. It's back to the chicked-and-egg problem that they faced when they started iMode.

On their 3G platform, they offer MPEG4 video, and it's evolving into being a multi-point video phone and better platform for content. 384Kbps currently. But they only have 380,000 users of 3G today because not enough applications have been developed for it. But they're driving customers over with a cost-savings value proposition, and then layering in specific 3G content services. 505i phone is the first to come close to enabling 3G applications. But it will take 3 years to get to 2 million users, largely do to lower area coverage.


1) US/Europe follow iMode model with content-centric value chain model.
2) Big migration from 2G to 3G starts in Japan in 2004.
3) Deeper convergence between Internet and telco
4) De factor standards most important.

My question: will devices evolve to be true consumer electronics devices that combine stereo music, DV/camera and video communications, eventually displacing portable music and camera markets?

He thinks it will in the long run, but it's no where near making this transition today. The music and camera capabilities are very far behind, and are really mostly applied in the special context of mobile communications. That will change over time.


8:03:00 PM    comment []

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