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  • Taking advantage of digital age key to unlocking shareholder value: Murdoch

    MUMBAI: A couple of days ago during a speech at News Corp’s annual stock holder meeting, chairman and CEO Rupert Murdoch stressed on the importance of taking advantage of the digital age.

    Murdoch noted that if News Corp wanted to deliver on the mission of returning value to its shareholders then it is important that the company is transformed to take advantage of the massive digital transition that is occurring. “At its core, this company from the very beginning has been about offering choice – greater choice – to under-served consumers.

    “It’s what led us to create a fourth broadcast network and a third cable news network; a regional sports network and a UK and Italian satellite platform. Empowering the consumer through greater choice is exactly what this company strives to accomplish. And there’s no greater medium of choice than the Internet.”

    He noted that to leverage the value of the online world the company formed a special Internet unit earlier this year. Properties like Intermix Media were acquired that have instantly delivered tens of millions of new customers, and, in the process, begun a transformation of the company.

    Speaking on the media major’s performance, the News Corp boss said, “I’m very pleased to report that fiscal 2005 was another record year for the Company on virtually every key financial indicator. The past three years of double-digit revenue and operating income growth have placed your company in the strongest financial position in its history.”

    Some highlights that Murdoch listed:
    • Net income up 39 per cent to $2.1 billion. A record.
    • Cash flow from operations up 41 per cent to $3.4 billion. A record.
    • Revenues up 15 per cent to $23.9 billion. Another record.

    News Corp finished the year with $6.5 billion in cash, while net debt fell to just $4.5 billion.

    STAR EXCITING GROWTH DRIVER
    Murdoch also made a pointed reference to News Corp’s Asian operations stating: “The other major asset in the Television segment – our pan-Asian channels group Star – was a testament to how a bold, long-term vision can pay off. After a long infancy, Star has blossomed into one of News Corp’s most exciting growth drivers. Earnings more than doubled last year and I fully expect them to be significantly higher again this year. Star India, which has the most popular shows on cable and a vast library of local programming, is becoming a major profit contributor. And in China we have a great presence with Xing Kong and I’m confident of our future there.”

  • TV, music content to become key as mobile ops attempt increasing market share

    MUMBAI: Across the globe handset vendors and operators are finding it increasingly challenging to grow and carve out market share.

    With key prosperous markets reaching high penetration levels and vendors that have previously focussed on specific regions now pursuing global expansion strategies, a much reduced growth rate is predicted from 2008.
     
     

    Market research group Informa Telecoms & Media will put a report on the same next month. Handset sales forecast to reach 899 million by 2010, from their 2005 level of 743 million. Handset manufacturers will look to new features and supported services to rekindle growth over the next five years, with music player and mobile TV providing huge revenue-earning potential. Digital media broadcasting receivers on handsets could be of the greatest significance.

    These will enable users to not only receive digital audio but also watch broadcast video or terrestrial digital TV, igniting an effective and powerful media combination with mobile communications. Mobile subscribers worldwide totalled 1.59 billion last year with expectations for 2005 of 1.94 billion, a year-on-year increase of 20.5 per cent. Driven by the ever-expanding Asian markets, China is the world’s single largest market in terms of subscribers, accounting for more than one-in-five of all subscribers worldwide at the end of 2004. The next milestone – the 2 billion subscriber mark – is expected to be surpassed sometime in 2006.

    India is another key market: The number of mobile phones users has risen year on year and it is expected that by 2010 there will be over 2.7 billion mobile users globally. The main drive for this growth will come from countries such as India and China in the Asia Pacific region and by 2010 the region will contribute almost half of the mobile subscribers globally as subscribers rise from 843 million in 2005 to 1.3 billion.

    The vast majority of subscribers worldwide were still on 2G networks in 2004, representing 83.6 per cent of total. Analogue subscribers are slowly petering out since reaching a peak of just fewer than 100 million in 1997, forming only 0.6 per cent of all subscribers in 2004 with the vast majority of these using AMPS. The US has the largest analogue market. These are forecast to be negligible by 2010 as many operators either migrate subscribers to digital networks or switch off analogue networks completely.

    By 2010, subscribers to 2G technologies will still hold top share (46.5 per cent), followed by 2.5G (29.6 per cent). By this stage, though, the 3G subscriber base will have reached almost 23.8 per cent of total as full migration to these networks starts to take affect in developed regions.
     
     

    Handset Market Trends and Outlook: Low-end, entry-level products for emerging markets will play a key role in generating revenues since the second billion subscribers will be totally different from the first in terms of consumer expenditure and poverty levels. They have also shown their worth in more mature markets as particular customer segments have been identified that require simple, easy to use devices.

    This market focus on the low-end could, however, have a severe impact on the longer term dynamics of the industry. Specifically, the low-end gives lower margins and this will put further pressure on vendor margins and revenue expectations, which in the longer run may ultimately determine their survival in the market.

    Handset Features: Progress in the global mobile handset market and continuing improvements in wireless networks is encouraging a shift from mainly voice-centric to data-centric devices. It is new features and capabilities that are ostensibly driving the handset market, notably the replacement handset market, but they will also increasingly support and exploit the potential of next generation data networks, including 3G services and beyond. 3G services have blossomed worldwide because of the availability of good, well-featured handsets.

    Consequently handsets currently being manufactured are incorporating a variety of features from email capability and colour screens, to integrated cameras, MP3 players and Bluetooth.

    Looking ahead, voice services are still the primary use by subscribers, and voice applications using data such as the push-to-talk “walkie-talkie” -type service may become a ubiquitous feature in devices, notably in developing regions where it is seen as a cheaper alternative to voice and as a possible replacement for SMS in areas of low literacy. This may then pave the way to full voice-over-IP services despite expected intervention by the operators. While messaging will continue to be an important part of the consumer market in the future, entertainment will become an increasingly influential factor on the device particularly as networks develop.

    The onset of multimedia messaging, in tandem with colour screens, has now pushed the mass-market arrival of camera handsets in most markets worldwide despite usage of the actual service itself being relatively low. There is massive potential for integrated camera phones as Informa Telecoms & Media estimates that 301 million will be sold in 2005, with 3G providing a huge boost to imaging devices. By 2010 around 691 million integrated camera phones will be sold worldwide, with many being also capable of mobile video. Indeed, video download and video streaming are both proving popular in some markets, despite the fact that it was video telephony and video messaging that were touted as the few true differentiators for 3G networks.

    Other advances in handset features surround those with music and media capabilities. Polyphonic sound is starting to become a common feature of handsets and, in the medium term, a larger number will incorporate MP3 storage and playback. Additionally, as 3G networks reach greater penetration, downloading music files to the handset and their transfer to different devices through Bluetooth and USB connections, most evident from the agreement between Motorola and Apple for its iTunes device and service, or possibly wireless LAN, will become popular as will high quality audio streaming. The integration of analogue FM radio has appeared on some handset models, but it is the potential for digital media broadcasting receivers on handsets that could be of greatest significance.

    Two particular systems – digital multimedia broadcast (DMB) and digital video broadcast for handhelds (DVB-H) – are in service or being trialled around the world.Wireless broadband applications such as high resolution multimedia streaming, video downloads, advanced interactive gaming, and TV broadcasting require powerful devices with sophisticated computing performance and good battery life. To enhance the end-user experience and to make good use of wireless broadband services, mobile devices will have to feature high processing speeds, large RAM memories, high resolution wide displays and large storage capacities.

    Informa Telecoms & Media senior analyst, and principal author of the report, Dave McQueen, said, “The mobile market has developed substantially over the last 18 months, particularly with the eventual take off of 3G networks in Europe and in North America following the lead taken by Japan and Korea. The migration from 2G to 3G is likely to be accompanied by dramatic changes in the industry value chain, with the mobile handset community increasingly shifting its focus from voice to data services support.

    “These new trends are changing the industry landscape and creating many new and exciting investment opportunities. To stay ahead, leading players need to differentiate their products by means of new technologies. Standards, alliances and partnerships also need to be created throughout the technology value chain, to ensure that technology diversity does not result in unwanted market fragmentation.”

  • Key Fox TV exec seeks greener pastures at Paramount

    MUMBAI: Gail Berman the Fox Television network president of entertainment is said to be leaving to take an unspecified role at Paramount Pictures.
     

    An AP report indicates that Paramount is in discussions with Berman about a senior creative role at the studio and hopes to reach a deal soon. Paramount issued a statement saying, “Berman is one of the most talented executives in the entertainment industry, with great relationships, exceptional taste, and an amazing creative track record.” Fox and News Corp have not commented on the news.

    Another report in The Hollywood Reporter indicates Berman may take on a role akin to that held by Sherry Lansing, who oversaw the studio’s creative decisions until her retirement. It is also not clear as to who will be succeed her at Fox. Speculation centered on FX Networks president Peter Liguori and 20th Century Fox TV president Dana Walden
     
     

    Berman would be the first high-profile hire of Paramount head Brad Grey, who himself took the top spot at Paramount from Lansing earlier this month. Berman has led Fox for five years, a relatively long tenure in the pressure-cooker job of network entertainment. After its traditional slow start, Fox caught fire in January with the return of American Idol. Largely on the strength of that show, Fox is currently No. 1 this season among viewers aged 18-to-49. It ranks fourth when all viewers are counted.

    The pressure to make a quick decision on a replacement for Berman is heightened by Fox’s recent shift to a year-round programming cycle. This means that in addition to presenting its plans for the second half of the year to advertisers in May, the network is scheduled to launch a miniseason of new and returning series by mid-summer.

    Berman’s efforts to develop hits have been hampered by a schedule that is interrupted by Major League Baseball playoffs in October and November, when rival networks are building audiences for new programmes.

  • Simplicity key to access tech’s success: Experts

    NEW DELHI: ATM, ethernet, RPR, Wi-Fi, Wi-Max, satellite… What next? In this age of consumerism, it is not only content and marketing that are consumer driven, but technology too.

    This common sentiment on technology came through at a seminar on Access Technology here today at the Exhibitions India-organised 13th Convergence India where panelists spoke on the subject, giving the whole subject their own perspective.
     

    The panelists felt that there was a need to make services attractive for the consumer. Whether it was a common node capable of delivering service in multiple ways or the emphasis on quality of service, the technology experts were emphatic that, for the consumer, what coloured his views was the application and how affordable it was.

    This was amongst the many theories put forward by experts who have been active in the field of access technologies.
     
     

    Motorola’s Porotip Ghose, while making an interesting presentation on seamless mobility, illustrated the various networks and access technologies that a consumer interacted with in a day.

    For good measure, he added that seamless mobility was “blurring the geographical barriers and concepts” such as headquarters, office and home.

    In a world where devices are getting increasingly smarter, Ghose quoted from the future vision of international carriers, which have underlined four kind of communication — human to human, humans to things, things to humans and things to things.

    Chaired by Bharat sanchar Nigam Ltd (BSNL) director for commercial and marketing, N K Mangla, the panelistsfor this session included Alcatel CTO Olivier Baujard, Lucent Technologies’ Dr Eshwar Pitampalli and Juniper Networks India’s Prasad Babu.

    Lucent India’s CTO, Dr Eshwar Pittampalli, while dwelling on broadband, said it’s an always-on network capable of providing interactive voice, data and video services on public networks.

    Throwing light on the opportunities in broadband, he said,” Estimated addressable market today is 140 million to 200 million, while the penetration is less than 50 per cent.

    Pointing out that the emrging models for broadband would embrace big enterprises, schools and public centres and mobile entertainment, Dr Pittampalli enlisted some challenges that the sector faced. They are as follows:

    – The falling average return per unit and the need to keep it in check.

    – Low cost business model for service offerings

    – Affordability of access devices at attractive price points

    – Low cost basic wireless

    While wrapping up his presentation, Dr Piampalli emphasised on IP video, saying it was an essential component of successful service bundles.

    Juniper Networks’s Babu minced no words and said it in plain simple words: consumer was the king and driver of various access technology.

    According to him, “An end users’ views are driven by applications. A successful services model would have to be based on an understanding of how, by whom, where and when were the various applications and sub-applications used.”

    Talking about video content, he differentiated between various applications and said, “While broadcasting is multicasting, where a single stream is cast to multiple end users, video-on-demand demanded much more bandwidth because it is unicast.”

    All the speakers were also clear that whether it was wireless or wireline technology or associated technologies, what mattered more was the quality of the service, its simplicity in application and consistency of delivery.
     

  • Key issues affecting satellite industry to be discussed at ISCe

    CALIFORNIA: International Satellite and Communication Exchange (ISCe) which claims to be the premier West Coast satellite and communications conference and expo, for the commercial and government industries in the US will take place from 18-21 August in Long Beach, California.
    The four-day event will highlight satellite-based services and technologies including: Information & Communications, Broadcasting, Navigation, National and Homeland Security, and Remote Sensing. One of the sessions is Global Assurance and Homeland Defense: Implications.
    Booz Allen Hamilton VP R. James Woolsey will lead off the conference with his views of how changes in global politics and the global economy are shaping the need for resilience for infrastructure in the US, including telecommunications.
    Another session deals with Growth and Momentum – Key Drivers for the 21st Century. It is debatable if last year was the worst for the satellite industry, but certainly there was not much room for optimism. However, there is definitely hope for the future for several reasons: continuing progress in technology, increased government needs and signs of possible recovery in the telecommunications sector.
    As the industry goes forward, it needs to carefully choose its direction in order to get the fastest possible benefits. The panel will address what are the growth areas to concentrate on as the industry goes forward.
    The speakers will include director, Satellite Centre ISRO Dr. P.S. Goel, president & COO Intelsat Ramu V. Potarazu,