Wi-Fi is now one of the most essential services a hotel can provide apart from a bed, and yet poor internet connection is on the top 3 list of complaints from hotel guests around the world.

Nah! It is really my #1 complaint.

There was time when all of us road warriors walked around with a laptop and a phone (probably a Blackberry). Now we carry around a phone, a tablet (or a Kindle) and a laptop. I am guessing connected cameras are coming next and a slew of other gadgets with a built-in need for the network. And at the same time we are all going to be using cloud services for everything; listening to music, watching videos, working, buying and ordering food. In such a world, the network (both in terms of stability and quality) takes on greater importance.

The common refrain is — well let’s just use LTE. And while we all like to believe that LTE is the panacea to our networking woes, the fact remains that we still are heavily reliant and will be reliant on Wi-Fi, especially when on the go. According to ABI Research, there were a total of 4.9 million hotspots owned by carriers (including those run by the likes of Boingo and iPass) and the total number will hit about 6.3 million in 2016.

Of course, the place where one feels the pain most acutely is in the hotels — who in my opinion are the worst offenders in providing decent and generous connectivity. It is not as if they don’t have a way to quietly tuck in the charges into our room rates! As someone who spends a sizable amount of time on the road checking into random hotels, I can safely say that bad Wi-Fi is one of my biggest complaints.

According to Hotel Chatter’s 2013 Hotel WiFi Report:

• Nearly two-thirds of hotels offer some kind of free Wi-Fi. (It is hard to say if it really is free if the price of the hotel room goes up a few dollars a night and we don’t know about it.)
• The standard amount of bandwidth in a hotel with free Wi-Fi is usually about 1Mbps per each room. (I can categorically state that is not really true.)

It doesn’t matter if the hotels (or motels) are big or small. It doesn’t matter if they are in New York or Nashville, the fact of the matter is that both the quality of network connections and the bandwidth available on the network simply sucks. Even in the best of hotels one struggles to 500 Kbps to 600 Kbps. Try watching Netflix at that bandwidth, or in my case the MLB game! I guess our shifting media habits are killing the in-room video-on-demand business, a lucrative sideline for the hotel industry. (When I am in a really bad mood, I am likely to call it a nice racket!)

Sure, I can do some basic surfing and emails on this so-called free Wi-Fi, but that’s about it. And someone who needs to blog — and thus keep up with a whole slew of news and information sources when on the go — it is virtually impossible to use the Wi-Fi for even getting the work done. I almost always take the upgrade option, paying more for more bandwidth only to find that it still sucks. Unless these guys get their act together and build high-quality robust networks, they can’t really expect people to pay up.

For now, I almost always end up using the LTE network (if it is available.) But we are already starting to see that LTE networks are getting crowded and slower and slower. So it is not difficult to imagine things are going to get a lot worse for those of us dependent on-the-go internet.

Like I said — I love the connectivity in the hotels, I just hate the poor quality networks.

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But alas, the Castro Theater, while beautiful, is somewhat of an internet-less cave. I couldn’t connect to the internet via my wireless hotspot, or through the phone’s LTE. I tried repeatedly to upload the photo over the course of an hour (there’s something about having it fail that makes you want to upload it even more), but no luck. I kept getting the circular “fail” arrow of death. I couldn’t even get Twitter to load very reliably. It was indeed a tragic, first-world-problem, kind of evening.

Yet there was a greater reminder from my upload problems than just my inability to share a not-so-great photo. The moment served as a reminder that even as some of us get access to fast network speeds from technology like LTE on mobile or Google Fiber’s gigabit internet, there are still many moments in life where fast internet is hard to come by. Yes, even in the middle of tech hotspot San Francisco. And in these moments, when it’s impossible to upload or download even a single photo, video is still unthinkable.

Why Vine is the best we have so far

As I’ve written before, and continue to believe, Twitter’s Vine is the best app we’ve seen for mobile, social video-sharing. It’s not perfect, but the app that just launched in January and came to Android just this month gets the most important things right: it adds a crucial limitation — a six second clip, max — that forces you to be creative with your post, and makes it fun to watch (just think of all the times you’ve sat through a YouTube video looking for the funniest part). The interface is intuitive (just tap to record.) And the addition of looping the videos once recorded make them more like animated GIFs than long narratives. Everyone loves GIFs.

These advantages to Vine have only become more clear in the five months since the launch of the app. Twitter has not released precise usage stats for Vine, but it has 13 million downloads — more than Path’s 10 million announced in April, or Facebook’s paltry 1 million for Home. Anecdotally, I’ve seen many people download the app, and while not many of them post videos, the ones who do get pretty into it.

But technological limitations of mobile networking make it harder for Vine’s makers to deliver a consistent user experience, making immediate success much harder. This isn’t to say that Vine can’t overcome this hurdle, but it’s obvious why the Vine team has a tougher road ahead than Systrom and Krieger ever did.

Why Instagram isn’t doing video just yet

As we sat in the Castro Theater, the Instagram co-founders talked about how they built the product from a basic app (spun out of a failed attempt called Burbn) into something Mark Zuckerberg wanted to buy for $1 billion. It’s not a new story at this point, and has been chronicled extensively, but it’s still remarkable to consider that in the early days, it was just the two of them keeping Instagram running. (You can listen to the full conversation from the Commonwealth Club here.) Even now, the team that powers an app with over 100 million users is just 35 people. The two said they missed countless birthdays and time with girlfriends, just to keep Instagram online.

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So when Rose asked the inevitable question — What about Vine? When will we see video on Instagram? — Systrom was diplomatic but clear in his response as to why video isn’t something they were previously or currently ready to tackle.

“We’ve always been really interested in video, and I think Vine does that well,” he said. But serving up video is the equivalent of serving “30 pictures per second to a given person, and that’s a really difficult experience to do on mobile.”

Systrom has talked about this concept before at our Roadmap event last November: that serving up photos quickly was the most important thing in making sure users kept coming back to Instagram. There’s no point in adding bells and whistles if the basic function — loading a photo — doesn’t work.

“No one wants to sit outside at a ballpark waiting for a video to load while there are 100,000 people around you wandering and you’re trying to get network signal. It’s hard enough for us to push an image down to you, I can only imagine a moving image,” Systrom said last November. Videos “are just innately harder to produce and consume.”

Systrom has said before that part of the reason Instagram took off was that it hit the technology wave just right — by October 2010, the iPhone camera had improved dramatically and smartphones with access to internet were become widespread enough to make a difference. It might be that Vine has hit the wave of widespread LTE and Google Fiber a little too early — the question is, can it catch up?

If you don’t believe me that Vine is pretty awesome, here’s a round-up of some of my favorite posts. My colleague Adam Kazwell has also created a great list over on Quora. Some of them are from famous people (Jack Dorsey, Ryan Gosling), my friends (normal people), Twitter employees (a group of comitted Viners if there ever was one), parents of toddlers (some of the best-equipped Viners out there) and crazy committed Vine experts (who have clearly put hours into perfecting the art.) But they give you a taste of the possibilities:

(Tap the middle of the square to play.)

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That’s kind of unsurprising, as EE currently has a monopoly on 4G in the UK — the carrier has been “refarming” all the lovely 2G 1800MHz spectrum it already holds for 4G services, and rivals will only enter the LTE game later this summer using other spectrum they bought at auction earlier this year. Still, EE’s numbers seem to show an acceleration in takeup, as less than 2 months ago it reported a total of 318,000 LTE subscribers.

That said, with those rivals (Vodafone, O2 and Three) about to launch their own 4G services, EE seems aware that it needs to evolve its own offering. So it’s about to start providing two new twists, namely shared 4G plans – for multi-device or multi-person use – and its first pay-as-you-go 4G plans, for tablets and laptops only.

Pricing and availability are yet to be announced, but EE is coming to the end of its 4G-exclusivity honeymoon phase and it would be foolish to make these offerings too pricey. Of course, it would be pretty dumb to make them too cheap either – no-one in the uber-competitive British mobile market wants a race to the bottom just as they spend billions upgrading their networks.

“By the end of June, we will have rolled out 4G across 55 percent of the population, and will continue to switch on new towns and cities,” EE CEO Olaf Swantee said in a statement. ” And with commuters spending an average of 75 minutes travelling every day, EE will also roll out 4G across the busiest airports, commuter routes and shopping centres across the UK.”

EE aims to have 98 percent population coverage by the end of 2014. The next towns and cities on its rollout list are Aberdeen, Bath, Bournemouth, Brighton, Cambridge, Ipswich, Middlesbrough, Northampton, Norwich, Poole, Plymouth, Portsmouth, Swansea and York.

Incidentally, EE says its average 4G download speed is 19.4 Mbps at the moment. That’s decent, but it’s worth noting that its average download speed across both 3G and 4G is a still-respectable 13.6 Mbps — bearing in mind that EE has around 26 million customers, 98 percent of whom will still be on 3G technology, that’s a handy reminder that modern HSPA networks can do a pretty good job too.

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Of course, they would say that — more video over LTE is good for the carriers. It lines their pockets and it puts strain on the networks, which means they buy more gear from Ericsson. Okay, with that caveat out there, let us look at some of the salient data points from Ericsson’s report:

• Total global smartphone subscriptions hit the 1.2 billion mark in 2012. We will see 4.5 billion smartphone subscriptions by the end of 2018.
• Smartphones accounted for around half of all mobile-phone sales in Q1 2013, compared with roughly 40 percent for the whole of 2012.
• So it is no surprise that mobile-broadband subscriptions are growing really fast — during the the first three months of 2013, they grew 45 percent faster than the same period in 2012 and now stand at around 1.7 billion.
• More smartphones means more demand for data, ergo, data traffic volumes doubled between Q1 2012 and Q1 2013. Data traffic growth between Q4 2012 and Q1 2013 was 19 percent. Ericsson forecasts that the data traffic on mobile networks will grow 12-fold by 2018.
• During 2013, overall mobile data traffic is expected to continue the trend of doubling each year.
• Of course, a lot of this growth will come as a result of faster networks. Ericsson expects 60 percent of the world’s population to be covered by LTE in 2018.
• Across the world 20 million new LTE subscriptions were added in Q1 2013.
• In North America, driven by the U.S., LTE will account for majority of subscriptions in the region in 2016, growing to around 70 percent in 2018.
• In comparison, by 2018, LTE will penetrate around 35 percent of the subscriptions base in Western Europe.
• LTE subscriptions are expected to exceed 1 billion in 2017.
• So what do we with all that speed? Spend more time on social networking: an average of up to 85 minutes per day in some networks. Looks like that Facebook addiction of ours is going to become super expensive!
• And we don’t really spend that much time talking on the phone. Voice traffic growth between Q1 2012 and Q1 2013 was 4 percent. Ouch!
• Ericsson says that web browsing and social networking will each constitute around 10 percent of the total data traffic volume in 2018.
• Of course, we watch video — a lot of it.  According to Ericsson, the video traffic on mobile networks grew by 60 percent annually.
• On some networks, video consumption is on average 2.6GB per subscription per month. That should make the network operators break into evil grins — more of our money into their pockets.
• Of course, worried about its carrier overlords, Ericsson makes no mention of over-the-air communication apps in this report.

Now for more details about the mobile world at large:

• Global mobile penetration was at 90 percent in first quarter of 2013 and mobile subscriptions now total around 6.4 billion. However, the actual number of subscribers is around 4.5 billion, since many people have multiple subscriptions.
• China alone accounted for around 25 percent of net additions, adding around 30 million subscriptions during first quarter of 2013.
• India added over 10 million, as did Indonesia. Brazil and Nigeria both added over 5 million subscriptions during the first quarter.

We will parse some of the data in separate posts later.

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The WSJ minces around the cost issue by distracting readers with the chimera of more Wi-Fi hotspots and better cellular coverage as the reason people are cutting the wireline cord. But its examples show cost is the issue for most people. Essentially Patrick Downs, quoted in the story, doesn’t want to pay for a wireline connection and a wireless connection, so he picked wireless because mobility is a higher value-add for him. Apparently youth in Japan were doing the same thing, prompting NTT to lower its fiber to the home prices.

Sticker shock is an issue

And if cost is the primary reason people are electing to ditch their wireline service we have two problems. One, wireline broadband costs too much, and the second is wireline can’t convincingly differentiate its value from the current LTE-wireless offerings. The first is a problem that can be laid at the door of ISPs and our regulator’s inability to boost competition or innovation in broadband. It’s taking private companies like Google and Gigabit Squared to move the needle on faster speeds and lower costs in wireline after Verizon all but stopped deploying its FiOS fiber to the home service to its customers.

As the WSJ story notes:

Leichtman Research surveys show that spending for home Internet service has risen steadily over the years, to an average of $46.78 a month last year from $28.46 in 2005. People trading up to faster services—from dial-up to DSL to cable to fiber-optic—accounts for some of the increase, but so do rising prices.

What it barely mentions is that broadband is just part of a growing telecommunications bill for most Americans, that includes cellphones, pay TV and broadband (and sometimes home voice). And what it skips over, but would be a great business story, is that despite the world moving to all-IP, where it is technically possible to deliver TV, voice and data all via the same packet network and infrastructure, prices have not dropped, and have indeed risen. The issue here is a lack of competition and regulatory will. Consumer habits are also hard to break.

For example, on the regulatory side the FCC defines anything over 4 Mbps down as broadband, which means wireless LTE networks are broadband, just like a gigabit network is. The FCC also doesn’t have a real solution for boosting speeds and pushing innovation other than empty goals that are announced after companies have already put in the real work of building out new infrastructure.

On the consumer side, people are sticking with their existing carriers (they like the subsidies) despite the nation’s top 2 carriers implementing pricing plans that eliminate many of the savings one might earn by using over-the-top IP services like Google Voice, Skype or WhatsApp.

The bigger problem is that both services look the same

That’s the pricing side. But the second problem is a bigger one in my mind. That people don’t differentiate between wireless and wireline means that the technology and entertainment industry is failing to deliver apps and experiences that make people want and demand a fast wireline service. The carriers (especially in rural areas) love that people are willing to look at wireless and wireline and see the same service, because delivering wireless has higher margins and it means carriers don’t have to invest in costly underground network upgrades.

Is Netflix a good enough reason to buy wireline broadband?

And, despite the real issues I think consumers will have if they embrace LTE in exchange for a wireline connection, the fact that Netflix or Hulu streaming is the main argument people in the story seem to have for keeping wireline broadband, means we need to push the envelope on building better apps.

While we may all have that quirky friend who chooses Clearwire or just uses their cell phone data plan (I have a co-worker who does this), if this becomes a real thing, it’s not just some pithy story about how people are giving up wireline connections because they cost a lot and we have a lot of free Wi-Fi and good cellular networks. It’s an indictment on our telecommunications policies over the years and our failure to offer visionary apps and services that make people look at wireline broadband as indispensable.

Right now, these 1 percent cutting their broadband cords, look at broadband the way early adopters might have looked at electricity. You got electricity so you could get light bulbs. But electricity brought so many other innovations and improvements to our quality of life that even though flashlights are cheap and widespread, no one says they are going off the grid because their Maglite gives them all the lumens they need. Broadband is the web today. But as more devices get connected, broadband will become more than just access to Facebook. It will be access to healthcare, to education, to entertainment and to our relationships. And it will allow smarter devices in our homes to connect, get and share useful data.

Our regulators, our innovators and our ISPs need to see that. Otherwise, we’ll be sipping our lives through cocktail straws and marveling at those who invested in the firehose of innovation that superfast wireline broadband can provide.

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Verizon is selling seven devices that sport LTE radios in the Advanced Wireless Services (AWS) band – including the popular Samsung Galaxy S 4 and Nokia’s latest Windows phone, the Lumia 928. When the new network goes live, Verizon will ship out a software update that will activate its dormant AWS radios, Verizon spokesman Tom Pica said.

The other AWS-capable devices are Samsung’s two 10-inch Android tablets, two Verizon Jetpack mobile hotspots and a USB dongle. The current LTE iPhone 5 iteration used by Verizon doesn’t support the AWS band, but that could change with future versions. Meanwhile, the forthcoming BlackBerry Q10 will be able to access the new network, Pica said.

Customers won’t necessarily get faster speeds (though they might experience some initial bandwidth gains over these less-crowded AWS airwaves), but they will have access to a lot more network capacity. Verizon will be adding anywhere from 20 MHz to 40 MHz of new spectrum to its LTE systems – either doubling or tripling its current 4G capacity.

What’s more, Verizon will be focusing the new LTE systems in congested urban centers. It will overlay capacity at cell sites where demand is highest and in some cases surgically inserting bandwidth into highly trafficked indoor and outdoor areas using small cells. Bottom line: customers with newer AWS-capable devices will have access to a hell of a lot more network and enjoy a better mobile data experience in the exact places that experience tends to suffer.

Eventually Verizon will be able to use new LTE-Advanced carrier aggregation techniques to combine its two 4G networks into a single superfast system, but we’re still a year or two away – and another generation of handsets – from seeing that capability.

Going forward, Pica said, Verizon will require its device makers to include AWS support for most new LTE devices. So even if your current smartphone won’t work on the forthcoming network, your next Verizon smartphone most likely will.

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First off, it’s important to realise that no formal complaints have been made and the European Commission has not launched a formal investigation. However, according to a Financial Times report on Sunday, the Commission has sent a questionnaire to several European carriers, asking them to clarify what Apple asks them to do.

The article claims the questionnaire asks whether operating groups are forced to buy a certain quota of iPhones, whether Apple dictates how marketing budgets should be allocated, and whether the U.S. firm demands subsidies and sales terms that are at least as favorable as those offered to other manufacturers. Interestingly, it also says the Commission is looking into potential “technical or contractual restrictions on the iPhone 5 that mean it cannot be used on high-speed 4G networks in Europe.”

The 4G factor

As I explained in March, there’s a lot standing between where we are now and a full-blown antitrust case – for a start, Apple does not actually dominate the smartphone market in Europe (it has around 25 percent share), making it less likely to be the target of an antitrust crackdown. Simply put: it’s not that hard to jump the iOS ship for Android or some other alternative.

That said, the questionnaire’s mention of restrictions on the iPhone 5′s 4G capabilities is intriguing.

The European (GSM) version of the iPhone 5 does have natural limitations as to which LTE networks it can run on, due to the bands it physically supports – it will run on Deutsche Telekom’s 1800MHz spectrum in Germany, for example, but it doesn’t support 800MHz or 2.6GHz LTE, so Vodafone has to sell the iPhone 5 as a 3G device that country.

However, there have been reports suggesting that Apple’s restrictions extend beyond the strictly necessary. The company apparently heavily vets the LTE networks it will support — even an unlocked iPhone 5 will not run on an unapproved LTE network. The question now is whether this is entirely a technical matter, or whether commercial reasons also come into play.

Market definition

I’m waiting for the Commission’s antitrust office to get back to me (my guess at this point is that they’ll say the questionnaire forms part of its regular market-monitoring activities), but, as I have said before, I’m skeptical that this will evolve into a formal investigation. The only basis on which I can see that happening would be the definition of Apple’s platform as a market in its own right, independent of the wider picture that also includes the actually-more-dominant Android.

If that were to happen, it would be a game-changer — Apple might be forced to allow alternative app marketplaces, for example. But let’s wait and see what happens before we speculate too far down that path.

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Those high-capacity connections are only available to customers who buy a compatible device (many phones in GoPhone’s portfolio are either 2G-only or can only access slower HSPA speeds) or to customers who bring their own compatible devices to the network. And yes, that includes new high-end smartphones like the iPhone 5 and the Galaxy S 4.

AT&T sells data add-ons to GoPhone plans, ranging from $25 a month for 1 GB to $5 a month for 50 MB. New customers will get immediate LTE and HSPA+ access, but current customers will have to wait a bit. An AT&T spokesman said the carrier is working on ways to extend these new network capabilities to its existing customers with compatible devices, but it’s still working out the details.

AT&T’s archrival Verizon Wireless has restricted access to its LTE network to only its contract smartphone customers, and it looked like Ma Bell was going to do the same. Earlier this month AT&T launched a new prepaid brand called AIO Wireless, targeting more data savvy smartphone users who didn’t want to deal with contracts. The AIO service, however, doesn’t include access to LTE.

I suspect we’ll see LTE on AIO as it rolls out to new markets, though. Of its two prepaid brands, GoPhone is definitely the lower-end service. If AT&T is finding that its GoPhone customers are asking and willing to pay for LTE, then AIO customers most certainly would do the same.

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Although the branded net customer additions numbered only 3,000, it was the first time that figure was positive since the first quarter of 2009. Customers on the network only tell half of the story though: Measuring monetization of customers through ARPU, or average revenue per user, is just as important.

ARPU fell by 6.3 percent year-over-year to $54.07 for postpaid subscribers as the company says 36 percent of the customer base has switched to either a Value or Simple Choice plan. Once again, however, prepaid customers came to T-Mobile’s rescue: ARPU for this group rose 11.3 percent to $28.25.

T-Mobile sold approximately 500,000 iPhones in just under a month; Sprint, Verizon and AT&T monthly numbers were found by dividing Q1 iPhone sales by three.

In March, T-Mobile introduced the Simple Choice offerings when it decoupled service plans from the price of hardware. As the company gains new customers — or has existing ones switch to newer phones — it will have an even greater number of people on the Simple Choice plans, which range from $50 to $70 per month.

The company highlighted its $1.1 billion capital expenditures for the quarter, investing large sums in network modernization. T-Mobile began to move some services to different frequencies last year on its network in order to pave the way for LTE services. This also allows T-Mobile to carry a standard GSM iPhone, which will likely bring new customers. By the end of 2013, T-Mobile expects to cover up to 200 million people with its new LTE network.

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From the earnings release:

“We have a number of strategies in progress to increase loyalty and attract more customers, including our announcement today that we will begin offering Apple products later this year. By further strengthening our device portfolio, we’ll give consumers another great reason to switch to U.S. Cellular, and enable our existing customers to choose from an even wider variety of iconic smartphones, and enjoy the outstanding U.S. Cellular customer experiences they deserve.”

This is not a case of Apple finally bestowing the iPhone on the carrier. It’s the opposite: Apple has made a smartphone that U.S. Cellular wanted to sell. You may remember the CEO of the carrier’s parent company, TDS, saying in late 2011 that he’d offer the iPhone when Apple made a more “cutting edge” phone — in other words, he was waiting for LTE.

LTE is a big priority for the carrier: U.S. Cellular said Friday it will bring LTE to 87 percent of its existing customers this year. But smartphones in general are where it can improve. Currently, less than half — about 43 percent — of its subscribers have a smartphone. That means there’s plenty of built-in demand for customers looking to upgrade to one for the first time.

U.S. Cellular customers may certainly go for the iPhone 5, which is Apple’s LTE phone, but the cheaper iPhone 4 and iPhone 4S have been proving especially attractive to late smartphone adopters.

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