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Ofcom Report: The Change in UK Network Use

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The Network use in the UK is increasing as Brits are spending more time online than ever before, according to Ofcom’s annual Communications Market Report

British consumers are spending more time on the internet network than ever before, so much so that many are actively seeking a so-called “digital detox” from their online lives, according to communications market regulator Ofcom.

In its latest Communications Market Report – an annual survey of British communications and media usage and attitudes – Ofcom reported that 15 million people in the UK have sought time offline to do other things, such as spending time with friends and family, or holidaymaking.

Most of these people found taking a break from the digital world to be a rewarding experience, although some respondents to Ofcom’s survey reported feeling lost and cut-off, or worried that they were missing out.

“The internet has revolutionised our lives for the better, but our love affair with the web is not always plain surfing,” said Ofcom director of market intelligence, Jane Rumble. “Millions of us are taking a fresh look at the role of technology in our lives and going on a digital detox to get a better tech-life balance.”

The 2016 report highlighted the importance of connectivity to the increasingly digitised world. According to Ofcom, 9.2 million broadband connections are now superfast – in the regulator’s view this means capable of delivering speeds of over 30Mbp. This was up from 7.1 million two years ago.

As a result of this growth in superfast connections, total telecoms revenues grew for the first time since 2011, up 0.5% to £37.5bn between 2014 and 2015, as average household spend increased due to the higher costs associated with most superfast packages.

Superfast connections

Rumble said the regulator estimated that nine in 10 premises now had access to a superfast broadband connection, up from 83% last year, which tallies with other assessments of availability.

“We are aiming for 95% by the end of 2017, so availability is growing,” she said. “I think the core questions are now related to those people who aren’t able to get superfast broadband and that is absolutely a priority for Ofcom.”

Rumble also reaffirmed Ofcom’s commitment to the 10Mbps universal service obligation, currently on its way to becoming law. She said the regulator considered a 10Mbps connection adequate for activities such as streaming video on demand (VoD), an activity that has seen a boom in popularity in the UK in the past 12 months at the expense of live television.

Ofcom will release more concrete statistics on broadband take-up in September 2016.

4G popularity still soaring

Meanwhile, 4G connections accounted for 46% of all mobile connections, up from 28% in 2014. Ofcom said 98% of UK premises were now covered by at least one 4G network, and 71% were covered by all four.

Data use is also soaring, with 89% of 16 to 24-year-olds and 25 to 34-year-olds, 77% of 35 to 54-year-olds, 50% of 55 to 64-year-olds, and 21% of over-65s using web and data services on their devices.

The report said 71% of UK adults now owned a smartphone, up from 66% this time last year, which remains the most popular device for getting online.

Ofcom said the popularity of smartphones was giving rise to a number of new social impacts, such as an increase in people bumping into each other on the street because they were absorbed in their phone, and 40% of respondents said they had been “smart-snubbed” by a friend or relative.

The report also revealed a surge in the use of instant messaging, with the proportion of adults using over-the-top services such as WhatsApp at least once a week rising from 28% in 2014 to 43% in 2016, higher among the so-called millennial age group. Photo messaging services such as Snapchat are now used by 21% of adults weekly, up from 14% in 2014.

This growth came largely at the expense of email and, notably, text messaging, which presents a revenue stream problem for mobile operators.

Rumble acknowledged this trend and said Ofcom had seen mobile revenues remain flat over the past year, which suggested operators were responding to this to some degree.

“I think with any business, as behaviors change and shift, we would expect to see different businesses adapt to those shifts in behavior,” she said.

– Alex Scroxton

Cloud Competition: Amazon vs Google vs Microsoft

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With Amazon, Google and Microsoft all reporting strong growth on the back of cloud, we take a closer look at how they have achieved it

The grip that Amazon Web Services (AWS) has on the infrastructure-as-a-service (IaaS) market can make it hard for even relatively big players to get a look-in when enterprise CIOs shop around for cloud services.

Microsoft has managed to hold its own, with the help of its Azure platform, by focusing on convincing its existing base of on-premise enterprise customers to ditch their own servers and use its cloud infrastructure.

It is a strategy that appears to be working very well for Microsoft. Its fourth-quarter 2016 financial results saw the Azure cloud division emerge as one of the company’s best-performing business initiatives, with revenue growth of 102%.

In recent years, the company has also publicly committed to matching AWS on price for various commodity cloud services, which has been a useful marketing tactic.

For instance, every time Amazon decides to publicly announce a price cut for any of its cloud infrastructure services, Microsoft grabs the opportunity to crowbar its way into that narrative and announce a price cut of its own.

This has helped to create the impression that the IaaS market is something of a two-horse race between AWS and Microsoft, which is an image Google has been working hard to dispel since late 2015 when it appointed former VMware co-founder, Diane Greene.

A Google board member since 2012, Greene was appointed to oversee the running of Google’s newly-converged cloud services business, bringing the product, engineering, sales and marketing efforts of its off-premise infrastructure and software initiatives under one roof for the first time.

Unified approach

The move was comprehensively referenced during a conference call to discuss Alphabet, Google’s parent company, and its 2016 second-quarter results, with CEO Sundar Pichai, who described how taking a more unified approach to cloud was opening doors for it in the enterprise.

“It’s a big set of changes, and it’s obviously having an impact,” said Pichai on the call transcribed by Seeking Alpha.

“So for me, I see a shift to a world-class enterprise approach, and it’s definitely having an impact on the type of conversations we are having and the outcome of the RFPs [requests for proposals] we are engaged in.”

Proof of that is evident in some of the high-profile contract wins Google has secured this year with the likes of music-streaming site Spotify and Apple.

To keep up this momentum, the company outlined the steps it has taken to increase its headcount across several areas of the business, including its cloud division, with more than 2,460 recruits taken on in the previous quarter.

Google vs AWS

At present, Alphabet does not provide a breakdown within its financial results of the cloud’s contribution to its wider business, which banked a profit of $4.9bn against revenues of $21.5bn in Q2.

Instead, it is reported as “other revenue”, which means the performance of Google’s converged cloud unit is muddied because its figures are lumped in with those for Google Play and the company’s hardware ventures.

Even so, this part of its business brought in revenue of $2.2bn, up 33% on the year before.

It is currently unclear just how big Google’s cloud business is, but there is no denying that AWS has the upper hand, based on its financial results, which were released the same day.

The activities of AWS alone brought in $2.9bn in revenue for its parent company, Amazon.com. This figure is 58% higher than that for the same quarter a year ago, and equates to about 9% of Amazon’s total sales.

During a conference call to discuss the results, also transcribed by Seeking Alpha, the senior management team at AWS said the work being done behind the scenes to improve the efficiency of its infrastructure was having a positive impact on its revenue generation.

Datacentre footprint

The company is also currently building out its datacentre footprint across the globe in response to customer concerns about latency, data sovereignty and security, and this looks set to bring a fresh tranche of users on board, it said.

Brian Olsavsky, chief financial officer at Amazon.com, said: “When we expand geographically, existing customers will run more of their workloads on AWS. Sometimes they have local latency concerns or security issues that require them to run things in their country, so that helps.

“We also open up to new customers when we add these regions, and it is certainly an exciting investment for our customer base.”

In view of Google’s and Microsoft’s attempts to become even bigger thorns in the side of AWS, the company is in no danger of overlooking the competitive threat either of these rivals pose to its market-leading position in the cloud.

Particularly, as Olsavsky referenced elsewhere during the results call, there is a strong chance that AWS, Google and others will find their services being used by the same customers as enterprises move to adopt a multi-cloud approach in their IT environments.

“We have been in this business longer than anyone,” he said. “Having said that, there is plenty of room for multiple suppliers in this business.

“What we focus on is innovating on behalf of customers and expanding our geographic footprint to make our services more widely available.”

In a briefing note following the recent wave of financial results, Kate Hanaghan, research director at analyst house TechMarketView, said AWS clearly continues to lead the way in the cloud market.

“We know more about the performance of AWS than its competitors,” she said. “Google’s cloud revenue is buried, and while we know Microsoft’s Azure revenue was up 102% in its last quarter, this was from an unknown base.

“Our view is that AWS is growing at a slower rate in the UK specifically. That said, AWS is outpacing the market and most of the other players.”

– Caroline Donnelly

IT Infrastructure Worldwide Growth

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Spending on IT Infrastructure by Cloud Environments in 2016 Will Be Strong Despite First Quarter Slowdown, According to IDC

According to the latest forecast from the International Data Corporation (IDC) Worldwide Quarterly Cloud IT Infrastructure Tracker, total spending on IT infrastructure products (server, enterprise storage, and Ethernet switches) for deployment in cloud environments will increase by 15.5% in 2016 to reach $37.1 billion. This amount excludes double counting between storage and servers. In comparison, spending on enterprise IT infrastructure deployed in traditional, non-cloud, environments will decline by 4.4% in 2016, but will still account for the largest share, 63.4%, of end user spending. Spending on private cloud IT infrastructure will grow by 10.3% year over year to $13.8 billion with more than 60% of this amount contributed by on-premises private cloud environments. Spending on public cloud IT infrastructure will increase by 18.8% in 2016 to $23.3 billion.

All regions are expected to increase spending on cloud IT infrastructure in 2016 with investments in public cloud growing at a faster rate than investments in private cloud IT infrastructure. For cloud environments combined, spending on Ethernet switches will be growing at the highest rate, 39.5%, while spending on server and storage will grow at 11.4% and 14.2%, respectively.

For the long-term forecast, IDC expects that spending on IT infrastructure for cloud environments will grow at a 13.1% compound annual growth rate (CAGR) to $59.5 billion in 2020. This will represent 48.7% of the total spending on enterprise IT infrastructure. Spending on non-cloud IT infrastructure will decline at 1.4% CAGR during the same period. Within the cloud segment, spending on public and private will grow at 18.8% and 10.3% CAGR respectively. In 2020, IDC expects public cloud service providers (CSPs) will spend $38.4 billion for delivering services, while spending on private cloud will reach $21.1 billion.

“Despite weakness in hyperscale CSP demand for IT infrastructure products in the first quarter, we expect spending on public cloud to increase in the second half of the year,” said Natalya Yezhkova, research director, Storage Systems. “Overall, we will continue to see steady growth in demand for public cloud services and, as a result, underlying spending on IT infrastructure by CSPs. The economic and financial volatility we see in some regions will push demand further as increasing sophistication of public cloud offerings allows organizations to fulfill their needs across a growing variety of IT domains while OPEX-oriented pricing models provide some relief to tightening IT budgets.”

– Business Wire

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How Wimbledon will use IBM’s Watson to serve up Data

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If you’re lucky enough to get a ticket to this year’s Wimbledon tennis championships, be prepared to be scanned by a supercomputer: IBM Watson.

Cameras linked to IBM’s Watson “machine-learning” platform may be monitoring your facial expressions and trying to work out what emotions you are displaying.

If Watson learns quickly enough over the fortnight, it will apparently be able to work out which player you are supporting just by reading your face.

The All England Lawn Tennis Club (AELTC) and its tech partner IBM are remaining tight-lipped on the details of the new technology – not least because it needs legal approval and raises privacy concerns.

But it is another example of how sport is becoming increasingly digital, for fans, players and venues alike.

Even if Watson isn’t tracking your every cheer and grimace at the championships – which begin on Monday 27 June – it will be digesting millions of conversations on social media platforms, such as Twitter, Facebook and Instagram, and using natural language processing to identify common topics – not necessarily just about tennis.

“During last year’s final we were analysing about 400 tweets a second,” says IBM’s Sam Seddon. “Expand that out into Facebook, Instagram and more long-form content, and that’s a lot of data.

“We can come up with insights much faster than humans can and inform the media team so they can decide what kind of content they should be offering.”

Wimbledon’s digital team has a global audience to serve – the website received 71 million visitors last year – and a window of just a few seconds to persuade people to read its social media content rather than that of other publishers.

So, armed with IBM’s social media analysis, the team will be able to entice people chatting about their own country’s performance in the current Euro football championships, say, towards Wimbledon content about a tennis player of the same nationality.

“Social media is growing exponentially and is increasingly becoming the primary voice with which we communicate with our fans,” says Alexandra Willis, Wimbledon’s head of communications, content and digital.

Data-driven sport

On top of this social analysis by IBM’s “cognitive command centre”, sensors and computers at the venue will be collecting about 3.2 million pieces of data from 19 tennis courts across the fortnight. The tech company claims a sub-second response time and 100% accuracy.

This performance-monitoring data – everything from live scores to fastest serves to the number of backhand winners – is made available to fans via smartphone apps, the website, and now Apple TV.

You can personalise the app and receive every piece of relevant content on your favourite players, using data going back eight years.

But, to the surprise of many tech commentators, Wimbledon still has no plans to introduce wi-fi in the grounds, so visitors will have to rely on an imperfect mobile network to access all this data and content.

It will be interesting to see if this limited connectivity – and potentially higher mobile data costs – mars the user experience, particularly for international visitors.

While the tennis players can also use sensors inside tennis racquets and wristbands to monitor their own performance, under current International Tennis Federation rules the data is not allowed to be used for coaching purposes during matches.

But is there a danger players will become too reliant on detailed data analysis of their opponents and end up cancelling each other out?

“The great players know how to understand and react to what’s happening on the court – no amount of data analytics can prepare for that. It’s only one element of a sportsman’s preparation,” says Mr Seddon.

Super Bowl economics

The increased use of smartphones and apps is giving sports venues reams of valuable data about the way fans move around, the things they buy, and the content they want to watch.

For example, during February’s Super Bowl final at the Levi’s Stadium in Santa Clara, California, data analytics helped improve the fan experience and drive up sales of drinks and merchandise.

Tech firm VenueNext developed an app on behalf of the NFL (National Football League) and nearly half the stadium’s 71,000 capacity used it on the day to make purchases and access game stats.

“By offering an in-seat beverages delivery utility orders increased 67% during the Super Bowl,” says John Paul, VenueNext’s chief executive. “Delivery times averaged less than 10 minutes.”

A crack team of 200 ushers delivered the drinks and fed back data to the app on how long the queues for the toilets were, for example, and where the quickest place to buy a hotdog was at any time during the event.

“We also implemented express pick-up of merchandise after ordering online via your mobile,” says Mr Paul. “We ran out of inventory because it was so popular – we could’ve sold five times more than we did.”

The average spend was $212 (£145) and the most popular item was a woman’s Denver Broncos jacket costing $225, he says.

Horses for Courses

Mr Paul admits that the many breaks in play during an American football match make in-seat ordering practicable, but it wouldn’t be suitable for other sports and venues.

Indeed, Wimbledon’s Alexandra Willis says that’s the last thing they want during an intense tennis match. Nevertheless, location-based app data does help them improve signage and navigation for visitors across the complex site, she says.

During a summer of sport that includes the current Euro football championships, Wimbledon, and the Olympics, global audiences are set to grow and digital will be the main way most people access the action.

Andrew Chant, head of networks at cloud services firm Exponential-e, notes: “Since the Uefa European Championship began on 10 June, an average of 30% extra traffic has been added to networks.

“Excited by real-time intensity, we predict that the reach of this year’s biggest sporting events – from the Euros to Wimbledon and the Olympics – will extend far beyond the stadium and into the workplace, as connected sports fans live every second of the game, wherever they are.”

– Matthew Wall

Fujitsu Signs Deal to Integrate Box Cloud Storage into Enterprise Software

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Fujitsu have just signed a deal to integrate Box cloud storage into their enterprise software

Box just inked one of its biggest deals in Asia so far as it focuses on international growth. Fujitsu, one of Japan’s largest IT services providers, announced today that it has struck a strategic partnership with the cloud-storage company and will integrate Box into its enterprise software.

Fujitsu will first start using Box to store and manage files sent on communication tools used by its 160,000 employees around the world. The company says the internal use of Box’s services will help it develop new enterprise software, including customer-relationship and enterprise-content management solutions, that it plans to release by March 2017 and market throughout Asia.

Fujitsu will also integrate Box into MetaArc, its new cloud platform, next year. MetaArc includes third-party services (like Box storage), as well as infrastructure and application hosting services. Customer data uploaded to Box will be stored at Fujitsu data centres in Japan. This will help Box appeal to businesses that don’t want to store their data overseas and complements the company’s new plan to offer cloud data centres, called Box Zones, in Ireland, Germany, Singapore, and Japan.

Box founder and CEO Aaron Levie has said that expanding in Europe and Asia is a priority for the company, which went public in January 2015 but has traded below its IPO price since then despite posting solid earnings.

Other partnerships Box has struck to expand internationally include an agreement with IBM that will let Box store data in IBM’s cloud data centres, which are located in 16 countries.

– Catherine Shu

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