Brough Turner on Mobile Communications

The run time is 1 hour and 2 minutes.

Lee: Skype never liked your job position by the way... It crashed out so in your job position I will just mentally categorize you as a chief or one of the chiefs, would that be a quick summary if we just call you chief or co chief?

Brough: Chief technology officer?

Lee: You need to add all these extra words in here. It reminds me you know when I was at university, the person who used to pick up the litter; he ended up getting his name changed to litter abatement officer. So I have never been a fan of adding in words but I am only partly being funny. By the way if I ask you a bit something that is a bit cranky and is distressing of any nature, we will chop it out. Can you tell me Brough what NMS Communications does please?

Brough: Sure, the primary business is we produce platforms for people who are developing mobile value added services. We sell boards and software and media services, specialized media gateways, both voice over IP based connectivity, traditional PSTN connectivity, everything you need to do if you want to launch something like a ringback tones or voice SMS or video portals over 3G mobile video. We sell in the Americas, Europe and through the Middle East and Africa and all over Asia. In fact, Asia is our fastest growing area. It accounts for more than a third of our revenue. It is quite a bit ahead of Europe at this point. The sort of applications our customers make are all over the ballpark. There is plain old things like Converse is a customer and they make voicemail plus some newer applications. We have a lot of the large equipment providers like Alcatel Lucent and Ericsson use our components in various value added services but the interesting thing is the startup companies. You have somebody called Green Tomato in Hong Kong who has got an interesting mobile video dating site and things like that people using our video technology to do mobile TV on the Hong Kong CSL network and all sorts of interesting things going on inside China.
That is the primary business that is NMS communications. We have a separate wholly owned subsidiary called Livewire Mobile which focuses on actually delivering one particular service and that is ringback tones, basically caller personalization. It is very, very widely adopted in Asia. It has been launched in Europe and the US. So far, adoption in Europe and the US has been lack luster probably less than 10% in most places but is beginning to change. In Asia, ringback tones are 35 to 55% adoption so it is very, very popular thing and I see that happening eventually in the other parts of the world. So Livewire Mobile actually delivers services to operators like Vodaphone and Virgin Mobile USA and things like that. NMS communications delivers the platforms that people build interesting applications on top of.

Lee: One company, NMS is selling hardware in effect for others to build with whereas Livewire Mobile is a completed solution or set of solutions?

Brough: Yes, Livewire Mobile is delivering complete solutions and also offering complete managed services, white label services if the operator does not want to run it themselves so we do it both ways. I guess on the NMS side, yes, we are selling hardware. Of course the reality of anybody selling hardware is 95% of your development engineers are software people not hardware so the delivery vehicle is hardware but the reality is a development platform for software people which means it has an enormous software content itself.

Lee: I have understood and we have not actually chatted about NMS much and we have not even planned to chat about NMS but it is a burning question I have is that for me at least, I know the name NMS but it is not one that instantly spring to mind. But I have been told, not from yourself that actually behind a lot of large name providers, vendors and maybe Alcatel Lucent or one of these names, it is actually NMS is bought by these and then packaged, is this true?

Brough: Our components, subsystems and development software and so forth is inside a lot of major things like products from Alcatel-Lucent and Ericsson and Converse and so forth. The only place that I can think of it being repackaged is Ericsson resells the Livewire Mobile application, the solution as the Ericsson personal greeting service. Otherwise, we see Alcatel-Lucent, Ericsson, Converse and people like that as application developers who are using our development environments and our components.

Lee: That has at least clarified that. It is kind of funny, I have known you for so long and yet we have never chatted about NMS before. We always chat about everything else in communications. So what I wanted to do, what I was meant to do first was say Hey, Brough, please tell me why you are attending eComm? Why is eComm important? Why does it excite you, why are you coming along and why are you investing your time?

Brough: That is pretty simple. I go to shows for one or two purposes. Number one is probably to meet people and/or quickly grok a particular industry or an area that I am interested in and so I go to a lot of different conferences in the course of the year. I speak at a lot of different conferences.

eComm stands out because it brings together a bunch of innovators who are typically lost in the other shows that I go to. There is also a set of advance thinkers. Some are people I have met and know but who I only see once or twice a year and others are people that I know the name, I have read the blog or seen them quoted in the press and they are people I want to meet so I guess the issue innovation. I do not see a lot of that in a lot of the shows.

The other thing is the sessions look to be a lot more real than the majority of the shows I go to. The majority of the shows I go to, you are hearing people stand up and give product pitches and they have been lumped together into so called panels of related product pitches but even there, they are like arbitrarily lumped together and here, we are looking at a completely different format that focuses not on people giving product pitches but on people exposing innovative ideas and directions the industry might go in, emerging concepts and a fast pace, not... it is a very different looking show so I am very optimistic that this is going to be a good use of my time.

Lee: Great, you may know, I think I have said to you before, I try not to attend conferences because I get bored to tears. Because I hate marketing brochures, just give me the URL please. I only want to hear things I cannot obtain on the web. But it actually reminds me if you do not mind me going off topic is I have heard when I went to the NMS Connect 2007 and hopefully you do not mind me bringing up what you said there and you said there has been no innovation in 10 years. I am laughing here. Except Skype. When you said that when you were in a panel, an Alcatel-Lucent person sitting next to you, I do not know if you noticed but he did not give you a very good look when you said that hey, there has been no telecom innovation in 10 years.
He said triple play and you said no, that is a marketing construct. Can I get you officially on record as saying there has been little or no innovation in 10 years?

Brough: Sure, I think I would be cautious. I would use the word little but the disappointing thing about the whole voice over IP and I have been literally pursuing voice over IP since 1995 to 1996.

I have gone to all of the VoIP conferences since 1996. I have actually spoken to all of them but if I look at the VoIP industry, most of what has happened is that it is reinvented plain old telephone service as digital POTS over IP. It has not actually done something radically different. The biggest innovation in the telephone industry in the last 20 years is the advent of mobile where you actually get a personal number that belongs to you instead of one that you share with your family and which you have with you at all times. So if I had to say is there any innovation in the telecom industry in 20 years that I would point to mobile not to VoIP and that is disappointing.
Now, the reason I mention Skype was that it combines the idea of chat and voice and video in one user interface. The idea that you can determine if the person, when I start something, I typically look to see if somebody is really available and then I may say hey are you there? Can we talk in terms of typing text and then I actually place the call and talk to them if I indeed need to talk to them. So Skype is actually a different user interface, a different communications and another sore subject for me over the last 10 years has been wideband audio. The first session I ever moderated at VON in 1996, was a panel in which I was trying to promote wideband audio as why are we trying to make VoIP as good as total quality speech when toll quality speech is so poor, why are we not trying for something new and it did not happen until Skype came along and actually had wideband audio so I am on the record as saying

I am very disappointed in the VoIP community in the last 10 years of VoIP during which we have basically changed the underlying technology but not changed the service in any meaningful fashion. We are still doing basically digital pots.

Lee: I could not personally agree more. So in short, I take it VoIP does not excite you?

Brough: The concepts and the opportunity excite me and there are, I did not want to say there has been no innovation. There has been dribs and drabs of innovation here and there and there are many people doing things like Skype and there are all sorts of other things going on right now of trying to fold voice and video modes into different social networking things. There is a bunch of interesting stuff happening.

It is not that VoIP does not excite me. It is that I am disappointed that we have had so little progress in 10 or 12 years of messing around.

Lee: What would you blame on that? Who would you blame if someone is to blame? I get the sense by your laughter there that Lee, these are things I cannot say on the record. I do not know if that is what I am detecting but you can dodge around that question if you wish.

Brough: No, I think it has been fairly hard to get new applications into the telephone network. In the 90s, it was easier to get new applications into the enterprise. After all, that is where we got voice mail and auto attend and all the early speech reco stuff and it all came through the enterprise and worked its way back into the public network. With the advent of mobile which is still being run by a bunch of old line teleco people but in most countries in most of the world, mobile is at least competitive. There are two, three, four or more competing vendors.

So mobile has done a lot more, provided a platform for a lot more innovation than doing things in the fixed line network.

Going forward, I am very optimistic about the next five and 10 years. I do not know about the next one year because we are approaching a tipping point where there will be enough mobile internet bandwidth to allow you to do things like VoIP. We will reach the tipping point that when we got a few megabytes down and a few hundred Kbytes up for fixed broadband access, we suddenly had a whole flock of VoIP companies like Vonage and AT&T call advantage and 20 clones. That same thing is liable to happen in the 3G mobile industry in the next two to three years.

So there is a lot of excitement ahead and it may actually happen with some combination of VoIP and mobile just because the mobile industry has more competition and thus more opportunity for innovation, trying to wedge things into the traditional telco environments, it is a very stultifying place if you will.

Lee: So are you telling me that you find what I call "naked VoIP", that is a place to call, talk and end a call, do you find that exciting and do you think that will be profitable long term?

Brough:

If you mean naked VoIP replacing a fixed line telephone, which is what it is mostly, if you mean Vonage and things like that or cable VoIP that is what I call digital pots. It is not exciting. It is a commodity business doing something that was done with the old TDM infrastructure using the new IP stuff to do the same service, that is not very exciting.

Lee: I just wanted to clarify there. So when you see mobile VoIP is exciting, I am assuming you do not mean "mobile naked VoIP"?

Brough: No, I was saying that in the mobile space, because there is competition, even in advance of VoIP, we are seeing a lot of interesting applications. The mobile telephone industry invented multimedia messaging, that was supposed to be the coolest thing, it has not been widely used for anything except sending pictures but in Asia, we see voice SMS and video SMS as two services that use MMS if it is there but they work on any handset with a very simple well understood fashion and they respond to a human need.

So those to do not have anything to do with VoIP but they do have to do with communications innovation and they are happening in the mobile space because there is competition there and there is some openness to new ideas which you do not find in the fixed world so what I was saying is that I am optimistic about the next five years or so because I see VoIP capabilities becoming feasible in the mobile space, it is not that I want VoIP to duplicate today's mobile telephony but that I want the capabilities and the fact we have more innovation in mobile than we do in fixed to combine to produce something new that I have not thought of yet.

Lee: I completely accept that and maybe I am driving a point too hard here because I am actually wanting to go to one of my conclusions which I will share and we will see if you agree with it.

For too long especially on Internet, in chats and discussions and so on, people are excited about what we call naked VoIP, place a call, chat and end a call. It went over IP, let us get excited about it and this has been annoying me for a long time because I just see voice as something which can be imbedded in other places and that [telephony] is an application which hung off an electromechanical network and we are not in that position today. So imagine what you are saying is that...

Hey, you are not excited about your VoIP, naked-VoIP, but you are excited about is it being combined into other services and innovative applications, where it is imbedded and not primary focus.

Brough: Yes, exactly, that is the point. I am just saying that more

likelihood that will happen in a mobile environment than a fixed environment just because of the competition and the mind set. The point is to figure out what the new kinds of communication are that may or may not include live voice connections, but include a myriad of other forms of communicating.

Forget about VoIP, we are supplying various forms of mobile video technology most of it circuit switched, that has been embarrassing, but that is the way it works today, to people in Asia who are inventing all sorts of cute services and dating sites and social networking things. These are people communicating non-real time in voice or video driven by their hormones perhaps, but it happening. It is different. That is a form of communication and it includes as one option that actually talked to somebody and maybe you want to be able to talk to them without them actually knowing your phone number and..,yes, it is a whole set of issues.

So you can look down on it as another dating site, but I see innovation there in combination of the Internet and mobile telephony that I do not see so much in the fixed line world.

Lee:

I very much agree that the innovation focus is definitely on the mobile, on wireless handheld devices. There is no argument there because it is on you. It is personal. It knows where you are and it is with you all the time. So it can learn about your life more. That is definitely the platform as you say over the next three to 10 years is definitely the space in which I see the most opportunities. What has been annoying me aside from this excitement about what you are calling digital pots over IP, this love with a thing called "VoIP", this POTS replacement, is that mobile operators - their services have been very localized. Only within a country and there has maybe been high charges for them. They have not really been taking much and have not been much consumer attraction. I would like to ask and I do not know if you have, done any thinking about it. Do you think the open spectrum is a possible opening up of gates to innovation?

Brough: Yes, but not on a close enough time frame. Most of the open spectrum things are pushing for a different way for a spectrum to be made available.

The arguments in favor are the fact that we took a couple little slivers of junk spectrum in particular at 2.4 gigahertz, which nobody else wanted because microwave ovens and various industrial equipment was already using it. By making that available we have got more innovations there than in practically anywhere else in the entire spectrum

their arguments in favor of open spectrum, but they are of enormous numbers of invested interests and most of the politicians want to make a ton of money by auctioning off spectrum. So, anything that can be reclaimed is liable to be sold for top dollar.

So, I love the idea of open spectrum. I promote the idea of open spectrum, but I do not expect there to be a lot of new open spectrum having an impact on anything in the next three years.

I am hopeful that the white space once analog TV is turned the white space between digital TV channels will be made available. That is an argument going on in the US right now.

But, if that is resolved it might begin to have an impact in 2010 and be a big win by the 2015, but these are slow things because there are a lot of vested interests

So, now if I think about what are hope is for getting global mobile internet access and that is really what you want as mobile open internet access anywhere in the world. It is the fact that the mobile operators are deploying evermore data infrastructure just because of Morse Law and nothing else.

Mobile is at least competitive. Software defined radio technology is coming along, which means it is getting a little bit easier to get phones that have multiple different radio receivers in them. So it is becoming possible to receive several different cellular bands and Wi-Fi and maybe in the future Wi-Max, so if you have a number of different people competing to offer you what becomes Internet access and you have a hand set that can tune to several different choices and pick whatever is cheapest at the place and time that you are at.

We could see mobile open Internet access as reality in less than five years whether we see it in the next 24 months or so I do not know.

We do see it today already at pretty high prices. If you look at what is 3G technology being used for in Europe and the US today the number one purpose is for more voice traffic, but if you set that aside what is the number one data application. The answer is USB modems. In the US for $80.00 a month you can get broadband connectivity for your PC over 3G. That is really a dumb pipe application. Yes, it is an open access with some asterisks with some limiting the terms of conditions and so forth. But it is a competitive market . In the US, we have three nationwide footprints right now and a half in the case of T-Mobile USA. But T-Mobile USA paid a lot a lot for spectrum in 2006 and we will probably be a fourth nationwide 3G operator by 2009 so there is a lot of interesting things happening and there are several things in Europe where you got four more competitive operators including in the UK. So one way or another whether 3G, 3.5G, WiMAX, access to open local Wi-Fi hot spots the chance of getting open Internet access while you are wondering around first with the PC and later with a smaller device down to a mobile handset. It is getting better and better. I am fairly optimistic on the mobile side.

We will get open Internet access in less than five years.

Lee: That is maybe one area where US has won an advantage because you have a large geography there and you can go coast to coast and pretty much go in operator 3G. Where as in Europe - say in Denmark with a Danish SIM and you have unlimited Internet access again via 3G or 3.5G. Once you go into a neighboring country which is exceptionally easy to do in these small European countries and then let see you go into Sweden. You are hit with access rates all over again for data roaming so you just do not use it. Take for example the moment I am in Vienna, Austria. I have got unlimited data access on my UK SIM, but I will not use it because I will be hit by a huge price. Can you respect the difference there, the take up may be different?

Brough: Yes, the unfortunate thing is that the problem of Europe has is the result of some very well intentioned regulatory actions that with hindsight were a big disaster. In US, we had a place where it was an early AT&T wireless at that time not the current one, but the one that existed in the late 90s struck some deals to basically provide a high priced national roaming thing...and when they rolled out, that was called the digital one rate program and when they rolled that service out, no one else could match it and every other operator was scrambling to come up with some sort of alliances and interoperability things so they could match this AT&T service to AT&T digital one rate. The same thing happened in Europe, in the US, no regulator intervened and the result is we ended up with many competing people offering nationwide roaming. In Europe I think it was a Vodaphone. There was a set of acquisition things with Vodaphone in the UK acquiring a German company.

Lee: Mannesmann

Brough: exactly and the EU regulator freaked out about possibly monopolist activity on Vodaphone's part not realizing that there were other competitors in the market and so they basically forced Vodaphone to back off and maintain each country as a separate domain and the result is there is no European wide roaming and the prices are ludicrous and the regulatory intervention, now the regulator is trying to come back in and repair the damage

but it may take a few years to straightened out and there are so many vested interests now because of course, the operators make more money this way by not having to compete for EU wide roaming.

It is a complicated situation but it...

Lee: It is certainly not a good situation, I can tell you that much. Just before I came on to interview yourself, I was out to lunch with someone and he is another Scotsman here in Austria and he badly needs email access so I showed him here is my N95, but I won't load Gmail because it is my UK SIM and I do not want hit with this silly data roaming rate. He said good "I will get an Austrian data roaming SIM and it is only 20 euros a month". It is unlimited Internet. It is high speed circuit switch data. You should get 1.8 MG in Austria but he is out of Austria at least once a week in some other European country and so I say and he is not such a technical person- but I had to say look if you go out of the country, you are not going to be able to check your mail and so on without an extortionate cost. You can access the Internet but the costs just would not be worth it. He was completely puzzled as to how he could be paying for unlimited access. But as soon as he stops outside a little European national border, he is being clobbered again so it is a very unfortunate situation.

Brough:

The point is there is a lot of outcry right now and presumably the regulators will figure out how to fix it but it is a place where we just lucked out in the US because the regulator was not trying to do anything good or was not paying attention so there was no any intervention

and mobile is actually a competitive market so the reaction was when it looked AT&T was going to sew up a nationwide thing, within less than nine or 10 months, they had two competitors who had also put together a hodgepodge of roaming deals and whatever so they could offer a nationwide package also and since then, the prices for that nationwide package have kept coming down to the point where most people have the nationwide package just thrown in.

Lee: But when you say nationwide and roaming, you mean data roaming, Internet access?

Brough: Either. It started with voice but it works the same way with data.

Lee: Okay, our hope, when is I say our hope, I mean us who are having to suffer doing the SIM card juggle every time we land in a plane and acquire SIM cards in every new country we go to. We have a lot of hope in the open spectrum because for example in UK, I should not mention large company names. But they are looking at acquiring analog TV channels. I just have to watch because the information I have got, I cannot guarantee it is on the Internet [it was and is public domain], so I turn from 700 megahertz, Google's Android, have you had much thought about that?

Brough: The number one thing that interests me about is not just Google Android although NMS communications is participating or our Livewire mobile group is participating in the Android, the Open Handset Alliance.

But from my perspective, the thing that is interesting is a series of attempts to open up the network and the first one that got broad consumer awareness was obviously the iPhone. Steve Jobbs and Apple made a wonderful thing where consumers, non techy people are suddenly aware that there is an issue about being locked into networks and having this capability and so forth. Then with the Google Open Handset Alliance and Android comes another wave of stuff that got broad coverage in not just the techy press but also in nighttime TV and so forth . So it takes a series of these things to get awareness to the point where non-techy consumers understand that there is such a thing as having an open device that is not locked to a particular operator and where politicians and regulators understand that issue.

I think we are we are making progress so that is the first thing where the Google Android helps. The second thing is all and I do not know how much this has made it out to consumers but it certainly had some impact in the US Congress and that is all the discussions of the 700 megahertz auctions and what is Google going to do and so forth. Again bring up the whole question of open.
I have written a few blog posts about what I think is going on with Google and 700 megahertz but it is just speculation.

The one important thing is that it is another piece of raising awareness with consumers and raising awareness with legislators and regulators about what open access means.

Any raising awareness in that grounds is good.

Lee: In the 1990's or at least the very end of the 90s, the hype was amongst all other hype was that 3G was going to change society fundamentally. We were going to be browsing the web, walking down the street and consuming lots of videos pushed to us by mobile operators and content partners.

It is 2008 now and that has not happened, at least not in Europe and the US. Do you think that with the iPhone beginning to warm up especially the US market to the notion of open handsets and innovation on the handset, the Google 700 megahertz, possibly going in that direction, Android, do you have the hope that almost 10 years after the hype, that mobile is the new frontier?

Brough:

Yes, I am very optimistic certainly in the three to 10 year timeframe, I see open mobile internet access at the rate of a couple of megabytes down and several hundred Kbytes up becoming a reality in certainly the US and probably in any competitive market over the next three years. I see just competition driving people to open things up and that is a wonderful platform in which to build all sorts of new services.

You mentioned everybody waiting to see if any video would happen. I have looked a mobile TV. I have looked at various video services. I have experimented with a bunch of them. It is pretty clear that there is interest in mobile video but it is video on demand and not broadcast and it is short subjects, short clips and three quarters or

80% of the stuff that those people who do things actually look at is stuff that has been sent to them by friends or referred to them where friends sent the equivalent of URL and what is going on is it is not about a limited amount of content that is on the operator's WAP deck. It is about a bunch of user created content. It is about access to YouTube. Being able to refer people to weird things and we are not quite there yet.

But the big break though this month, January of 2008 is that YouTube finally has a mobile version. But that is not going to get us anywhere unless the operators actually allow everybody to connect to it. I suspect there is a large untapped opportunity for video short subjects three or four minute things or one minute things that you might watch in an odd moment or that you might send to a friend and I think that will be realized but only after we get away from the walled garden and there is some easy user interface that allows people to pass this stuff around.

Lee: So, you are saying quite clearly there that people are more interested in sending content to others and sharing their own produced content, user generated content than they are in consuming little say MTV snippets?

Brough: Even if they are interested in consuming professionally prepared mobisodes, that is cool, it is just that you need the broad range of content that you cannot get from mobile operators today. At least in the US, about a year and a half ago, I was on a panel about mobile TV with people from Verizon and ESPN and mobiTV and Sprint and I cornered the guy from Verizon at some point and just said how do I cut a deal with you if I want to put my content up and his answer was basically we only have one and a half full time equivalent people involved in business development so we do not have time to talk to anybody who is smaller than ESPN or Disney, in other words, you cannot.
So until that changes and it actually becomes an open garden, not a walled garden, that is open access to YouTube and the 20 YouTube clones, the world is going to remain the way it is for the last eight years but the moment they open it up, I am quite positive that people will be passing round things including passing around pointers to lost scenes from Star Trek and weird professionally done mobisodes and the point is, people are looking for some breadth of content and what they are getting on the current services is really lame.

Lee:

When you are talking about when things open up, the way I understand what you are saying is when there is open Internet access and when there is open Internet access, the mobile operator does not make money per video, they just have their dumb pipe once again and it is the likes of YouTube who make money through advertising deals but it is splitting the application away from that kind of connectivity or are you still trying to say that the mobile operator is going to be the content provider?

Brough:

My guess is that the mobile operators are going to become dump pipes.

I think Martin [Martin Geddes, STL Partners] and I are in agreement on a lot of things but Martin is very focused on trying to tell the operators how they can remain relevant by opening up some of their platform capabilities to third parties.

I am not as optimistic as Martin. I do not think most of them ill open up soon enough and I think there is a second problem that most mobile operators are national or perhaps regional. They are not global so my guess is that a few of them will figure out some of the innovative things that Martin and STL Partners are talking about and the majority of them will just become dumb pipes.

That is not necessarily bad. A lot of people say I do not want to be a commodity that is low margin business but you have to remember that a commodity business is also by definition it is a high volume and there is a different business model but there are plenty of ways to make money in commodities so.

Lee: So this may be an awkward question for you and particularly in the position you are in but I will still ask anyway.

It seems to me you are accepting that over the next five to ten years there will be an operator mass consolidation?

You do not have too many commodity key players let's face it. You get fewer and you get bigger.

Brough:

Yes, I suspect that is true. Certainly as I look across countries. There is already a lot of consolidation going on.

There are three mobile telephone groups that control about 80% of all subscribers in South America. A year ago there were eight mobile phone groups that controlled three quarters or maybe 60 or 70% of all the subscribers in Africa. What has happened in the last 18 months is that group of eight has dropped to about six.

There are going to be some major international brands that cover much of the globe, but as long as you can have ideally you would like to have four competitors in any one location because that is the thing that tips the balance and causes ramped competition.

One and two are monopoly, duopoly is hopeless. Three, can be sort of stable, but four gets you ramped competition. If you can keep four people and they are global that is okay, when you get down to three it becomes a problem and if you get two to one, it gets to disaster then you are back to the old fix line monopoly and no innovation for decades.

Lee: But, hopefully, when we get there and it is a dumb pipe largely then I do not worry hopefully. I do not have to worry too much about innovation [because over the top players will innovate]. You would like the dumb pipe to be innovated?

Brough: I want the dumb pipe to keep getting faster according to Moore's Law. The wireless mobile dumb pipe. There is no reason why it cannot get keep getting faster in decades.

Lee: In Europe in particular, because of the whole SIM card juggle and you cannot data roam without being slaughtered. In particular there is a lot of hope that with consolidation that it will end up in pan-European players. But hey we can see what happens. If it does not happen that way I hope we get access on fatter [pipes] to the Internet some other way so that we can communicate without huge toll booths in the way so that we can innovate together and co-create value at the edge. And talking of co-creation at the edge of the network, I should I ask you what are your current interests and kind of what you are focusing on at eComm?

Brough: This has nothing to do with my day job but an interest for sometime has been for sometime in broadband Internet access especially in the fixed fiber to the home, fiber to the neighborhood or other ways of fiber or combinations of fiber and local consumer owned wireless meshes - that has been an advocation for several years and it is a place. I have a number of things to suggest there, things that blogged about and I discussed with people in the community. I figured this was a time to organize my thoughts and make it a straight forward pitch. I think there are three topics but I'll probably only cover two of them. But, the first is just when people talk about how to get fiber to the home and so forth, almost all of the conversations I hear are couched in terms of the existing telephone or cable TV regulatory environments. And very seldom do I run into anybody who actually talks about what you would do, what would make technical and economic and business If you are coming in with a clean slate. I recognize that there is no way that you could get the best way of interests to back down and give you that clean slate. But, if you never thought of what you really would like on a clean slate then even over ten or twenty years you are never going to get there. If we can identify what makes sense, it may take 15 years to change and get there, but at least we have some understanding of what would make sense. I do not see people discussing that. Part of, I have got bits and pieces of presentation which I will have before eComm.

Lee: Please.

Brough: We have gotten a certain amount of material that I have presented in bits and pieces, which I am going to bring together to one presentation. Part of it is, if you look at the fiber to the home question. You hear a lot of people saying, well, it is a natural monopoly, if the telephone company gets there first. They are going to win. If they cable company gets their first, they are going to win and no one else could possibly compete. I guess I object to that because people are saying it is a natural monopoly.

Yes, if the only thing you are comparing is complete services, but if you are prepared to look at other models including consumer homeowner ownership of condominium fiber and other kinds of economic models and go back to first principles what you will find is the natural monopoly is the right of way.

That is the one thing which is either owned by the city or the by a governmental entity or maybe owned by a co-op if you live in a gated community, or it might be subject to some right of way over someone else's land based on common law dating back 1,000 years. But the point is the right of way is certainly something that is a limited bottle neck. When you put stuff into the right of way like conduits and fiber and so forth. You could think about putting competing conduits in the ground. We do have water, sewer, gas, electric, phone, and cable TV already. So you could think of having two or three conduits in the ground. It may or may not make sense since conduits have useful life measured in a minimum of decades. Likewise, if you pull dark fiber into these things, they have got a useful life, dark fiber the minimum use for life might be 20 years and in reality it might be 50 years or 100. The fiber is not wearing out, the dark fiber. So, you could argue that those things might well go with the right of way as things that should be either government owned or community owned or owned by individuals on a condominium basis. If you think of models there...

My problem is the moment you connect any kind of electronics to this you are connecting something that is obsolete in a year or two.

Moore's law causes the lasers that light up the fiber. The electronics that provide the Internet or any other kind of protocol. The routers, every piece of box that you would connect to a dark fiber is subject to Moore's Law, and it typically has a life of less than two years before it is functionally obsolete and maybe three or four years before it is literally long overdue to be scrapped.

Lee: Have you been having chats with James Enck who stopped blogging about a year ago by any chance, when you talk about this community owned glass?

Brough: Yes, I have not talked to James Enck since he stopped blogging, but I was an email correspondence at that time through his blog and independently. Also, Bill at the Canary Group in Canada. In fact back in the late 90's thru about 2002, I was in communication with the then managing director from STOCAB in Stockholm. So there are a variety of people who are understand these issues and talk about them, but they do not get a lot of coverage.

There a half dozen of people around the world and they are not getting through to the mainstream discussion

as nearly as I can see and that is something that I am thinking I may spend a lot more time on in the next two years.

Lee: You have been talking quite a lot on, I hate to say the phrase. "next-generation", that phrase has to die at some point, but next-generation mobile applications that seems to be a big topic of yours. Can you summarize what you mean by next generation mobile applications?

Brough: I think the mobile phone or the mobile hand set, because it is a lot more than a phone is the intimate personal device that is associated with people. I am not advocate of everything being convergent to it. I agree with Dean Bubbly that people will likely have a variety of special purpose devices on their person, but the reality is a device on your person is a communication device or devices that you most favor. I see all sorts of stuff in terms of communication between live talking to each other, two-way voice, and one-way radio. Mom I'm climbing Mt. Fuji look at the view, real time things like that, video sharing will have you two near real time messaging, which is what real instant messaging is. It is what SMS and MMS and a lot of social networking chatting is to slower speeds stuff like blogging to email.

There is a progression of things that involve communications, a variety of media, a lot of information about who is available to talk to whom at one circumstances that is a very rich field for innovation. It probably happens in the context of your personal devices that you carry on your body. In that sense, the innovation is in the mobile domain

Lee: Can I jump in there and add something. Today, people are talking about slow down and so on, economically. I know, and I would not even say impression,

I know as a hard fact the opportunities today in the mobile space is just beginning to break open at the end of last year are just unprecedented and there are huge opportunities for huge winners. And unfortunately, there will be large losers in the mobile space. Do you think it is a good time for VCs to start getting excited again about the mobile space?

Brough: Yes, I think it is a good time in terms of what is happening, in terms of data rates and capacities, things politically opening up and in some sense when business is having problems, when there are down terms recessions or something, it is an ideal time to do something new because as you come out of a recession indoor growth phase, the people that were doing something during the recession have the leg up are poised to get there wheras as the people who did nothing during the recession and start once business is doing well again ,are typically late. I do not know if you we are about to have a recession or not. If the slow down is just in the financial community or it is going to be more pervasive, I don't see it being a slow down in high tech yet, but whether a slow down, I do not think that is any reason not to barge ahead. It's even a compelling reason to go ahead and barge ahead and do something new. Time is right.

Lee: Brough you are moderating what I feel is the most exciting panel at eCcomm., which is on mobile innovation, Can you name at least one person who you are excited to have on that panel that you are putting together?

Brough:

Among other things for sure is Rich Miner who is one of the architects of the Google Android Open Handset Alliance program. Looking to get a few people together so that we get different views of platforms for example Google is taking a different view of doing their own spin on Java under a different licensing and I have heard people very strenuously in favor of that and people very strenuously opposed. There is a whole question of what layer in the handset does the innovation happen at, strong arguments that could be that it is Ajax browser based stuff might be the answer in the long term. My goal in this panel is to get interesting people who have strong views and not have them get up and present a bunch of boring slides, but for me to quiz them to see if they can not get a little controversy here and at least expose what people's positions are and leave the audience to figure out what the real truth is. Hopefully, we learn a few things form this and I always find panels with speakers who get to the start, I won't say fighting but I will say getting after each others positions, controversy and so forth makes the panel a lot more interesting to listen too. So hopefully, we will have something really exciting here.

Lee:

Okay because I look forward to it so much - not only because for example Google is going to be on the panel and we ought to have Chris [Allen] who had held the iPhoneDev camp on that panel, almost others. But, I see the opportunity is really here. It is in the mobile space and as I said with the Apple, possible SDK coming up, with Android, with open spectrum. And with other APIed networks I see, massive opportunity and we are talking about what I am told is the largest market in the world. It is mobile market. I am very excited about that. The whole question is how do you going to innovate on that platform. Hopefully this is the debate that you are going to lead the eComm?

Brough:

The debate I am hoping to get people is why is there particular approach going to attract more innovators and facilitate more applications, that begs the question of what are the applications

, that is completely a subject for a completely different panel or for the individual speakers who are speaking.

Lee: I very much look forward to this panel that you put together and we have been on this call for an hour so I am going to need to go off. I appreciate your time. I really look forward to seeing you their. Thank you very much again for doing this panel.

Brough: Okay, Lee, thank you very much for having me and boy do I look forward to going to eComm and seeing you and meeting many interesting people. Thank you.