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Tuesday, April 25, 2006

Another 11 UK GSM operators (provisionally)

Ofcom's just announced its provisional list of winning bidders for its low-power GSM licences. The UK now has another 11 GSM operators (excluding O2 which already has a normal licence).

Ofcom expects to grant the licences officially next week, subject to payment of the licence fees by this Friday.

14 companies bid in the auction - the two that didn't make the cut were Zynetix and Orange.

It will be very interesting to see how rapidly companies build out services in the new spectrum - and what the usage cases will be. My view is that a few things will happen:

- the price for making GSM calls when users are not actually "mobile" but nomadic (ie at home/work) will plummet. This has already happened up to a point, but will now accelerate further, especially given other initiatives like dual-mode Fusion-type service launches and (probably) Genion-style HomeZones
- we're going to see businesses exert a much greater level of power over mobile operators. If large enterprises and government bodies have a choice of 16 mobile operators (and probably countless MVNOs), it seems very likely that corporate cellular tariffs will cease to be such a burden on CIOs' telecom budgets.
- it wouldn't surprise me if various other operators around Europe and elsewhere start to do the same thing & instigate low-power GSM regimes themselves
- it'll probably take longer to get things up and running than everyone expects. There will be technical glitches and delays in network rollout, service development and (as always) user experience tuning. For example, does anyone know what happens when a phone's "network selection" menu has 10+ options shown? Were the menus even designed to cope with that many, perhaps scrolling onto another page?
- there will probably be some interesting international-oriented business models emerging here. Clearly, PLDT is going to do something with its Philippine expats, but there are other bits of cleverness that may emerge - maybe using GSM phones to dial-in to VoIP gateways, or perhaps something with innovative roaming arrangements. I have a meeting this afternoon with a roaming specialist firm, so I'll ask them.
- a lot of companies that have been ignoring picocells and femtocells are going to sit up and take notice. I'm expecting to see that type of functionality being integrated into home gateways & bits of enterprise networking
- lots of network security equipment vendors will have to get their act together. Remember the fuss a few years ago when people were plugging "rogue WiFi access points" into enterprise networks & PCs? Welcome to guerilla wireless v2.0 , only this time with cellular.


Anonymous said...

Zynetix was the most visible player for the low power GSM with its CoffeeTelecom concept. How come they didn't get it?

Richard Edge said...

Comment in response to anonymous:

Zynetix/Coffee Telecom developed an attractive concept, and were effective in lobbying for access to the spectrum.

With all spectrum auctions we must remember - you can win by not actually acquiring the spectrum, and lose by being a "winner" if you pay too much. The format of the auction (single round, sealed bid, multiple bid values reflecting desirability of different numbers of licensees, maximum revenue combination selected by Ofcom) will have allowed Zynetix to bid highly if only a few licenses were to be issued, and to express little or no interest if the maximum of twelve were to be awarded. With twelve awarded licencees Zynetix may have been successful in not acquiring spectrum in a highly competitive market. It will be interesting to see if Ofcom publish the winnng and losing bids. We'll find out if the "winners" have won over the next couple of years if and when services are deployed.

As an aside - the Cloud/Vonage link-up announced this week provides a very similar concept, with deployed/standardised technology (VoIP over WiFi).