Speaking Engagements & Private Workshops - Get Dean Bubley to present or chair your event

Looking for a provocative & influential keynote speaker, an experienced moderator/chair, or an effective & diligent workshop facilitator? To discuss Dean Bubley's appearance at a specific event, contact information AT disruptive-analysis DOT com

Tuesday, January 31, 2006

Per-megabyte rip-off in the UK

Listen up UK mobile operators! Your GPRS/3G pricing is ludicrous! Treat your roaming customers like this, and you're building up a future base of potential churn candidates like you wouldn't believe.....

I'm in the market for a new mobile tariff plan. I've decided I'm paying too much, and with a few foreign trips coming up I thought I'd see what's on offer. In particular, I want a plan which gives me vaguely-reasonable per-MB data charges to the "real Internet" both in the UK and from abroad. (No, not a portal. I want Google, Yahoo, my ISP Email & worldsbestbars.com when I'm on the road)

I'm not happy.

Firstly, trying to find data charges on operators' websites is almost impossible. "Check the fine print" is an understatement even for in-UK domestic rates. And I feel I deserve a Nobel Prize for actually daring to try to get to international data roaming fees.

And then the prices.

Overall, they are somewhere between 10x and 1000x reasonable figures.

For reference, let's look at what putting data onto the Internet costs. A quick burst on Google yields a few ISPs quoting $0.50 - $2.00 per gigabyte, not megabyte. Some fixed-broadband ISPs charge not much more "per incremental extra GB" downloaded on capped services, say $1-5 / GB. A not unreasonable premium vs. the scale economies of hosting.

So where do the 3 or 4 extra zeros go in the cellular network?

I'm not going to list all the tariffs here, but the typical "pay per use" domestic UK GPRS/3G tariff from a phone (ie not a laptop data card package) is around £2-3 ($3-5) per MB. Then there are bundles that give you say 10MB at 60p ($1) per MB.... but these aren't available on all phones/PDAs, or all voice plans.

So, let's say I want to get the O2-specific version of the HTC Wizard (which looks pretty ideal for web browsing over either 2.5G or WiFi).... I go through the purchase screens, and the only tariff options give me £3 per MB, with no option to select bundles, unless I want to restrict myself to on-portal use at O2 Active and i-Mode (NO!!! I WANT THE REAL INTERNET!!!!!)

T-Mobile at least gives a more general bundling offer, but we're still looking at stupid prices of around $1-2 per MB.

And then there's the killer. International data roaming.

Step forward Orange, and collect your prize for the most ludicrous tariff I've seen. Up to £25 per MB for some countries. That's $44. It's even £10 / MB to roam to Orange's home country, France. Play around with the "country select" screen here - maybe I've missed an even higher one.

Let's put that in perspective. It's cheaper to use a damn satellite connection. Or get a long-haul flight's worth of WiFi . Maybe I should do my email & browsing on the plane at 35000ft altitude rather than on the ground when I arrive.

Vodafone is a little better. They have some data roaming tariffs as "low" as £4.11 ($7) per MB, as long as you roam (and stay connected) to the right foreign operator. Wow. Or else it's back to £10/MB again.

T-Mobile's international roaming is at least simple at £7.50/MB for anywhere.

On average, maybe O2 is the "least worst".

The bottom line? Looks like I'm going to be signing up for WiFi hotspots a lot. Or using Internet cafes.

And waiting to churn to the first WiMAX / WiBro / Flash-OFDM / UMTS-TDD provider that has sensible roaming arrangements.

And I'm also wondering whether any of this could possibly be classed as "anticompetitive" and worthy of investigation by regulators. Any combative lawyers out there fancy pitching this to Ofcom or the European Commission?

Managing heterogeneity and multiple service providers

A lot of the new business models around fixed-mobile convergence, or triple/quad-play, seem to assume that a whole household will willingly switch to a single service provider.

I can certainly see why operators would dearly love this to occur - ARPU and margin uplift from bundling, customer lock-in, and easier support calls (no finger-pointing or 3rd party equipment).

But is this unreasonable? It strikes me that "in the real world" there's a whole host of reasons why operators may have to deal with heterogeneous, multi-provider households:

- One family member has a company-supplied mobile phone with a different operator
- Family members unwilling to switch ISP, owing to use of email addresses
- "Content lock-in" - eg if someone is silly enough to have their music collection tied to a specific operator's services
- A given market has two "dual-mode" operators, each providing their own home gateway, and two family members independently buy one of each
- Shared households of students / young professionals
- Increasing use of long-term contracts over 24 months inhibiting migration
- Regulatory reasons prohibiting "single phone number" or "fixed+mobile" services
- People moving home to areas with different DSL / cable availability

... and so on. All of these strike me as possible problems in reaching the "single operator utopia". Together, it wouldn't surprise me if this reduces the addressable market for such services to under 30% of what more optimistic planners may expect at first.

Friday, January 27, 2006

Predictions - FMC launches in 2006

I was at the FMC Congress again today. After his keynote presentation, FMCA Chairman Ryan Jarvis was put on the spot by one questioner, who challenged him to take a punt on how many new FMC services would be launched this year (he counts "already launched" ones as KT's OnePhone, BT Fusion)

He reckoned:

2-4 based on Bluetooth Cordless Telephony Profile (CTP) - [ie similar to KT's services]. This isn't something I've really tracked, but I guess SKT and LGT in Korea have to be fair bets to be among these prospective operators.

4-5 more based UMA - my guesses are Cingular, T-Mobile US, France Telecom and Telstra, with an option on TeliaSonera

2-3 based on WiFi SIP - my guesses would be neufCegetel's BeautifulPhone (in trial) and T-Com in Germany.

Make money out of your friends' incessant chatter.... or spammers... 3 WePay

I love the possibilities of 3 UK's new WePay tariff .

Personally, I'm very much a fan of the 4-second phone call: "Alright mate? Pub? 7 o'clock? Yep. Sorted. Seeya later". But I do have quite a lot of friends who would rather have their entire conversation on the phone, rather than talking in a civilised fashion an hour later, over a pint. Maybe knowing they were effectively buying me a drink before we got to the bar would make them change their behaviour....

Similarly, having a completely separate mobile number that I can dedicate to giving to organisations I suspect will spam me with SMSs is a great idea. I always avoid putting my mobile number into forms that I expect will generate marketing guff.

Actually, this is the first manifestation of something I've wanted and expected for ages - making the "marketing industry" pay for the privilege of marketing at me. Want to send me a piece of junk mail? You pay. Want my personal details in your database? You pay. Want to phone up and try and sell me stuff? You pay. Maybe if you've got a product & you're not wasting my time, I'll give you a refund against my future purchase. You're on commission selling me stuff? Share it.

Nice one 3, truly visionary. Now where do I send my invoice for having to see your appalling adverts on the tube?

Thursday, January 26, 2006

Hosted Mobile PBXs. Yawn.

I'm staggered by the amount of blather I hear around the concept of hosted "mobile PBXs". Loads of operators are talking up the proposition, and Broadsoft, Speakanet & assorted others extolling the virtues to me in meetings & conference calls.

"Ditch your lump of Avaya or Nortel tin, and just use your normal mobile phones with some clever gimmickry in the network to set up call groups, easier hold & transfer, and if you're really lucky, cheaper on-net calls to your fellow employees"

My take? It's a niche of a niche.

Fixed variants of hosted PBX, IP Centrex, whatever you want to call it, is sort-of picking up in popularity, albeit from a very low base. Some companies like the idea of outsourcing their phone system to a carrier, with various types & levels of management. OK, fair enough, I can see the point for 10-20% of users at companies who don't want to hire another telecom administrator, or who have lots of remote sites for which PBX installation & management would be a pain.

But how many of these outsource absolutely everything? Not many. Most (especially large enterprises) will keep a lot of their telephony systems in-house, especially if they have call centres, or if they're integrating VoIP with enterprise applications like SAP or Siebel. Again, fair enough if you're using a carrier that has some IT systems integration expertise, perhaps BT's Global Solutions Division, or AT&T.

But a mobile operator, offering mobile centrex? Do you really expect them to support incremental migration from PBX to hosted mobile-based service over a couple of years? Do they have an PBX experts to help with this, or the various bits of IT integration? How will they deal with bits that have to be kept fixed (like call centre agents)? Will they be able to route calls over your shiny new IP-VPN to reduce international call charges? I don't think so.

OK, I can see the argument if you're a startup software company in Helsinki with 11 employees & no legacy PBX or key system. Or perhaps a chunk of your mobile sales force. But anything else? Maybe 1-4% of the overall enterprise marketplace (ie 10-20% of the 10-20% mentioned above).

Oh, and I'd like to see how these services work indoors in large buildings, especially if they use 3G.....

Last point. Any mobile operators out there that can honestly say they run their entire business on mobile? Including their customer service agents, their legal department's fax machines and their reception desks in local offices around the world?

We're all subsidising the truly-mobile users.....

Spent today at the FMC Congress in London. A fascinating pitch from Swisscom mentioned the fact that their average mobile customer generates 70% of their calls (and revenue) from just 3 network cells. I'd guess that one at home, one at work/school, and presumably another one at their local pub / shop / town centre.

This highlights an increasing issue I see in cellular - all the really "clever" (and expensive) bits of the network, like cell-to-cell handover for example, aren't actually used that much.

Essentially, the 90% of people using their mobiles on the sofa at home are subsidising the 10% who are actually driving down the motorway or sitting on a train.

And given that at another conference last week, I found out that up to 20% of a 3G phone's sales price goes in patent royalties, I wonder just how much of that costly IPR only gets used once in a blue moon. Never mind patents being based on "how important they are to a standard", how about pricing them on "how often they're actually used".....

Monday, January 23, 2006

Enterprise VoWLAN and SMS

Hope to catch up today & tomorrow on a couple of things outstanding from last week. I chaired a day of Informa's Multimode Handset conference in London on Weds / Thurs and saw a lot of presentations about combining WLAN, cellular & other stuff (mobile TV, GPS etc etc) into phones.

A few things stood out in my mind.

First off, a very interesting presentation from Cisco about its view of dual-mode devices & how they might work in the enterprise. Although I regularly meet with Cisco, the profile of enterprise telephony tends to be pretty low in many cellular industry suppliers, who prefer to deal with markets with number of users in 9 or 10 digits, as they're selling software or chips for a few cents or dollars apiece. Enterprise mobile is "low volume, high value" - great if you're an operator or integrator, but mostly just icing on the cake for a chipset supplier.

Cisco's speaker came from the company's IP Communications division, and continued the last few months' tradition of drip-feeding information about the upcoming Cisco dual-mode solution, based around Motorola and (especially) Nokia dual-mode phones. (See my earlier post on the E-Series) . All good stuff, and I'm expecting to hear more noise still over the next month or so. My betting is on some major integrators and fixed/mobile operators (probably existing Cisco distribution partners) to be in the vanguard of shipping things.

But one thing stood out - and this also applies to the Avaya / Nokia solution as well. In general, the idea seems to be to tie all corporate comms back via the enterprise-adminstered IP-PBX, and to encourage employees to use the fixed-line # rather than their "native" mobile number where possible. This makes sense for a few reasons, but depending on how it's implemented, has one major potential flaw - poor integration with SMS, and possibly other cellular applications.

Particularly in Europe, business people SMS each other as well as email. "Running late", "At airport, in lounge", "Can't spk now, in boring mgmt mtg, boss droning on".

SMS needs to work "nicely" when the dual-mode device is in VoWLAN/IP-PBX mode. This is especially true if the solution aims to "cloak" the phone; mobile number and pass off the call as a purely PBX-based call with a fixed-line #, tie in with conferencing systems etc etc. But if the employee texts his client, then caller ID will reveal the "real" mobile number - which the client / supplier / colleague will then just enter in his or her mobile's address book and use by default.

It's not especially complex to fix this in theory, but the messaging functions on IP-PBXs tend to be very voicemail/email/IM-centric, with poor (if any) SMS integration.

So. A suggestion to Cisco, Avaya, Ericsson, Nortel, Alcatel, Siemens & assorted other IP-PBX and VoWLAN people - sort your SMS integration ASAP, and don't let your North American R&D & product marketing people tell you it's a low priority.

Indoor cellular services

One of the lowest-profile, but most interesting, backwaters of the wireless business is that of on-campus / on-site dedicated "private cellular". Various regulators, companies and service providers have given the green light to corporate-level local cellular networks, which run in specific dedicated slices of spectrum, often at lower power levels than the main "macro" networks in the same country. A typical application is for a company to build "its own MVNO" - ie using ordinary low-cost cellphones as the main communication device for employees, switching "on-net" calls locally and connecting in with their existing PBX or IP Telephony system for cheap/free intra-company tariffs. Often, the private cellular network will have dedicated in-building coverage, using pico-cells or distributed antenna systems. Potentially, very individualised "local functionality" can be added, enabling customised services to be offered on a site-specific basis.

The best-known European examples of this approach are Swiss operator In&Phone and Swedish operator Spring . Also, UK regulator Ofcom is currently formulating plans for auctioning "spare" slices ofGSM spectrum in 2006, that may also enable indoor applications from new operators. Disruptive Analysis is aware of various companies' interest in this spectrum.

It's worth noting that this approach is different from the type of "Mobile PBX" solution espoused by companies like BroadSoft and Speakanet , which use the macro network's coverage and frequencies, rather than dedicated in-door spectrum and a separately-licenced service provider. These services act as a value-added "intelligent network" overlay application, and group together a given set of numbers, rather than acting in the site-specific (and improved indoor coverage) mode of the private cellular option.

One of the notional disadvantages of this type of solution has been the need for the "indoor" operator to enable "roaming" from the in-building network onto the macro network. (The operator is typically a specialist provider acting as outsourcer, rather than the company itself - most corporates or universities don't have the skills to build & manage a cellular network). Given their frequent opposition to regulators allowing new players to cherry-pick profitable niches like corporate campuses in the first place, there is understandable reluctance from established macro-cellular operators to conclude such agreements. It is therefore notable that In&Phone has just signed such a deal, which holds promise for similar models in other countries.

Overall, this adds a new twist to the corporate FMC / indoor-coverage / PBX-integrated wireless marketplace, which looks to be shaping up into a 4-way fight:

- conventional macro-cellular networks with mobile PBX "closed user groups", or mobile VPNs, for lower on-net tariffs
- conventional macro-cellular networks with an "Office Zone" tariffing system, reducing prices within a given cell (essentially a corporate version of O2 Germany's Genion-type system)
- dedicated in-building cellular networks (ideally with an external roaming partner, or provided by a macro operator in the first place)
- dual-mode VoWLAN / cellular, offering the benefits (free calls, productivity etc) of a "full VoIP" solution indoors, but at the cost of dual-mode handsets and additional infrastructure and integration.

From my perspective, there's no obvious outright winner yet. It'll depend on country/regulations, business demographics (company size / industry / building infrastructure etc), device costs, PBX interoperability and the relative difficulties of installing new in-building WLAN vs cellular coverage solutions. It'll be interesting to see what new changes in this landscape are announced at 3GSM in February.

Sunday, January 15, 2006

Dual-Mode handsets done right

I'm regularly asked to explain my scepticism of UMA and so-called "seamless" behaviour of dual-mode WiFi/cellular phones.

One of my core beliefs is that consumers will use WiFi-enabled mobile phones in a very different fashion to ordinary cellular-only handsets. They will want the WiFi function to do a lot more than simply extend cellular coverage, and offer transparent "access agnostic" links to existing mobile services.

In particular, I think consumers will want to do a lot more than access "services" with a dual-mode device. They'll start treating the phone as a piece of home consumer electronics, rather than purely a "service-led" device. They'll want to get MP3 files from their PC's hard drive over WiFi, maybe share contacts, and possibly hook into all the other new bits of WiFi-enabled gadgetry around the home. They'll want to use the phone to browse the web via their broadband connection from the sofa (with no per-MB charges), and use the integrated WiFi to access email, IM, VoIP (yeah, maybe Skype) and all that other good "proper Internet" stuff.

UMA handsets, on the other hand, will tend to usurp most of this in favour of billable operator services, just using your WiFi as a way of tunneling the (locked, walled & expensive) cellular "user experience" over broadband. On some phones you might be able to get at some of the other functions over WiFi, but only if you go down 17 levels of menus & obscure configuration settings, and your operator hasn't locked all that stuff down.

On the other hand, UMA and its next generation, 3GPP GAN, is actually a standard, while the various approaches using SIP alternatives are more proprietary, and also tend (at the moment) to lack the much-hyped voice seamlessness which I think really isn't that big a deal.

All of which means I was very happy to find that French broadband operator NeufCegetel appears to agree with me, and is working on a trial dual-mode solution that uses SIP and a proper PC/Internet-integrated smartphone. "Choose music, photos, videos or other documents on your computer or the Internet and load them at high speed"....

.... although maybe, just this once, they should have diverted a few pennies from their clearly very innovative R&D team, and spent a bit more on their marketing & branding efforts.... I mean, I know beauty is in the eye of the beholder, and the Qtek 8300 that NeufCegetel is using isn't really an UglyPhone, but still, would you want to say you had a "BeautifulPhone"?

Thursday, January 12, 2006

Thoughts from Africa

Happy New Year.....

Before I get onto analysing the growing stream of pre-3GSM announcements, a quick post on observations of things mobile/wireless-related from my recent trip....

- I bought 3 prepay SIMs while I was away: 2 in South Africa (Vodacom, at about $3 each, I lost the first one...) and one in Mozambique ($2 on mCel, including $2 of credit). So, these supposed "2 billion mobile subscribers" worldwide? Just how many are duplicate SIM owners? I could quite believe that 10-20% of the global total are double-counted
- Plenty of GSMA-inspired low-cost Moto C115's in evidence
- ... but also quite a few high-end devices. Notable that a few shops in Maputo (capital of Mozambique) stock Moto RAZRs, Nokia N-series and other similar handsets, while Motorola has an extensive advertising campaign in the region for RAZRs - and not just in affluent areas either (I saw a huge poster in the JoBurg township of Soweto) Also quite telling that there seem to be various 3G phones sold in countries which only have 2G networks.
- Very few non-Moto/Nokia phones in evidence. A few Samsungs (especially in S Africa), but I hardly saw any LG's, S-Es or others.
- In Mozambique, everyone sells prepay top-ups. Clothes shops, pharmacists, petrol stations, hawkers on the street. Advertising is everywhere.
- Vodacom sponsored a music festival on New Year's Eve in the remote area of Tofo Beach, 7 hours' drive from Maputo. I guess the roaming revenues from a couple of thousand South Africans must have justified the expense....
- Public Internet access seems considerably rarer than in Asia or South America. No Bolivia-style Internet shops full of schoolkids doing homework and IM'ing