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Friday, December 18, 2009

Predictions for 2010: Mobile Winners and Losers

It's mid-December, so it must be time for the annual prediction season. I've tried to keep them short and sharp and to the point - there's plenty of detailed argument behind each of these if people are interested.

I'm off away on holiday tomorrow, so may not get a chance to respond to comments.


  • HSPA+ Just like LTE, but it's got voice and it's straighforward to implement
  • Apple iPhone - looking unstoppable, playing the pricing and distribution curve flawlessly, and doubt Mr Jobs will have some extra Wow Factor in mid-2010 to maintain its cool. Apps will continue to help, although from Apple's point of view they're just a means to an end rather than an important revenue source. As usual, hardware is where the profit is.
  • Android - OK, I'm eating my words on this one, it looks like Google has got it right on the second attempt, rather than some platforms' 3rd or 4th time around. Momentum looks like it's building, unless OS fragmentation calls a halt. Might still struggle in parts of the world where low Gmail penetration deprives it of a headline use case.
  • Augmented reality - Layar and its peers seem to have tapped into something unique to mobile devices. The notion of a wireless "head-up display" is sci-fi turned real. I can see a whole ecosystem evolving here - and a set of headaches for network planners who have only just got their heads around a shift to indoor usage of mobile data - it might shift back.
  • Facebook - sets the standard for personal communications, but also the user-provider interaction model. It encourages rebellion among its own users. Meanwhile, it's turning from a service to an app-platform to a web OS. Makes mobile operators' claims of "loyalty" look like a joke in comparison.
  • Consumer femtocells - ignore the impatient critics expecting overnight adoption, the momentum is building slowly but steadily. The need for extra capacity, offload and the ability to use them as services platforms is inexorable. I'm expecting decent-size deployments in 2010 - although ignore anyone suggesting it's an alternative to WiFi.
  • Huawei - the scariest vendor in the telecom industry. Derided by some as a cheap copy-shop a few years ago, it's now aggressively pursuing every sector of the telecoms industry with skill and depth. Watch out for its handset division taking out back-markers like SonyEricsson, while the infrastucture side is still worrying everyone. The company's lack of dogmatic pursuit of specific standards is very positive.
  • "Comes with data" - 2010 starts to see the end of the "subscription mentality". Following on from the Amazon Kindle, we're going to see a range of devices with connectivity "built in" to the retail purchase price, with no need for onerous contracts. Behind the scene, new wholesale models will rule the roost.
  • Connection-sharing - I've written quite a bit about this recently, and it might take until 2011 to really pick up, but I think one of the most disruptive possibilities is that of users pooling their mobile broadband connections. "Share my mobile connection - only with my Facebook friends"
  • Operator-on-operator applications - I'm not convinced that many will be successful, but I'm expecting various MNOs to follow Vodafone's and Orange's lead and try to launch software apps and widgets to run over each other's networks, exploiting smartphones and open appstores.


  • Mobile IMS and RCS - the dead parrot is now looking undead, shambling about like a feathered zombie that won't stay buried. But there's plenty of garlic and wooden stakes around....
  • LTE - No clear advantages over HSPA, all manner of teething problems in optimisation and building scale. Looks like 2001-era UMTS. Come back in 2014 for it to move beyond niche.
  • Virtual conferences - virtually useless. Everybody hates them, irrespective of the supposed savings in travel. If I can't be there in person, just email me a PPT or PDF and give me a dial-in number.
  • NFC - the videoconferencing of the 21st century. Repeatedly hyped, repeatedly delayed and will be repeatedly ignored by customers. Pointless.
  • Twitter - either niche or irrelevant. Either way, it doesn't deserve more than 5% of its current hype.
  • Enterprise femtocells - no clear business model, and a world of pain in implementation. Question to ask your mobile operator: "How many customer-facing firewall experts do you have?"
  • Embedded 3G netbooks - The business model and user behaviour still don't stack up in most cases, a year after I highlighted the deficiencies in a major Disruptive Analysis report on Mobile Broadband. There's already evidence of fraud with subsidised laptops being "box broken" and resold. Dongles and MiFi's are cheaper and easier.
  • Smartphone profit margins - Touchscreen? Check. Fast processor? Check. Web Browser? Check. AppStore? Check. Widgets? Check. Differentiation? Nope. Margins? Ever-thinner.
  • Operator AppStores - Might turn out to be "table stakes" to play in the smartphone market, but I really can't see them being the main avenue for application sales for handsets, especially as the iPhone is excluded and every other device will have its own vendor-run store as well. Won't "move the needle" for MNO revenues or churn.
  • Aggregated social networks - As I mentioned a few weeks ago, the idea of combining various web services into a single handy screen & identity sounds great to operators and other wannabee "owners" of customers. But no user actually wants to be aggregated - we're all very good at multi-tasking now, thank you very much.
  • The terms "dumb pipe" and "over the top" - Hugely evocative and judgemental soundbites, which have caused countless executives to make hugely wrong kneejerk decisions. Try using the phrases "Happy Pipe", and "Independent Application Provider" instead for a few weeks. The world looks different now, doesn't it?

No surprises

  • WiMAX - Steady but unremarkable growth for fixed-wireless broadband in developing economies. A few high-profile mobile-centric deployments, but not many devices. Slow going for the promised new business models.
  • Open network APIs - Lots of noise around initiatives like GSMA OneAPI and numerous operator-specific programmes. Location lookups, network-based SMS, voice and CEBP, automated authentication and billing. Moderate market uptick in 2010, although with a continual battle as alternative work-arounds developed by Google et al continue to mature.
  • WiFi - Doesn't get replaced by femtocells, doesn't displace cellular mobile broadband, gets embedded in more devices. Hotspot business models largely still a train-wreck, apart from free venue-sponsored ones.
  • Nokia - finally gets going on touchscreens and decent UI. Bounces back a bit. Chugs along steadily and profitably for feature phones and the developing world. Confounds the more hysterical pessimists and doesn't disappear. Ovi might return from the dead, but I'm not banking on it.
  • BlackBerry - Continues quietly growing in Apple's PR and branding shadow. Makes considerable headway among consumers, especially teenagers who use it for messaging and Facebook. The PIN messaging system starts to encroach on MSN's territory.
  • Consolidation - margins are looking ever uglier. New business models aren't succeeding yet. Capital remains tight. Scale is king
  • Mobile TV: Was dead, is dead, will stay dead. No surprise.
  • Data roaming prices. Everyone knows it's a huge embarassment. But it's such a profitable embarassment that nobody will budge until regulators or competition authorities come after them with a big stick.

Thursday, December 10, 2009

Another operator-on-operator service: Orange ON

After the launch of Vodafone 360, there is now another entrant into the fray for mobile operators offering so-called "over the top" applications themselves, from the usually ultra-conservative Orange.

There's an article about it here . I'm at the Telco 2.0 event in Orlando today, but will try to chase down more details when I can.

One tantalising snippet though:

"Although the final details are yet to be confirmed, the network is looking at offering VoIP-type services in markets where Orange does not have a presence. It is understood that this could eventually be rolled out to customers on other networks where Orange does have a footing"

I think that this sort of operator-on-operator competition will be a major disruptor in 2010-2011. I've been talking about the idea for a few years, but it's needed a critical mass of smartphones and appstore-type delivery mechanisms to make it practical.

For some history on this concept, see a previous post here.

Friday, December 04, 2009

LTE Voice: the more I've looked at Circuit fallback, the worse it's looked

I've been talking about the problems with voice on LTE for more than two years now. I first published a report on VoIPo3G in November 2007 in which I discussed in great detail the problems with IMS voice, and the fact that there was no simple, standardised version of "basic VoIP" suitable for operator deployment. I'd previously written about the issues with IMS-capable handsets in 2006, and VoWLAN the year before. More generally, I've been covering wireless VoIP since about 2001.

A common strand in my analysis has been that the technical standards are often completely divorced from considerations of end-user behaviour and experience, the needs of application developers, the practicalities of handset design and the realities of business models.

Like politicians, there's instead usually a focus on control and ideology, rather than pragmatism.

That's not to say that every new technology development has to start with some sort of fluffy "inclusive" focus group approach, or that pseudo-cartels should invent things that competition authorities will frown upon.

It often just means that more consideration needs to be paid to questions like:
  • "Hang on a minute - how's this actually going to look in the hands of the user?" or
  • "Isn't this going to make it worse than the older solution people have already? Who's going to buy that?" or
  • "Isn't that going to break all the other applications running on the phone? What happens if it's multi-tasking?"

A very good example of this is one of the proposed standards for providing voice over LTE networks, Circuit Switched Fall Back (CSFB). This is the 3GPP approach to supporting voice which drops the LTE connection back to 2G or 3G to make or recieve a phone call. It is generally positioned as an "interim" solution before moving to full IMS voice.

I've written before about CSFB, and it's also been discussed in many of the comments threads on my previous posts on LTE voice, such as here, here, here and here - many of which also cover ongoing problems with IMS voice. (The recent OneVoice announcement is a possible medium-term solution to some of those problems).

Some of the issues that keep cropping up include the latency involved in the LTE-to-3G/2G process, the impacts on any data applications running on LTE at the time of a call, and the need to have overlapping coverage of older networks everywhere you put LTE.

I've now done a more thorough analysis of CS Fallback's flaws. I've come to the conclusion that it's not just awkward, it's actually terrible - worse than useless, in its current incarnation at least. Going back to my questions before, it seems clear that nobody ever said something like:

"Hang on a minute, LTE phones will be expensive, so our best customers will buy them first.... but it will give them a worse telephony experience with CSFB than their existing handset. That's never going to fly!."

(Incidentally, coming back to a discussion from another thread, one commenter asserted that fallback could be achieved in about one second. I cited 2-4secs, based on a 3GPP submission I'd seen, and we agreed to disagree in the absence of hard evidence. I spoke to a *very* senior person in handset RF development for a major device vendor earlier in the week, who has more cellular patents than I've had hot dinners. His estimate was for 6-12 seconds extra latency. For an LTE-to-LTE call or SMS, it would be quicker to use Morse code).

I've now written a white paper covering CSFB's major flaws, which actually seem pretty extensive even beyond what I've written above. It almost looks like it was designed to make IMS voice look good by comparison.

The paper is available for download from here. But first, some disclosure. It has been commissioned by Kineto Wireless, the chief proponents of the main alternative VoLGA, which has evolved from UMA/GAN. In common with all Disruptive Analysis' sponsored material, I only take on topics where I already have a strong opinion - I'd written positively about VoLGA since March , despite having been a thorn in UMA's side since its launch in 2004. (I'm convinced that somewhere in Kineto HQ is a dartboard with a picture of my face on it). It's not perfect either, but it seems much better than CSFB or IMS.

I'd also previously written about CS over HSPA (which is the same basic principle of 2G voice over a 3G IP bearer) in early 2008. I'd even originally suggested doing "2G over 3G" as a possible better use case for UMA than WiFi, way back in 2005/6, albeit a bit flippantly at the time.

The bottom line is that I think that 3GPP should reconsider VoLGA or something close to it. CS Fallback looks like a terrible interim solution for voice-on-LTE, especially for operators who aren't sure that their particular endpoint is IMS voice. The current two-solution approach (CSFB / IMS) seems guaranteed to either promote 3rd-party VoIP solutions, or delay LTE entirely. If the whole thing *has* been some sort of standards conspiracy to force IMS into the hands of the unwilling, I'd make a suggestion to include some game theorists in the discussion next time.

One thing I should note for completeness is that there are a couple of other options out there, notably NSN's Fast Track and another from Acme Packet and Mavenir. I haven't had a chance to drill into those as much, but from an external perspective they don't seem to have as much traction or behind-the-scenes support as VoLGA.

Once again, the white paper on why I feel CSFB is "not fit for purpose" is here.

Thursday, December 03, 2009

Facebook just added a small Twitter bird to its farm on Farmville

I'm a longstanding Twitter skeptic.

I'm convinced that its importance is vastly over-blown by the media industry itself, especially lazy journalists who use it as a quick barometer of opinion. Nobody "real" actually seems to use it, just a few people who either like talking to themselves, or who like the external validation of lots of "followers" (celebrities, politicians, social media commentators and other assorted narcissists). Some of my friends in the tech PR community have also succumbed to it, despite my attempts at re-educating them.

So I found it deeply amusing that an even more annoying social web phenomenon has now grown much larger than Twitter - the intensely irritating Farmville apparently has 69m users - a subset of Facebook's 350m. I'm one of the other 280m who've switched off all Farmville notifications from our addicted friends.

An early prediction for 2010-11: Twitter falters a bit..... then gets acquired by some wannabe media-turned-social-media company... then disappears into a black hole to join PointCast, FriendsReunited, Second Life and Friendster as one of the long list of Internet has-beens. And it's joined shortly thereafter by Farmville as well, in a pleasing sort of symmetry.