3GSM hot topics
A new location and a new focus to the 3GSM conference programme, although some of the topics up for discussion are reassuringly familiar. Keith Dyer looks ahead to what are likely to be the key themes at the Congress.
Close on 900 exhibiting companies, 35,000 people through the doors, and another 15,000 milling around the hotel lobbies and conference rooms who never even make it to the Congress proper.
It is, by any standards, a large event, attracting pretty much the entire GSM community and friends for the week. Although 170 nationalities are represented, it’s still predominantly a European event in terms of visitor numbers — the continent supplying 65% of the attendance. And it’s only partially a show for operators to come and talk to suppliers and consider buying — only 20% of total attendees work within operators. But that’s still 7,000 people working for mobile operators coming through the doors, seeking enlightenment, a meeting with an interesting potential new supplier, the sniff of a deal. And the industry has become much more interconnected than a simple buyer-supplier split. Media content and media companies, convergence and new wireless technologies are bringing differing players into the market, all looking for partnerships, the best company to work for, looking perhaps just to understand another part of the market they have previously not had to deal with before.
In years gone by, and we’re talking reasonably recent history here, not the table top outside of a conference beginnings of the event, the show has been structured around the activities and desires of the incumbent manufacturers. Nokia, Ericsson, Siemens and Alcatel, Nortel, Lucent and Motorola took the most space, expected full attendance at their press conferences and laid down how it was going to be.
But now the mix is much more radical. Only Nokia and Motorola, for a start, could hold a press conference and talk devices and infrastructure and services. And then there are the Asian competitors, who of course demand to be listened to, and bring completely different perspective on the industry from a content and applications point of view.
But even more differently, the operators are beginning to make their pitches at the event. T-Mobile and Orange both make a concerted effort to put their message across? Why, at a show where it was once assumed they were there to do the buying, are they there to do the talking? Well, of course, for just that reason. Pan-continental operators with their sort of presence can deliver a message to their market and to their competitors, can set the agenda for their supplier companies, and influence debate. They can also look attractive and powerful to potential media and content partners, convincing the record companies and film production companies that they have the scale to deliver their products.
So what are these operators likely to touch on, as they seek to influence the debate? Well last year it was a vision of users accessing services through integrated multiple access modes — mobile, WiFI, fixed — but accessing services built and delivered from a converged single platform. The bearers would be WiFi, 3G with HSDPA, perhaps a flirtation with other fixed wireless access methods in appropriate markets. The delivery mechanism for the control of the applications would be IMS. Service layers would flatten out.
So this year, is it likely to be any different. Well, on IMS, one company has recently polled operators on their attitudes to IMS, and found that although intentions are positive, there is still a lack of clarity n some areas.
The survey, conducted by independent consultancy, Loudhouse Research, found the rising costs of new service provision on legacy architecture, together with the need to offer attractive service bundles to subscribers is driving the move to IMS.
We can be reasonably sure that IMS will remain a hot topic this year, given that 60% of respondents believe that creating a next generation IMS network is a key priority for their businesses. The reasons for this conviction are reducing operating costs, with 93% of respondents believing that IMS will have a positive impact on operational cost reduction, with 40% considering that impact to be ‘significant’. Indeed 65% of respondents agree that phasing out proprietary hardware is imperative in order to stay competitive over the next 3-5 years.
However, the migration path was estimated by respondents to be at least 12-18 months long. And with the structural change of IMS, comes a major shift in thinking, representing a range of business and IT challenges. Particular issues raised by the research include an certain ROI model (54% of respondents) and technical change (60%). As an example of this lack of clarity, operators yet to begin IMS deployment projected ROI within 1-2 years, while those currently implementing strategies are seeing a longer term return of more than two years.
As significant, and something which impacts the whole model of the industry, is that 84% of respondents see business change as the significant challenge in delivery against IMS strategy. In other words, IMS brings benefits, but as well as reducing operational cost and increasing service flexibility, it also scares the trousers off some operators,
IMS implementation also lacks examples of best practice, with 79% of carriers using a disparate combination of tactics to deliver IMS.” Although multiple applications and replication are common across HLR infrastructure, operators are slow to move to subscriber-centric alternatives to create an ‘IMS ready’ network,” the survey authors reported.
Andrew Wyatt, VP Global Marketing at Apertio, the company that commissioned the research said, “Operators have given themselves ambitious opex and capex reduction targets of 10% and 5% respectively, and see IMS as a key tool to achieving these goals.”
“This suggests that once implementation is underway there are surprises en route that can push back deadlines.”
“More worryingly, perhaps, is the confused picture around establishing the business case for IMS as the approach to adoption varies from carrier to carrier. Operators run the risk of failure in delivering against an IMS strategy if plans for implementation lack the appropriate breadth and clarity. Chasing short term revenues with pseudo IMS ‘point solutions’ significantly impacts the broader transition towards a true IMS architecture.”
So this research suggests that there is going to be ongoing discussions on IMS, and most interestingly that will be, first, on ROI, and secondly on the changes to a company’s business processes and markets.
And what that means is, due to the development of convergent multimedia platforms, content. A brief glimpse at the Conference programme shows the GSM Association itself has recognised that the significant information gap this year is in the sourcing, delivery, marketing and monetising of mobile content.
Allied to this is the prospect of the changing world of telecoms, with many non-traditional players entering the market, some of them massively funded consumer internet brand names. If you doubt this will be a hot topic this year, the play our bingo game above, and see how often you tick the boxes with Google, Ebay or Skype in them.
This changing market dynamic is a sign that there is a realisation outside the mobile industry that the industry is now ready to deliver on its long held promise of delivering multimedia and content in all its forms to mobile phones. The networks are faster, service plaforms will become more manageable. Billing and packaging of services is better understood, mobile TV is breaking down the barriers of consumer resistance much faster than anticipated, as Orange is certain to hail once more this year. Vodafone’s Arun Sarin too, is likely to highlight his company’s development in this area, and its growing links with Sky TV.
So the Congress will act as a proving ground for operators to the content providers, and for the content providers to the operators. One discussion the TV companies are sure to want to have is on mobile broadcast TV. They will have legitimate questions about an industry building a business case around a technology that uses spectrum that isn’t currently available, and may not be for years. With that in mind, opinions such as that proposed opposite on this page by BT Movio are likely to get heard, and represent a challenge as well as an opportunity for the mobile operators.
The Mobile Entertainment Forum’s Chairman Patrick Parodi says that for a long time mobile operators were on the sidelines of discussions about mobile content.
“But innovation in content aggregators and companies who have expanded their handset capabilities have extended the ability of the operators to offer services,” he says.
“Operators have a better understanding of the tasks required to enhance the user experience.”
Parodi also counsels caution on mobile TV, likely to be the hot topic of the mobile content domain in this show. “Personally, I don’t think having TV on your mobile is enough. The industry has the opportunity to deliver video on demand, location based services, filtered and even seasonal content. It can deliver above and beyond the current experience of watching television to create user value.”
Finally, amidst all the talk of the changing business models, there has been a quiet change in many of the networks in the development of EDGE networks. The charts on page 22 show that despite scepticism that operators would implement the full upgrade path through 2.5G to UMTS to HSDPA, many of them have done so, even if they have kept quiet about their EDGE deployments. So perhaps those big incumbent vendors, now likely to be pushing the HSUPA button as well as HSDPA, knew best after all. Which is where we came in, I think…