An Industry at the Crossroads: Mobile World Congress 2008 Summary


My impression of MWC (Mobile World Congress, nee
3GSM) is it was quieter than last year, less hype and less people; however, the
organizers claim attendance was up 3000, perhaps they were all the

I think the industry is at a crossroad, in my discussions
with operators internet access is the product that’s selling at the moment,
with operators facing the same operational challenges of broadband ISPs (Internet
Service Providers) as traffic grows exponentially.  Some mobile operators are seriously asking if
being a mobile broadband ISP is really that bad.  This question sets up the crossroad, do
operators take a left and follow the ISP route, or continue along the current
strategy, or perhaps take a right along a path that enables and enhances
services over their network (the nebulous open network initiative).

The flight to and from MWC was full of misbehaving
adolescents playing with the toys bought by their parents and ignoring the
flight-crew’s instructions to turn them off. 
Unfortunately, the ‘adolescents’ where middle-aged telecom workers
playing with iPhones.  However, it certainly
provided a clear example of why the industry continues to over-estimate what
customers can do with their mobiles.  I
felt the need to rebel, so I brought out my seven year old Nokia 6130i and pointed
out to my neighbour that it would not run out of battery during the show, he then
brought out an equally old Moto phone and agreed with me.

Top two topics: Mobile Advertising and LTE / HSPA
Evolved (HSDPA+). 

The focus on LTE/HSDPA+ (Long Term Evolution / High
Speed Downlink Packet Access) is a natural extension to the success some operators
have in providing competitively priced internet access with HSPA.  There were many announcements on this topic
with Telstra moving to HSPA Evolved (21/42 Mbps) this year, with LTE (160 Mbps)
on the roadmap.  Ericsson estimates there
are 174 HSPA networks in 76 countries with an estimated 180 million HSPA
subscribers.  Alcatel-Lucent and NEC are
teaming on development of LTE with the creation of a new joint venture, which
given Ericsson claims LTE will be commercially available in 2009, means the new
JV needs to work fast. 

Mobile Advertising is a simple label, but it leads to
misconceptions.  A more appropriate,
though not as succinct, label could be: Advertising over the mobile channel as
part of a digital media campaign.  At the
show, most applications had a “mobile advertising” component, most network
elements gathered business intelligence for “mobile advertising,” and most
service platforms included the ability to insert “mobile advertising.”  As I’ve unfortunately slowly learnt through
my career, understanding your customer in-depth and providing a simple to
understand (for them) solution to their immediate problem is the only way to
extract cash.  In Advertising, media
buyers and advertising agencies are the customers (the ones with the cash).  Very few companies were talking the
advertiser’s language, e.g. giving them ‘slots’ to ‘targets’ for their
‘campaigns.’  Instead assuming the
customer will change the way they do business given the unproven richness of
mobile.  However, the announcement from Vodafone,
Orange, O2,
T-Mobile and Three that they are working together to develop common measurement
standards for mobile advertising is a great first step

does transform the way advertising works, but equally Facebook (the online
world) has lots of information about me, yet it still keeps inserting adverts
for 30+ singles in my area, no wonder some social networks are seeing
click-through rates of 2-4 per 10,000 impressions; that’s not a campaign,
that’s an accident.  In the many pitches
on mobile advertising at the show only one company had a complete end-to-end
business intelligence and ad insertion solution, IMImobile, the wrinkle is you
would need to adopt their complete managed VAS solution for that to be the case.

Other interesting insights from
the show

The variety of mobile phones and mobile enabled
devices at the show was astounding, hundreds of new devices, at the high end Sony
Ericsson’s first Windows Mobile handset the Xperian 1, Nokia’s N96 and Samsung’s
Soul should provide current iPhone users a reason to change their device by the
middle of this year.

SUPL (Secure User Plane Location) is an IP based
method to get the AGPS (Assisted GPS – cheaper GPS unit that needs to know
roughly where it is before it works) unit up and running on a phone without the
cost and complexity of a control plan solution. 
TCS ( were demonstrating
their SUPL based navigation solution.  Available
under a rev-share managed service framework this provides an ideal first step for
smaller operators or those operators with limited geographic coverage or those
not yet convinced on LBS (Location Based Services). 

Android from Google was capturing the attention of
the press; however, there were lots of demos for the competing LiMo (Linux
Mobile) at least 10 handsets from 5 companies. 
Most of the demos were pedestrian from a user experience perspective.  Customers really care about how the phone
looks, the price, the battery life, how easy it is to use, the bundled applications,
and even the ease to sync with their corporate or personal email; OS is far
down the list.   As A la Mobile pointed
out when they announced their Android demo back in January, “Despite the
open-source nature of the Android framework, developing a complete mobile
system solution with customized, differentiated features continues to present
major technical challenges requiring considerable time, effort, and resources.”  Open source OS are not really free given the
lack of a common hardware architecture like the PC. 

SpinVox (
continues its progress, launching with Vodafone Spain.  A simple voice to text service provided as a
managed service.

Open Network is a nebulous term.  However, the SDP (Service Delivery Platform)
is becoming a focus for many  operators as they look to make it easy for 3rd
parties, enterprises and their own services to use network capabilities such as
billing, profile, single sign-on, presence, location, etc.  This was one of the topics of discussion with
many operators at the show.

Start-ups to keep an eye-on:

Cibenix ( sometimes it’s a matter of
stamina, the ODP (On Device Portal) is in a renaissance with successful
deployments in operators such as Three and Vodafone, and Cibenix is one of the
few ODP remaining.

eBIZ.mobility ( enables
operators to become a PayPal for online purchases using their existing billing

IMImobile ( has created a strong
position in APAC, LATAM and MEA.  A
simple managed VAS solution, e.g. content, content management and the gateways
to deliver the content, all provided under a revenue share framework.  Several operators and suppliers were
commenting on the difficulty to make money on content, I pointed them to look
at an out-sourced model that is making money on content for over 200 operators

Useful Networks ( and ULocate
( are saving the operator the problem of managing the ‘long
tail’ of LBS by aggregating all those weird and wacky apps and making discovery

Wadaro (
has a cute little app on the OS or SIM that monitors how calls or data sessions
fail / terminate, and reports the stats back to a managed platform.  A simple way to find problems and focus network
investment to improve the basic mobile experience.

2 thoughts on “An Industry at the Crossroads: Mobile World Congress 2008 Summary

  1. Ade

    Hi Alan,
    Very interesting blog entry. You mentioned that in your discussions with operators some mused whether “…if being a mobile broadband ISP is really that bad.” How, in your view, will they be able to make the business case for the network upgrades required to be viable mobile broadband ISPs without the payoff of revenue from value-added services for customers? Thanks.

  2. Alan Quayle

    Thanks Ade. If an operator does decide to focus upon being a broadband ISP, then they will need to significantly scale down their costs. Essentially it is a utility business case, which means more outsourcing and a reduction in employees. If they maintain their current employment level and cost structure, then operators need to improve their ability to generate profitable revenue from VAS (Value Added Services). Here the Telco API (a.k.a. ANI, Application Network Interface, or 3rd Party API) will be important in extending the reach of their service roadmap. I’ll go into this in more detail in another blog entry later this month (March).

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