| CHETAN SHARMA |
| Technology & Strategy Consulting | |
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The immediate impression from the recent CTIA in San Francisco was that it is bigger with more attendees, booths, and excitement. Also, attended the Mobile Entertainment Summit (MES) squeezed at the Masonic center. Some random observations and commentary from the two events: Theme: I thought for the most part it was more of the same (compared to last CTIA) with some nuances. Solutions in each of the sub-segments like music, games, video, location, enterprise have matured in technical quality and packaging though business issues are the ones that are keeping them from mass-adoption in certain geographies. In addition, each of the sub-segments is seeing increased competition from newer players for example, Video (VisualON), Location (Intrado), P2P (Nareos), Search (JumpTap), etc. Though enterprise was supposed to be the equal personality of the show, it was clearly dominated by its evil twin – entertainment. Helping the hurricane victims: There was lot of praise for helping out with communications after the hurricane disaster. While the efforts of all involved should be commended, much more needs to be done and government should undertake the building of emergency-response infrastructure to tackle such events. It is a shame, we aren’t able to use technology when it is needed the most. Mobile Search: If there was a new area of interest, it was Mobile Search. Different vendors are still jostling to define the space. Some are trying to blur the lines between feature and product. For e.g. visual search (picture from camera phone is used as an input to query for things, places, objects, etc.) companies like Mobot or nevenvision are features of an offering not a product in of itself. Big record labels and content companies are also realizing the importance of search component if they want to be relevant in mobile space. In addition, there is a debate around white-label vs. branded mobile search solution. So far, carriers are opposed to a Yahoo or Google based carrier offering. However, mobile/local search applications will be embedded just like video player or IM client. Mobile Video: One year ago, most of the solutions were languishing at 1-5 fps. Now, QCIF 15fps is considered the base standard. There were several players who showed 30fps but data rates were touching 400kps and processors were in the 200-400MHz range – not a mass-market solution just yet. MobiTV did well to educate the market about Mobile TV and create a mini-ecosystem but its ability to grow its solution offerings from here and also deal with the competition is doubtful (unless it uses the cash it raised to buy better codecs). Qualcomm also showed their Mediaflo vision. Impressive. There are some rumors of Sprint-Nextel doing something with the technology in 06. The biggest challenge again will be the business model. Also, as we reach the critical tipping point of 1-2 million paying customers in mobile video, focus will move from unicast to broadcast. Mobile Gaming: Developers can learn a lot from gaming efforts in the industry. Some of the good games really harness the capabilities and work around the short comings of the wireless environment. The industry is becoming more and more competitive as bigger brands and online gaming companies are making an aggressive push. Porting remains a cost burden and is being outsourced by most companies. Building communities around specific games helps capture some of the behavioral aspects of user interaction and thus becomes a gold-mine for future content push. MVNOs: For the past two CTIAs we have been hearing about data-centric MVNOs from the likes of ESPN and EarthLink. Mobile ESPN is scheduled to launch next Feb with soft-launch this Dec. I believe MVNOs will potentially change our industry next year for the better from a solution offering and user experience point of view. It will pave the way in how content should be delivered to the handset. When you flip the phone, relevant content for that instant should be there .. no-clicks or browsing to get to the first screen. Motorola’s Screen3 and Qualcomm’s uiOne are steps in the right direction of enhancing usability, though much needs to be done on the back-end to enable the capability (including advertising). It is not about killer applications that every one seems to be searching for. It is about killer user experience (across applications and services). Mobile Music: There was more emphasis and talk about mobile music than mobile video, which seemed to be the rage during last two CTIAs. With Warner and Real at the keynotes, Mobile Music discussions were in full-swing. Also an indication that big brands are starting to move aggressively to take advantage of the medium. However, industry is still struggling on the business models and rev-share amongst the value-chain. Technology is the easy part in this case.
Enterprise: The biggest splash seemed to come from Microsoft. It started with their analyst-day presentation in Seattle earlier this year and now it is in open – they want to kill RIM. I think market is big enough for both companies to enjoy growth in sales though RIM will come under increased pressure as more and more handset providers license Activesync and eliminate the need for middleware. (Microsoft and Palm also announced windows TREO on Verizon's network this week). Remaining (PIM) players in the space will be consolidated or disappear in the next 12-24 months. Also, it seems enterprises are becoming more savvy about their mobile strategies and are considering solutions are part of their long-term strategy rather than point-tactical implementations which increase TCO significantly. Security and device management requirement awareness has also increased. Location based services: Back in 1997, I was involved in building location-based services and the year was billed as the year of LBS. FCC’s inability to drive the industry on E911 has delayed the advent of services based on location. However, there is some light at the end of the tunnel. Nextel has been doing LBS apps for sometime and Sprint is opening up their network as well. Verizon and Cingular will follow. Business model for application developers still needs to be ironed out (it can’t be on a per query basis). It will take a good part of 2006 to do that. Once we have location, it enables a major piece of the context-based content delivery puzzle. P2P: Sharing content, user experience, advertisements, etc. across communities is being embraced by players in the value chain, as such some new technology and business models are emerging for superdistribution and information access. Garden walls are crumbling: There was a ton of discussion around off-net content and how garden walls are being poked all around in the US. Carriers maintain they need to care for the quality of service and content provides are seeking democratic justice. Off-net content revenue is estimated between 10-15% and is expected to reach 30% in 12 months and possibly 50% in 24 months. As we know, Cingular and T-Mobile have started the trend of allowing 3rd party content on their network. CDMA guys are sitting tight though Sprint has been allowing download of off-deck applications and content (they just don’t advertise it). Verizon will be the last one to give up. Consolidation is coming: As solutions are advancing, startups have played their part in the ecosystem and are ready for consumption and consolidation. Look for several acquisitions and mergers in the next 12-18 months in content providers and technology providers (music, video, search, email, p2p) Other Wireless technologies: There wasn’t much discussion around other wireless technologies like Wi-Fi, WiMax (except some during Intel keynote), Zigbee. With regards to Wi-Fi, the biggest item on the table is Google’s Wi-Fi network, WiMax is still struggling to define itself after a number of missteps by the consortium, and Zigbee will take some time to take a foot hold as the market is already embedded with several proprietary technologies in the space. Deployment of HSDPA was a big thing for Cingular/Lucent to effectively compete with EV-DO guys. Personalization: There was lot of talk around personalizing services and content though it means different things to different people. One of the companies is using avatars to personalize the voice experience. Avatars have been quite popular in South Korea, Japan, and Europe essentially turning mundane applications like weather in money-generating machine while spinning a completely new community culture that has become an industry in South Korea. Comverse launched “Klonies” which is essentially “picture Ringbacks”. It shows a personalized avatar on receiving handset. Neat. Tepid international participation: I thought percentage of international companies at this CTIA was lower than previous conferences. Japanese and Chinese firms were conspicuously absent. Maybe they are saving their budgets for April 06 show in Vegas. Finally, increasingly, the event sessions are turning into paid advertisements for product pitches. Instead of talking about vision and debating issues and direction of the industry, it is a let-down sitting through “what XYZ product does” spiel. Who cares? I can go to the website and grab that info. Panels with engaging moderators are much more useful. Overall good show though. Excitement and participation is indicative of better times for the industry. Your comments are always welcome.
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feedback@chetansharma.com - we look forward to hearing from
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