The most convenient way that mobility is getting built into products is through the convergence into the cellphone of capabilities that previously existed as standalone products. That way, those products are now with you and available for your use whenever you need them wherever you go.
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Now playing: Derek Webb – Love Is Not Against The Law
Yesterday I posted about Connect 2007 in Boston. As I indicated I was very impressed with the participants and the resulting discussion. I’m thankful that Brough took such great notes, but leaning on his work means that I failed to share my own perspectives.
The tone for the day was set in the very first session. One member of the panel articulately shared his perspective that mobility won’t see real growth until carriers open up and recreate the Internet “dumb pipe” model. Another panelist passionately rebutted that view, setting forth instead a “smart pipe” model where wireless carriers provide valuable services to third parties so that those content and applications providers will want to work with the carriers rather than trying to find any possible way to bypass them. Given the nature of each panelist’s business, much of their argument was framed in terms of how to monetize the value created.
I strongly agree with both.
For my purposes, the monetization discussion (although always critical) wasn’t really the heart of the discussion, so forgive me for ignoring that aspect in this post.
As I’ve said many times before (and which is a key theme in The Power of Mobility), mobility creates value in a couple of key ways. The first way is by increasing the availability of products, services, and processes by enabling things that used to be fixed in place to go wherever needed. The second way is by leveraging what is unique about mobility. I usually refer to this as context, but it includes the personal connection folks have with mobility; who they are; their changing situation (‘where ya at?’, ‘whatcha up to?’, ‘who ya with?’) and even taking it further to connect that with information known in the network (weather, traffic, movie showtimes…).
The wireless industry, up to now, has had to deal with issues like severely limited capacity, high cost of data transport, reduced data network performance relative to wireline, etc. The industry has necessarily had to place limits on what customers could do and how much they could do it.
Networks like Sprint’s EV-DO Rev A 3G network begin to push us past some of these constraints (although carriers still need to wrestle with potential abuse that really does destroy the performance and economics for the vast majority of users). Networks like Sprint’s Xohm WiMax buildout blow past these limitations.
Xohm is all about bringing the value of mobility (taking anywhere) to the broadband Internet experience. It clearly will deliver the value of that first aspect of the power of mobility (increasing availability) and will enable what the first panelist I referenced above was arguing – opening up the “dumb pipe” Internet model for lots of innovation. (Note that specific pricing models for Xohm have not yet been announced – although there will be pricing options that are very different from traditional wireless pricing models.)
But, that doesn’t negate the opportunity for the “smart pipe” approach.
The debate often falls back to “open” vs. “closed.” This thinking misses the real opportunity. Going from “closed” (restricting what users are allowed to do) to “open” (allowing them to do anything) is not enough. We must extend to “enabled” – enabling new things to happen that can’t happen without our participation.
In The Power of Mobility, I include case studies of four companies that all happen to be Sprint customers. But in three of those case studies, much of the real value is delivered by someone else (Xora, Rave Wireless, and Anyware Mobile Solutions). In each case, it is the partnership between Sprint and these companies that results in real value for the customer. Some of it is boring, non-technology stuff – joint marketing, joint selling, single bill – that enables each company to be more successful than they could be on their own.
But what reflects the true value of Mobility that extends way beyond the “dumb pipe” value of the Internet is the additional value that comes from Sprint enabling these partners (with the customers’ explicit permission so that the released value accrues to the customer) to access information that isn’t easily available in the “dumb pipe” Internet (who is this user, where are they, what is their network connectivity status) and marrying it (not quite a “mash-up” yet) with information unique to the application (what job are they working on, what tracking did they request, does this location match a specific store).
For years, Sprint Nextel has very actively sought to enable third parties with information (e.g. location) and relationships (e.g. line item on the cellular bill) that are uniquely available through the wireless carrier. This creates tangible value for the end customer and the monetization of that value is shared between the carrier and the innovator that has been enabled. (The specifics of that sharing clearly can generate plenty of passion, but again that’s not the point of this post.)
Bottom line, I believe that the explosion we are on the brink of in the mobility revolution will be driven both by “opening” wireless networks to the best-effort “dumb pipe” Internet model AND leveraging the unique attributes of mobility by “enabling” innovators with a “smart pipe” mobile connection to the end customer.
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Now playing: Timber – Plans (I Lay It Down)
I know The Power of Mobility has only been out about a week, but if anyone has already finished reading their copy, please consider writing a review at Amazon. So far, I’ve added my notes, but there aren’t any real reviews. Thanks!
Sprint has introduced a web site called waitless.org that is intended to help you live life at “SprintSpeed.” Although the site has little to do with mobility, they are fun ideas. So, every week I’ll share one.
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Now playing: Sandra McCracken – Steel And Magic
Earlier this week I participated in the Connect 2007 conference in Boston produced by NMS Communications. NMS managed to pull together a very impressive collection of speakers. The day was organized around panel discussions that worked very effectively. NMS had also worked several extended networking breaks into the day which created the opportunity for good dialog. Overall, I was really pleased with the event.
I had planned on summarizing key points from the event, but Brough Turner did a great job “live blogging” the event, so I’m simply going to quote from the notes at his blog. If these notes peak your interest, you might want to read his complete posts:
Here are interesting quotes from Brough’s notes:
Andrew Budd of mBlox is very articulate on the need for wholesale models, i.e. not the “real” Internet, but a mobile world where operators allow (facilitate) customer access to 3rd party content. This is the compromise position between the typical walled garden operator and the completely open Internet (which Dean Bubley pressed in a question from the floor). Andrew’s argument against the wide open mobile Internet is roughly that we don’t want the 900 number meltdown that we saw in the US in the 1990s (when premium rate services became associated with scams and porn).
Likewise, Jud Bowman of Motricity, clearly expects the “real” Internet to win eventually, but in a long transition in which operator run programs dominate. Jud made an interesting point I need to double check: PC’s are only upgraded every 4-6 years (can it be that bad?) whereas mobiles are upgraded every 2 years (in the US). The implication is we’ll see very rapid change in the mobile market in the next 2-4 years as handset vendors learn from the UI of the iPhone and 3G data capacity continues to evolve.
(Shai Berger has a bit more on this debate at Call the Cloud.)
Michael Scully, Director of Music, Mobile Content and Data, at Virgin Mobile USA was the one operator representative on the panel and, as might be expected, (and completely legitimately), pressed the point that Virgin Mobile has a relationship with their customers that centers around a very personal device – their mobile phone.
Seamus McAteer of M:Metrics — the US is not the mobile backwater people usually say, at least for music services. Subscription services are the only really viable models today. Per transaction sales pale in comparison to monthly subscription revenues. It’s not rational (on the consumer’s part), but it’s what consumers want.
Stan Reiss, General Partner, Matrix Partners — it’s still very early for mobile Internet. So far there is not a good model for how to monetize the mobile Internet. The operator’s view that they are going to charge per transaction is very inhibiting (versus “free” on the Internet). Carriers are making money and content folks are making money, but startups in the middle are being squeezed out. Investors are looking for business models that can stand up to the carriers.
Karen [Cambray, CFO, Groove Mobile] points out that Europe is ahead of the US in allowing off-portal or off-deck, i.e. wholesale, content sales. The key is getting reasonable charges for data usage. Some discussion of data charging models that are emerging in Europe, including capping the data fee per day.
Universal admiration for the iPhone’s user interface. Jud [Bowman, CTO at Motricity]notes that even if Apple sells 20 million iPhones, that’s a drop in the bucket of a billion plus handsets per year. The point is 40 other handsets vendors are scrambling to include parts of the iPhone’s user interface. Ken [Olewiler, Managing Director of PUNCHCUT] expects a flood of copies, many of which will be by wanna-a-be’s, who don’t actually understand what Apple has accomplished.
Negatives: iPhone voice calling isn’t great. The SMS user interface (with no tactile feedback) is impossible to use behind your back, in your pocket or under the school desk (where you can’t see the screen).
But there is still universal admiration from all panelists, including Russ at Sprint. Russ does point out that Apple set the bar with the Mackintosh, but it was a (comparatively) closed ecosystem and Windows won in the end. So Apple has raised the bar for everyone – that’s good. But who wins in the end is not clear.
Digression on smart phones… Russ makes the point they are like a Swiss army knife, great to have a pair of scissors but they are not as good as a real pair of scissors. Russ uses that to promote Sprints new WiMAX service Xohm, where they expect 3rd party device vendors to go wild.
Ewald [Anderl, CTO and VP at Kirusa] is very much in favor of AJAX on the mobile phone as it reduces the application’s footprint on the device to zero. Jud confirms that user purchases go up tremendously when users succeed in downloading a Java application. He can’t wait to see wider deployment of AJAX capable browsers so he can avoid the need to have the user download an Java application.
A lot of discussion about location and privacy issues. All of the panelist seem to assume that location is something that may become available from the service providers. So far, no one has mentioned Navizon which I wrote about last week. The real issue is trust and the need to push control of location information to the user. Edge solutions sound best to me, but everyone seems to assume they’ll have to work with operators to get location info.
A long discussion of swarming, i.e. too many people including completely unrelated people showing up for a suburban party, political protests, or related, cyber bullying. Also discussion of privacy in virtual worlds and in your on-line social persona. The panelists are worried about privacy, but everyone on the panel is over 30. My impression (even though I’m over 50) is that today’s youth are much more comfortable with living their lives publicly. Or to put it another way, it used to be if you lived in a small town, everyone knew everything that went on. Today, it’s not just in a small town.
Making money — social networks must appear to be free as they are on the Internet. Money comes from driving traffic (on a flat rate plan), perhaps by offering some premium service to a subset of users and, eventually, by advertising and advertising-like activities, for example, content discovery and content recommendations.
In response to a question, Nicolas [Arauz, Co-founder and Managing Director, Xipto LLC] made the point that your closest contacts on your mobile may churn quite rapidly but can be represented by who you’ve communicated with in the past 24 hours and/or past week. To me that suggests that a mobile social network client should capture all your phone calls and SMSs and ask you if they are people to add to your social network (and if so, where and how they are to be added). And, sure enough, three minutes later Nicolas added the idea that your biggest mobile social network is the people you call and SMS in any given day.
General agreement that mobile social networking won’t really take off until it is available across operators. Exclusive deals won’t promote widespread adoption.
Dan [Melinger, CEO, Socialight ] suggests that handset standardization should come through browsers, although this will take time to roll out.
First impression: there are several sources of telephony controlled by web interfaces, but they all cost money or are just sandboxes. No one has mentioned APIs that let developers also participate in billing, or ways that web telephony can be available at or near free. Surely one or the other is needed to see this industry take off.
For now, all the discussion is about enterprise developers. Mashups are a new way for enterprises to develop their IVR and call center solutions. So far, no examples of developers targeting consumers. Alan [Quayle, Consultant, Business and Service Development] has mentioned that BT’s API has also been used for Salesforce.com integration.
Now Alan is discussing cost. When location data cost 25 pence per inquiry, no one used it. No one has a good suggestion of how these kind of services should be priced. What about an application that needs two database dips, an international phone call and two international SMSs? General agreement that this is an issue, but no specific suggestions or pointers to solutions.
The popular APIs to mashup with (besides Salesforce.com) are Google Maps, Flickr, Facebook and Amazon (for storage), at least today.
Now Joel [Hughes, General Manager for Mobile Applications at NMS] has explicitly asked how things are priced. Amazon is priced by the GByte per month and Salesforce.com is by user per month. Enterprise telecom groups either buy the platform or pay per transaction until they buy the platform. Their issues are reliability and minimizing costs.
Matt Gross describes the value uLocate brings to Sprint is to handle the long tail of developers that Sprint can’t deal with directly.
Alan says BT’s Web21c has helped expose issues and challenges. They are still experimenting. As far as location goes, the pricing is still too steep. Alan expects that Google and others will note the GPS coordinates of every cell site, retrieve that from the handset and skip interfacing with the operator. Operators will have to price their location info appropriately or they will be bypassed. Consumers do seem willing to pay for safety-related location-based services.
Relation of mashups with IMS. North American operators are adopting IMS to control VoIP telephony, but IMS is just the base for connection control. The broader service delivery platform is less standard and yet that’s what’s required as the platform that supports web services. SIP-based applications going a lot slower than web APIs. In the end it’s applications that matter. No one on this panel cares about IMS except as an underlying layer that supports their web APIs.
A question from the audience: how do you see the handset interfaces w.r.t. mashups. Kevin [Nethercott, President and COO, LignUp] is focused on voice telephony. He doesn’t see the mobile handset as the application UI for now. In the long term, he expects browser-based user interfaces, but for now, he’s doing voice. Alan seems to agree. Handsets are so different that all you can rely on is basic voice and SMS. Sam [Aparicio, CTO, Angel.com] complains that even the so-called open API phones, you can’t actually to deep features on the handset. This crew is focused on voice.
Kjell [M. Johansson, Director of Solutions Management, Multimedia, Market Unit North America, Ericsson] – SDPs are essential to the development of actual services, but the problem here is too many standards in what’s exposed to the developer. Kjell alluded to pressures from operators that may result in the major equipment vendors converging their service creation environments, but he couldn’t give specifics or a date (beyond soon, within the next year).
Susan [Norris, Communications Industry Advisor, Norport Technology Management Consulting] said operators think of IMS as the solution for new services. They are generally very conservative (particularly on the operations side) and wouldn’t dream of opening up their networks for something like web services.
Doug [Tucker, CTO NA, Ubiquity Software Corporation] offered that IMS and higher level development environments, including web services, are not conflicting. IMS is the platform, but it’s standardization stopped below the application layer. IMS needs web services and/or other development layers to actually realize new services.
And it was Jouni [Welander, Head of New Solutions US, Nokia Siemens Networks] who offered “IMS is not about killer apps, it’s about a killer environment” i.e. IMS is the platform but it needs (the non-standard) SDP layer above to support service creation.
And the sense I was left with (as were several members of the audience with whom I talked later) is roughly as summarized in my title above. IMS is plumbing that helps operators manage their networks and is a great platform to support a variety of new services, but it will take higher layers (not part of the standards) to actually facilitate new applications, In addition, there are many, many other issues to resolve, both technical (like integration with billing systems and other operator IT infrastructure, simplification of handset diversity issues, and so on) and business model related, i.e the extent to which will operators open up to new applications.
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Now playing: Silers Bald – So On
The Law of Mobility talks about value increasing with mobility. The impact of this law is being felt because the barriers to building mobility in are being obliterated week after week. Here are examples of technology advances enabling this to happen:
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Now playing: Shawn McDonald – A Little More
More and more, the world around us reflects the growing assumption of the law of mobility. Each week we will track indicators of Mobility’s growing importance in our businesses, our lives, and our society:
Full list here.
Mobility is a wonderful thing. As mobility gets built into all products and services, businesses need to learn how to both capture the power of mobility and manage the dangers introduced through mobility. Here are some examples of how the power of mobility is being applied to create competitive advantage:
Complete list here
The most convenient way that mobility is getting built into products is through the convergence into the cellphone of capabilities that previously existed as standalone products. That way, those products are now with you and available for your use whenever you need them wherever you go.
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Now playing: The Downing Family – If That Don’t Make you Want to Go