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Shaping The Future Of Mobile
Jenny Lau
Tuesday, July 4, 2006
Earlier this year, the world ’s largest mobile telecom trade show — 3GSM — took place. Four themes dominated:

1) The convergence of networks;
2) Customer-centricity;
3) A yet faster version of wireless data; and
4) The collusion of many industry giants.

Taken together, we’re seeing the start of the uniting of technology with players’ and customers’ needs.

Fixed-mobile convergence (FMC) is about the bundled offering of voice, video, and data to consumers — independent of the type of network (fixed or wireless) or devices (smartphone, PDA, or laptop) that these services run on. Operators like Orange and Vodafone will spend billions of euros to deploy IMS, a platform that enables converged services delivery. All the major infrastructure vendors showcased their latest IMS enhancements. We also saw device convergence, for example with the launch of Nokia ’s 6136 — a dual—mode handset with GSM and Wi-Fi. Vendors like Microsoft and LogicaCMG also highlighted their plans to enable converged network services, such as a single address book, for all communication needs.

Forrester’s take: The convergence trend kicked in after fixed-mobile substitution became significant. We believe FMC is the right move for integrated telcos (with both a fixed and mobile arm), but we ’re still at the beginning of FMC technology enablement and service deployments. Expect to see much more activity over the next five years as vendors and telcos make true convergence a reality.

It’s not the first time we have heard operators and vendors say that they are customer-focused, but we found that they weren’t just paying lip service. Some examples: Orange will implement a companywide segment focus that extends all the way to the retail store. Many vendors, including LogicaCMG, announced new predictive analytics tools that let operators extract more customer information from the network to predict the likelihood of churn and product usage.

Even Amdocs — traditionally a behind-the-scenes billing system provider- launched a new end-to-end integrated customer management platform.

Forrester ’s take: In previous years, operators have too often confused their customers for SIM cards. As obvious as this shift to customer-centricity seems, it’s a radical change for the industry and one that impacts the whole organization. For instance: Call center representative have to be able to see the entire profile of the customer, not just the phone number he’s calling from; this profile includes all the services the customer subscribes to, actual usage, and how much he spends. This will be the beginning of operators cracking the churn problem- in some markets, churn exceeds 30 percent.

Mobile broadband with speeds exceeding 1 MB per second is on its way, thanks to high-speed downlink packet access (HSDPA). Samsung launched the first HSDPA phone, and operators like Vodafone and Orange announced HSDPA deployments. This year, the focus will mainly be on access-using an HSDPA data card to access the Net via the laptop. Vendors announced several types of data cards: Dell will embed them into its laptops, and Cisco and Vodafone Spain launched a mobile broadband router data card. This card plugs into a Cisco router to allow up to five people to share a single mobile broadband connection. Sony Ericsson’s 3G cards can be software upgraded to the HSDPA card.

Forrester’s take: In terms of launches, 2006 will be the year for HSDPA. But don’t expect mass adoption: Handsets won ’t be available in large volumes, and the mass market simply won’t sign up to datacards for broadband Internet because DSL still prevails. We also see a problem with upgrading the current users of 3G cards: Although users of Sony Ericsson’s 3G card can run software to upgrade to HSDPA, operators like Vodafone don’t offer that service- its customers will have to physically swap their 3G cards for HSDPA cards in one of the Vodafone shops.

The collaboration of industry giants:
The GSM Association (the consortium of GSM operators worldwide) issued a press statement around interoperable instant messaging standards. The first operators to offer instant messaging interoperability are Orange, T-Mobile, Vodafone, and China Mobile. Another major announcement came from Vodafone and Microsoft, for a joint push email service to mobiles for Microsoft Exchange users. And let’s not forget Google and Vodafone’s release on integrating search capability from the popular search engine into the Vodafone live! portal.

Forrester ’s take: We cheer on this type of collaboration because it means mobile operators focus on their core business and use partners (e.g., Microsoft and Google) to improve their offer. The result will be mobile services that consumers can understand because they are familiar with Windows from the PC and Google from the fixed Internet. Although these announcements suggest a more open mobile Internet, it doesn’t ’t mean the fight over customer ownership will end. Global mobile operators, especially Vodafone, will continue to try to own and control all aspects of mobile services.

Jenny Lau is a wireless analyst at Forrester.
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