Telco 2.0's Private Mobile World Congress
So everyone else has done their 3GSM...sorry...Mobile World Congress round-up posts; what did Telco 2.0 think was cool? As you'll no doubt guess, it wasn't the shiny gadgets that got us; even at MWC, the anti-shiny goggles all Telco 2.0 team members get issued still block them out. It was a very serious conference this year; we think it may have been the first to get serious about the kinds of communication and enterprise-focused activities that will eventually make serious money for carriers. We broke them down by themes...
Not a frequent Telco 2.0 topic, but it's worth pointing out a few things. For a start, WiMAX is doing a roaring trade - 2007 was a year of delivery. And there seems to be a lot of potential in the HSPA air interface; Telstra was talking about pushing their downlink speeds towards 40MBits/s. Similarly, the network architecture is already flattening out, rather than waiting for the LTE Systems Architecture Evolution group to report; Nokia Siemens Networks' "Internet HSPA" relies on a new radio-network controller to break out IP traffic very close to the user. In a sense, this turns the whole telco into a provider of authentication and billing to the users of its IP connectivity.
Another alternative technology, UMTS-TDD, has had some very good news. Its main proponent, IPWireless, has been pushing it for many years; after their anchor deployment, the planned roll-out of 8,500 Node Bs with IPMobile in Japan, went sour when IPMobile couldn't finance the job, the company was forced to merge with NextWave. But now, they're roaring back; one of their key capabilities is that they have about the only sensible technology for mobile TV we're aware of, and it's being deployed in the UK under a sharing deal between Orange and T-Mobile UK. Telco 2.0 saw the test results last year; they were more than convincing.
Part of the Telco 2.0 vision is that being a digital logistics company involves multiple ways of bringing bits to the customer, and broadcast should certainly be part of the toolbox. NextWave's technology has the huge advantage of needing no new radioplanning and having a standard interface to the operator's core network. (They are also doing some very cool things for emergency service comms.)
Femtocells were another big theme, and oddly enough an emerging British speciality. Both Ubiquisys and ip.access were much in fashion; just wait for the first vendor to build a femtocell into a full-featured set-top box/media centre/router/slingbox product. We give it about three months.
Geography: a Killer App
Telco 2.0 doesn't believe in the killer app; but we love killer apps. It's increasingly clear that geographical services (not quite the same thing as location-based services) are going to be just that. And Nokia appears to have been working very hard on the new version of its Nokia Maps; Nokia Maps 2.0 looks like a cracking product, but it's not just that. They're keen on three-dimensional mapping and orientation, moving from a model of navigation appropriate to cars ("turn left at the traffic lights, and continue for 300 yards; then turn right and join the A308") to one appropriate to pedestrians and an urban environment. They're also keen on user-generated content; mapping blogs, wikis, forums, RSS feeds, and social networks onto the fabric of the city.
Here's the distinction between geographical and location-based services; LBS is typically about locating mobile users or objects in space and reporting their whereabouts to some sort of central service, then pushing information out to them. Geographical services, by contrast, are more about mapping information from virtual space into real space and more about applications than networks - the end-user pulls information from online sources and has it displayed in geographical context.
Yahoo!'s new OneConnect mobile unified-comms app points up some of the tensions here; it essentially scrapes all your friends' activity from several social-network sites and displays it on a map. Further, you can get updates when people you know are nearby, and integrate the whole thing with your e-mail, address book, and the like. Obviously there are privacy issues, but more seriously, will it be a geographical service or a location service? The only business model that sounds likely would be ad-funded, which suggests that Yahoo! wants it to be location-driven; and that's going to make the privacy issues even more important.
Google is mad keen on integrating sociability with location, too. As Michael Halbherr of Nokia's LBS operation said, people love maps and play with them even if they aren't going anywhere. No wonder Nokia's started integrating GPS in absolutely all their new products; not just N- and E-phones, but two new mass market gadgets as well. Telcos: get your location API out there before everyone gets a GPS phone. Or lose it.
The barriers between technologies and businesses are breaking down. The techblogger hype was all about Google Android, but you'd have struggled to find Googlers at the show; but the mobile Linux business is surging and doing some very interesting things. Indian software house Azingo is the first to get a LiMo Foundation-compliant Linux system running, on a Broadcom reference handset; but the really interesting bit is that they have got a set of Nokia S60 widgets to run on the Linux gadget.
The much better-known Access, meanwhile, has developed a virtual machine for its Linux platform that allows Palm OS applications to run on their system; that means that the original PalmOS is a goner. It looks like we won't have an operating system lock-in on mobile, even if MS PowerPoint still won't render .ppt files produced by OpenOffice properly. In a related, if not exactly identical, development, Sony Ericsson - usually a Symbian UIQ shop - announced its first Windows Mobile device.
At a much higher level, the conference saw more CDMA carriers signing on to the 3GPP technology evolution path, suggesting that the wars of religion in radio networking are coming to a close. Permeability is a key concept for Telco 2.0 - the platform is all about replacing the hard cell wall around the telco with a membrane that lets information leave and money enter; and the place to go for that was the IBM stand.
IBM brought an impressive collection of telecoms-related demo projects to MWC, like a brass band conducted by senior tech Zygmunt Lozinski. The shiny gadget was their integration of live video from the real world into Second Life; the video feeds being displayed on giant "screens" in the virtual environment. In a postmodernist touch, the video camera was trained on Lozinski himself demonstrating the application on a giant screen. But there were much cooler things.
Business Finder is a geographical application which mashes up telco location and presence data with a business search engine; it's almost uncannily like one of the case studies we prepared for our 2-Sided Business Model report. The data comes from an IMS core network, but we're willing to forgive them that, as it's a glowing example of the full opportunities telco platforms can provide. IBM also showed a simplified management interface - a sort of business IDE - for telco mashups using their WebSphere servers and Rational service-creation environment.
Qualcomm and HP, meanwhile, nailed two of our key themes with the announcement of the Gobi chipset, which offers both a selection of radio air interfaces (even that lock-in is going) and also integrated GPS for those crucial location-based and geographical services. Watch'em differentiate and disintermediate in '08.
Identity, Authentication, Payments
Telefonica and Turkcell are both deploying a fascinating new service, Mobile Signature, which uses a cryptographic ID stored on the SIM card to offer two-factor authentication for the Web. Basically, you provide a user number when you need to prove your identity to a third party; they call the telco's ID API, which sends a WAP PUSH message to your phone. It knows it's your phone because it authenticates against the crypto key on the SIM card. You verify the challenge, and you're done as they say at Amazon.
Turkcell is pricing it at one SMS=one lookup; this seems a little steep when some websites are made up of dozens of AJAX function calls.
At the Mobile Money seminar, meanwhile, it was very clear that Orange has a clue about mobile payments. They are starting major projects in Egypt, Jordan, Cote d'Ivoire, and Senegal this year, with an international remittance service to follow. Mung Ki-Woo, VP of Payments, described what amounts to a standard operating procedure for rolling out payments; you have to address the cash economy in these societies, where mobile phones can outnumber bank accounts by a factor of eight.
The key to this is the ability to get cash back out and pay bills; Orange's answer is to partner with a bank at one end (which takes care of the horribly complicated regulatory issues around banking) and its own network of airtime vendors at the other. Customer balances are rolled up into one lump of cash held at the bank. The bank also gets to handle the inevitable corner cases, such as what happens when a customer dies with a balance outstanding. Orange reckons that the business is 55% business-consumer, 35% business-to-business, and the remaining 10% is accounted for by interest paid by the bank on the subscriber balances.
Talking to machines
"We're reaching saturation point in terms of our human customers"; so said Paolo Paganucci of TIM. The answer? Give robots mobile phones. Seriously. Machine-to-machine communications looks like it's going to be a major theme in the next few years; as it deals with things like tracking containers, monitoring production processes, and managing down pollution and the waste of energy, it's very Telco 2.0 indeed.
n a sense, it's the opposite of the geographical services we mentioned; the real LBS is for machines and organisations, rather than people and communities. Paganucci described its role as interworking between real and virtual space; just like Nokia Maps 2.0, but from the opposite perspective. TIM is working on a SIM card that includes a ZigBee radio, so mobile devices can interact with embedded device networks and link them to applications on the Web or running in the carrier's SDP.
The opportunity is large; Italy alone has 2.5 million cars and 30 million electricity meters. So are the problems; embedded devices are embedded in things that last many years longer than a mobile phone, such as cars, buildings, and machine-tools, so they must be future-proof. Further, the reason for using embedded devices is often that the object they are embedded in is somewhere dangerous, remote, or inaccessible. If your device is embedded in an offshore wind turbine, you better be able to update the firmware over the air; and the device will need to be able to detect a problem with the update and rollback without using the network.
Finally, the Core Network Geekout
Yes, it's tragic, but we love core networks here at Telco 2.0. We were very impressed by Tekelec's SCIM, which looks like just the thing for a telco applications platform; it stands between applications servers and the core network itself, chatting a variety of telco protocols at one end and IT ones at the other. And they claim it works in hybrid SS7/IP, IMS, and IETF SIP environments too.
Note that our Top 10 vendors will be demo'ing their products in the Innovation Zone at the Telco 2.0 event in April.