Ring! Ring! Hot News, 18th August 2008
In Today's Issue: 3G iPhones don't work; developers think Google is being evil; Sun open-sources more stuff; China Unicom inflates the Chinese 3G bubble; UK MNOs not so good at ISPing; public doesn't want Be CCTV after all; Orange UK gives away Asus EEEs, makes money; UK 2.5GHz is with the lawyers; Sprint's new apps; Yahoo! FireEagle - your telco should do this; East Africa gets fibre
Oh dear. The iPhone iHype is followed by a wave of customer dissatisfaction, with hordes of iPhone buyers complaining that the device's performance on UMTS is poor, and worse, that it struggles with connectivity in areas where other 3G devices find no problem at all - which points the blame straight at Apple rather than AT&T. It's a serious problem. After all, if (as rumoured) the issue is somewhere in the signal path between the antenna and the RF amp, there's no alternative to a hardware fix, which means recalling the Jesus Phones. As we periodically have to point out, radio is hard. There's a suggestion here that the device doesn't comply with ETSI's specifications for UMTS terminals. Hmmm, let's think... Moto are good at wrapping radios in boxes, but struggle at software. Maybe there's a CEO phone call to be made...
Meanwhile, all is not well with Google Android, for political rather than technical reasons; developers are angry at the decision to release the SDK to winners of a competition, and the fact there's still no date for a general release. Sun, meanwhile, open-sourced its mobile GUI kit. Who would bet against a company that specialises in open source and community development, like Sun, winning this race?
It's almost as if this was the week where boring, traditional values had the upper hand in telecoms. The Jesus Phone doesn't work, Google is being evil; and the world's mobile network vendors are hunting for their share of a huge greenfield roll-out. How 90s. China Unicom just announced that it's planning to spend $14.5bn in CAPEX in order to build a spanking new 3G network, now that the Ministry of the Information Industry has made up its mind. It's going to be one of the last great vendor gold rushes; if Unicom needs fifteen billion dollars' worth of kit, China Mobile and China Telecom must both need something similar. Presumably, the government-mandated TDSCDMA deployment at China Mobile will mostly be sourced from Chinese vendors - nobody else cares - but the other two are very much up for grabs. Unicom is forklift upgrading every damn thing, too - it used to be a fixedline operator with a CDMA WLL network, on which the limits on mobility that kept it from legally being a CDMA mobile network somehow didn't work, but now it's slated to deploy UMTS.
In the UK, it looks like the trend for mobile operators to resell DSL has reached a natural limit. Which makes sense, really; mobile operators don't have any advantages in the fixed market, which is itself under heavy pressure with the triple assault from cable, BT Retail, and BT Wholesale and Openreach. It doesn't help that as Tom Alexander of Orange UK confesses, their customer service has been indifferent at best. So, they are increasingly concentrating on their fast-growing mobile-broadband business, where there's probably some net additional spending up for grabs.
Meanwhile, out of the DSL operators, Sky (Easynet as was) is doing best, competing Carphone Warehouse's customer base away. CPW's glory days of last autumn begin to feel distant; you've got problems if you're losing customers despite giving away computers, and they've also had significant execution problems including trouble with BT Openreach and with their own customer-service workflow. Sky, meanwhile, is benefiting from integrating DSL with its TV content offering. O2's DSL operation, Be, has just closed its home-security CCTV service; apparently there aren't enough tyrannical Home Office suits and imperial-minded property sharks in the UK to make mass-market video surveillance profitable.
Orange UK, meanwhile, shows that you can apply the same approach to the mobile-broadband market as CPW did to DSL. But perhaps better. Yes, they're giving away Asus EEE mini PCs with HSDPA dongles, on condition you sign a 2 year contract at £25 a month, for 3GB a month's data transfer. If you reckon they're getting the Eees at a 20% discount, that's £450 in revenue after the giveaway or £6.25 a GB a month. Seeing as 3UK will sell you 15GB for £15 a month, on condition you sign for 18 months and pay £49.99 for a dongle, there's obviously quite a lot of pricing power left in mobile data.
T-Mobile UK and O2 would like to keep it that way, too: they're suing to prevent the UK's 2.5GHz reauction going ahead. No WiMAX for you... Elsewhere in the industry's eternal drive for popularity, BT has decided to end its Digital Vault service, and existing users will lose their stuff unless they pay up. Nice. Except didn't we say that telcos should be positioning their brands as trustmarks, not trashing your family photos?
Sprint is updating its Instinct iPhone clone with a volley of applications. Navigation, visual voicemail, all very impressive. But perhaps what you need is a better way to be followed around? Yahoo! has one, with the launch of FireEagle. It's actually not that bad, being a user-defined opt-in service. What it actually does is to act as something similar to OpenID for location updates, aggregating the flow of location data from many users so applications developers only need to hook into one API. This is what your mobile operator should be doing, you realise?