The Q2 2010 numbers are in, and people love smartphones! According to Strategy Analytics, and covered in a piece on RCR Wireless, smartphone shipments jumped 43% year over year. More impressive is that 60m units were shipped in Q2. That works out to nearly 20% of the total number of handset units sold worldwide. Very impressive.
As a result of a recent smartphone survey sponsored by Kineto Wireless, we know that over 80% of all smartphones have Wi-Fi. The next step must be Smart Wi-Fi.
For mobile operators, there is an ugly truth about basic Wi-Fi offload that no one wants to talk about: the packet services you can collect revenue for can not be offload to IP, or worse yet, aren’t even accessible when Wi-Fi is on.
MobileCrunch writer Devin Coldewey covered the story of trying to run AT&T’s MobiTV service on his Android phone.
AT&T supports ‘basic’ Wi-Fi offload, which means the Wi-Fi radio dumps web traffic directly to IP, but must maintain a 3G connection for any operator hosted service.
But the problem with basic Wi-Fi offload is that revenue generating packet services, like MobiTV, can’t be offloaded to Wi-Fi because there’s no secure connection from the mobile core network to the smartphone. Whoops.
Smart Wi-Fi addresses this specific problem. Smart Wi-Fi creates that secure connection between the handset and the mobile core network so paid packet services like MobiTV (and visual voice mail, and MMS, etc…) can be delivered to the subscriber over Wi-Fi.
Throw in 3G data caps, and Smart Wi-Fi is better than sliced bread.
The operator wins two ways: first, they can continue to sell data services that actually make money, rather than simply transporting non-revenue generating YouTube traffic. Second, they can offload those valuable data services to Wi-Fi.
The subscriber wins two ways as well. First, they get access to the service over lightening fast Wi-Fi. Second, by using Wi-Fi they avoid the tiered data cap.
Wow, Smart Wi-Fi looks like it’s a win-win-win-win situation.
It's interesting to see how similar the US and UK numbers are. These numbers are the results of two online surveys conducted in Q2 2010. The surveys were completely independent of each other and were conducted by two different companies. Yet, the level of interest in more Wi-Fi-based services is high across both geographies.
The US survey was done by MarketTools Zoomerang of 330 US smartphone owners. The UK YouGov online omnibus survey focused on the 23% of nearly 2,200 respondents in the United Kingdom with smartphones.
More highlights:
In the US -
Read all the rest at Kineto.com. And there's plenty more. Then, tell us what you think in the comments.
About 9 months ago, Telefonica purchased VoIP service provider Jajah for $207m. Today, it was announced that Telefonica is rolling out a new service called 'O2 Gloabl Friends' based on the Jajah technology.
Certainly we're glad to see mobile operators taking the VoIP threat seriously. Telefonica, with large operations in Europe and South America, may have been feeling the heat of Skype, now the largest service provider of international voice traffic.
For other service providers, there is an easier way than buying a VoIP provider. Based on the 3GPP GAN specification, it's possible to turn existing voice services into VoIP services.
No new VoIP gear, no new VoIP systems, it's all based on the existing voice network already installed. GAN turns the internet into a generic access network for all your mobile services, including voice. Products exist today!
Android devices are showing distinct signs of picking up speed, as evidenced by Orange's recent announcement it will launch a low-cost LG Android smartphone in Europe later this year.
Orange also reveals its new 'affordable smartphone strategy,' which includes Huawei, ZTE and Gigabyte devices, among others. Lowering smartphone costs will make services more accessible to a larger group of subscribers. So it appears it will be a win-win for Orange - top-notch phones on a strong operating system pulling in more subscribers.
Patrick Remy, Orange's vice president of devices, said: "At the beginning of 2010, 15% of Orange portfolio was smartphones. This will rise to 30% by the end of the year, and will be 50% by 2013."
That seems right in line with the smartphone growth analysts are predicting and other operators are reporting globally.
I'm not sure I agree with everything Andy Abramson says in his recent blog post titled "Why a femtocell/microcell is of no value once Apple iOS comes out", but he's certainly spent some time thinking about the issues. Any anyone who gives props to Smart Wi-Fi (aka UMA) is on the right track for this blog.
Light Reading Mobile reporter Michelle Doneghan reported last week that Deutsche Telekom is the latest operator to announce it is using Wi-Fi to offload its 3G networks.
The article also references a Heavy Reading report published recently and authored by Gabriel Brown, "WiFi Offload for Mobile Operators," that talks about the many active Wi-Fi engagements mobile operators have undertaken as they've moved "from a position of hostile objection to passive acceptance, and now active engagement."
The next logical step will be for them to realize there are ways to get more from their Wi-Fi services and make the customer experience smarter and better. This will result in improved indoor coverage and battery performance, easier access to Internet and data services, churn reduction, competitive VoIP response where operators are still keeping subscriber minutes on Wi-Fi, and even greater increases in network capacity.
As someone who has been evangelizing Wi-Fi for years now, I say woo hoo! I thrill to the sound of mobile operators embracing the benefits of Wi-Fi. Now, let's see the leaders take it to the next logical level.
Smarter Wi-Fi for Smart Phones
I just concluded a whirlwind tour down-under. It was my first time visiting Australia and New Zealand, and both countries certainly were beautiful. And, mobile services and smartphones are exploding in popularity there, just like in the US, Europe and Asia.
It turns out there is quite a bit of overlap in the work day between Kineto's home office in California and Sydney, so much so that I found myself making and receiving numerous calls throughout the day. Like many international travelers, I rely on email from my smartphone. However, history has taught me that roaming, particularly for data, can be very costly.
I found myself relying heavily on Wi-Fi to stay connected. Fortunately, office buildings, hotels and airports and even ferry terminals all had Wi-Fi coverage.
Yet the best tool I had was Kineto's own Smart Wi-Fi application for Android devices. The application, that I'm testing, works on my Android smartphone in conjunction with my mobile operator's services in the US to provide me a virtual connection over Wi-Fi anywhere in the world.
When my phone was on Wi-Fi and the Smart Wi-Fi application was attached, I had a virtual local connection in the US. No international roaming bills; I paid standard rates for all the calls I made to the US. That saved me a bundle.
For international traveling, I found the benefits really add up quickly.
Now that I'm back in the US, as always I'm still using Wi-Fi for better indoor coverage, faster data access and more reliable 3G services.
T-Mobile offers this as a service -- Wi-Fi Calling. It's based on UMA/GAN technology and is available on a range of BlackBerries today. There's no additional cost for Wi-Fi Calling, and many corporate customers have used it to significantly reduce their phone bills.
The service is also available from other operators in other countries, like Rogers in Canada, as well as Orange in the UK and France, to name a few.
I strongly recommend T-Mobile's Wi-Fi Calling service, especially for anyone traveling internationally. We use it extensively and it has saved us huge amounts on roaming costs for both data and voice.
Google tracks user interest in features/capabilities on Android. Item number 6242 is "UMA enabled Android OS". Click on this link to get to this screen:
Now do two things:
First, make sure to 'Star' the feature. This is simply clicking on the grey star in the top left to make it yellow.
Second, take a moment to add your comment and write up how much you love UMA. Tell Google that UMA/GAN support should be native in the OS.
Companies like Kineto are already working with individual handset manufacturers to add UMA/GAN support into their individual platforms, but native support in Android would dramatically increase the availability of handsets supporting Smarter Wi-Fi.
Gartner released some figures on the mobile phone market, and smartphones in general. The information was covered in this article in Total Telecoms.
Last year we picked up a report by RBS projecting a full 50% of all handsets sold in the world in 2014 would be smartphones. They projected something like 1.6b units, and 800m are predicted to be smartphones.
Along comes this report to show that the world is well on it's way. While Gartner is projecting the global handset market to grow 11-13% in 2010, they are reporting 49% year over year actual growth for smartphones. With 54.3m smartphones shipped in the first quarter of 2010, it's easy to project 325m units in 2010, easily extrapolated to 800m units in 2014.
However, consider the implications of 800m smartphones shipped in 2014. Today networks are groaning under the impact of a tiny fraction of that many smartphones. And one trend which I haven't seen reported, but seems to be true in my focus group of one, is that the longer people have smartphones, the more data they use.
I think consumers become confortable with email, then venture into different elements of the smartphone experience, moving pictures, recording videos, hitting Facebook, watching YouTube videos and streaming Pandora. These last two are particular new favorites of mine.
I don't listen to the radio in the car anymore, I just start Pandora and let my smartphone deliver internet radio to my car. And YouTube has become a very easy way to kill time when I'm waiting... for the kids at soccer practice or at the airport or whereever.
The need for Smart Wi-Fi is growing as fast as the shipment of smartphones.
In my mailbox this week are several emails from Ovum touting their new report "Mobile Operator Response to VOIP: the six steps". We don't have an Ovum account, so I don't know what the six steps are, but there are several steps operators can take, using their existing infrastructure and a Smart Wi-Fi solution based on 3GPP GAN, to address mobile VoIP.
1. Turn Mobile Voice into Mobile VoIP. Mobile operators have a huge technical, market and competitive advantage with their existing circuit voice service. The 3GPP GAN specification enables operators to turn Mobile Voice into Mobile VoIP. The existing voice service is transformed into a new, cutting edge VoIP service... and the best part is that it doesn't require a massive new infrastructure upgrade. With Smart Wi-Fi, mobile voice becomes a Mobile VoIP icon/application which can be distributed far beyond the confines of the mobile phone.
2. Compete where the competition is. Most mobile VoIP occurs over Wi-Fi. Subscribers have access to Wi-Fi in the home and at the office. With Smart Wi-Fi, the mobile operator can create a low cost calling service that's available only when the mobile phone is attached to Wi-Fi. The advantage? Mobile operators don't have to drop prices when the user is in their car or traveling, only in the same places where there is actual mVoIP competition, when there is Wi-Fi available.
3. Bundle your mobile VoIP service with USB dongles. USB dongles have been a tremendous success for mobile operators. The mobile operator now has a platform on the subscriber's 'other' device, their laptop. And yet operators haven't chosen to embed a mobile VoIP client into the USB dongle. With Smart Wi-Fi, a mobile VoIP client using the existing mobile voice network can easily be embedded with the USB dongle. This is certainly better than giving subscribers high-speed mobile data service, and then leaving a gaping hole for voice that requires a quick download from Skype.
4. Embed mobile VoIP onto the iPad. While launched here in the US, the iPad 3G is about to take off in Europe. Guess what's missing? Any type of voice service, operator-based or otherwise. With Smart Wi-Fi, operators could easily have their own mVoIP app pre-loaded onto the iPad. Sure, users may still choose to download Skype, but at least they have the option to use the operator's service.
5. Extend mobile VoIP to non-cellular devices. Once the stodgie old 'mobile voice' service has been transformed into a shiny new Mobile VoIP service with Smart Wi-Fi, it can be used on non-mobile devices. It can be downloaded to laptops, desktops, iPads without 3G, the list goes on and on.
6. Address the ILD disparity. This is the most controversial decision to make. Kineto Wireless conducted a survey several months ago and found that the primary use for a third party mobile VoIP application is to place (outbound) international long-distance (IDL) calls. I have a colleague who only turns on Wi-Fi on his iPhone to place Skype calls to relatives around the world. As long as there is a tremendous arbitrage opportunity, subscribers will jump through the hoops to use alternative mVoIP services. This is immensely profitable for operators, so there is no hurry to collapse the market.
But I think everyone sees the same evolution which transpired in the fixed network coming to the mobile network. Today calls to fixed lines in most developed markets are about $0.02/minute. As mobile termination rates continue to decline, mobile ILD will continue to decline as well.
It's clear to me that there are two major trends occuring in the mobile voice market. One is that the revenue per minute is declining, and will continue to decline for some time.
The second trend, which I think is coming faster than people realize, is that the total number of minutes served will begin to decline. There is a new generation of subscribers who talk less. They view the mobile phone as a text, email, IM, Facebook tool. Making a voice call is distinctly secondary. We can see it in the network trends (Ericsson: data overtake voice traffic), in Smartphone UIs (Blur, Sense, ...), in the service plans (Vodafone: £15/month gets 300 min voice, unlimited texts).
The implications are profound for mobile operators. Less revenue per minutes, less minutes overall, sounds a lot like the fixed line voice world.
To conclude, mobile operators have tremendous influence in the market, they have spent billions to create brand awareness, and now with Smart Wi-Fi, they can leverage their most valuable service, voice, beyond a mobile phone.
Two articles showed up yesterday, one on the Android Guys blog, and covered again on Electronista. The comments to the Android Guys post were pretty funny. There are still a lot of people who love their UMA. I don't think T-Mobile helped the situation by changing names of different products because it does get pretty confusing.
"Wi-Fi Calling" is the name of the original UMA service. The original name from T-Mobile was HotSpot@Home, but that got changed to Wi-Fi Calling.
Then they launched their fixed line VoIP product called "@Home". But HotSpot@Home and @Home are not the same things.
As for the $10/month all you can call plan, I'm not 100% sure, but I think they dropped new sales of that. When T-Mobile dropped prices aggressively on unlimited plans in early 2009, it was difficult to charge extra for unlimited Wi-Fi Calling.
We have been saying for a while that T-Mobile should just make calls over Wi-Fi free, like nights and weekends. No fee, just free!
This is something available to enterprise customers today.
Last week there was a great article by Peggy Albright covering 25 years of Wi-Fi. I guess 25 years ago, the FCC made a decision to open up three spectrum bands, 900 mHz, 2.4 gHz, and 5.8 gHz with little oversite other than to suggest that devices 'play nice with others'. These three sandboxes were opened up for entrepreneurs to create the future.
Wi-Fi, Cordless phones, Bluetooth and certainly many other products/technologies have flourished in the unlicensed playspace. Entire industries have formed based on the availability of the spectrum, and organizations have developed specifically to sheppard the tenant of 'playing nice with others' into an impressive range of innovations and specifications that have resulted in products that actually work together.
I could wax on about the wonders of Wi-Fi or the importance of local wireless networks, but it dawns on me that perhaps the most important lesson to take away from this is that, given the right set of circumstances, human creativity is nearly unstoppable.
I talk to customers every day and ask them to tell me what's on their wishlist to meet their technology and communication needs. Just yesterday, I sat in a room with a customer who spoke to me about how he can't wait for the day when all the networks converge; when users have one device that seamlessly moves back and forth between Wi-Fi and next generation mobile networks.
This is the week of RIM's big Wireless Enterprise Symposium (WES) event in Orlando. Hence the flurry of announcements related to new RIM devices, the new RIM 6.0 OS, and the addition of Wi-Fi calling to the MVS product.Considering T-Mobile offers a UMA-based 'Wi-Fi Calling' service and offers MVS with 'Wi-Fi calling', there may be some confusion in the market. Is MVS competitive or complementary with UMA? The short answer:
They are complementary solutions.
UMA is the delivery of mobile services over Wi-Fi. With UMA-enabled BlackBerries (in this case), subscribers use their mobile services the same over Wi-Fi as over the GSM/cellular network. UMA offers two specific benefits to the subscriber: improved mobile coverage via Wi-Fi; and lower-cost calling, primarily due to T-Mobile's 'unlimited Wi-Fi Calling' offer for enterprises. We like to say that UMA makes the mobile phone "work better and cost less".
MVS addresses a different problem. The new Wi-Fi calling feature in MVS extends a subscriber's fixed-line PBX extension to their BlackBerry. Personally this isn't something I would want. If I really want someone to get ahold of me, I give out my mobile number. If it's not urgent, I give out my desk phone. But there may be subscribers (or enterprises) that want to push the fixed line onto a BlackBerry. More importantly, I think there are enterprises interested in managing how employees use their mobile phones and how accessable they are on their fixed lines. But I digress...
The point is that both MVS and UMA offer an overlapping benefit: lower cost calling. With UMA, it takes the form of mobile calls over Wi-Fi not using the bucket of minutes assigned to the enterprise. With MVS, it comes by not using the mobile network (and therefore the mobile operator's billing system) and routing calls through the enterprise PBX (and over negotiated fixed line contracts).
Therefore, it is possible to deploy MVS (ie put a PBX extension on a BlackBerry) with or without UMA. And conversely, it's possible to have a UMA-enabled BlackBerry without the MVS client. Ergo - it is also possible to have a BlackBerry with MVS *and* UMA.
For IT managers, what's better? Well, it comes down to what problem is being solved. UMA offers two benefits: lower cost mobile calls and better cellular coverage.
MVS offers at least two benefits: lower cost calls through by routing Wi-Fi calls through the PBX, better management/control of mobile calling and the ability to put a fixed line on the mobile phone.
For mobile operators, it's clear that UMA retains control of the call through the mobile network, where MVS takes Wi-Fi calls off the mobile network and into the fixed-line PBX.
To conclude, MVS and UMA are not competitive, they are complementary technologies, solving different problems for the enterprise.
Roger Entner, the SVP of Research with Nielsen's telecom practice recently posted an article explaining why the research company believes that the US market is rapidly moving to smartphones.
What makes this statistic even more impressive is that today (Q2 2010), Nielsen concedes that just 21% of US consumers have smartphones. They are projecting a 30 percentage point swing in phone ownership in the next 18 months.
Personally, I completely believe it. I have likened the jump from feature phone to smartphone in my life to the jump I made from dial-up to DSL 10+ years ago. I remember thinking "Dialup is fine, I don't really do that much on the computer." People would gush about how wornderful DSL was, but concrete benefits (beyond "it's faster") were hard to come by. But once I moved to DSL, I knew at that moment I would never go back to dial-up.
I think it's the same with smartphones. I can never go back to a feature phone. I was at a little soiree this weekend talking with a fried who works at Cisco. He never seems to be at the office.
He whipped out his iPhone and showed me why. Cisco has an internal instant messaging application with an iPhone client. He opened the client, changed his status, and suddenly he was 'working' to his contacts wtihin the company. Then he showed me the WebEx client for the iPhone. He can listen to the conference call while viewing the slides, all from his iPhone. Unless someone walked by his cube, no one would know he wasn't in the office.
The implications are staggering on many dimensions, but since this is a blog about smart Wi-Fi, I'll circle back to the need for coverage, capacity and offload. To actually work from your iPhone, a subscriber needs a strong signal for voice and good throughput for data apps like WebEx .
The cellular network is already straining with 21% of the population using smartphones. Imagine when we get to 50% penetration 18 months from now. Smart Wi-Fi is a critical technology for making the smartphone vision come true.
In an article posted to Fierce Wireless Europe, it appears that O2 UK has developed a new pricing structure for subscribers to make low-cost International calls on their mobile. As reported in the post, O2 will offer subscribers the ability have 'unlimited' (subject to a 5,000 min "fair use" cap) to call one (presumably fixed line) number in one country for just £5/month.
This is a good first step.
Checking O2's International Calling page, this offers significant saving over their published rates, or over their "International Traveler Service" (or ITS) rates, which shows the current retail rate to call the US at £1/minute. Ouch.
In a survey on how consumers in the UK market use mobile VoIP (conducted by Kineto Wireless), the primary use of a mobile VoIP client was to make discount International calls. This makes sense to me. A VoIP client on a smartphone requires the user to decide to launch the application and place a call.
Taking a look at Skype's pricing page, and they offer unlimited calls to any landline in Europe for $7.95/month, or to any of 40 countries around the world for $12.95. [Ed note: No asktrik for 'unlimited' on the Skype page]
We believe that mobile is the next battlefield for VoIP, and International calling is where the battle will be fought.
