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CTIA Wireless 2008
Roundup
http://www.chetansharma.com/ctiawireless.htm
Sin City
(Vegas) hosted CTIA Wireless 2008 earlier this week. On Wednesday morning, just
before leaving for the convention center, I caught some portion of Ben
Bernanke’s congressional testimony on the US economy woes. Few minutes
later, strolling the show floor, talking to various companies, and
hearing the keynotes, it seemed like I was on a different planet. Either
someone failed to deliver the memo or the wireless industry is resilient
enough to weather the turmoil in the financial and housing markets with
some ease. The show was bigger with more attendees, the booths were
returning to their glamorous heydays of the past, and the general buzz
and energy at the show all seem to indicate the industry is going to do
just fine and is primed for further growth. The general themes were
around open network and access, user experience, and bandwidth.
This note summarizes
our impressions from the show.
CTIA Wireless in Pictures
First let’s do the
numbers:
CTIA released their semi-annual statistics on the US market. In
summary: For 2007, $23B in data revenues, 2 trillion in MOU, $139B in
total service revenues, 48B txt messages/month. (We released our
US Market and
Global Market updates last month)
Keynotes: In
terms of style, Sir Richard Branson stole the show with his
pompous exuberance and pep talk (the talk of imaginary flight to
Mars was hilarious; investors in Microgin and Viroo must be upset). For
substance, Marco Boerries, President, Yahoo Mobile gave a nice compact
overview of Yahoo initiatives and products in the market which are
pretty darn good. (Marco wrote an opinion piece for our Mobile
Advertising Book – “The future of Advertising is in the Consumers’
Pockets”). Yahoo has sewn together a number of deals worldwide that
gives them a potential reach of over 600M users.
Vodafone is one
operator which has been quite vocal in stating its positions on future
infrastructure roadmap and data opportunities. Arun Sarin is probably
the only CEO of major global operator who has publicly stated that
Mobile Advertising will constitute a significant portion of their
revenues in the coming days (Arun’s point person on the initiative
Richard Saggers also wrote an opinion piece for our book
“Opportunities for Mobile Advertising.” Let me know if you are
interested in reading these two opinion pieces).
Microsoft’s Robbie
Bach had the tough task of following the Branson-fest. He announced the
arrival of a full-blown browser (finally!) for windows mobile. Also, the
new windows mobile device from Sony Ericsson (Xperia)
looks pretty darn cool. FCC Chairman Martin announced the rejection of
Skype petition on the carterphone principle (to Skype’s dismay, it was
not an April fool’s joke). Clearly, the definition of “open” is in the
eye of the beholder. It means different things to different people. It
has also been clear from the various activities and keynotes that the
industry is trying its utmost to remain a “Self-regulated” industry and
stay away from the clutches of eager politicians.
Lowell McAdam, CEO of
Verizon Wireless conducted a panel with CEOs from Alcatel-Lucent,
Ericsson, and Nortel and probed them on the 4G migration path, trends in
applications and services, and contrasts in adoption and introduction of
new technology in various parts of the world. Final day was marked by
what is now becoming a trend - keynotes from politicians. This time
around Sen. Edwards and Sen. Thompson graced the podium.
Mobile
Advertising: In talking with numerous players in the value chain
from small developers to large operators to ad networks to media
companies, the impression was that things have matured over the last six
months. It was gratifying to hear that some companies are adopting
strategies and recommendations we propose in our book. Still, some of
the basic problems remain – majority of the inventory remain unsold
indicating weak demand, CPM rates are still over-rated though they are
starting to come down, and fragmentation continues to remain an issue.
The good news is that
the size of the mobile campaign budgets are getting bigger with several
seven figure RFPs floating around. While some companies are still trying
to throw a lot at the wall in the hope that something sticks, others are
maturing as companies and are more focused in their positioning and
product roadmaps. Integration of various channels is starting to appear
on the horizon and the integration with the publishers is becoming
tighter. The issue of measurement and auditing standards remains a big
issue and unfortunately not much progress to report. There are carrier
initiatives and various industry bodies are taking the challenge to
rally the ecosystem, but, frankly, consolidation of such efforts is
necessary, we can’t afford yet another layer of fragmentation in an
already complex ecosystem.
We were interviewed
on Mobile Advertising prior to the show by several publications. Some of
the articles were published this week to coincide with CTIA
Wireless Wave
(CTIA) –
Moving Targets: Mobile marketing reaches consumers on their terms
by Lynn Thorne
BrandWeek
–
Mobile Marketing – Fantasy vs. Reality by Ken Hein
Wall Street
Journal – Personalized promotions: Sending the right ads to
your phone – Peggy Anne Salz
NFC: There
were many more NFC-enabled devices on display this time and vendors were
talking and demoing NFC and Biometrics based payment solutions. While
there are handsets on the roadmap, this market is still very nascent in
North America and Western Europe.
Inspiration:
The inspiration for new and creative services still comes (at least for
yours truly) from Japan (and Korea). I love spending time in DoCoMo’s
booth for it gives a glimpse into what’s to come. No other company
better understands the development of devices, services and applications
that overlay on lifestyles than DoCoMo (e.g. a wellness handset that is
a pedometer, heart rate monitor, body and bad breath monitor and yes,
you can make voice calls too). They view wireless air-interfaces as
nothing more than enablers to solutions that enhance daily lives.
Various device manufacturers also displayed some really cool devices.
The quality and diversity of handsets that have been introduced into the
global markets over the last four quarters is just astonishing. The
cycle of innovation and time-to-market keeps on accelerating.
Femto Cells: A
number of players like Airwalk, Airvana, and others are bringing Femto
cell solutions to the market and carriers are starting to pull this into
their strategy as well and look forward to deployments beyond the
trials.
4G: LTE vs. WiMAX
(vs. UMB): Since the decision of Vodafone and Verizon to support LTE,
UMB has been disappearing from the discussion. The 4G discussion is
convulsing around LTE and WiMAX now (though Nortel did indicate its
support TD-SCDMA as a 4G candidate). Without a doubt the operator
community is rallying behind LTE and there might be an opportunity to
finally converge to a single standard (haven’t we seen this movie
before) but frankly, the advances in silicon to integrate multiple
radios has made the standards debate less relevant. WiMAX has forced
acceleration of LTE standardization process but is starting to lose its
time (and cost) advantage. All eyes are on Sprint’s XOHM business
rollouts in the coming days and months.
Accessories: I
have never seen so many accessory and reseller outfits at a CTIA show.
Business must be booming.
Best Booth:
Thought there were several good layouts, LG and Samsung continue to
impress with their creativity and “art of marketing.”
Developer and
Publisher woes: Along with John Philips (Astraware) and Peter
Baldwin (Cellmania), I helped facilitate a few developer session at the
Mobile Jam Session organized by WIP. The issues of distribution,
discovery, and monetization remain challenging for the small developers
worldwide. Even with million user base, they are finding it difficult to
monetize but we did discuss a number of success stories. The core
elements of success that emerged from the discussion were: choosing the
right market, embedding viral component into everything you throw out
there, there is no room for mediocrity, and personalizing and
customizing go a long way to get traction. An interesting tidbit: the
number of page views for mobile MySpace app is a magnitude higher on
off-deck vs. ondeck. Several of the companies are trying mobile
advertising with varying degrees of success. After spending 4 hours with
the developers, I sat on a carrier panel discussing mobile advertising.
The contrast between the two worlds was so apparent. Clearly, more needs
to be done to help both sides understand each other a bit better.
Green CTIA:
There is a stronger emphasis on recycling and contributing to save the
environment. The show itself is a big resource hog, so every bit helps.
Alternate Mobile
Devices: The universe of alternate devices is expanding. Companies
are buying wholesale data packages from the operators and integrating
broadband chipsets into hardware to do digital signage (ICG), M2M (Sensorlogic),
PND and much more. The definition of being “mobile” keeps on changing.
On Being “Open”:
Obviously, given the recent activity around openness, getting a penny
for each time the word was uttered by a speaker would have paid off for
a lifetime of CTIA trips. While talk is cheap, demonstrable progress is
being made by the likes Yahoo, Apple (btw, 3G iPhone is on its way), and
AOL.
Another MVNO
experiences turmoil: Movida - a Spanish focused MVNO which has
garnered almost 300K subs filed for chapter 11.
Voice is becoming
mainstream: With the product launches from Nuance, SpinVox, Vlingo,
Jott, Yahoo, and many others, voice based navigation and its tighter
integration with data services is becoming mainstream.
Where are the
opportunities? Last week,
I was moderating a panel with executives from AOL Mobile, T-Mobile,
Motricity, and Formotus and the themes that emerged were around platform
play, user experience, and productivity. At CTIA, in addition to these
areas, there was a lot of discussion around social networking (though
the market is being saturated with the MoSo noise). It is also clear
that we are moving into the phase of “aggregation of fragmentation” with
initiatives from Yahoo, AOL, and Google dominating the landscape.
Home Screen
Effect: I have been talking about using the home screen for driving
data usage for the last 8 years. I think we will see good innovation
this year on that front starting with Yahoo’s One Platform. There are
several other initiatives in the works where operators and OEMs will be
deploying frameworks and technologies to bring information to a
“click-less” idle screen environment.
Overall, no major
news but industry stays vibrant, healthy, and exciting.
Your feedback
is always welcome.
Chetan Sharma
Disclosure: Some of the companies mentioned in this note are our
clients. |
