Wednesday, January 28, 2009

Innovation in Mobile .....

...if the things outlined in the Independent today are the best that the mobile industry can come up with can you stop the Bus I want to get off!

Whilst I agree that the Mobile is becoming more and more a Remote for life I would hope that the Executives within the Networks at this time are focusing on the Quality of the Service rather than the Technology and User Interface. In talking to the Normal User one of the biggest demands they have with the new handsets is that the battery lasts just like it did the that Black & White Nokia that we only charged on a Sunday. Once they realise that using data services resulted in no phone after lunch they stop using data!

Talking to those who are excellent in segmentation and targeted marketing speak about just how bad the Networks are at Communicating. For Example, If I have been a contract customers with your network for 8 years and every time I have upgraded my handset I have selected a Nokia what makes you thing that you can sell me a Samsung? Tesco's know that if I am a Pepsi drinker I will not switch to Coke so they incentivise me to buy expensive cans rather than cheap bottles. When then don't the Networks use some of the data locked in the billing system about me to try and increase my user behaviour rather than get me to try something new?

Most people feel that the Customer Service Experience when it comes to a Mobile Network is something a kin to an Estate Agent or Dentist rather than Rolls Royce. Orange last year told those in the UK that it understood their pain and would move call centres back to the UK. As an Orange consumer I see no improvement to my care, since they have become French I no longer get calls to ask what can be done to improve my experience or reduce my bill.

As a consumer I have FIVE UK sims for my personal use and we have three others in the house that Orange know about as they are topped up from my Contract. Orange know about on half of the Sims I own, they have not attempted to cross sell Broadband (Fixed or Mobile). Thus I have to question what value they place on me as a customer?

The reason that I do not use a Single Network is because the Coverage I have at present is erratic at best. It is not a question of budget to build in the case of the Provider but rather planning permission to build new cell sites. Having been involved in Fixed Mobile Convergence I know that using GSM & WiFi = Reduced Battery Life so I want a system that is GSM. I also know that the audio quality of the GSM network could be enhanced and for someone who is a heavy voice user that is an innovation that would increase useage.

If you are interested in a Universal Remote Control rather than download apps from the iStore onto you iPhone switch to a RIM and sign up for Unify4life.

Monday, January 26, 2009

Carnival of the Mobilists No 158

Radvision has edited the best posts on Mobile this week for the Carnival of the Mobilists.

Go over and take a look at Mobile Content, User Interfaces, Mobile Futures and Nokia v Apple. 

Sunday, January 25, 2009

Just who needs Broadband?

The Sunday Times today reports that the Mobile Operators are to be offered the 3G spectrum in perpetuity in exchange for the provision of a universal service which could cost an additional £1-2B to build. In the Observer we are told that BT is looking at a return to mobile becasue of the loss of revenue having spun out Cellnet to help pay off a £30B debt at the time of the 3G auctions.

As someone who was involved in the 3G bids I have to question some of the logic in these reports. On a very simple level if I were the CEO of a Network in the UK the thing I want is planning permission for all the base stations they have planned. The Investment needed for 3G has been slowed because of local resistance to new base stations not cash concerns. In the Local Elections last year the Liberal Democrats had as a manafesto pledge the refusal to allow any new masts to be built. The outcome of this is that Networks need to Appeal Planning Applications to get one built, this is at present taking some 4 years to achieve! For me it means that I have very poor coverage from Orange which will only improve once they get permission to improve coverage not a Governement incentive.

3G spectrum might not be something that has a long time frame in that the current thoughs on 4G is that the old 2G spectrum is refarmed in an effort to improve inbuilding coverage.

Lord Carter (one of Mandleson's Business Ministers) is at present putting the finishing touches to his Digital Britain Report aimed at looking at the needs for UK PLC. It seems that at this moment the Mandleson Machine is stress testing some of the recommendations prior to publication. As well as the 3G "leak" we have the Observer
reporting that the central plank of the plan, Fibre to the Home is under threat. BT is looking at the best way to manage its cash knowing that they have a hole in the pension funds and declining incomes thanks to bundles that offer free calls and problems in the Services business.

Whilst I have been looking forward to a better connection than I have at present I am unsure of the benefits of just building FTTH. When you look at the expansion of the M25 you see that the adding of more lanes just means that more are stuck in traffic jams! Thus with a faster internet will we get a better one? The TV content that I want is not yet available on iPlayer and the regulator has said that Picnic or Kangeroo are not fair to sonsumers and so cannot launch. So it best solution for me to wait until the serries finishes and the buy the DVD at HMV if I wish to remain legal or risk viruses and file share. The Government seems to think that because so many are breaking the rules they need to
Tax all users of the web. If you get a better connection the incetive will be to break the rules more so who wins?

Friday, January 23, 2009

A New Dawn or the beginning of The End for Nokia?

This week we have seen the presentation of results for Nokia and Apple which in headline terms present a change in the fortunes of the leader and a significant challenge at the high end of the market.

In his presentation  Ollli-Pekka Kallasvuo Chief Executive of Nokia said  In recent weeks the macroeconomic environment has deteriorated rapidly, with even weaker consumer confidence, unprecedented currency volatility and credit tightness continuing to impact the mobile communications industry. ” 

Apples results show that it sold 13.7m devices in 2008 which is about 1-1.5% of the total worldwide market by volume.  The last quarter saw only 4.4m sold rather than the 5m the market estimated. The key comment made in the Earning Call was that the iPhone performs poorly in non-subsidised markets, indicates that at some point when demand evens out carriers will have more power over the price they pay Apple for the handset. 

With 40% of the handset market and the Integrated model rather than contract manufacturing Nokia has better Economies of scale than its rivals.  Apple is a design house that gets its handset made by Hon Hi as a contract manufacturer.  When you are making Phones in small volumes doing so in someone-else's factory makes sense however is it something that works when you have more than one design and 10% of the market?

Whilst some see the entry of Apple and Google into the handset market as the opening of the ecosystem thanks to the application platforms that they present I have to ask if the economics work?  The Network Operators have made investments in infrastructure, distribution and support over the last 20 years.  Why would they not expect some return on that investment and security over the future customer revenues?

Looking at the history of Mobile I recall that Nokia assumed that with the arrival of Data services in the late 1990's it presented a chance to take control of the consumer with the launch of Club Nokia as the primary Wap bookmark.  The result was a boycott by the networks until they localised devices for each Operator.

Talking to those who work in FMCG I am told that advertising is not about getting someone to switch from Coke to Pepsi but rather to get them to increase the volumes they consume.  The same is true with Handsets most people say that they are a Nokia user, Sony Ericsson person, Blackberry Addict rather than Orange customer, Vodafone Fan, O2 Punter.  This Brand loyalty makes it difficult for new entrants to capture market share the rise of Blackberry and HTC has taken 10 years to achieve.

The presentations at Barcelona next month will be interesting in that we in Europe will get to see the new Palm Pre and perhaps the first Android based handsets from Motorola as well as new handsets from all those in the mainstream.  I hope that we will get to see the first devices that use the Snap Dragon chip which could offer features better than the current smartphones with hopefully better battery life. 

Nokia will innovate devices in the economic downturn.  The conditions hopefully will mean that they cut a number of handsets from the product range in an effort to improve the user experience and quality of the offering.  In light of the downturn will Motorola, Samsung and Sony Ericsson be able to do the same? If they fail to then they will be the ones who lose out to the New Entrants.  Before I see Apple as anything other than an opportunist they will need to offer a range of handsets similar to their iPod or Laptops.

Wednesday, January 21, 2009

Consumer Choice?

With the fall of both Zavvi and Woolworths over the last months the UK consumer of music suffers even more than at any time since I have been buying it.  

I have no wish to have my listening dictated by the whim of a PR agent for the record companies.  The fact that the Christmas Number 1 has become the anointment of the X-Factor winner rather than a competition is only the tip of an iceberg.  The New Comers List for 2009 whist showcasing talent does not tell the whole story it is the will of the record labels who wish to launch the next Duffy, Kylie et al whilst promoting artists like Coldplay, Lily Allen etc..

I listen to Jazz mainly the artist that are available on iTunes are limited in terms of range and quality.  My local Zavvi whilst not a large stockiest of Jazz benefited from the fact that at times you could meet Courtney Pine as it was his local music shop.  I have managed to get the last three CDs he has released signed because of that fact.

This week I wanted to get a couple of CDs that were not yet available for download.  With only HMV as a specialist I was unlucky, WHSmith have yet to grasp the opportunity presented by the fall of rivals and Tesco stock just the top 50.  One CD was available as an import from Amazon at £16 the other you buy from the Artist's Website where an EP costs £12. So much for consumer choice.

Perhaps those that set up DarkerThanBlue can find some funding and relaunch the site as a music hub? I know that the important element of Woolworths failure was the removal of Entertainment UK who undertook the distribution of Music Games and Books and it is this decline that has hit consumers most.

How are others managing to get music outside of the Cities?  I hope that as small bookshops have been able to survive after the Net Book Agreement was removed we might see new music stores open.

Since Christmas I have taken advantage of the chain of Oxfam shops close to clients to replace a number of old music that I have on Tape with cheap CDs.  However not many of those that give music to Oxfam listen to Jazz. Before the rise of eBay we had local CD Warehouse that served the needs of those looking to buy and sell second hand CDs.  The company went bust but now it could return if others see the opportunity.

Monday, January 19, 2009

Anyone doing Mobile Banking in the UK?

Mobilink have released its latest analysis of its customer base.  It says that the service is used by young families and new home owners.  So I guess that at the moment this is a service for the person concerned about budgets rather than someone looking to replace cheques to make P-2-P payments.

I talk to quite a few people about mobile usage and whilst I have been told about M-Banking by those from Pakistan, South Africa, Kenya, Nigeria, Uganda and America no one in the UK other than people working in the Banking Payments community have used Mobilink.  Thus I have to question the validity of the report.

Since 2005 I have been evangelising Mobile Banking, it is a service that I am confident will happen on all phones.  The technology is simple in that text based, browser based and Java solutions are available dependent on the type of handset and transaction you are attempting.  On a simple level once people replace bank details with a mobile number it will be easy to transfer funds by text rather than write a cheque, with a small fee more and more will also pay by phone rather than use small value notes and coins.

With the Banks looking at the cost base as well as their capitaisation I feel that they will seek to become more local and less international.  Using the mobile phone rather than Internet Banking will be a technology that the consumer adopts, too many of us share a computer but very few share a phone and so it is more secure and we almost always carry a phone whilst most of us have a static computer (even if it is a laptop).

Carnival of the Mobilists

MJelly has hosted the Carnival this week and has a number of excellent pots from those in the Mobile Ecosystem talking about what matters most to them.

Looks like my evening will be spent condensing a number of the other posts that made it into this weeks post.

Monday, January 12, 2009

Mobile Zeitgeist

Sitting and thinking over the Christmas Holidays I took the opportunity to consider the state of the Mobile Industry.  Following my post asking for a Leader to step forward and create an Ecosystem that benefits all a few asked the question was Mobile a single entity or was it a number of Industries?

Whilst I agree that at present what we see might be more a kin to a medieval Britain in that what is seen are a number of waring fiefdoms I have to say that after some twenty years we might be reaching a degree of maturity that sees those that run Networks, Handset Vendors, Chip Makers, Equipment Manufactures and Regulators starting to take a rounded view that looks at the relationships between all that makes up the Mobile Industry.  As we enter difficult economic times to maintain the present position let alone move forward Leaders and Managers understand that it will require cooperation as well as innovation if mobile is to maintain its historic share of the wallet.

On a simple level I look at the talent in the industry and ask is the average IQ of those working in Mobile rising, falling or about the same as it was at the start of 2006?  Are those that are joining Mobile brighter than those that we coming into mobile in 2000 or below the standard of those joining in 2002?  At present I have to say that those I see starting a career in Mobile are not as smart as they were ten years ago when it was an exciting place.  A lot of those that joined Mobile at the time of the 3G auctions have moved onto the next hot trend, which might be philanthropic commerce in Africa and South East Asia judging by the updates of friends on LinkedIn! One of the issues that I have with those that have joined the sector is that they do not seem to have the drive that the previous entrants had to understand the history of Mobile so that can avoid the errors of the pioneers.  It might be a function of becoming Middle Aged but the current Youth do not seem to want to undertake any form of education but rather seek training so that they can perform the day to day duties of their role.

A review of the Networks sees that in Mature markets size is a good thing as consolidation sees those operating national networks seeking to become more International to share infrastructure in what looks like an old fashioned arms race.  The race seems to be one of speed as capacity fills they are looking at merging towers.  With an eye on costs all CEOs are looking at what can be undertaken to maintain profits are revenues fall.  Rationalisation in the sales channel means that no longer are the Networks prepared to speed money on acquisition but rather wish to reward loyalty. The Brave CEO  whilst cutting cost will also invest in CRM tools that improve knowledge. In the Emerging Market the CEO is faced with far greater challenges in that most of his customers have a limited budget that sees them using his network for less that 6 days a month.  The interesting thing is that the Emerging Market CEO is far more attuned to his customers needs and incentivised to insure that they have network coverage and customer service.

There is no dought that at present it is the Handset guys who are feeling the downturn the most.  The interesting element seems to be that the activity is speeding the end of life for a number of 2G handsets rather than the stalling of development.  In a recent presentation I talked about the move towards a number of standard Operating Systems in an effort to limit the cost and time of introducing handsets onto a network (just look at the pain RIM are feeling with the launch of Bold).  I see that we will have one form of Symbian (Nokia S60), LiMo and one from Windows Mobile, RIM, Apple.  Symbian’s new business model has seen the death of UIQ and the new license agreement means that Nokia have no reason to cut down is premium software stack to save money.  Whilst Android looks like a better opportunity than developing for Apple it is still a closed system that has the Networks concerned that Google is more an Enemy than a Friend.  I am sure that by the end of 2009  we will see more  devices available  on the Android platform than  iPhones but cost might be an issue should the networks decide not to  subsidise the cost of those handset.

In the Chip business it is the lag with the handset makers that will effect most and the question is who is prepared to maintain Engineers in the current market?  Those that offer simple solutions such as CSR will be the most effected and survival will mean that they need to find a bigger firm to buy them.  Those that produce chips for industries other than mobile will find themselves squeezed as costs do not match revenues.  All these facts mean good news for Qualcomm and I think that more will license the ARM Instruction set and develop chips capable of matching the speed and capacity available in today’s mobile network.

Equipment Makers face an interesting year with 3G spectrum auctioned in  India and China offering the opportunity and threat.  The staged roll out of Mobile Broadband offers opportunity to sell volume but with a limited margins.  The risk for Equipment Makers is that the Networks scale back the roll out of HSUPA and HSDP+ as revenues fail to kick in.  Looking at the future, this year we will see LTE finalise.  Losers are likely to be Nortel, Motorola and Alcatel Lucent who bet too much on WiMAX.  Ericsson and NSN will suffer as the Chinese buy market share.  Huawei will continue to impress the Networks with the quality and speed of its Engineers.

At this moment I do not think that the Industry is in terminal decline, but it is getting smaller.  I would like to believe that those in charge of the various stakeholders have the knowledge to insure that the decline is limited in terms of time and effect. Looking at the progress in America over the last year the launch of mobile banking shows that a federated approach benefits everyone.