Friday, January 22, 2010

Mobile World Congress 2010 –Rumours and Expectations

It’s that time of the year again when mobilists around the world prick their ears to detect the crescendo of rumours concerning the 2010 edition of the Mobile World Congress in Barcelona.

Changing times

Globally, mobile is growing at a steady pace, with emerging economies taking the slack from mature ones, smarter phones encouraging greater use of data connections over the 3G and 4G networks and new services (like mobile money) coming on stream to create more captivating services on mobile.

So, why the gloomy faces on the mobile operators’ executives? Because times are a changin'. What began as an easily shrugged-off trend, ‘openness’, has seriously destabilised the comfortable world mobile operators were operating in. Threats of ‘dumb pipes’ loom large on the horizon. What I’ve referred to as ‘Open Playgrounds’ back in 2008 are now becoming the norm. Increasingly, operators find themselves at a loss to come up with a compelling consumer proposition that they can control (control being the key to monetisation). Meantime, that much loved measure, ARPU, continues on its gradual downward decline. Not the best situation to be in if you need to upgrade creaking 3G infrastructure to ‘gold standard’ 4G or LTE architecture by investing billions of euros.

Much more than hardware

Where exactly is the light at the end of the tunnel? No-one is sure, but increasingly operators think they can see an Apple silhouette against that light. Because no-one has been able to engage consumers in a controlled or closed environment quite the way Apple has done with the iPhone. Hence the launch of the GSMA App Planet (it’s all about the apps) during the Congress –which is great in a kind of ‘let’s jump on the bandwagon’ sort of way, but not so great when you notice that Apple isn’t in the GSMA’s App Planet (presumably Apple’s planet orbits within a different galaxy). Still, Google will be there to let everyone know that they are serious about mobile.

Google’s presence will loom large

In fact, Google will have the biggest profile ever at the Mobile World Congress, following its NexusOne launch and also with the much anticipated Key Note by CEO Eric Schmidt. Without a doubt, Google will shake up the industry and create (as well as destroy) new market segments –what I’m not sure about, is how much they will tread on the toes of operators in doing so.

Nokia and LG absent

Even for market leaders, this is a dangerous strategy –despite agreeing with Nokia’s strategy to re-invent itself into a de-facto software provider, their manner of doing so has also meant they have eroded their market leadership in the hardware/handset market. Partly so, by annoying operators with an attempt to create their own controlled system (remember, this is what operators consider part of their territory). It should come as no surprise therefore, that Nokia will be absent from the show,as is the case with LG. They too plan to create their own controlled App store and ecosystem.

Let Innovation Take Centre Stage

When the going gets tough, the tough start innovating! Now is a great moment for new services and companies to test out new concepts and shake up the industry at the grass-roots. We already saw at the CES Show last month some great innovations in the area of 3D technology. I expect Augmented Reality to be one of the key innovations buzzed about at the MWC (if it isn’t, something will be amiss!). If you are visiting the show, I recommend you check out the Innovation Zone and see where the services of tomorrow will be born.