Thursday, June 25, 2009

Intel/Nokia tie-up - what does it mean for Qualcomm and connected devices?

The news that Nokia and Intel have teamed up to “define a new mobile platform beyond today’s smartphones, notebooks and netbooks” raises interesting questions about who the winners will be in the brave new all-IP world that is LTE. Or, more pertinently, what will this mean for the previous goliath of mobile chipsets and licencing - Qualcomm?

In May, Qualcomm 'launched' a new category of device (if you can launch a category) called the "Smartbook". Ostensibly, this is “the smartphone experience in a larger form factor” and based on QCOM's Snapdragon chipset, which apparently "as a single chip solution combining GPS, multimedia, the processor, wifi and 3G on one chip, promises to make smartbooks lighter, thinner, cheaper and give them a longer battery life". The thing is, I'm not entirely convinced by this form factor... indeed, the clue is in QCOM's own description ... it's larger than a smartphone but does the same stuff. Well, that's a winner.

The Intel/Nokia tie up in many ways looks to the same inspiration, but with a difference. Intel knows how to make computing devices; Nokia knows how to make mobile phones. Crucially, they are talking about the devices being "pocketable" (and hopefully they're not working on the assumption that everyone in 2010 is going to be wearing baggy cargo pants!). The details are still vague but there are a few things that the tie-up suggests:

First, it's a real shot in the arm for mobile Linux and other open source projects. Potentially, it's not good news for Symbian, although you could argue that it's already given up the fight now that it has also gone the route of reinventing itself as the Symbian Foundation.

Furthermore, the implications go further than this deal because of Intel's acquisition of Wind River earlier this month. This really could be the beginning of something big in the broader connected devices market. As we're already seeing with devices such as TomTom embedding connectivity into them, more and more consumer electronics devices are being connected. This isn't about Smartphone functionality in a device as big as book, it's about taking devices we already use and connecting them to new services and creating new revenue streams for operators. The combination of Intel, Wind River and Nokia is potentially a powerful one here especially.

At the moment, the deal gives Intel an HSPA 3G licence but continue the line of thought and the Intel/Nokia tie-up is bad news for Qualcomm. The new mobile platform that it creates goes far beyond netbook and smartbooks. It potentially sets the scene for a much bigger play in the wider consumer electronics market, leaving Snapdragon on the sidelines.

So it's just struck me, substitute Snapdragon for Puff the magic dragon in the well known ditty, and you get a sense of what the future may hold:

Qualcomm, the snapdragon lived by the sea*
And frolicked in the autumn mist in a land called honah lee,
Qualcomm, the snapdragon lived by the sea
And frolicked in the autumn mist in a land called honah lee.

A dragon lives forever but not so little boys
Painted wings and giant rings make way for other toys.
One grey night it happened, jackie paper came no more
And snap that mighty dragon, he ceased his fearless roar.

And all together now ...

* [Ed note: San Diego is by the sea, so it works!]

Wednesday, June 24, 2009

Femtocells go commercial

All of a sudden, the world seems to have gone femto-crazy ... or more accurately, operators have finally decided to bite the bullet and deploy services. Disapppointingly, this seems to mean that my big brave prediction for 2009 has been shot down only six months into the year. I still maintain that LTE will be the bigger opportunity for femtocells, but nevertheless the news that Vodafone and AT&T are launching commercial services this year goes to show that there is some immediate and real opportunity as well.

However, looking deeper into the news and you get a sense of some of the underlying themes which will now start to come to the fore.

  1. Quality of Service: Suffice it to say, if I used a Voda femto in my flat in London, I would struggle to get more than three words out so bad is my Tiscali broadband. The simple fact is an operator can never guarantee QoS. In a conventional network, they can guarantee it throughout the core as far as the cell site, but as soon as it hits the RAN, there are so many environmental variables (pesky things like buildings that get in the way) that the operator can only then do a best effort. Now, in theory, femtocells solve this problem - it fixes the in-building RF problem. But, if operators such as Vodafone then use the subscribers' own DSL connection to backhaul the call, they have again surrendered control over QoS. In fact, they've taken a step back. While they can optimise the RAN, they have no control over the ISP.
  2. The Form Factor: At the moment, AT&T and Vodafone are planning to go to market with standalone femtocells. The marketing wizards at AT&T have branded theirs a '3G microcell, clearly expecting the US consumer to be tech-savvy, while Vodafone have gone the route of calling it an 'Access Gateway' (access to what, you can already hear consumers asking). However, AT&T has also alluded to 'integrated femtocells' coming later, and this is perhaps where it becomes a real consumer market. I sat in a briefing by Continuous Computing* with Ovum this week and this point came up. Although a lot of the details are still under wraps, Continuous Computing said that not only are about half of their femtocell design wins are with set-top box manufacturers and the like, but that we should be seeing the first integrated femtocell products shipping around late 2009 / early 2010.
  3. The Pricing: Well, this really is the big one, isn't it. The pricing from Voda has that the femtocell with be free on selected tariffs (so operator subsidised like handsets) and also bundled in some phone packages. If you buy the femtocell as a standalone, you're looking at £160 or £5 per month. I won't even try and digest the different phone packages since I've always maintained their are designed solely to confuse but it's clear that the subscriber is going to have to pay extra to solve a coverage problem which you can be pretty sure they weren't warned about when they first bought their shinny 3G handset.
But let's not be churlish. Femtocells are going commercial with two tier 1 operators and for an industry that has invested time, money and effort in creating the market, that can only be a good thing. Well, provided they work and deliver on the subscribers' expectations that is ...

* Continuous Computing is an AxiCom client

Thursday, June 18, 2009

Mobile comms on Olympic starting line

London 2012 is already starting to have an impact on the infrastructure of London, and that includes communications.

OFCOM today "published proposals under section 107(6) of the Communications Act 2003 to extend Airwave Solutions Limited's powers under the electronic communications code to enable it to rollout a private mobile radio network for The London Organising Committee of the Olympic Games and Paralmypic Games."

It seems like every company in the land is fighting for its share of public money sloshing around in East London right now, so who might be some of the winners?

  • TETRA ... despite having over 150 organisations from 35 countries (according to the TETRA Association) backing the standard, it never has exactly hit the big time. But as the OFCOM news suggests, there's still life in the old dog yet.
  • Mobile TV ... every major global sporting event seems to spur an innovation in broadcasting. If the Beijing Olympics saw HD going mainstream (the 2006 FIFA World Cup was the first to be broadcast in HD), then what price London 2012 being the one to reignite mobile TV? The BBC is one of the few broadcasters with the resources to innovate and deliver it, and then there's that L-band spectrum that Qualcomm bought that's lying dormant ...
  • NFC ... the BT team responsible for the communications at London 2012 are apparently looking at NFC for micro-payments of under £10 within the Olympic Park. While the Oyster card is a success for Londoners already, this could be the spur to start seeing NFC embedded into more handsets and to see retailers equiped with NFC-enabled mobile terminals
.. and then of course there's everything else that comes with it ... the network planning, the extra base stations, the mobile apps (both officially sanctioned and those trying to pull a fast one), the list goes on. Hell, we may even have LTE and universal broadband by then ;-)

Wednesday, June 17, 2009

Digital Britain - what it means for mobile operators

Yesterday's publication of the Digital Britain report has predictably been met with headlines about the imposition of a broadband ‘levy’ (or ‘tax’ to you and me) to help fund the future investment in a national high speed internet infrastructure. But, as the appointment of Martha Lane Fox as ‘Digital Inclusion Champion’ perhaps mischievously suggests, is this all a little bit of a lastminute strategy?

There are some interesting points contained within the report (Martha's appointment not being one of them!), not least the news that ISPs are going to be made responsible for policing their own subscribers. This is maybe not such good news for the ISPs, but for anyone selling DPI-related products, it can only be a good thing ... but more on this in a later post.

One area that hasn't received much attention thus far has been what it had to say about mobile networks. There has been some moaning that mobile is just being seen as a stop-gap solution until fixed networks can sort themselves out and deliver the requisite speeds (a heady 2Mbps) to the more remote, broadband-deprived parts of the country. However, I think that's a bit harsh, to be honest.

The report not only acknowledges that next generation mobile networks will be able to deliver data rates of up to 100Mbps, but clearly says that both 3G and LTE have a key role to play in delivering the goal of universal broadband coverage.

What is of perhaps more significance though is:

  • WiMAX is essentially dead in the UK. While it advocates "the immediate release of WiMAX-suitable 2.6Ghz unpaired TDD spectrum for auction", the reports lays its cards on the table and states that there is "an encouraging consensus amongst incumbent mobile operators for the mobile broadband networks to be based on either 3G or LTE. This does not preclude a new entrant using other technologies, such as WiMAX, but in the highly competitive UK mobile radio market it is highly unlikely that such a new entrant would have the market power to de-stabilise the vital standardisation that underpins national and international mobile roaming for UK users."
  • The 'Big Auction' for 2.6Ghz paired FDD spectrum (i.e. the spectrum for LTE) is set for mid-2010. But, there is still a big debate to be had over spectrum refarming before this can happen. Essentially, if Vodafone or O2 (who occcupy 900Mhz spectrum for their GSM services) want any 800Mhz spectrum for future mobile broadband services they will have to trade in their 2G spectrum. The reason, simply, is that the economic advantages of 900Mhz over 1800Mhz (greater cell coverage etc.) are such that the regulator has to balance it out so T-Mo and Orange aren't penalised. So the auction of 800Mhz and deployment of LTE rests on how easily 900Mhz can be refarmed.
  • In a bid to drive universal mobile broadband coverage and so get 3G services as nationwide as 2G, the terms of the 3G licences are going to change from time limited to indefinite in order to give operators a chance to see an ROI from extending their 3G coverage. What's more, the Digital Britain report seems to favour network sharing in the sub-1Ghz spectrum as a way of expediting this network expansion, not least because lowering the cost of delivering broadband coverage to the last 10% of the UK is critical given that they are so well dispersed and "not a viable market" on their own.

Overall, the Digital Britain report seems positive for mobile operators. I've heard murmurings of people saying LTE could solve all the problems and so we wouldn't need to pay the 'broadband tax' to bankroll building a nationwide high speed fixed network, but realistically this was never going to be the case. Any anyway, the economics of delivering mobile broadband in remote areas is still something that needs help from the regulator to balance.

Either way, with several important spectrum issues to be resolved over the next 12 months, it's clear that there is still much to play for in the role mobile networks will have in policies to finally deliver a universal high speed internet in the UK.

Tuesday, June 16, 2009

Digital Britain Report

The Digital Britain White Paper has just been published... Analysis to follow once I've read all 245 pages, but according to the Dept of Media and Culture's press release, Digital Britain measures include:

Communications Infrastructure
Steps to strengthen and modernise the UK’s Digital Infrastructure so the UK can compete and lead globally

* Universal access to today’s broadband by 2012, creating equal access for all and a fairer digital future
* A fund for investment in the next generation of superfast broadband to ensure it is available to the whole country, not just some of it
* Digital Radio Upgrade by 2015
* Accelerating current and next generation mobile coverage and services
* Proposed new role for sectoral regulator Ofcom to carry out a full assessment of the UK’s communications infrastructure every two years

Digital Participation
Steps to ensure that everyone can share in the benefits of Digital Britain

* Three year National Plan to improve Digital Participation
* Programme of Digital Switchover in public services
* A new Digital Inclusion Champion: Martha Lane Fox
* Revised Digital remit for Channel 4 and key role for BBC
* Guaranteed funding for three years for targeted marketing and outreach

Digital content
Steps to make the UK one of the world’s main creative capitals

* Robust legal and regulatory framework to combat Digital Piracy
* Digital Test Beds to promote innovation, experimentation and learning around creation and monetization of digital content
* TV Licence Fee: consultation on contained contestability, primarily to secure news in the nations, regions and locally
* A new direction for Channel 4, championing new talent across all digital media
* Guidance note and clarification on the media merger regime and an enhanced evidence role for the regulator in local mergers
* Support for Independently Funded News Consortia


Synopsis of report here

Full report here

And the Digital Britain Impact Assessment is here.

Chinese vendors set to dominate infrastructure market

The contention that Chinese infrastructure vendors (namely ZTE* and Huawei) are going to dominate the market has gathered more momentum. Tarek A. Robbiati, CEO of Hong Kong's number one mobile operator CSL said in London today that “Further consolidation will come in the next three to five years. In the end there will be only three [infrastructure vendors] left, and two of them will be Chinese. The European vendors are just too slow.”

Perhaps even more significantly, according to who met with Robbiati today (Robbiati is in London with ZTE to discuss their work together in deploying an HSPA+ all-IP SDR network) he also argued that ZTE and Huawei can no longer be viewed as competing only on price - an accusation that has been levelled at the two vendors in the past. Price remained important, he said, but technical performance was the deal maker.

As this blog discussed back in March, ZTE is "confident" that it can maintain double digit growth in 2009 and, with a $15 billion line of credit from Chinese banks, drive market growth in the infrastructure market in Western Europe.

The combination of financial muscle, a production capability that can continue to thrive in an increasingly commoditised market, and a growing track record for innovation and R&D is a powerful one. Not least because there are some competitors who are reporting poor financials, are struggling to keep costs under control and are being driven to outsource more and more of their R&D and software development.

Well, they say the customer is always right ... and ZTE will be hoping that this one most certainly is.

* ZTE is an AxiCom client

Is Broadband a Utilty - the conclusion?

As Lord Carter prepares to unveil his Digital Britain report today, Gordon Brown has already gone on the record in The Times stating that the internet is a"as vital as water and gas".

Watch this space for an analysis on the Digital Britain report once it's published, but in the interim, check out the story so far on whether broadband should be considered a utility:

Part 1: OFCOM opens the door

Part 2: Lessons from Australia

Part 3: Open Access?

Part 4: Consumer survey by OFCOM

Thursday, June 04, 2009

Is broadband a utility? (part 4) - UK consumers say "Yes"

For a while now I've been banging on about whether Broadband should be considered a 'utility', particularly in light of the decision by the Australian Government to invest in building a 'National Broadband Network'. Well, it seems as if we finally have an answer ... Yes, it should be.

A survey by OFCOM's Communications Consumer Panel has found that 73% of those questioned described a high-speed connection as important, even ranking it above a mobile phone in their list of necessities on the basis that people who did not have broadband would be at a disadvantage, missing out on services such as shopping, banking and public services as they were increasingly being delivered online.

According to Anna Bradley, the chair of the Communications Consumer Panel: "The key message is that people think broadband is at a tipping point. It's fantastically useful for everyone, essential for some now, but will be essential for everyone in the near future. It is being compared by consumers to gas and electricity - things which they think we all ought to have access to, almost as a right."

Consumers questioned in the survey supported broadband access for all and said that:

  • It should be possible to have broadband at home, regardless of where people live (84% agree, 46% agree strongly).
  • It is everyone's right to be able to have broadband at home (81% agree, 42% agree strongly).
  • It should be possible also for people to gain the confidence and skills to make full use of broadband at home (80% agree, 32% agree strongly).
  • It should be possible to access broadband at home, even if they have a low income (73% agree, 32% agree strongly).
But, if we do indeed consider broadband to be a utility that should be available to all, the UK has some way to go both compared to its peers internationally but also domestically.

While Lord Carter in his interim recommendations for Digital Britain, has proposed a Universal Service for broadband, with a recommended 2Mbps which the government has backed, the reality is that much of the UK remains disconnected.

According to research commissioned by the BBC, about three million homes in the UK have broadband speeds of less than the magic 2Mbps. What's more, the physical distance of many homes from the local exchange mean it is practically impossible for them to get anywhere nears this speed.

The map of these so-called Broadband NotSpots put the scale of the problem in context (check out ThinkBroadband and SamKnows for their NotSpot maps).

As soon as you drop below the 2Mbps, the access to content and services drops off dramatically ... heck, you won't even be able to watch the re-run of the Apprentice on iPlayer ... it's THAT bad.

Monday, June 01, 2009

Who manages the spectrum?

Spectrum is again dominating the headlines but this time it is the regulators themselves who are in the news. As a child, I was always told that children should be seen but not heard - and I can't help thinking regulators should be the same. Their impact should be seen, but they should never be the headline makers themselves.

In a week when Europe goes to the polls to choose who will the lucky passengers to board the EU gravy train, sorry, I mean be elected to represent us in the bastion of democracy and freedom that is the EU, it seems only right to have a look at the role the European Commission has to play in the great spectrum debate. In particular, where does their role begin and end?

The regulatory landscape used to be quite simple. The ITU would be responsible for the global management of the radio-frequency spectrum and satellite orbits, while on a national level each country's regulator would be responsible to managing spectrum usage. But things have got a bit more confused now that the EU has waded in and positioned itself as a supraregulator.

The issue has come to a head with the decision of the EU to award Inmarsat Ventures and Solaris Mobile enough radio spectrum to run trans-Europe satellite data networks, effectively forcing the hand of national regulator such as Ofcom who in theory still have the final say over how much each operator will have to run their network down to the UK's street level.

According to The Register, the spectrum concerned, two blocks around 2GHz, has been allocated to satellite data services by every country in Europe. The EU has been deciding, by beauty contest, who would offer the best connectivity to the remotest parts of the EU, and it's come down to Inmarsat and Solaris, but they'll still have to do regional deals with the regulators in each country, with Ofcom presenting one of the more serious obstacles.

But does the EU actually have the legal authority to make trans-national spectrum awards? And what will happen to the companies not awarded the right to operate a satellite service in the S-band spectrum? Well, they'll fight the decision in the courts, claiming the the European Commission does not have cross-border jurisdiction over spectrum. According to ICO Global Communications, the US satellite operator and one of the losers of the EU's beauty parade, only the ITU has the authority to allocate and manage spectrum and orbit resources on an international basis.

However, LTE spectrum auctions start to finally take place this year, you can see the EU wanting to poke its nose in more and more. Keen to replicate the success of GSM, which provided a consistent pan-European cellular coverage and enabled easy roaming between states, you can see the EU trying to influence spectrum auctions so that there is a similar pan-European mobile broadband coverage.

One route seems to be to simply open up the existing GSM spectrum for use by UMTS-based systems. Back in April, the EU amended the GSM Directive to open it up for HSPA deployment (see my earlier blog on this) in a policy known as spectrum refarming. National regulators are following suit with Swiss regulator ComCom announcing that it is enabling all three licensees to use their existing 900MHz frequency also for UMTS applications (although obviously they're not in the EU!).

So, taken together, we can arguably see that not only is the 900MHz spectrum being lined up for mobile broadband, but also that the European Commission is prepared to be increasingly activist in issues of EU spectrum and so may even go as far as mandating it.

Where does this leave the ITU? Well, I had the privilege of meeting the ITU a couple of month's ago and I must admit I left feeling a little underwhelmed as to whether they actually have any clear vision of what they are doing. It seems as if they are content to leave regional spectrum issues to the appropriate regional governmental authorities and instead focus on the more worthy issues of communications poverty in disconnected parts of the world.

The way seems to be clear for the EU to take a lead on European spectrum issues - pending, of course, the legal challenge mounted by ICO.