Android as the mobile windows ?

Mobile device planet is definitely shaken these days.

While Android OS market penetration rockets, 4 millions iPhone 4S has been sold in 3 days.
Behind these 2 leaders, other manufacturers are making a lot of announcements and/or promises but the time for long lasting illusions will be soon over :
- Samsung announces a new version of Bada while previous version did not outperform - apparently trying to master its own future after Motorola acquisition by Android's masters,
- Samsung and Apple engage in a patent war rarely seen at this level in Consumer Electronics, arguing about 2001- a space Odyssey,
- Sony wants to buy back Sony-Ericsson - currently loosing ground - to better leverage its strong brand and skills in high end consumer electronics,
- Blackberry faces a 3 day outage while shareholders set pressure for a split of the company,
- Microsoft sold 1.5M phones of Windows Mobile during a quarter (yes, 90 days).

Decisions will come soon but impacts of decisions taken earlier this year could be measured even sooner.
Within 2 weeks, we will get a very good indicator of the chances of Windows Mobile to survive. Nokia will then announce its new series of smartphones based on Windows Mobile. If these new phones are not striking, either through features or through prices, Microsoft can probably bury very deep any ambition on mobile and ... Nokia in the same grave. That would leave Android possibly playing the same role on mobile as the one played by Windows on PC.

During this war between each others, device manufacturers also try expand and eat a part of the cake of network operators.
On one hand, many device manufacturers have engaged in acquisition of companies active in content ecosystem playground, for example to strengthen their content and app stores.
On the other hand, Apple managed to "commoditize" the network more than ever. One of the major breakthroughs of the iPhone 4S is the simultaneous support of CDMA and GSM for the same device. If advantages are not perceived here in Europe, it means that iPhone 4S will be working on both AT&T and Verizon networks. Moreover, after a costly deal (for Sprint obviously !), Apple gives full freedom of network to consumers.
On this page, Apple now present network as a pure commodity - just comparing telco prices and packages - the price of the phone being the same on all networks. They just miss a coverage map to allow better comparison. Any concept of service - provided by network operators - is completely hidden. In US, dumb pipe is not a telco threat any more. It became a fact.

This period is definitely critical within the poker game between all these mobile smartphone vendors.
It's written as a thriller. The name of the killers are quite clear. The uncertainty resides in the name of the victims and especially the order for them to die or give up the market.

Future will say ...

Benoit Quirynen

A hype revival of vintage mobile video communication in MWC 2011

Let's get back to 2004, the hype in Mobile World Congress for the first time in Barcelona is about video communication. Thanks to 3G and embedded cameras in the mobile phones, people can proceed to a mobile video call from their device. It's huge. Telecom operators imagine gateways to enable subscribers to proceed with video call between a mobile and a PC to compensate the low numbers of nascent 3G phones. Two years after, this turns to be a failure. Damned, consumers are not using it.

Several reasons have been given at that time : cameras not powerful enough, screen definition too low, requirement of "high quality real time bandwidth", low willingness to use due to high intrusiveness and, finally, too difficult to take a continuous movie of its own image in good condition for the other party (sun, image stability, etc...).

2011, Mobile World Congress, perhaps one of the last time in Barcelona. The hype is back on ... mobile video communication. What can explain the revival ?

Some progress have been done on the technology side, especially on the devices now much more powerful in terms of CPU, screen and camera. Moreover, Skype, which has largely contributed to popular usage PC-2-PC of video, is everyday increasing its penetration on mobile phones.

However, the major factor could be the support of the magician Steve Jobs through Facetime, the video communication service from Apple. US investors suddenly start to poor money in these technologies. Of course, these "dollar cow-boys" did not necessarily participated to the hype 8 years ago since US was still at that time an underdeveloped country in terms of mobile usage, fighting to make CDMA EVDO operational.

Despite device technology evolutions and financial support, some challenge remain on the way to a large penetration of this service on mobile phone. Video communication still is intrusive and image stability did not significantly improve when you have your mobile in your hand.
Another main hurdle - requirement for a high quality network - will still exist for several years. Watching Youtube, users can benefit from buffering in the device, which is not possible with real time communication. This thus requires a continuous quality and bandwidth, which is challenging for a good quality. Just have a look on your device how many times you switch from GPRS (G) to Edge (E) to 3G (3G) to HSDPA (H) and you will see the stability of the data network, especially when you move one meter in your office or when your neighbor starts watching Youtube (because you share the cell data capacity with your neighbors, you like it or not ;-).
Moreover, in terms usage, some analysts state that consumers would use the service to show what is around. Capability to record a video and send it by MMS or email (on smartphones) exists for years. MMS video traffic is very low due to high price for upload of large volume. Imagine the price range when telecom operators want to guarantee a higher quality all along the call.
Finally, since telecom operators face problems with huge data traffic generated by smartphones and USB dongles, they will normally price the video call higher than voice call. Who is willing to pay more for a good quality video call ? It's true that Skype video calls are used on fixed Internet but using video or not is always the same zero price. Willingness to pay is probably the final killer of mobile video communication.
And if some operators would offer video call service at the price of voice calls in order to maintain price of a voice/video call revenues, they would significantly increase their cost without increasing the revenues. Better use this bandwidth to offer more low consumption services.

I had the chance to live the complete previous cycle of mobile video communication. We thought at the beginning that we were very successful since we signed a lot of contracts with major telecom operators but consumers brought us back on earth a bit later.
So, if you are in this business, have fun but do not expect your venture to be funded for a long time. Dollar cow-boys will probably stop soon pooring money in bottomless pit when they will discover the lack of fruits and remaining hurdles of previous experiences.
There are probably much better ideas for new telecom services, focused on low bandwidth for higher profitability of the whole value chain.

Future will say.

Benoit Quirynen

AOL acquires The Huffington Post - capitalism against illusion of freedom

AOL has acquired this week The Huffington Post for $315 millions.

The Huffington Post is a kind of newspaper written by citizen bloggers. AOL expects to sell ad space around what became a popular real estate. As outlined in The Herald Tribune by David Carr, it's funny to see that all these bloggers have created value for Miss Arianna Huffington.

A lot of this content is created by citizens, inspired from other articles in paid newspaper (as this one ;-). Before acquisition, it was difficult to attack a company with no fund. Tomorrow, shooting for the 2.2 $B from AOL market capitalization risks to tease a lot of content providers willing to protect their assets and value their content.

Moreover, now that citizen bloggers know they directly feed advertising revenues of AOL through their posts, they will perhaps not demonstrate the same appetite to contribute ... at least on this particular real estate. Of course, AOL can pay the best contributors but the relationship then becomes commercial with a totally different mindset.

On the other hand, will readers continue to absorb this content the same way since the spirit has evolved ?

Anyway, this move is the demonstration of capitalism against feeling of freedom. And the most cynical is not AOL which pays money but Ms Arianna Huffington who receives money valuing the efforts from a lot of others.

Will citizen bloggers go on supporting this attitude ? Will readers change their behavior ? It's a good test for our whole society.
Future will say.

Benoit Quirynen

Print publishers - it's time for a Copernican revolution

Today, we see a lot of print publishers willing to leverage IPad interactive capabilities to better monetize their assets. Since paper is currently their main source of revenue, they thus study how they could extend their IT systems and processes with minimal impact to deliver interactive experience.

Experience proves that adding interactivity along the way is complex and painful, often requiring manual costly processes. For a future-safe approach, publishers should consider redesigning their whole IT, taking digital and interactive as the source and "passive paper" as one of the multiple and diverse outputs.

Some of them already started this move in to adopt to the online space. It's only the beginning. This definitely requires a "Copernican revolution" and related change management processes to move the whole company in 21st century.

Thanks to evolutions during the last decade in this domain, by both industries and open source, this investment will make it much more cost effective and seamless for introduction of new formats and extension to new devices.
Having "rock-bottom" costs for the production factory can leave the money on the long run to either attract top writers and bloggers, bringing the right audience and/or give flexibility to evolve in terms of business model.

Yesterday, moving in the new space was an opportunity. Tomorrow, keeping current methods will yield a threat.

Are "Print publishers" ready for this change ? Future will say.

To be continued

Benoit Quirynen

Telecom - why not simply deliver a better service ?

Blogs, articles, books, everywhere in the world strategists are discussing about the battle between internet boys and telecom elderly. Why are Internet boys so successful, in a kind of continuous hype curve, while telecom elderly are perceived as old-fashioned even if the second ones provide the necessary pipes for the first ones to operate ?

This interesting discussion was reenforced this week due to the Broadband forum.
There is certainly nothing wrong to raise the question and, even better, it's important for the whole society to find the right balance between the two sets of dinosaurs in order to support further evolutions.

But, before engaging in some hazardous strategies, telecom operators could perhaps simply deliver a better service. It's not about inventing yet another stuff. It's all about services around voice, messaging, data access and 3rd party premium services - all the services used by large panel of subscribers.

We can distinguish two aspects : provide a better user experience and solve all the numerous small inconsistencies which are very annoying for subscribers, eventually leading to a complete loss of trust.

Why the hell is the Skype user experience better than my phone experience ? I don't ask for a free service. It would nice but I understand it would not be sustainable. I just ask a mobile user experience as convenient as Skype.

The second improvement concerns the loss of trust that I still have in my telecom provider. Why the hell do I face a problem each time I activate a service ? It's true that I receive more alert messages than before, assumed to explain unusual situations. Receiving alerts when call center tells you that there is no problem creates frustration. Not receiving an alert when there is a problem is even more frustrating. And finally, each time spending 20+ minutes waiting in call center queue is certainly not my favorite activity.

Telecom systems have been built as mushrooms growing, on a yearly basis, a few month after annual Mobile World Congress. In order to face the other category of dinosaurs, it's time for telecom to debug all these minor frustrating error cases or even better, time to streamline the architectures.

Let's remove dangerous mushrooms and structure the telecom landscape for an open field based on latest technologies and concepts - supporting a new wave of innovation.
Fighting or partnering with the other side ? Future will say.
To be continued ...

Benoit Quirynen

Content is king, cross-device digital rights is key ... for e-paper as well

The limited number of e-books available on IPad pushed me to install Amazon Kindle app on this device.
In my humble opinion, IBooks reading experience is better but reading Winnie-the-Pooh starts to be boring ;-)

Moreover, thanks to Amazon, I can choose to read it on several of my devices where Kindle app could installed (IPad, IPhone, PC, Android systems, etc...). Even if reading a book on a phone is not convenient at all, at least I feel that my digital rights are respected. If I loose or break my IPad and wants to buy back a Samsung tablet equipped with Android, I'll have access to my library of e-books.

Cross-device digital rights is a MUST HAVE for publishers moving to digital world. Apple can not lock readers to his devices using content created by others. It tried it in the past with music. It had to extend afterwards to deliver MP3 versions of music.

You will argue that I could read some books on iBooks and some others on Kindle. And you are right. But today, in my mind, I can accommodate the user experience of Kindle and prefer to have future-safe digital rights. So next time, I'll first search on Kindle.

For newspaper, I also experience the "content is king" assertion. I subscribed to a newspaper quite limited application - even painful from a user experience point-of-view. However, I renewed my subscription to keep access to the content which I find useful.
On the side of cross-device digital rights, I'm blocked. Even if I have a subscription on my IPad, I can not read it through my Android phone. I consider this as unacceptable since I already paid for accessing this content.

When will iBook be open, when will newspaper support cross-device digital rights ?
To be continued ...

Benoit Quirynen

Microsoft Kinect - some good reasons why a "Kinect app store" could be soon announced

Microsoft could be the Santa Claus of the year thanks to its Kinect - a visual motion detection system combined with XBox360 to replicate Wii gaming experience without any remote control/wimote. A "Kinect app store" could have a huge impact on the overall multimedia and communication market.

Despite the fight between main smartphone manufacturers to federate application developers around their app store in mobile arena, Microsoft still applies the classical game console business model where the top-5 game editors provide a large part of the content. Zune will be the content platform. No signs of app store ... until now.

However, a "Kinect app store" would definitely re-position Microsoft against different kinds of competitors :

Against kings of smartphone apps. This would give Microsoft a first mover advantage against a possible extension of Apple or Google on TV. Both companies federate a large community of developers and already have thousands of apps available. Both Apple and Google could create home devices running their portfolio of apps on TV.

Against game console manufacturers. This would rapidly build the largest portfolio of console games. Of course, Sony & Nintendo could react but both companies don't have any experience with support of large communities of developers. Microsoft support developers for 2 decades. Of course, this would push Microsoft to some compromises in the way they currently deal with developers.

Against telco and SetTopBox vendors in the small IPTV market. Leveraging their leading position in IPTV, Microsoft could propose SetTopBox extensions/migration scenarios for consumers to benefit of these apps. Most of SetTopBox devices hardware setup is today probably too weak to support this kind of local applications, especially if it was not foreseen from day-1. Moreover, Microsoft significantly reduced the price of basic XBox. Simple SetTopBoxes are doomed to disappear.

It's obvious that KIN and KINECT have same roots. There is no coincidence. KIN project on mobile is perhaps delayed, waiting for Microsoft to focus on home during 6-12 months, develop an app position on this market and bring a compatible smartphone afterwards. Microsoft would then be the first player addressing the whole scope of multi-screen.

But even the large Microsoft is too small to develop all applications for this potential. Moreover, leveraging a community of developer largely supports the development of a device during beginning of this 21st century. So Microsoft probably has interest to delegate app development to developer communities. Apple paved the way of developer federation. Google proved that this model can be copied. Microsoft can then smartly activate developer communities, which has been his territory during last two decades, seeding their multimedia app portfolio from TV green field instead of overcrowded mobile arena.

Launching a KIN in June this year did not indeed make sense in this scenario. No obvious reasons for consumers to buy KIN now. If Kinect is a success, rules of the game then change and a complementary mobile phone then fully applies for young consumers and thus solve the issues addressed in this post and in this post.

Another market analysis published these days shows that consumers, when buying a new TV set, more focus on online connectivity than on 3D features. So consumers are demanding an Internet TV model.

Until today, this "Kinect app store" scenario still is an assumption. On the other hand, the fact that TV landscape and ecosystem will drastically evolve in the coming 5 years is a given.

So, game console manufacturers, telco vendors, smartphone vendors, gaming software editors have some time to prepare a battle plan taking the "Kinect app store" scenario into account. Telecom and cable operators would also be well inspired to analyse such a scenario.

Because, for all these players, there are so many things to do to anticipate possible next moves of the dinosaur.

To be continued ...

Benoit Quirynen

Racer mobile phone - the name of the winners not written in the press release

Racer, the new Android phone sold below symbolic threshold of 100 UK Pounds, produced by ZTE and distributed by 3-UK, has been announced this week. This is probably an important milestone in the mobile phone history. Funny enough, the name of the true winners is not written in the press releases.

The announcement indicates an important smart complementary offer; 3UK granting a volume data bucket of 150MB for top-up on a prepaid account.

3UK and ZTE are obviously mentioned in the press release.

Through this launch, 3UK, desperately tries to attack its strong competitors with an appealing offer for youngsters. Vodafone, T-Mobile/Orange and O2 are able to follow when they decide. If the phone is a success, it's just a question of months to come back to a similar balance between telco players on the island.

On the other hand, ZTE makes a step towards a position in the top-5 mobile phone manufacturers but there is still a long long way to run.

Funny enough, the name of the big winners of this important milestone is not written.

Android is mentioned but Google is not. Through its "free licensing model", Google will win the scale battle with Apple. Google copies the Windows model used by Microsoft against Apple during last century. Google does not directly produce cash through this kind of offer. But advertising inventory (display and search) will indirectly grow at an higher pace and this growth is directly linked to G revenues.

The name of the other winner is Facebook, with the same logic of increased inventory, since target of this phone is most probably youngsters, heavy Facebook users. This can be extended to myriad of mobile phone application providers.

Names of losers are rarely written in press releases.

We can not say that Apple will loose with this kind of move but it defines the borders of a profitable corner.
Apple, luxuriantly trapped by the very high value of his brand and its vertical approach - mandatory to change the game at the beginning but limiting the scale during next phases of growth -, will loose against Android in terms of mobile OS market share. As a consequence, iAds, advertising initiative from Apple, will then probably be restricted to high-end brands while Google presents a universal inventory for any brand, any shop.

This announcement now materializes another level of danger for Nokia. Lost in Symbian, Meego, Linux mobile OS announcements, Nokia is still the number one but does not manage to tease interest of developers for applications - the next criterion for people to buy a phone.

Moreover, the whole telco market could start to see ARPU (average revenue per user) declining faster at this stage. Through this offer with such a pricing for device and data, number of data users could reach a tipping point where messaging traffic could start to significantly migrate from charged SMS to free instant messaging.

This only if the Racer phone is good and is a commercial success.

To be continued ...

Benoit Quirynen

Treaty of Tordesillas in 1494 - a business split still under discussion for telecom

1494, Spanish and Portuguese kingdoms ruled a dispute about ownership of the new world. Today, Portuguese prime minister wants to make use of its golden share to prevent Telefonica to control Vivo Brazil, the largest telco in the huge - fast emerging - country.


In 1494, "Treaty of Tordesillas" drew a meridian line (Tordesillas meridian) to determine ownership of the new world : Western part to Spain (all known America), Eastern part to Portugal (islands on the way to America). At this time, it was unknown that South-American territory was extending eastern this meridian line. In 1500, only 6 years later, Cabral, Portuguese navigator, discovered eastern part of Brazil, de facto becoming part of Portugal according to the famous treaty. From this presence in Eastern Brazil, Portugal extended his territory to take more than 50% of South-America.

In 2010, Vivo is the largest telco in Brazil. Through a JV, Telefonica and Portugal Telecom control major part of Vivo. Both Iberian telcos struggle with declining revenues in their home country and consider Brazil as the way for growth. Last week, Telefonica made an offer to buy shares of Portugal Telecom in this JV. Portuguese government now wants to make use of its golden share to protect interests of Portugal.

Spain still has to pay today for an error of about 12° longitude, 500 years ago. When drawing a line to share territories in a fast evolving business, you never know how, where and when it will end ... In ICT, business agreements and M&A operations are often handled much too fast, under immediate market pressure, without clear understanding of the consequences, especially since a lot of new territories are still to be discovered in this domain. What will happen in ICT world 2016 ?

To be continued ...

Benoit Quirynen