2007 saw a slew of mobile operators around the world finally push Internet access to the forefront of their offerings. Theirs could be a rosy future, says Peter Purton.

When Apple launched it iPhone in the USA last June it was to many the first time they realised that mobile phones could be used to access the Internet. Such is the power of the US computer and consumer electronics maker’s brand.

In fact the Internet has been part of most network operators and even most mobile devices’ offerings for some years now. Unfortunately it got off to an awkward start with Wireless Applications Protocol (WAP) in the late 1990s.

WAP became infamous as a failure. It was much hyped at launch as web access from your phone. Well technically it was. It just wasn’t the web as most consumers knew it – it was much more limited in range of services offered, speed of access and ease of use.

In short WAP was disappointing – but it was hardly a failure. It is still the most used method of accessing the Internet from a mobile phone and has become a feature on the phones of over half a billion people around the world.

What the iPhone has done, however, is to wake people up to the fact that their – more or less – regular Internet experience could be taken with them. Apple are not the only ones plugging this, however. And mobile phones are unlikely to be the only devices offering it. In fact one of the most likely candidates are just smaller versions of the computers we already use to access the Internet.

In November the global trade association for the mobile industry, the GSM Association (GSMA), and Microsoft published the results of the first-ever consumer study into mobile broadband computing that shows that there is a tremendous addressable – but currently untapped - market.

The study highlights a 70 million unit opportunity, worth some $50 billion in 2008, for notebook PCs in the high growth, mass market $500 - $1000 price range with built-in mobile broadband.

The research reveals a gap of potentially 46.5 million units between recent industry analyst forecasts and the new analysis, suggesting that PC manufacturers have yet to deliver the right mobile broadband PCs - bundled with pre-configured mobile connectivity - to appeal to mass market PC buyers.

The research, undertaken by Pyramid Research, involved more than 12,000 consumer interviews across 13 countries, with input from notebook manufacturers, component companies and chip set suppliers as well as more than 200 field trials.

“With the right form factor, price and ‘out-of-the-box’ connectivity, the research has unearthed substantial demand for mobile broadband embedded notebooks that is not yet being met,” says Rob Conway, CEO of the GSMA. “Now that we understand the market potential and consumers’ requirements, we are pleased to communicate the findings to the broader industry eco-system.”

“By quantifying and characterizing PC market demand, it is our hope that mobile operators and OEMs will collaborate to introduce compelling and affordable notebooks with innovative new services. We believe that people everywhere, in both developed and emerging segments, could benefit from access to the Internet through mobile broadband on a wider range of notebook PCs,” says Will Poole, corporate vice president of the Unlimited Potential Group at Microsoft.

Twelve mobile network operators supported and participated in the programme, including: Thailand’s DTAC, Malaysia’s Maxis, South Africa’s MTN, France’s Orange, Smart Communications of the Philippines, Telecom Italia, Telefónica O2, TeliaSonera, Turkcell, Vimpelcom, Vodafone and Wind.  And leading PC manufacturers, including Asus, Dell, Fujitsu, Lenovo, Siemens, Twinhead and Vestel, have expressed interest in working with mobile operators and the GSMA to meet the market demand revealed by the research.

Mobility is becoming a strategic issue for computer makers. “People all over the world want to access the information that they need, when they need it, wherever they are," says Ron Garriques, President Global Consumer Group for Dell.

The company has already started putting built-in mobile broadband notebooks in its portfolio. In fact, it has more than any other PC manufacturer, says Garriques. Mobile broadband is the way to help drive connectivity for more people around the world, he adds.

Another computer company taking a lead in the mobile computing arena is Fujitsu Siemens Computers. It currently has the broadest portfolio of integrated Universal Mobile Telephone System (UMTS) notebooks in the Europe, Middle East and Africa regions and is market leader according to analysts.

And its aim is to further consolidate that position and bring the experience of mobile broadband to “even more businesses and consumers, “says Andreas Thimmel, Senior Vice President Volume Business Fujitsu Siemens Computers.

”For mobile PC users, we believe that the widespread deployment of wireless high-speed broadband service represents one of the most exciting developments in recent memory,” says Philippe Davy, vice president of marketing, Lenovo.

“For the first time, notebook PC mobility will intersect with cost-effective wireless service and bandwidth that provides an experience similar to what people get with wired broadband support at home,” he adds. “Lenovo was the first notebook PC company to embrace integrated 3G service, has set the standard for wireless innovation, and we will continue to drive additional value in wireless technology for our customers."

Network operators are showing increased interest in the burgeoning market. At first many seemed to fear that direct mobile Internet access via their networks could undermine their own strategies to make money from the Internet. These fears have abated as the potential of the opportunity has become more apparent.

“The potential size of market opportunity here cannot be ignored both now and especially the future” said Sigve Brekke, CEO of Thai mobile network operator Total Access Communication (DTAC).

“Customers’ strong preference for mobility both on the phone and the PC Notebook gives us the opportunity to meet their needs with attractive bundled offers attracting new users with the strength of DTAC's extensive EDGE network, and by strengthening our channels through closer partnership."

“Uptake of mobile broadband services is beginning to surge in many countries, as consumers and business users see the benefit of having a high-speed connection available to them at all times,” says Dr. Nikolai Dobberstein, Head of Products & New Businesses at Maxis, Malaysia.

 “We are witnessing the creation of a virtuous circle in which mobile broadband will drive economies of scale, bringing down the cost of HSPA equipment and enabling more and more people to enjoy easy access to mobile Internet services.”

"Mobile broadband has fabulous potential and promises to transform the communications landscape world-wide," says Dave Williams, CTO of Telefónica O2 Europe and GSM Association Board Member.

"This new survey confirms that there is a very real hunger for next generation wireless technologies not only from the industry, but also from businesses and consumers who clearly can't wait to embrace mobile broadband and the benefits it will bring."

“Telstra’s new Next G (3GSM 850 MHz) service is the world’s largest nationwide wireless broadband network with download speeds as fast as any in the world," says Sol Trujillo, CEO of Australian network operator Telstra.

Almost 400,000 Australians or seven per cent of Telstra mobile subscribers have realised the benefits of mobile computing with high-speed data cards in the past year alone. This tells us our customers want real-time, easy data access and this GSMA initiative will further enhance the offerings to this market."

“Looking at the way the market is heading, mobile broadband is the thing to look out for,” says John Strand, CEO of Copenhagen based management consultancy Strand Consult. “It will become the big thing, and a number of countries will see between 30-50 per cent of all new broadband connections becoming 3G connections. This development will for some countries mean that broadband penetration will race towards the 100% mark and within the next few years surpass 100% (mobile penetration is measured against inhabitants, broadband penetration against the number of households.).”

The chances are good that in the not too distant future, mobile access to the Internet will be taken for granted just as much as cordless access to general telephony services is today.

PANEL
Broadband Survey Findings

The study, commissioned by the GSMA and Microsoft and implemented by Pyramid Research, involved more than 12,000 consumer interviews, as well as extensive input manufacturers, component suppliers, chipset producers and over 200 field trials with mobile operators.  These are the key findings:

In 2008, the survey estimates total demand of 79.5 million notebooks in the high growth, mass market  $500 - $1,000 price range

The survey indicates 88 per cent of consumers planning to buy a notebook in this price-range would prefer mobile-broadband built-in to notebooks to their original choice

In 2008, OEMs are planning to ship some 33 million notebooks in this price range, only a fraction of which will be mobile-broadband ready

While most usage is in the home, the majority (78 per cent) of respondents citied at least two other locations where they regularly used their notebooks

The majority of potential buyers prefer the simplicity of a notebook with embedded mobile broadband. Separate ‘plug in’ solutions found favour with just 15 per cent of respondents

75 per cent of consumers plan to buy notebooks in 9” to 15” range – very small or very large form factors are not driving purchasing influences

60 per cent of consumers now want to buy a voice and data package from an operator with a mobile broadband notebook

57 per cent of the demand comes from emerging Asia Pacific geographies, 15 per cent from North America and 11 per cent from Western Europe

The full study is available at: www.gsmworld.com

 

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