3GSM

Hi there,

here very busy...starting up a company :)
Long time without writing...I'll make a new effort in the coming weeks.

I just came back from 3GSM, in my beloved Barcelona. I came back quite energized regarding the status of the convergent wireless/telecom/media industry. So much, that I want to offer here a summary view of some of the mega-trends in the Telco (mostly wireless, but that’s where most of the stuff is happening) industry. Of course this is not a comprehensive view, but overall, the topics below have been consistently discussed in meetings, presentations, and discussions in the last few weeks/months. If you are interested in any of these, we can discuss them further (contact me: elio . narciso @ gmail . com).

Of course, this is freebie, but my consulting time is not ;)

Five trends that I see in the industry:

Content
Overall, in this area, there is a lot of excitement. Main topics and trends:
• At $5bn worldwide, this is still a small industry, which offers a lot of potential in the coming years. The name of the game will be expanding the pie, not quite yet how is divided.
• A lot of video content starts to go around, together with lot of hype around Mobile TV. However, views in the industry differ: some people/companies (e.g. MobiTV) are betting that TV streaming on the phone will be the key to future content, some other (e.g. MTV) believe that Video content on phones is better served in snapshots, “snacks” of content that users download and watch on their screen
• Music is of course going the way of full track downloads. Nokia recently introduced the N91 terminal with 4GB of capacity (around 3,000 songs) that is basically a wireless iPod. Here the name of the game will be who will be the “iTunes” of mobile
• Finally, there is a lot of talking about social networking, for various reasons. The acquisition of MySpace for about $500M in the US has been pretty impressive to many. The ability to create social communities is considered a key strength, especially if they can be evolved with richer content (audio, video, images, etc.). An example is chats: here the objective is to continue to expand and improve the model to include richer media and content, and creating “interest” groups on dating, music, sports,…


Marketing
The big excitement in this area is about:
• Search: Who will create the Google mobile? In the US, Google has launched a free SMS service: Google Local. You send an SMS to 46645 (GOOGL) with for example “Chinese Restaurant 10024 (zip code)” and obtain a list of places in the area. So, of course, Google is a strong candidate to develop the mobile search industry as well, but since the money-making application is still not there, there are a lot of companies trying to develop this space
• Advertisement: how to deliver effective mobile marketing and advertising? Still no company has emerged with a clear business model, but lots of investors and VCs would love to see viable models in this space
• Communities: Another area with a lot of interest here is, again, social networking and mobile communities. As per MySpace example, the ability to attract and continually engage people and users around a community space, is extremely attractive to deliver marketing messages, content, etc.

Devices
In 2005 China Mobile added 42 Million new subscribers to its network, for a total now of 243Million. In the last months, they are adding about 4 Million new subscribers per month. This draws attention of course for many reasons, (content, marketing, etc.) but especially in the area of devices, many companies and investors think that to satisfy the growing demand of developing countries (from Turkey to China, from Africa to South America), new innovative cheap/low end devices will be needed. A “below $100” handset seems to be the answer to this and there are few companies trying to reach that goal.

In the area of the devices, another relevant point is: there is a growing sense of urgency towards software and systems that will allow for a higher homogenization in handset management. There are many handsets and many content providers, and many carriers. The integration of all this elements is not trivial and it will be key in the coming months/years. In this sense, Microsoft, at least in the business segment, is trying to push really hard for their platform (Windows Mobile) to be the standard solution that integrates different content and applications.

Communication
The sale of Skype raised the level of interest for all VoIP applications. The industry is obviously waiting to see what happens with the first successful “mobile” VoIP. No leader emerges here, but lots of interests and companies are converging on this space.

In the area of wireless networks, many wireless carriers are giving a big push to HSDPA, the new “4G” standard. Vodafone has closed a deal with Dell computer to have installed a “Vodafone Inside” HSDPA chip in all new Dell laptops, and many others are betting on this new technology to transfer information with broadband speed. It’s mostly for businesses now, but clearly there are opportunities also on the consumer space, once you have computers wirelessly connected to the web.

In the broader Telco (non-wireless) networks, it seems that the broadband providers are trying to compete on a “triple-play” basis: Internet + TV + Phone.

Security
A fifth and final area of interest is all things related to security: of transactions (e.g. information exchanged wirelessly); of payments; of scanning, etc.
This is more medium term, but with the increasing complexity of information and transactions operated through cell phones, many are betting that, as for computers, this will become a big industry by itself.

Ciao
Elio