Subscribe to the::unwired's RSS Feedthe::unwired at Twitterthe::unwired on Facebookthe::unwired on Google Plus
the::unwired Article
THOUGHT: How GSM Carriers (doesn't) develop the Wireless Data segment
Posted by Arne Hess - on Wednesday, 01.10.03 - 12:13:14 CET under 09 - Thoughts - Viewed 7220x
Not Tagged

GPRS data is only slowly becoming what GSM voice became fast in the early 90s, a must have decision for consumers. I only know a handful people who clearly bought this or that phone because it included GPRS and Bluetooth or an E-Mail client or even a HTML browser. No, today most phones are still sold by brands and price but less because of new features.

An exception might be camera phones but even here the sent MMS compared to sold camera phones is a different story.

However I think most carriers are developing the mobile data market still wrong. We live in an Internet driven world and data access might be the most important today; doesn't matter which ways (bearers) you use to access these data like SMS, MMS, WAP or GPRS; the need is there but in most cases neither the infrastructure nor the proper tariffs are in place.

Let me take a step back into the beginning of the Internet in the early 90s (and I mean the Internet, not the World Wide Web later or the ARPA Net before). When I got my Internet access from the University of Frankfurt in 1993 I was completely amazed about what I can do like using Telnet to login to a remote computer or using Gopher to find information within seconds. And also an E-Mail was delivered just in seconds and not in days like before with the Fido Net I've used.
In the early days, before the public introduction of the WWW, developed by CERN, speed wasn't the argument at all. I remember well when I bought a PCMCIA Modem from Intel and I've asked a friend if I should take the 9.6 of 14.4 versions and I decided to go with the 14.4 version because I thought this is pretty much enough. And it was more then enough in the beginning - until I installed my first NCSA Mosaic browser (something 0.x alpha) and I realized that sites became more colorful, included pictures and photos and page size increased. So when I was in the US in 96 the first I did was buying a 28.8 Megahertz PC card modem which included the option to upgrade it by firmware to 33.6. Something I've learned from my investment before that even if that time 28.8 were fast enough it's not the end.

Then - at least here in Germany - Deutsche Telekom pushed ISDN and it was clear for me to upgrade to ISDN because it gave me access to the Internet with 64 K and again I've upgraded my PC cards.
Today I'm connected with a 1024/256 ADSL line and a flat tariff, something I never thought about to be required 10 years ago! But also DSL was pushed here by Deutsche Telekom.

But the bottom line of the story above is that the need for more bandwidth increased with my usage pattern. If I would start with the Internet today and wouldn't be a "geek" even 28.8, like in 1996, would be enough for me. It was my personal evolution not the technical revolution which brought me to upgrade my connection types all the time. But it was also the mix of my personal usage and the technology push including increased connection types, cheaper PCs and increased information offer on the web.
However, for instance at home my girlfriend is using GPRS only with her Notebook which is quite enough for her. She isn't using the Internet that heavy in her leisure time and the monthly fee she would have to pay for a landline is more then the GPRS volume she consumes and even if she has faster access at work she is pretty happy with the speed GPRS gives her even today.

If I take the learnings from above and compare it to the GSM world it's a kind of frustration. WAP didn't offer what it was promising (yes - that's the truth today and I have to include myself into that fact since I was the responsible Product Manager and Business Developer for WAP at O2 Germany) but it wasn't because WAP is "simply bad" but because the backend technology for WAP wasn't in place (WAP on a CSD connection is useless and when introduced GPRS wasn't available) and because of the offered content.
So we (the industry) realized that WAP isn't the booster and introduced GPRS. While we tried to provide the user with WAP a helping hand (established WAP "portals" which wasn't anything else then a link list) the customer is left alone with GPRS. It was introduced in a kind of "sink or swim" without providing the uses fitting devices, services and price plans.

The good news is that some carriers realized it early that just the introduction of GPRS as a bearer isn't enough but still not all. So mmO2 did a great job with the xda introduction as well as T-Mobile with its MDA/Phone Edition. These kinds of bundles are easy to use and more or less that good pre-configured that everybody with minimum computer knowledge is able to use it. Also Orange and SMART with the introduction of its SPV made the right decision but in every case, the devices weren't positioned in the right segments because it was positioned in the business customer segment, not in the consumer segment.
However, today the multi billion $ business in the Internet isn't the business segment but the consumer segment like selling and providing access, E-Commerce, E-Services, etc. But anyway - the carriers above realized at all that they have to provide easy to use packages which include a SIM card, a contract and a preconfigured device.

Other carriers like Vodafone or KPN's German share E-Plus still haven't realized it and tries to push their "propriety" services like Vodafone live (which isn't anything new then bundling existing GSM services like SMS, WAP and MMS under a brand name) or E-Plus' i-Mode. At least E-Plus realized it (again, they already had a similar package 2000) and introduced a HP iPAQ H2200 with separate GPRS CF card but honestly - who wants E-Plus to target with this bundle? I'm helping a lot of folks here on PPCW.Net and in the newsgroup to get that kind of combinations configured and working and even if it is pre-configured with a great 3rd party wizard, the use of that kind of devices is completely inconvenient for "Joey User" as well as for "John Business" that this bundle won't be a success at all. And I know what happens after that promotion in the E-Plus HQ: they will get the feeling that there is still no data market out there and will turn back to their propriety i-Mode services which is completely wrong - there is a market out there.
O2 Germany for instance realized it pretty soon when they introduced their GPRS fees which was a tenth from the competitors and now they introduce the "Multi Card". One contract, one phone number but up to 6 SIM cards! The idea behind it is to enable the user to use its "multi device" environment: one cell phone, one car phone, one GPRS PC card for notebooks and one xda without changing the SIM all the time. That's great and this generates convenience for the customer. This helps to develop a wireless data and multi device environment.

Last but not least the tariffs. Today's GPRS plans are prohibiting! If we would still have the plans for fixed Internet access as we had them in the early 90s, the Internet never got such an impact in our society but it was a question of the price. I mean it's simple marketing: "More customers allows cheaper prices and to get more customers I have to reduce the price". Today's situation is that Mr. Vodafone, T-Mobile, O2 and all the others sits in their chairs and await a mobile data boom which can not become true with that price plans! And if it isn't becoming reality there is no reason for the user to migrate to 3G within the next years.

The point is - as I described in my column "How fast GPRS is today" that GPRS is using empty network resources only. If a cell isn't occupied with voice traffic the rest of the resource is available for GPRS which takes these empty resources (in best case). The CEO from BT had a great example between the difference of a carrier and an airline: there is no difference! Both have to try to sell their capacity and while airlines firing out unoccupied seats for low prices, carriers watch their price lists and doesn't give any benefits. I mean if GPRS is using the empty capacity of a cell only why not giving it away for lower tariffs then keeping it unsold?

I'm not talking about flat fees but moderate fees while even flat fees would be possible, depending on the kind of services a customer is using. But most GSM managers have never heard anything about port 80, SMTP and FTP while these different services would typically fit into their GSM tariff schemes. A voice call is different charged to a SMS message which is different charged to a MMS message. Why is the Internet just charged as Internet and not charged by services as well?

Why don't we have a flat fee for SMTP (port 25) andPOP3 (port 100) an included amount of data for TCP/IP on port 80 (Web/WWW), while FTP (port 21) is charged higher? The Internet specifications already provides the services classes but most GSM managers are not aware of it (something really frustrates me when I was employed in the GSM industry).

No, today the GSM industry is waiting for the mobile data boost or it is trying to push their GSM only services instead of seeing that the user want to do wireless the same stuff what he is used to do fixed as well. Surfing the web, chatting with friends, mailing with colleagues and downloading the latest Microsoft patch.

Until this isn't realized, the customer won't upgrade to higher capacities, not to GPRS nor to 3G. If I take my early Internet experiences and I wouldn't generate my own demand for more access I would still use a 28.8 modem today instead of an ADSL connection. And if the mobile user today isn't aware of the wireless Internet possibilities, he has no reason to request more - more bandwidth, more services, and more devices!

I know, many of the PPCW.Net visitors comes from the GSM industry (I have just to watch a typical server log file) and it includes infrastructure vendors as well as handset suppliers and carriers and some of them might be "pissed" about my statements above but face it - it's the truth! Maybe some other pick-up my ideas to redevelop their mobile data strategies and improve it (if you need help or want to discuss it offline, contact me - it's my job now as a mobile data consultant) but fact is there is so many room for improvements I wonder how long the industry will waits for?
Please don't think with 3G everything is becoming better! The mobile data future is today!

Cheers ~ Arne


Related Articles THOUGHT How GSM Carriers (doesnt) develop the Wireless Data segment

  • No related articles found.
Social Sharing
This Week's Top Stories
Feeds & More
Awards & More
Recent Discussions

No items available

© Copyright 1998 - 2013 by the::unwired® & Arne Hess
All rights reserved!
the::unwired is a registered trademark of Arne Hess.
All trademarks are owned by their respective companies.
All site video, graphic and text content is copyrighted to the respective party and may not be reproduced without express written consent.