Insight: What's Up With Wireless?

Posted by Mae Kowalke on Wednesday, June 24, 2015 with No comments

The wireless market is definitely in flux, with networks increasingly evolving toward virtualization and 5G visions encouraging major investments that may not pay off for quite a while. Here's a quick look at some of the recent moving and shaking in this dynamic industry. 

Let's start off with a question posed by Fierce Wireless Europe: can mobile operators become 'disruptors' in emerging markets where the landscape is "mobile first" or "mobile only"? Short answer: yes, if they are willing to risk possible failure by adopting startup-style strategies. 

The fear of failure, which stops innovation in its tracks, isn't the only barrier mobile operators face in capitalizing on developing world opportunities, Fierce Wireless said. They must become more agile, simplify service billing, and improve customer service. No big deal, right?

Well, in developed markets at least, change does seem to come slowly and new offerings are not always what they're cracked up to be. 

For example, AT&T in the U.S. recently changed its business model somewhat, doing away with contracts for iPhones, RCRWireless reported. Instead, the carrier now offers a set of device financing plans called Next; customers pay a monthly payment ranging from $20 to $35, and have the option to upgrade to a new device after 12, 18, or 24 months. 

It's expected, RCRWireless said, that Next plans will eventually be rolled out for all smartphones purchased from AT&T. (Of course, there's always the option to pay the full sticker price, and buy an unlocked device directly from the manufacturer.) 

Meanwhile, early analysis of Google's "Project Fi" indicates that the beta service is likely not innovative enough--and involves too much hassle--to become viable for a mass market.  

At least, that's what Core Analysis founder and CEO Patrick Lopez thinks. He points out that Google Fi runs only on the Nexus 6 smartphone (at least for now), relies (for seamless connectivity, anyway) on open Wi-Fi networks that don't actually exist in most places, and limits roaming data speeds to 256 kbps (not nearly enough for streaming video or data-hungry apps like Facebook or Netflix). 

Some of the points Lopez makes address the complexity of measuring Quality of Experience (QoE); it's about more than just processing network data, RCRWireless pointed out. It also requires using data in a meaningful way to provide actionable insights. 

Real-world QoE indicators include the performance of many different apps: streaming video, internet browsing, gaming, uploads/downloads, and voice. Customers in saturated markets have so many service options, they can opt for whatever best matches their expectations. 

Just measuring the broadband speed of a fixed or mobile service is an incomplete way to determine the subscriber's actual experience, RCRWireless concluded. 

That's not to discount the importance of connectivity, of course. Fierce Wireless Europe noted that Ericsson's latest ConsumerLab report indicates consumers globally spend 20 percent more time commuting than they do on more pleasurable activities like socializing. As such, they perceive connectivity on public transportation to be a basic requirement; yet it's a requirement transport providers are not meeting. 

To be fair, mobile operators have a tough row to hoe in order to meet subscriber QoE expectations, RCRWireless pointed out. They must increase capacity to meet growing traffic loads, in a way that's cost efficient, improves performance, and allows them to create revenue opportunities. 

Continuous optimization of network resources is the key here; merely adding capacity drives up usage and costs, but not revenue, and often fails to deliver consistent QoE anyway since some assets remain underused, RCRWireless noted. Only real-time information about networks and subscribers can solve this conundrum. 

Given that fact, there's plenty of room for innovation in the wireless industry, FierceWireless concluded. LTE continue to mature, paving the way for 5G networks. That innovation is exemplified in FierceWireless' "Fierce 15" list--a diverse set of startups ranging from bandwidth optimization and wireless backhaul to text-based marketing and secure messaging to wearables and geospatial data analytics. 

How do you see the wireless telecom industry evolving over the next several years?
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