Questions & Answers

A Nokia spokesperson has confirmed that in the very near future, “almost the whole of our portfolio” of handsets will feature GPS. Is this a market opportunity for the independent? Or does it represent the loss of the existing revenue stream represented by standalone satnav units?

Harvey Alexander: I would bet that everyone knew someone who received a satnav-related product in their stocking last Christmas. It is the latest must-have, so it makes complete sense to add this to the latest mobile devices. It is just a natural progression towards the additional services available on mobile handsets, just like the continuing phase of high quality cameras being added to new models. Consumers are always looking for something extra, or what is the point in upgrading?

This obviously represents a huge opportunity for the independents as it is yet another function consumers are eager to get their hands on. The key to their success will be training; the industry is no longer about volume, it is all about solution selling – as long as they are fully trained to sell their customers solutions they will reap the rewards.

This will obviously result in a reduction in revenue stream for stand alone satnav units, but as the market for this was already heavily saturated for distribution (with consumers favouring electrical retailers for their purchases) I do not see this as being an issue for the independents.

Notteboom, Mio Technologies: Although the general trend leans toward converged technology, I think there is much to be said for keeping it simple. A phone’s primary function is to provide the best quality phone connection available. Although GPS capability may be integrated, it will always be compromised.

Phone GPS is very convenient but realistically an addon, limited in terms of performance and, more importantly screen size. There are very many factors to consider when providing a great GPS experience, such as map detail and software usability. It takes years to perfect! Though some may be initially swayed by a phone’s additional features, end users will ultimately return to their standalone satnav unit to provide them with the re-assurance of knowledge, technology and design.

Mio has devices on both sides of the coin and we see them happily co-existing for many years to come. Integrated devices are convenient but almost always a compromise so people will continue buying both devices for the foreseeable future.

Every device is built for a specific purpose and Mio’s will always be navigation.

Google is reportedly talking to O2 about launching its own branded mobile network in the UK in the next few weeks. Can this work?

Kadar, Airwide: Although this could potentially be a very exciting project, Google should be cautious as a number of MVNOs have recently suffered poor financial results. Amp’d Mobile, for example recently filed for bankruptcy, MVNO Mobile ESPN was shut down by its parent company Disney after a year, and Virgin Mobile, which has been unprofitable for five years, has accumulated $553 million in debt.

Google could be the first MVNO to prove the industry wrong but to do this they must not only invest in the right marketing strategies to profitably acquire and retain subscribers but they must also ensure that they have a robust infrastructure in place to keep up with consumer demand.

As new types of messaging technology such as mobile IM evolve Google should ensure that its hosting network has the correct architecture in place to reduce operating expenses while also protecting the brand from increasing mobile security threats. Done well, this will lead to a natural and well-timed rollout of next generation messaging services that will offer greater differentiation, helping build brand loyalty and reduce subscriber churn, while at the same time offering additional revenue opportunities.

Is there a consumer market for VoIP using mobile handsets? Or is a B2B business?

Harvey Alexander: I think there is a huge market for VoIP using mobile handsets for both B2B and consumer. Before any of this will take off, the reputation of VoIP needs to be improved by user experience, as those that have not yet used this may not totally understand the benefits and ease of use. I think both the B2B and consumer markets would benefit from this. Once this has been achieved being able to use VoIP using your mobile device will be another added benefit just like GPS.

Hawkins, Nokia: The market for VoIP mobile handsets is in its infancy. Initial interest has certainly been in business where the mobile can be seen as an extension to an IP based PBX systems. Organisations such as Cisco, Avaya and Alcatel are starting to offer solutions like this, in partnership with Nokia, focused on the Enterprise today. These can offer significant financial and competitive benefits.

However in the future, with widespread WiFi adoption, both public and “in the home”, it is likely that VoIP will start to become more commonplace in the consumer environment. 3’s X-series is already making this a reality and with other networks planning VoIP offerings, this looks set to become even more widespread.

Kadar, Airwide:
There is a consumer market for VoIP — but rather than waiting for mobile handset providers to introduce high quality VoIP handsets, mobile operators can instead deploy VoIP services from within their own networks.

By using a hybrid Multiprotocol Session Controller (MSC) mobile operators can run VoIP calls over their networks using the same air interface as for standard calls. It is only once the call is set up that the call traffic is transitioned over to a pre- IMS or VoIP core. By using a transitioned approach like this one, operators can start deploying mobile VoIP services immediately without the need to build special networks for higher speed data rates to carry VoIP traffic.

To achieve maximum benefit in the long term, mobile operators should create an underlying messaging infrastructure that is cheap to manage and flexible for service and feature deployment. This infrastructure should be split into tiers which allow new features and services to be added, helping to drive revenue while having a minimal effect on operational costs.

If there is a market for mobile VoIP, who will the winners be – the networks, the mobile handset makers, the VoIP service providers, the retailers?

Harvey Alexander: The successors of mobile VoIP will be the VoIP service provides, although their negotiations with the networks will be critical to their success, the retailers and networks will notice an increase in 3G usage (so their government targets on 3G coverage will be ever more important- if they are to benefit), however the biggest winners will be the consumers, as like offering MSN on some handsets, it is another service which should help to reduce costs.

Hawkins, Nokia: Mobile VoIP is a broad opportunity for many different players in the industry. Networks can compliment their existing services with additional offerings such as VoIP and other “data” applications and increase customer loyalty. Handset makers can increase their penetration in the business community as they replace the standard fixed telephone infrastructure, the mobile in effect becomes the mobile and “fixed” phone in one device. In addition VoIP service providers can innovate by introducing new types of service, perhaps aimed at specific niche audiences and “new” target audiences.

For the retailer, as devices and services become more complex, there is an opportunity to differentiate their service offering and provide increased value add service to their customers, increasing value and customer loyalty.

Kadar, Airwide:
I predict that it will be many years before we see widespread adoption of mobile VoIP. However, in the long term the winners will be the subscribers because mobile VoIP will not only deliver cheaper costs for local and international calls but also slicker services using multi-session capabilities. The operators will of course also benefit from the lower operating costs to carry the IP traffic. However, to ensure they take full advantage they need to act now to adopt a tiered approach to develop messaging architecture that separates intelligent storage, routing capabilities for directing traffic, and gateways to manage messaging traffic.

Creating tiers of separately scalable components lets operators buy what they need when they need it — but most importantly, they provide a practical, controlled, phased approach to next generation services without disrupting their existing messaging network or the billing, reporting and management elements.

 
 
If there are any questions you think we should put to the panel just email them to us at: panel@mbmagazine.co.uk
THIS MONTH’S PANEL
 
Andrew Hawkins
Head of Enterprise Solutions for UK and Ireland, Nokia
 
 
Paul Notteboom
President, Mio Technologies
 
 
Vince Kadar
CTO of Airwide Solutions
 
 
Harvey Alexander
Director of Sales, Moco Distribution