a week in wireless


Sticks and stones

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In the great playground that is the mobile telecoms industry, Huawei has just pulled Ericsson’s hair and run away laughing. The two have been working on LTE projects in the run up to the Christmas holidays, this week announcing a commercial network apiece. On Wednesday, TeliaSonera, the Nordic-Baltic specialist, switched on an Ericsson-supplied LTE network in Stockholm and one from Huawei in Oslo.

Two days later and Huawei’s bragging to all and sundry about its superior performance. Thumb on nose and fingers waggling in Ericsson’s general direction, the Chinese vendor sent out the following message:

“Please find the media advisory below that Huawei in Oslo for TeliaSonera reached 96 Mbps, as compared to a rival network in Stockholm that recorded speeds of only 43-44 Mbps.” Oooohhh! The release quotes an interview with TeliaSonera’s CTO Lars Klasson in Swedish technology publication Ny Teknik. Klasson’s quotation somewhat takes the sting out of Huawei’s gloating.

“Ericsson’s network runs at 10MHz, while Huawei’s network in Oslo uses 20MHz.”

Pretty silly, really. Still, that’s not all that Huawei’s been ribbing Ericsson about, as the vendor also announced an LTE win this week with Telenor/Tele2 joint venture Net4Mobility on Ericsson’s domestic turf of Sweden. This one seems to have hit home, with Ericsson moved to issue a statement proclaiming its disappointment to have missed out on a deal with local customers. But, the firm said, it just couldn’t compete with the Chinese player on price.

“We are of course disappointed that we did not manage to reach an agreement with Net4Mobility, joint venture by Telenor and Tele2 in Sweden. We would very much liked to have delivered this LTE network in our home market.

In the negotiation process we went as low as we could in terms of price but it was not enough.”

And Huawei was also on the case here in the UK. Telefonica-owned O2 said this week that it had carried out a successful trial of LTE in the UK, pumping out a cell peak downlink rate of 150Mbps, while showcasing high definition video streaming, mobile gaming, high speed file transfer and video conferencing.

The trial is part of Telefonica’s far reaching pilot project announced in October. The European carrier is to roll out LTE test projects in six countries, with a view to selecting technology providers for its 4G deployments. The suppliers Telefónica has chosen so far are Alcatel-Lucent, Ericsson, Huawei, NEC, Nokia Siemens Networks and ZTE, all of which will start rolling out the equipment necessary for testing the technology during the coming months.

The project will take place over six months and will consist of field tests and the installation of base stations at Telefonica’s branded operations in Spain (Telefonica), the UK, Germany and the Czech Republic in Europe as O2, and Brazil and Argentina in Latin America as Telefonica Moviles.

In other news, Telefonica has set up an international M2M division that it hopes will enable it to gobble up substantial parts of a market that Gartner forecasts to be in the region of 200 million cellular modules by 2012.

Retail behemoth Tesco’s MVNO Tesco Mobile piggy-backs on the O2 network and the supermarket this week started offering the iPhone, at the lowest monthly contract price in the UK market. Users can have the phone for just £20/month on a year-long contract, but they’ve got to stump up more than ten times as much – £222 – to get the handset in the first place. And it’s not a fuel injected 3GS, either, it’s just the little 8GB 3G run-around.

If you want the latest model, then it’s a whopping £60/month tariff for 24 months. Hardly the kind of pricing you’d expect to appeal to a supermarket MVNO demographic. On this tariff you get the 32GB 3GS for £50 up front and you’ll be committing to a spend of £1,490. You’d have to be mental.

In other iPhone news Apple has overhauled the interface for its iTunes-based App Store platform, making it more graphically intensive. With over 100,000 apps now available in the store, the biggest problem developers face is discovery of their creations, a problem this new approach seeks to address.

Meanwhile, Google has confirmed the existence of a home grown Android-based device that is being tested within the company. In a blog posting, Mario Queiroz, vice president of product management at Google’s mobile division, said Google employees worldwide are testing “a device that combines innovative hardware from a partner with software that runs on Android”.

Queiroz said that the aim of the project is to establish a mobile lab, “to experiment with new mobile features and capabilities”, which actually makes it sound more like a software testing platform for Google’s in house Android-based developments and less like a bit of Google-branded hardware that might make its way into consumer hands.

In other handset news, Christmas came early for Research In Motion this week, with the news that the firm saw Q3 profits jump almost 60 per cent year on year to $628.4m. Revenue was up 41 per cent year on year to $3.92bn, with 82 per cent coming from handset sales, 14 per cent from service, two per cent from software and two per cent from other areas.

RIM has benefited from a push into the consumer market and the firm said that more than 80 per cent of its new customers were consumers rather than enterprise users. Two years ago corporate customers accounted for half of the firm’s users, it said. Today that number has dropped to less than 20 per cent. RIM sold more than ten million BlackBerry handsets, up from its previous record (in the second quarter) of 8.3 million units.

Unfortunately US firm Palm isn’t doing so well, but at least it’s trending in the right direction. Palm’s net loss for the three months to the end of November hit $81.9m, compared to a loss of $509m in the same period last year. Revenues, however, did slide to $78m, from $191m in the third quarter of 2008.

The problem, it seems, is that Palm isn’t shifting the units as fast as it needs to be, despite the high profile launches of its Pre and Pixi devices. The company shipped a total of 783,000 devices during the quarter, down five per cent sequentially, but up 41 per cent year on year, which actually suggests it’s doing something right with regard to its product line up.

Indeed, according to figures from Informa Telecoms & Media’s upcoming Future Mobile Handsets report, Palm is one of a handful of high-end players that are seriously threatening the volume market leaders like Nokia, Samsung, LG, Motorola and Sony Ericsson.

These challengers will continue to steal market share in 2010, with figures released Wednesday predicting that the market share of the four underdogs will jump to 35 per cent of all smartphones sold in 2009 from 32 per cent in 2008 and just 24 per cent in 2007.

It’s no secret that while sales in the mobile handset space in general are in decline, the smartphone segment is actually growing and has turned into the most profitable segment of the mobile handset market. Informa forecasts that volume sales of smartphones are to grow by 33.5 per cent year on year in 2009 and by 36 per cent in 2010 to account for 27 per cent of the total number of handsets sold in 2010.

Incidentally, smartphones will also represent over half (55 per cent) of the value of the total mobile handset market and almost two thirds (64 per cent) in terms of profitability.

Informa analyst Malik Kamal-Saadi said that key to the success of these new entrants and smaller players is the adoption of new operating systems that have been built from scratch and better reflect the realities of modern mobile device requirements. In addition, they are not burdened with the support of a long legacy of devices and content already in market.

“Volume market leaders have responded, with a multitude of me-too iPhones offering multi-touch and an enhanced internet experience but true innovation is still lacking from many incumbent OEMs’ portfolios,” Kamal-Saadi said. “Some players (Motorola, Sony-Ericsson, and Samsung) have responded by opting for Google’s Android as key OS to bring innovation to their smartphone portfolios.  These changes will completely transform the smartphone market landscape and could potentially lead to the emergence of new leaders in the mobile handsets market,” Kamal-Saadi added.

We’ll have to wait until 2010 to see how this pans out, because the Informer is off on his Christmas break now.

All the best to everyone, have a happy break and a peaceful and prosperous 2010.

Take care

The Informer

  • LTE Advanced Pro and Gigabit LTE: The Path to 5G

  • Huawei


3 comments

  1. Frederic Bastien 19/12/2009 @ 3:37 am

    Quite pathetic to see the ‘big vendors’ argue on “my LTE is faster than yours”. The real challenge isn’t about theoritical download speeds, it is about service continuity and seamless mobility in a world where LTE islands will be surrounded by 3G coverage. Users will have several devices, some LTE, some 3G, some both, and will expect a coherent service.

    Back in 2000, the same vendors were arguing about their ‘3G speed’, and they were completely missing the point. 3G-2G service continuity remained one of the key challenges.

    frederic@blueslice.com

  2. simon 21/12/2009 @ 3:02 pm

    Ericsson must realise times have changed, they need to lower the price further to compete with huawei

  3. MatthewTan 10/02/2010 @ 4:51 am

    Given the very low price of new handsets, who really care about 2G/3G? All users need to do is sign a new 4G handset contract.

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