a week in wireless

Haven’t I seen you somewhere before?

The Informer remembers a time when new phone launches were exciting occasions, as the masses would convene to see the latest device to capture the imagination of the public. There was a widespread quest to unveil the smallest phone consumers had ever seen. Sometimes, manufacturers would capture our attention by introducing interesting quirks, such as flip phones, so that you could feel like Captain Kirk when answering calls, and some even brought out spring-loaded sliding phones to make you feel as if you were Neo from the Matrix. Ah, that was when form factor meant something!

But these days, the Informer is feeling more like Bill Murray in Groundhog Day.

Since Apple held a press conference to announce its very first mobile phone, the Informer has seen manufacturers pay homage to that one, same form factor – the 3.5-4in, front panel, back panel, battery in the middle, touchscreen handset.

Everyone’s at it, but not everyone’s getting the results. Nokia has now been given a warning that if its new phones are not going to be sufficiently unique and different to everything else out there on the market, it’s going to need to lower its prices.

That’s the opinion of Telefonica’s European general manager for devices , Simon Lee-Smith. He told Telecoms.com that “if Nokia wants to sell in volume, they need to bring out devices which are cost-competitive.”

“They need to be able to subsidise their high end smartphones, because they’re too expensive,” he said, adding: “All device manufacturers seem to think that a €400-plus device is the norm. Well, it isn’t. Customers and operators won’t pay that cost for a device which doesn’t differentiate sufficiently.”

These comments might indicate why O2 – for now –  isn’t offering the Lumia handsets in the UK. Operators are having to pay premiums for phones that simply have bigger screens or higher resolution cameras, as innovation in a handsets is becoming a thing of the past, and prices do not reflect this. As Lee-Smith put it: “Let’s not let the technology and cost curve ahead of the demand curve.”

Certainly it doesn’t seem to be the case that Lee-Smith doesn’t like the phone. He described it as “a gorgeous-looking device”.

The Finnish manufacturer is clearly looking to improve and is going back to the drawing board to try and once again wow consumers with brand new concepts for smartphones. Nokia’s head of design technology insights, Tapani Jokinen, told Telecoms.com about the firm’s plans for future smartphones – it’s looking to launch transparent, flexible bendy phones sometime in the future, as well as phones that are “skin-like”, which you can wear around your arm. It sounds like an interesting concept, but the Informer is happy to reserve judgement on that one until he sees them with his own eyes.

This week though, it was Huawei’s turn to underwhelm by announcing another me-too Android device. At least the Chinese vendor had the decency to compensate for it by inviting the Informer to a bash in a plush venue in Mayfair, topping up his glass with champagne every few seconds and paying Plan B to perform at the event.

On top of that, the Chinese firm paid for a host of “celebrities” to be at the event because let’s face it, nothing says “we’re serious about smartphones” more than having Tara Palmer-Tomkinson, Alexandra Burke and the cast from The Only Way Is Essex at your launch. Tara Palmer-Tomkinson? Good grief; not so much a has-been as a never-was.

The Vision smartphone and MediaPad tablet were the products on display. They’re Android devices, they’ll be launched in the UK first, but beyond that, the company didn’t want to give too much away at the media briefing. In fact, Huawei’s new UK head Mark Mitchinson, formerly of Samsung, said the words “without wanting to give too much away” so many times during his presentation that the Informer was beginning to wonder whether or not it was the new company slogan.

Perhaps instead they were hoping to just gloss over the finer details of differentiation and instead distract attendees with the champagne, music and reality TV star-spotting.

And standardisation certainly is the order of the day; with Adobe effectively admitting that its Flash Player mobile experience is a bit limited, so it’ll be investing in HTML5 instead. The company admitted that HTML5 is now the best solution for mobile platforms and will be relied on by all the big smartphone players, so Adobe wants a slice of that pie.

“HTML5 is now universally supported on major mobile devices, in some cases exclusively,” said Danny Winokur, vice president and general manager of interactive development at Adobe.  “We are excited about this, and will continue our work with key players in the HTML community, including Google, Apple, Microsoft and RIM, to drive HTML5 innovation they can use to advance their mobile browsers.”

Meanwhile, over in Eastern Europe, T-Mobile’s Croatian incumbent, T-Hrvatski Telekom, told Telecoms.com about its frustrations with the country’s regulator, which is holding back the deployment of fibre services.

President and CEO Ivica Mudrinić said the company is now in a position where it can  deploy fibre to the home (FTTH) to 300,000 Croatian households “very quickly”, but added that the country’s regulator has used the copper based access pricing as a reference point to define the wholesale rate for fibre.

“This means that it would force us to offer our wholesale fibre product to our competitors at less than the cost, or we would be effectively subsidising our competitors, which of course, we refuse to do,” he said. He added that a solution does not look imminent any time soon.

And in Cape Town, Informa’s annual AfricaCom event has been attracting the attention of the continent’s telecoms players, and there’s been a good few announcements made at the event. Among the most interesting were findings from a study carried out by Informa Telecoms & Media, which revealed that, by 2015, one fifth of African internet traffic will be carried by cellular networks. The global equivalent is just three per cent.

The analyst expects the broadband experience in Africa to become increasingly nomadic with the number of broadband connections over cellular networks exceeding 250 million by the end of 2015, compared with 15 million fixed connections, of which 70 per cent will be DSL.

But another study from Ovum showed that, today, consumers living in emerging markets are still paying far more for broadband than what those in mature markets are paying. While prices in most markets fell from 2010, broadband continues to be beyond the reach of the vast majority of emerging market consumers, the research found.

Elsewhere, Nokia Siemens Networks is selling its microwave business to wireless networking kit vendor DragonWave. The firm will pay €15m with extras and performance related payouts potentially raising the value of the transaction to above €80m. Under the terms of the deal, DragonWave would also become the preferred, strategic supplier of packet microwave and related products to NSN and the companies would jointly coordinate technology development activities, with a view to accelerate innovation in backhaul products.

And Ericsson has modestly declared that it is making twice as much money from the mobile infrastructure market than its nearest competitor, Huawei. The vendor said that it has increased its market share by four per cent in the past six months, from 32 per cent in May 2011 to today’s estimated 36 per cent – which is twice as much as what its nearest rival currently has. The company added that the fundamentals for the mobile infrastructure industry remain solid, so it expects major coverage build-outs of mobile broadband in the next couple of years.

Over in India, mergers and acquisitions in the telecoms industry are looking set to be made easier, in an attempt to ease congestion in a market where smaller players are making losses. The Telecom Regulatory Authority of India (TRAI) has submitted new guidelines to the Department of Telecoms (DoT), which, if approved, will allow carriers in India a maximum subscriber market share of 60 per cent in each of its 22 circles, up from the previous threshold of 35 per cent.

The proposals also see the introduction of a 25 per cent cap on spectrum holding, meaning each operator is entitled to a maximum of a quarter of each spectrum band in each of India’s circles.

“It’s a competitive market with very low rates; some operators don’t seem to have been able to break even – they’re private companies, so we don’t know their financials, but subscriber numbers have been very poor,” explained Anubhuti Belgaonkar, senior analyst for Asia Pacific at Informa Telecoms & Media.

And a report published by the Wireless Broadband Alliance (WBA) also revealed that the number of global public wifi hotspots are set to grow from 1.3 million in 2011, to 5.8 million by 2015, which would mark a 350 per cent increase.

According to the research, more than half – 58 per cent – of operators believe wifi hotspots are either “very important” or “crucial” to their customers’ experience, in order to offload busy mobile broadband networks and to provide value-added services.

China Mobile alone is planning to deploy a million hotspots and Japan’s KDDI is planning to grow its 10,000 wifi hotspots to 100,000 within six months.

And with Winter approaching, this week saw more operators announcing their Q3 results for 2011. The most notable being Vodafone’s reporting a rise in profit, and Telefonica struggling during the quarter.

Vodafone Group saw a 2.2 per cent year-on-year increase in its revenue in the six months ending 30 September 2011, generating $37.8bn in the period. Its adjusted operating profit stood at £6bn, which is 4.4 per cent more than the £5.8bn it made in the same period last year.

Meanwhile, Telefonica reported its first quarterly loss in nine years, posting a €429m loss for the quarter – a huge drop from the profit of €5.1 billion it recorded in the same quarter last year.  The firm admitted it is still seeing regulatory impact, hugely challenging economic and competitive environments.

On the upside it was keen to point out that its German operation saw postpay adds up 182 per cent and data revenues up 53 per cent for the third quarter. Excluding the Spanish market, Telefónica’s mobile data revenues now account fro 41 per cent of all mobile service revenues.

And that about wraps it up for the week – take care.

The Informer

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