Jim Machi : Industry Insight
Jim Machi

September 2010

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The Growth of Location-Based Services

September 28, 2010

I've been seeing a growth in the marketing of location-based services so I decided to look into it more. If you want to learn more about LBS, go to the Creativity Software website, which has a good overview of location based services.   One thing that the mobile operators have as an advantage (with regard to the over-the-top players) is that they know your location. Now, someone could map every wifi connection in the world as per something similar on this website, but clearly there will be more coverage and more accuracy with a mobile operator. And another advantage is that the mobile operators know how to bill you, which is important since LBS is worth monetizing.   Two of the fist and best known LBS apps are fleet management tracking and "family finder," which helps you keep track of where your children are. According to Creativity Software, people are willing to pay at least $1 ARPU/month for this, which makes these kinds of apps very appealing and which make for an easy return on investment for the mobile operator. Clearly, then, upping the take rate of these family finder apps to yield a higher subscriber update would be an excellent marketing campaign for a mobile operator.    I also view location-based mobile advertising as a huge growth area for location-based services. If you can get an ad to a mobile phone that is relevant to the location of the phone, the person may be more apt to take advantage of that ad.    This concept is conveyed well in the Dialogic corporate video and I put a snapshot of that above. The restaurant ad pops up as someone is watching a soccer game near the restaurant. Then when they click on the ad, the next screen shows up.    If the restaurant had a special and wanted to "advertise" it, a basic way of course would be to advertise it in the newspaper. But instead of doing this, what if they made a deal to advertise it to a phone near the location? The ad could be clickable to a voice call or a website to set up a dinner reservation as well (which is how this video showed it).   There is a digital advertising ecosystem that could make this happen. I would guess that within a few years this will be fairly commonplace.

The Mobile Phone Gamer

September 22, 2010

Games are another avenue for money-making in the video value-added service value chain. What is a "game" though on a mobile phone? Your mobile phone probably comes with some games downloaded already - possibly some kind of card or board game, or some kind of simple basic game where you need to move a target or shoot at a target. It's very interactive. So like downloading a ring tone, or wallpaper, there is a market for downloading games to your mobile device.    But games can be more complicated as well. There are many internet games - just go on the internet and play some game that would be web-based. You can play these on your phone as well. But there are some games that you can't access from a mobile device, and I can see for sure that in the future, we'll be able to play games like these. And lo and behold, when I was in Korea some time ago, they were able to play internet-accessed games on their mobile devices (which also had fairly large screens).   The games can be solo games, like a card game, or can be multiplayer games, like my son does with this X-Box.   With mobile devices, though, playing a multiplayer game can be time-consuming, and can mean you are on the "phone" for a significant portion of time, possibly becoming an expensive proposition depending on your payment plan.    I'm guessing that mobile phone games will continue to grow and that they will incorporate the touch screen and location in these games so they are in fact unique to the mobile device, as opposed to being some game accessed by a different broadband mechanism.

Wither a Whipsan WiMax?

September 15, 2010

Try saying that 5 times fast. But with Intel announcing it is purchasing Infineon's Wireless Solutions Business for $1.4B, Intel is getting into LTE in a much bigger way. Or did they do it since the Intel logo and the Infineon logo look quite similar? Assuming they did it to drive LTE, though, I'm sure the logo similarity couldn't have hurt. But what does that mean for Wimax? Oh, that woebegone Wimax. Intel once supported that and even drove that wholeheartedly, likely even hoping WiMax would become the "next WiFi" so that could drive a whole new laptop refresh. Intel is saying all the right things about supporting all wireless initiatives, such as WiFi, 3G, LTE and WiMax, but this has to hurt WiMax, at least mobile WiMax. 
  WiMax, from what I recall, was created to address the last mile as a wireless alternative to cable and DSL.   Mobile WiMax came later.  So perhaps WiMax could still play an important role if it does that really well. After all, from a personal perspective, I get my broadband through cable at home, and I do notice speed issues from time to time - I definitely would be open to an improved broadband experience if it really was improved and cost-effective. I'm sure I'm not the only one. So potentially fixed Wimax for the last mile could still be in play, and could be useful for even mobile backhaul. 
  So let's not write WiMax off just yet, but there clearly are hurdles ahead.

Everything Everywhere Except...3G and HD Voice and...

September 8, 2010

As some of you may know, Everything Everywhere is a merger of the UK Orange and UK T-Mobile. The EU took a hard look at it since it would be the UK's largest mobile operator and approved the deal in March
  Everything Everywhere just announced the first tangible benefit of the deal is free roaming between networks. This makes sense as it's the easiest thing to do. A September 6th press release actually claims though this is the "single, biggest improvement of network coverage since the birth of mobile". As a marketing guy, I love how bombastic this is, but really? 
  To me, the network coverage is exactly the same. There are no extra towers being built. It's just a first step in a single network. But this is only for 2G services. Why? I don't know. Is it because most people are on 3G now and that won't be free if you happen to roam between networks?  I hope there is a technical reason as opposed to that since only a 2G benefit is specious.
  Given Orange UK just announced HD Voice coverage in the UK, HD Voice calls also can't be switched between networks at this time since T-Mobile UK would need to have that implemented, including having HD capable phones. So it's not quite everything everywhere yet, except as a vision. A good vision at that, but the everything and everywhere part still has some ground to plow.

A Mobile HD Voice Update

September 1, 2010

As readers of this blog know, I periodically write about HD Voice. And I've written about Orange being a leader with mobile HD Voice. On their website, they claim that "by the end of the summer 2010, their 3G network will be 100% HD voice." (Note: you can click the Google translate bar if you don't read French!). And today, they have announced that they are the first operator to launch mobile HD Voice in the UK. This is indeed good news and it's good to see that Orange is sticking to their commitments regarding HD Voice on their network.
  While we know mobile HD Voice is a known quantity in Europe, and is known in the US (though more on the enterprise side), it's also good to see that HD Voice is getting a voice in Asia. Here is an excellent article written by John Tanner in Telecom Asia. Remember that there are 5 pages in this article, so you need to click to go to pages 2, 3, 4 and 5.
  If you want to hear more about HD Voice, you can come to my panel in the Mobile Communication track at IT Expo in Los Angeles in early October.

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