Top European Wireless Industry Predictions for 2008

The famous Danish physicist Neils Bohr provided a succinct view on crystal-ball gazing--"Prediction is very difficult, especially about the future."

But, without hesitation and with little fear of the difficulty, my thoughts for 2008 look to this year being pivotal for some mobile technologies and business models.

The success of WiMAX could finally be judged based on as little as two events: whatever the U.S. operator Sprint manages to achieve with its commercial deployments--a situation that is being closely monitored around the world by operators and equipment vendors alike, and the level of interest in many countries for spectrum auctions capable of supporting WiMAX networks.

The hype surrounding mobile VoIP has declined, but will it gain mainstream acceptance this year? Operators and mass market consumers remain reluctant or disinterested in the service - developments and uptake in 2008 could prove critical to its success.

The launch last year of Apple's iPhone indicated that large PR budgets do still work. However, the more important story is the iPhone user interface--a leap forward that will change the landscape for all handsets attempting to surpass the Apple device. 2008 will see other handset vendors attempting to emulate or better Apple's success with the UI.

The sharing of infrastructure by mobile operators has been talked of for some years, with 2007 being the year when serious negotiations got underway. This year will be the breakthrough or breakdown of these burgeoning partnerships, but the potential rewards could be high and the future implications hugely significant.

What looks sure to increase is the pace of developments in India and Middle Eastern countries, with huge contracts being placed for infrastructure and spectrum auctions achieving record highs. With India quickly moving away from its 'developing nation' status and the Middle East fueled by petro-dollars, this bonanza looks set to continue.

Lastly, the growth of social networking has outpaced even the wildest forecasts. While this is a fixed Internet phenomenon today its migration to the mobile environment will take place and have a profound impact.

However, 12 months is a short time in telecoms, and I defer to Jack Welch, formally of GE, to add a dose of realism to any of the above…"Business success is less a function of grandiose predictions than it is a result of being able to respond rapidly to real changes as they occur."

While my predictions might not be grandiose, I'll commit to reviewing my accuracy this time next year. -Paul

Prediction #1: Operators play wait and see with WiMAX

For 2008 every aspiring WiMAX operator will be intently watching the progress being made by Sprint with its WiMAX venture. From a European perspective there is an added ingredient--2.6GHz spectrum auctions.

This is made more interesting by Western Europe being the stronghold of HSPA for mobile broadband, which is deemed to be a natural follow-on from W-CDMA and not requiring new frequencies or a network deployment necessitated by WiMAX. However, significant auctions are on the horizon in the UK, Italy and Norway, and how this plays out will be a key indicator for the future of both fixed and mobile WiMAX in this region.

Many believe that deploying WiMAX in the major European countries will face significant opposition from the established operators, given their investment in 3G and HSPA. The increasing availability of low-cost HSDPA dongles aimed at the laptop user community is already gaining strength and will only increase as operators tailor data tariffs to attract more users.

To counter this viewpoint, 2008 could see the first multi-mode handset (WiMAX and HSPA) becoming available with the ability to switch between networks depending on whichever technology is the best in a given set of circumstances.

Supporting this latter vision is Howard Wilcox, an analyst at Juniper Research. "We've seen WiMAX take a big step forward with its inclusion as part of the IMT2000 specification. It's accepted now and we'll see mobile operators become more technology agnostic as they concentrate further on the financial business case for services as against the complexities of networks, etc."

Prediction #2: iPhone UI challenges handset vendors

The iPhone probably attracted more press comment in 2007 than all the many other handset launches combined. While this device is not revolutionary and has some shortcomings, its user interface has reset the agenda and challenged other handset developers to do better.

While the likes of Nokia and LG are ramping up their efforts, what they must fear is Apple's ability to evolve a world-class product, for example the iPod becoming a device that other music player vendors both didn't see coming and failed to replicate.

While Apple will remain a bit-part player in the worldwide handset business, its influence will force the pace of UI development. Nokia's N800 range of devices with their large screens and 'mini-tablet' approach to usability will gain attention from the business segment. At least that's what's planned.

However, to indicate the difficulty of business or consumer product positioning, Blackberry is now attracting more non-business users with over 50 percent of sales reportedly going to consumers.

This again raises the old, and unanswered, question of an individual carrying one mobile device against several. Perhaps there is no simple answer even after numerous attempts by many developers to solve this with the weird and wonderful.

Prediction #3: Radio Access Networking sharing promises much

While T-Mobile and 3UK only announced late last year their intentions to share elements of their networks, Vodafone and Orange have been negotiating the issue for many months longer.

The outcome of these discussions, and the potential success, could be critical to the future of this style of partnership.

According to Steve Griffin of PA Consulting, 2008 will be the year that radio access network (RAN) sharing comes good, or falls at the first hurdle. "Vodafone and Orange are ahead of the game and many other mobile operators are watching them closely. The key parameter is the level of benefits achieved by each company. If they're still struggling this time next year then perhaps RAN sharing will be reviewed and outsourcing will be back on the agenda."

However, Griffin maintains that RAN sharing has profound and significant implications much beyond 2008. "If it works then we could see the consolidation of telecom networks in general, with mobile operators moving to become MVNOs offering services and a brand identity."

Prediction #4: The rise of mobile social networking

A key service that should become widely available in 2008 is mobile social networking. Already outrageously successful with those in the 18 to 30 age segment, its transfer to the handset will be beyond the wildest dreams of any marketing executive with a mobile operator.

This is dependent upon decent, low-cost 3G handsets being available, and, more importantly, innovative data bundles from operators. "All the major social networking sites will be significant drivers for mobile broadband," states Howard Wilcox of Juniper Research. "Whether uploading videos from mobile devices or using Facebook on the move, our research indicates this is a key segment worldwide."

Wilcox claims that mobile social networking is only at the very start of its ascendancy. "While today's users are probably aged 18 and upwards, over the next few years a new generation of users, school children, who already have mobiles and use them extensively for many applications today, will adopt mobile social networking. This will be the mass market, whereas today's users are merely the vanguard."