Dumb pipe nostalgia at Mobile World Congress
"What begins in fear ends in folly," the English poet Samuel Taylor Coleridge once wrote. That should be a key takeaway for carriers departing the Mobile World Congress today. The conference grounds are ripe with the three words all network operators fear most: The Dumb Pipe. Most carrier executives made use of that magical phrase this past week in Barcelona. But why?
"Twenty-five years ago Microsoft was a puppy," explained Softbank CEO Masayoshi Son.Ãƒâ€šÃ‚Â "And everyone said 'ah, you are cute!' But then they became huge in the PC space, and the guys that made the computers, and built the infrastructure didn't make much money. If the mobile industry is not careful the same thing will happen, and carriers will become dumb pipes,"Ãƒâ€šÃ‚Â he said.
"In the endÃƒÂ¢Ã¢â€šÂ¬Ã‚Â¦ technology is not what matters: it's services, it's applications, it's experiences," Vodafone CEO Arun Sarin said during his keynote Tuesday. Carriers must offer subscribers a variety of ways to communicate--like SMS, email or social networking sites--the carrier must "be in all these places." He added: "We must not allow ourselves to become bit pipes and let somebody else do the services work."
Just as the carriers' fear of becoming a dumb pipe is one elephant the industry can't seem to push out of the room, it's worth noting that mentions of the Apple iPhone declined significantly at this year's show. Panelists talked about the rise in popularity of touch screens, the importance of user interfaces and the big push to bring the desktop Internet experience to the mobile platform. However, they rarely mentioned the handset that has done so much to evangelize these three trends. After an entire year barraged by iPhone news, the attendees didn't need to hear it.
One high profile carrier speaker never gave aÃƒâ€šÃ‚Â "dumb pipe" warning. Instead, AT&T Mobility CEO Ralph de la Vega detailed the myriad options that AT&T subscribers have for mobile content services after quickly rushing through a few slides with iPhone usage statistics.
De la Vega didn't give a dumb pipe warning during his keynote address because iPhone users have already turned AT&T's EDGE network into one. The iPhone's applications are managed by Apple and other Internet service providers. AT&T just needs to keep the network up and running.Ãƒâ€šÃ‚Â
So maybe Coleridge's quote doesn't apply here. Maybe the fearsome "dumb pipe" metaphor really is as tired as it sounds. Maybe the carriers' folly is already evident here at Mobile World Congress: No one addressed the power thatÃƒâ€šÃ‚Â Apple has wrestled from carriers the world over. The carriers'Ãƒâ€šÃ‚Â folly was in trying to resurrect the specter of one elephant in the room, while ignoring the presence of another. -Brian