Jarich on Mobile World Congress 2013: Virtualization, monetization, commercialization

Current Analysis Peter Jarich

     Peter Jarich

You've got to question some of the GSMA's facts and figures about last week's Mobile World Congress. Based on the new space and the crowds, I'd agree that there were likely more than 70,000 attendees. I'm not so sure that half of them were C-level execs.  Maybe I just wasn't meeting with the right people...

What I do know, however, is that it was one of the more exciting editions of the event that I can recall. In part, that excitement came from the fact that the Current Analysis team of 14 managed to engage in a few hundred meetings, briefings and other engagements over the course of show. In part, it was because of the new location and the fact that rain didn't set in until the last day. Mostly, it was because of the confluence of diverse technologies that came out to play. We had small cells and Wi-Fi making their presence felt. We had packet core applications living in the datacenter. We had LTE-Advanced moving forward alongside operator commitments to smartphone operating systems outside the "big two." 

For all this diversity, you might just get exhausted trying to look for a few common themes--think back-to-back meetings in Hall 1 and Hall 8--exhausted. Yet, somewhere between network infrastructure and device software, between proprietary platforms and general-purpose compute capacity, a few key themes were out in full force.

  • Virtualization.  We wrote last month about the intersection of the telco and IT worlds and how that intersection is serving to breathe some new life into telecom. There was no doubt that the theme would on full display at MWC. I won't bore you with the details; you can go check out the news and relive the demos from IBM, Cisco, Ericsson, Juniper, Intel, Affirmed and lots of other folks. In reality, nearly every network vendor had some sort of virtualization story to tell--a plan or strategy for moving telecom applications (think EPC, DPI, policy, optimization, etc.) on to scalable, extensible, less costly IT platforms. What was somewhat remarkable, however, was the way in which many people were conflating the concept of Software Defined Networking (decoupling control and data planes for simpler configuration and networking flexibility) with virtualization. Both are important trends. Both have their roots in the IT realm. Yet, while many operators are still struggling to understand SDN use cases--we've been doing a lot of work on this recently--the gains to be had from virtualization in the nearer-term are clear. Mixing them up, then, risks confusing operators and watering down the value of virtualization.
  • Monetization. On Monday afternoon, we had the pleasure of supporting a customer that held a private Forum focusing on what vendors, operators and governments can do to help drive mobile broadband development and encourage the creation of a "digital society." The audience had an emerging market focus with telecom ministers from various African and Middle Eastern countries in attendance. You might think that these decision makers would be solely focused on bringing broadband connectivity to their citizens. Instead, when we began discussing the need for operators to better monetize their networks, they lit up. Whether the topic was how to balance net neutrality against new service innovations or how to simply drive innovation across a conservative operator base, the need for better network monetization was well understood. It was also well-represented back on the show floor where self-service device clients were omni-present and the discussion around managed services began to evolve away from OpEx reduction and toward revenue generation. Circling back to the emerging market discussion, consider the MWC-timed entry of OSS-BSS vendor AsiaInfo Linkage into Europe, building on its success in China. Why push outside of the massive Chinese market now, you might ask? An interest in advanced monetization models stands out as one answer.
  • Commercialization. Trade shows are notorious for putting on display technologies that may not come to pass for years…if ever. For the past few years, we saw just that with demonstration after demonstration of LTE-A features. This year was slightly different.  Sure, we saw LTE-A demos. Thankfully, we also saw early LTE-A launch commitments and vendor wins (Ericsson @ SKTel, NSN @ DoCoMo) along with new LTE-A silicon from Broadcom and Qualcomm and Sequans.  While we've seen operator commitments to LTE-A in the past, the fact that we're seeing more and more signs of commercialization make them all the more believable and send a reminder that technology (or standards) on its' own doesn't result in viable products or services. And this is why one of the other major themes from MWC 2013--renewed buzz around new mobile operating systems--was such as disappointment. If you didn't get a chance to see the Tuesday night keynote with representatives from Mozilla (Firefox OS), Canonical (Ubuntu Touch) and Jolla (Sailfish), you owe it to yourself to watch. Personally, I'm truly excited about the opportunity for these folks to disrupt the platform duopoly of iOS and Android.  At the same time, you can't help but be impressed with the carrier and OEM support that Firefox OS has built. Yet, when the GSMA got Mozilla, Canonical and Jolla together in a keynote, they spent their time talking about the virtues of "openness" and the philosophies that drive them. It's as if there was no realization that values, features or even a reliance on HTML5 won't actually translate into commercial success--that "open" won't solve all problems if you want to create a viable new ecosystem.

Peter Jarich is the VP of Consumer and Infrastructure at Current Analysis. Follow him on Twitter: @pnjarich.