The GSM Association (GSMA) said this week that it will collaborate with Microsoft on a global research program to determine consumer user trends and the mass market potential of notebook PCs with embedded cellular broadband.
Through the GSMA, 13 mobile operators will participate in the research, including main survey sponsor Telefonica, AT&T Mobility (formerly Cingular), China Mobile, DTAC, Maxis, MTN, Orange, SingTel, Smart Communications, TeliaSonera, Turkcell, Vodafone and Wind.
Mobile broadband has rolled out to 155 networks which now offer HSDPA or EV-DO services in 68 countries, GSMA says, with more planning it.
This could be the first major offensive from cellular against both established Wi-Fi, and emerging WiMAX, and if the GSMA recruits Microsoft, and if the operating system vendor feels it can sway the market by bundling drivers and support software into laptops, it would be in a strong position to ask these cellular operators for a tiny slice of their extra ARPU cake from broadband wireless.
Microsoft has always felt it has the right to be a technology powerbroker on the PC, and in cellular broadband it may well step in, and this could put it immediately at the throat of its old partner Intel, for some time one of the global sponsors of WiMAX, and which is planning to put Centrino style WiMAX chips into a large percentage of laptop motherboards. Right now the costs of cellular, prohibit the widespread take up of broadband wireless on laptops.
Most enterprise users use Wi-Fi instead, and the broad appeal of flat priced hotspot accounts which also work with home and enterprise wi-fi is now established. To take this on, and cellular operators will find that this is the result of their survey, they will need fixed rate, all you can eat, low priced services, which also don’t cost the PC card marker an arm and a leg in intellectual property costs.
One tier 1 mobile operator confided in us at the WiMAX World show in Vienna this week, ‘It just gives us an opportunity to pay $100 per laptop, with much of it going to pay for intellectual property at equipment suppliers such as Qualcomm. Users refuse to take that cost on, so operators have to subsidize these 3G cards. Why would we not offer a WiMAX network instead and eliminate $60 of up front IPR cost?’
That comment perhaps puts this debate into perspective. Let’s say that Microsoft decides to play powerbroker here, and it supports cellular technologies. It did much the same in High Definition DVD players, the world wanted Blu-ray, but Microsoft and its partner Intel decided to support Toshiba’s lonely HD DVD technology, a move which has divided and stalled a market that had already universally shunned the HD DVD Forum’s technology in favor of Sony’s Blu-ray.
If Microsoft steps into this argument, on the back of a positive survey, it would do so without Intel backing it, because is has spent $billions backing WiMAX as the technology that will do this job. But it may still put a powerful argument to Dell, HP and other PC makers of ‘bundled’ cards and a free trial period, which might help sway the market.
For now it is just a finding out move, with a global study & field trials, but going forwards it threatens to rapidly become one of the great broadband debates, that of the right technology for personal broadband.
‘Microsoft’s customers are increasingly looking for the mobility and ubiquitous connectivity that mobile broadband-HSPA networks can provide worldwide today,’ said Will Poole, corporate vice president of the Market Expansion Group at Microsoft. ‘We are excited to be working with the GSMA’s mobile operator community to find ways to enable every Windows Vista customer to enjoy mobile broadband, whether they own the most economical entry level notebook or the highest-end model.’
The actual work will be carried out by Pyramid Research, and aims to identify the key drivers of broader adoption and an industry value chain.
‘Affordable notebook PCs with embedded mobile broadband that work right ‘out of the box’ as easily as connecting a desktop PC to a DSL, cable or dial-up are on the horizon,’ the statement said ominously. We have an uneasy feeling about this.
GSMA plans for controlled advertising models on handsets
The GSM Association (GSMA) is taking the advertising bull by the horns, even before there is a huge presence of advertising on cellular handsets, and has formed a new mobile media and entertainment group to set common standards on just what constitutes an advert delivered to a handset.
The internet advertising community could have saved itself about three years of development if it had enough powerful heavyweight players who could have enforced a common form of practice back in the late 1990s when it was at about the same stage as mobile advertising is now.
‘The mobile phone can offer advertisers a level of immediacy, intimacy and personalization that cannot be matched by other mediums,’ said Bill Gajda, Chief Commercial Officer for the GSMA. ‘To realize this potential, the mobile industry, the advertising industry and the content industry need to come together to better define what advertising should look like on a mobile phone and how its effectiveness should be measured.’
TV advertising found itself paying homage to a virtually monopoly in the US and in around 50 other countries, when Nielsen Media became the de facto source of all data on TV advertising measurement. At the time, back in the 50s and 60s when TV habits were being formed for the first time, viewer research was carried out by conducting thousands of interviews, and there only ever seemed to be enough cash to support one measurement player. But already on internet advertising, where automated methods are simpler, there are multiple groups measuring advertising delivery and effectiveness, and recently comScore and Nielsen were both approached by the Interactive Advertising Bureau in order to make their research more easily auditable.
The problem for anyone now like the GSMA trying to muscle in, is threefold. First there is a lot of experience out there with existing advertising watchers, and if they try to re-invent the process for the mobile world without those experts they will make inevitable mistakes. Secondly advertising is becoming more and more a trans-network experience. Advertising agencies want the ability to reach people with multi-device addressable advertising, in other worlds they don’t care where the person is, or what they are doing or what device they are on, they just want to reach the right demographic at the right time. So a campaign may run across interactive TV, the internet, in newspapers, on billboards, within games and on handsets all at the same time. Thirdly the rise of the mobile web will mean that much of the handset experience will just be an extension of the internet, leaving the job of advertising measurement in the hands of comScore and Nielsen and others who dominate web advertising measurement.
Which means that the Mobile Media and Entertainment Group will have to seek consultation from players not just within the cellular community, but will almost certainly have to reach out to the big advertising counters and extend their semi-monopolistic status.
The type of issues are how to ensure that adverts are not being initiated and then killed and yet still counted even though they have not been watched. One way this happened on a PC is that streaming media adverts were counted by some players at the time they began streaming, whereas in the end the standard settled on when the video advert had completed its stream. Also streaming to browser windows which were no longer active was another problem. In the early days of advertising, some sites reported files downloaded as the key measurement, but treated them as if it was an entire HMTL page that was downloaded. That meant that each graphic file was counted as a separate advertising viewer.
This kind of thing can be invisible on a large network and advertisers need a code of conduct and have systems which are audited and approved, so no advertisers pay for impressions which never happened.
The GSMA wants metrics effectiveness of adverts and for optimizing commercial models, and physical ad formats for each type of mobile content, with a special eye on what happens to the mobile user’s experience. If advertising is too excessive or intrusive, mobile users may just boycott some mobile services, and that would have a huge negative effect on ARPU.
‘The opportunities of the mobile entertainment and advertising market are both vast and challenging,’ said Ben Hirsch, Director – Market Development, Group Customer Marketing at Orange. ‘By working together to define a common approach to formats, delivery, inventory management and measurement, the operator community can ensure that it serves both advertisers and customers in the most effective ways possible.’ The GSMA represents 700 mobile operators serving 2.4 billion users.