CANNES, France—The mobile industry put on a brave face last week at the annual 3GSM World Congress here, with few signs of the financial downturn the industry is currently enduring showing through to the exhibition halls or the company-rented yachts that line the harbor outside the conference facility and house meetings, press briefings and cocktail parties.
The keynote and technical sessions were a different environment, however, with attendees desperate to exchange information that might help the bottom line. A more subdued atmosphere permeated the show than in past years, with vendors careful not to overhype technology and operators taking their fair share of the blame for the industry’s financial woes.
The focus of the event was applications and their role in boosting revenue, along with a stronger focus on the consumer than in the past.
Operators stepped up to the plate by noting that they are ultimately responsible for the consumer relationship and recognizing they must take more control of service offerings. “Operators are not managing the value chain,” said Tomas Isaksson, chief executive officer of the Americas region for Vodafone Group plc.
“We must be obsessed with what the consumer wants,” said Dave McGlade, managing director of U.K. carrier BT Cellnet.
“We must keep creating a steady stream of new services,” added Napoleon Nazareno, president and CEO of Smart Communications in the Philippines, citing the fact that Smart has rolled out 130 new services during the past two-and-a-half years. Smart currently gains 27 percent of its revenue from data services.
Following the services theme, vendors announced numerous applications-focused initiatives. Both Motorola Inc. and Siemens AG announced suites of applications aggregated from their technology and that of third-party vendors that can be carrier branded.
Nokia Corp. reiterated open technology and the Open Mobile Architecture Initiative specifically, which is aimed at enabling compelling services. OMA has 31 member companies and is focusing on Java and multimedia messaging services.
Along those same lines, the GSM Association announced phase two of its M-Services initiative, first launched last year. The program is focused on accelerating worldwide growth of GPRS services. The GSM Association touted the success of the initiative, citing a Telecom Italia Mobile sales campaign last Christmas that sold more than 1.2 million M-Services-enabled handsets.
OMA and M-Services overlap to some degree, and industry insiders said OMA, which developed earlier this year, may have been formed because some vendors felt M-Services was not completely effective.
“Nokia may have felt that the M-Services program didn’t fulfill all they wanted to do,” said Anders Lindqvist, co-founder of Stockholm, Sweden-based consultancy Northstream, citing the Finnish company’s offensive against Microsoft Corp.
Another technology-focused topic of the show revolved around EDGE and its future. The Global Mobile Suppliers Association said there is strong interest in EDGE in the European arena, a region that has not been expected to adopt the technology. GSA President Alan Hadden said all the major vendors had committed to EDGE development and most European operators are interested in rolling out EDGE in conjunction or shortly after UMTS networks.
However, Motorola executives stated in a press conference the company has no plans to release EDGE handsets due to a lack of demand.
Nortel Networks Vice President of Marketing for Wireless Internet David Murashige agreed with the GSA that the idea of EDGE in Europe is not completely dead. He added that Nortel is on target to meet its goal set in 2000 of gaining 25 percent of the total third-generation market by 2003, although it might take longer in the current financial climate.
Siemens said it is continuing to develop EDGE network equipment and expects the first pre-commercial products by the end of the year. The German company—which generated the largest vendor buzz at the event by renting a cruise ship anchored in the Cannes harbor where it held technology demonstrations and briefings and housed some employees during the conference—said it is confident it will increase its market share in the 3G arena and “wants to be a strong No. 3” in the worldwide W-CDMA infrastructure market behind Ericsson and Nokia, according to Valentin Chapero Rueda, Siemens president of networks.
He cited the company’s partnership with NEC as giving it a leg up in the W-CDMA contracts game, following a period of educating doubtful operators about the importance of the agreement.
There was more of a U.S. focus this year than in the past. Cingular Wireless and AT&T Wireless Services Inc. served as the GSM community’s poster boys for GSM, EDGE and W-CDMA migration, with numerous executives from the firms speaking on high-profile panels and in roundtable discussions.
