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of speculation, the company unveiled the Open Handset Alliance, a coalition of 34 handset vendors, wireless carriers, software developers, and component suppliers that are creating an open access device platform dubbed “Android.” In contrast to the closed, carrier-decides-all model which is the norm today, Google expects the platform will spur third-party software development and grant flexibility and customization options to consumers. In addition, Google made a number of high-profile pronouncements regarding the 2008 auction of coveted 700 MHz spectrum, and indicated that it would indeed bid.
The results for new wireless access business models were more mixed. High-profile municipal wireless networks in Chicago, Houston, and St. Louis flamed out before they had gotten off the ground, and others were similarly delayed or postponed, putting the viability of such “public access” projects in doubt. Sprint Nextel, which had touted plans for a nationwide WiMAX network, put its ambitions on hold while it searches for a new CEO and attempts to stabilize disappointing financial results as the year closes. Clearwire, which offers fixed WiMAX service in more than 30 metros nationwide, had a mildly successful IPO in March and reported that a majority of its markets are profitable. However, the company’s short-term prospects suffered when its erstwhile partner, Sprint, backed away from an agreement to build nationwide network jointly.
What to expect in 2008: A new breed of enhanced handsets combine with steady rollout of 3G data services to create a perfect storm of consumer interest in the mobile web. Development of third-party applications, especially on open source platforms or mobile web browsers, puts pressure on legacy wireless carriers to open their diverse networks. “Free wireless” offers begin to appear, but municipally-driven models continue to fade away.
Telecom Rookies – Emerging Stars?
The most enduring development for the future of the communications industry is likely to be the growing role of players from outside the traditional telecom sector. In the previous section we discussed moves by Apple and Google to alter the communications landscape. But there are others.
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The iPhone set a new precedent for the marketplace, placing the emphasis on device capabilities and applications. |
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Always poised to make a bigger splash, Microsoft has steadily inched into the communications space. Using its near-ubiquitous operating system, Office suite, and popular instant messaging app as a beachhead, Microsoft has worked to fold voice into its productivity platform. As the company shifts emphasis to collaboration tools, voice is key to its long-term strategy. Although not an overnight sensation, Office Communications Server 2007 gives businesses the ability to consolidate e-mail and instant messaging as well as voice, video, and presence on one server. By offering a compelling feature and savings combination, especially for small businesses without an advanced PBX system already, Microsoft aims gradually to claim the market from traditional telecom vendors. With virtually unmatched clout, such a shift could drastically reorder the communications status quo.
More indirectly, Intel hopes to influence and profit from next-gen mobile wireless. The company is betting on WiMAX, and even in the wake of the dissolution of the Sprint-Clearwire partnership it reaffirmed plans to introduce a WiFi-WiMAX mobile chipset by mid-2008. As the largest PC chip supplier, Intel may have the greatest influence of any player in the pace and direction of 3G deployment.
What to expect in 2008: Application developers’ role in the communications space continues to grow. New forms of communication, including but not limited to social networking and location-aware apps, become increasingly voice-enabled. Additional players, even farther afield than Apple and Microsoft, discover that their strategies are intertwined with communications, leading them to challenge or partner with established industry leaders.
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1 While 2007 saw the number of competitors decrease (in absolute terms), the network reach and overall strength of the consolidating competitive providers has increased. |
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