Real talk

The Mobile World Congress is as much a place to do business and catch up with the mobile industry’s biggest buzzes, as it is an opportunity to peddle ideas, and in some cases even float new ones. Comm. reports on a number of lines of communications from the show, and assesses whether what was said in some cases was actually meant

When it is communicated clearly and simply in figures, often times a picture is much clearer than the best intended explanations. In the last half of 2008, and in particular the last quarter, Motorola added its voice to the chorus of LTE evangelists more audibly than it has ever done in the past. The vendor’s official position on this increased publication relations effort around the technology, is that with LTE standards entering their final stages of ratification, and with delivery estimates realistically being set as late this year and early next, the time is now right for Motorola to communicate that it is a viable infrastructure partner for this next generation of mobile technology.

Back to the simplifying effects of numbers and statistics. GSM still represents approximately 50 per cent of Motorola’s business, while CDMA constitutes around 35 per cent, iDEN 8 – 9 per cent, and WiMAX, the remainder, according to Fred Wright, Motorola’s senior vice president and general manager of networks and wireless broadband products.

CDMA is a declining business, iDEN is a niche technology that is having some serious questions asked of it, and there is a gaping hole in Motorola’s activities where WCDMA/UMTS business is meant to be. While Wright makes the point that GSM is still a growth area with Motorola enjoying much success in the technology in emerging markets, the importance of throwing its hat in the ring for early consideration of a slice of the LTE cake seems a prudent thing to do.

“We have contributed the largest number of specs to the LTE radio access standards of any technology provider, and that reflects not only our belief in the technology but our competence in partnering to roll it out,” Wright said.

His disappointment for not being one of two vendors initially chosen to roll out LTE for Verizon Wireless in the US was palatable, though he maintains an optimism that Motorola will be picked up for a significant LTE contract in due course.

“We are still in the game with Verizon and Vodafone, and remain confident we will be a part of subsequent LTE awards,” Wright said.

With the turn in the global economic climate, hedging technology bets further also appears a prudent move, particularly in light of analyst predictions that the high proportion of greenfield and smaller alternative operators that populate the WiMAX space may be harder impacted than more established operators with respect to continued funding of their deployments.

Motorola claims a 25 per cent share of the global WiMAX market with 25 contracts having been announced and 7,000 access points deployed. A total of 400,000 customer premises units, typically home access modems, have been shipped to date and Wright said in Q408 Motorola recognised revenue accruing from WiMAX for the first time.

Wright expects to see Motorola’s sales in WiMAX to be five times higher in 2009 than they were in 2008, with an estimated half dozen announcements to be made in due course. However, it still appears the star of the show remains LTE.

“In terms of Mobile World Congresses – in 2007 WiMAX was the hype. In 2008 it was WiMAX and LTE, this year it is all about LTE,” Wright said. “Motorola was the first to demonstrate handover between a LTE channel and a 3G channel, and the first to demonstrate LTE usage at 700MHz,” he added.

Microsoft’s Steve Ballmer believes TV is going to be one of the significant elements around seamless experiences, while Nokia’s Kallasvuo believes mobility is part of the solution to help the global economy come through a difficult time

A concern on every equipment manufacturer’s horizon is that operators are going to slow or stop placing orders for upgraded or new equipment as they wait to ride out the worst effects of the global recession. Despite this, Wright remains comfortable in his forecast of the increase in revenues expected from WiMAX activities in 2009, saying that Motorola has been particularly conservative with its forecasts for WiMAX, having toned them down by 20-25 per cent already.

So the message is clear that over-reliance on legacy infrastructure is not advisable as GSM is declining overall, with Wright estimating an 8-10 per cent decline in average GSM base station prices year-on-year. “CDMA is declining at a faster rate, and chipsets are available from only one source, that being Qualcomm. CDMA is not a good technology for emerging markets as in some cases it costs more for a chipset than an entire GSM device. IDEN is flat, but still has an active international market,” Wright added.

Joe Cozzolino, Motorola’s senior vice president and general manager of EMEA and APAC, broke the company’s ongoing networks strategy into three clear areas – WiMAX, LTE, and convergence, where it relates to mobility being added to interactivity and content.

“We are still investing in new technologies, but are not trying as many new things,” said Cozzolino. “Our position with respect to net cash to debt is very healthy and our balance sheet is much stronger than those we compete against, so I am confident of our position and performance in the future,” he added.

Away from Motorola, Alcatel-Lucent was also keen to highlight its LTE credentials, announcing the introduction of a software module that enables service providers to expand the capabilities of their wireless networks through the introduction of LTE technology. The software module is a key component of the company’s enhanced NodeB (eNodeB).

Alcatel-Lucent’s LTE solution complies with the latest 3GPP standards and incorporates innovations from Alcatel-Lucent Bell Labs such as Self-Organising and Self-Optimising (SON) capabilities that facilitate the introduction of services and ensure that the network is dynamically optimised. The LTE enhanced NodeB solution also benefits from Alcatel-Lucent’s experience in key technologies on which next-generation wireless access is based, such as IP, multiple input/multiple output (MIMO) and orthogonal frequency division multiple access (OFDMA).

Nokia president and CEO, Olli-Pekka Kallasvuo said that his company’s ambition continues to be to convert the Internet experience to a personal, mobile one. In response to the global economic downturn, he believes that mobility is part of the solution in terms of helping the global economy come through a difficult time.

“Lawyers are the first to cast doubt about new technologies, because of intellectual property, and I should know because I am a lawyer,” Kallasvuo quipped. “Closer cooperation is an area that Nokia is working hard at. IBM and Microsoft are big competitors to Nokia, but we are working with them.”

Kallasvuo did want to stress the point that ‘open’ does not mean the opening of the floodgates with respect to allowing all and sundry to utilise or gain access to resources at no cost, rather than opening up only part of the business would be the better option, in a bid to offer fewer barriers. Nokia claims that only Symbian is a truly open operating system in the mobile world, and has reaped the benefits by establishing a community of four million developers and offering tens of thousands of applications. Around 250 million Symbian devices have been shipped.

“Symbian is a truly open operating system at a time when the smartphone market is coming into it own,” said Kallasvuo. “This particular gathering at the Mobile World Congress is historic for a number of reasons. It is the first time the industry is contracting, and we are feeling the impact in one way or another. However, my view is that it remains a vital and dynamic industry and we are lucky to be working within it.”

Microsoft’s CEO, Steve Ballmer, ran even further than Kallasvuo in his view that the cyclical nature of economic slowdowns had their place within all industries. “I believe the economic reset will be with us for some time as economies around the world reset to a sustainable level of growth,” Ballmer said. “I believe TV is going to be one of the significant elements in the rise of the dialogue around seamless experiences, and I believe that soon interactions with machines will be more like we interact with people.”

The Microsoft operating system remains core to the technology company’s ongoing activities, with Ballmer estimating that industry makes US$18 for every $1 that Microsoft makes from the Windows operating system, and the company went on to announce a number of initiatives aimed at its participation in the mobile arena.

Microsoft unveiled an overhaul of its handset operating system, as well as a new user interface and mobile browser. Windows Mobile will be replaced as a brand by Windows Phone, with the company expecting to release the Windows Mobile 6.5 operating system in the fourth quarter of the year. Microsoft also jumped on the application store bandwagon, unveiling its Windows Mobile Marketplace, which is an application store that will enable users to download any of the 20,000 mobile applications available for the Microsoft operating system.

MWC 2009’s big announcement

Dick Lynch, Verizon executive vice president and chief technology officer, detailed plans to build America’s first next-generation LTE network.

Lynch announced that Verizon Wireless, a joint venture of Verizon Communications and Vodafone, has selected Ericsson and Alcatel-Lucent as primary network vendors for its initial LTE network deployments in the United States. Verizon’s announcement comes on the heels of LTE network trials in the United States and Europe, carried out in conjunction with Vodafone. These two vendors are expected to build the underlying infrastructure that will enable Verizon Wireless to become the first wireless company to offer commercial LTE based service in the United States, starting in 2010.

“Verizon Wireless’ LTE network deployment will be driven by our vision of providing ubiquitous global wireless broadband connectivity and mobility. LTE enables us to continue to meet business customer demands for a higher bandwidth, low latency service that works broadly in the United States and globally, while helping us to meet consumer demand for mobilising the many applications they frequently use when tethered to high bandwidth wired networks,” Lynch said.

In addition, Verizon announced that Nokia Siemens Networks and Alcatel-Lucent have been selected as key suppliers for the IP Multi-Media Subsystem (IMS) network, which will enable rich multimedia applications regardless of access technology. IMS will be a cornerstone technology in the evolution of Verizon’s services infrastructure. Verizon plans to offer IMS-based IP converged applications and services on its wireless and landline broadband networks. LTE will be one of the key wireless access networks linked to the IMS technology.

Lynch said building and offering commercial services over Verizon Wireless’ LTE network, while also expanding its FiOS fibre network, is a consistent and complimentary strategy focused on a committed future in broadband. As has been previously reported, Verizon’s total capital expenditures totalled roughly US$17 billion in 2008.

4G/LTE Innovation Centre

Lynch also announced that Verizon Wireless expects to foster creative solutions for connecting people, places and things wirelessly on its LTE network by creating the Verizon LTE Innovation Centre. With support from founding partners Ericsson and Alcatel-Lucent, Lynch said the mission of the Innovation Centre is to be the catalyst for early development of non-traditional products for use on LTE networks.