THIS year's 3GSM World Congress, the giant annual showcase for the mobile communications industry currently playing in Barcelona, is notable on two fronts: it offers ample evidence that broadband technology is ready for prime time; and the major players seem to be finally buckling down to finding answers to the industry's prickliest demand: show me the money.
While soul-searching is very much on the agenda, the overall mood has been celebratory. Music is a key revenue stream for the new media, and some 10,000 visitors rocked to the beat of music artistes from the EMI stable, headlined by UK pop star Jamelia, at the Congress's opening party on Monday night.
And monetising the music was very much on the mind of Jean-Francois Cecillon, chairman and CEO of EMI Music International, who spoke at a panel discussion on Creating Next-Generation Business Models. Acknowledging that global piracy remained a concern, Mr Cecillon argued that content providers like EMI could thrive by placing top priority on product development and staying agnostic on business models. And most importantly, they needed to 'feel the consumer'. The key, he said, was to 'create loyalty without reason'.
Another panelist, Yahoo! senior vice-president Marco Boerries, saw mobile advertising as the missing link. Insisting that 'mobile opportunity is massive', Mr Boerries advised operators and content providers: 'Jointly create additional value that can be shared.' For instance, Yahoo!'s oneSearch, a streamlined search function for mobile screens, could draw eyeballs and advertising revenue for both Yahoo! and its partners, he argued.
For Carl-Henric Svanberg, president and CEO of networking major Ericsson, there is no all-encompassing business model. 'Different models will be needed for different categories,' he argued. But the common denominator, he noted, was the broadband technology that made the downloading and sharing of content easier and more compelling. '27 per cent of UK 3G users download four songs a month,' he said.
More to the point, there was dramatically higher data usage by 3G subscribers, compared with their conventional 2G counterparts. The future can only get better, as next-generation wireless and wireline technologies mature.
For many 3G operators, High Speed Packet Access (HSPA) is the logical next step, requiring just a simple upgrade to 3G networks using wideband CDMA. Close to 100 HSPA networks have already been launched across the world, according to Mr Svanberg.
In Singapore all the major mobile operators are conducting HSPA trials. Ericsson announced last November that Singapore Telecom (SingTel) had selected it to launch SingTel's HSDPA services along the Orchard Road shopping belt. (The 'D' in HSDPA refers to the downlink component of HSPA).
In briefings for Southeast Asian media at the Congress, Ericsson officials described a comprehensive roadmap that would take mobile broadband users from the one megabit per second (Mbps) download speeds of current 3G devices to quantum speeds higher in the near future.
Asked by BizIT, they declined to comment on their HSPA plans with SingTel. However, Ericsson's vice-president for strategy, Christian Hedelin, noted that by 2008, using a technology called MIMO, 30 Mbps download speeds would be feasible, while a next-generation technology called LTE, for Long-Term Evolution, would make downloads at 100 Mbps commercially feasible by 2009.
While the technology appears to be well on schedule, the search for a profitable business model looks set to continue. In a keynote speech here, Tim Berners-Lee, the legendary founder of the World Wide Web, upset more than a few moguls with his ringing call for Internet technologies to 'be a foundation, not a ceiling'.
Ceiling technologies place restrictions on their possible uses, and 'are the end of the road for innovation,' he said. To make a foundation technology, which maximises those uses, 'you need to put aside the short-term return.. and look at the long term'.
And in case anyone still doubted that he was talking about restrictive patents, he commented: 'In 1989 my colleagues in the Internet community would not have dreamed of patenting the ideas in the Internet protocols.' Mr Berners-Lee's comments are bound to fuel further debate on digital rights management and patents in general. But they also give a more realistic perspective to the search for business models that really work.
This article first appeared in BT on February 15, 2007