3G Phones go Wi-Fi – so what’s the future for mobile telcos?

by Andy Polaine on December 1, 2004

Interesting to read this story from Wendy Grossman on Wired today about the British company, Cambridge Silicon Radio and their new Wi-Fi chip, UniFi, aimed at the mobile market. The mobile telcos are going to have to change their business model radically…

The mobile market has flattened out, certainly here in Australia, with almost all the major telcos pushing very similar services and tariffs. Many of them have given up locking customers into long contracts and they have all introduced capped plans, which include data. Clearly their next target has been the take up of data services, but 3G has been very slow coming here and the 3’s offering has been pretty patchy by the sounds of it. Part of this is due to Australia’s massive size – it’s difficult, or rather expensive, to provide decent coverage.

So far most of other telco’s have been trying to push their 2.5G GPRS services, but as Grossman’s article mentions, once people get used to Wi-Fi speeds not only GPRS but 3G services seem so slow and clunky. The rise and rise of the personal media player and personal media distribution look set to bring Mark Pesce’s Fuck Big Media mantra to fruition. The analysis by Lars Godell from Forrester Research was rather tepid I thought, suggesting that by 2008 (or maybe 2006) there would be

“296 million Bluetooth-enabled mobile phones, laptops and PDAs in Europe alone, but only 53 million wireless-networking devices, most of them laptops.”

Sure, most of them will be laptops, but an $8 (or less) WiFi chip is an opportunity that most manufacturer’s are not going to pass up on. It starts to make sense to put one in all portable devices even just in case the market shifts. I can’t see telcos winning the battle here – their market has shifted and people look to the phone not the network for it’s features, even those that are supplied by the network. If the handset manufacturer’s get behind it, the telco-branded retailers aren’t going to refuse to sell the latest gadget, it would be commercial suicide.

Here’s a final thought too on VOIP. Quite apart from a Wi-Fi device used as a mobile, personal media centre, the idea of having one phone which acts as a mobile when out of Wi-Fi range and a VOIP device when you are at home or work (or Starbucks for that matter) makes a lot of sense. With Bluetooth (the UniFi chip is billed as “Bluetooth friendly”) that means other non-WiFi devices could become WiFi enabled more easily. My Palm Tungsten T3 for example. I know there have already been a few examples of this and, of course, the Phone/PDA combinations, but they’re pretty ugly and clunky, it would be nice to see it more seamlessly integrated into a mobile – that would certainly sell.

Like voice calls with the landline, voice charged by the second is absurd considering it is all data anyway. I think we’ll be looking at mobile telcos not differentiating soon – you’ll purchase a 1G plan from Vodafone and be done with it. Use the bandwidth how you like, just like broadband.

Well, that’s just me, what do you think?

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