CTIA Wireless I.T. & EntertainmentThursday, November 01, 2007
The fall CTIA show is the smaller of the two yearly CTIA shows and was launched about eight years ago. At that time, it was designed to attract IT professionals to an event that would, hopefully, help grow the market for wireless data services.
Over the years, it has morphed into a very different show with the added focus of entertainment and consumer applications. This change took place because the show was not attracting the IT population in large numbers and in order to be more viable, the entertainment aspect was added.
Looking back, this is what happened in the wireless industry as well. When the networks began to turn on their third-generation data services (EV-DO and UMTS), their first attempts at securing customers for these services were directed at the corporate world. Corporations already knew the value of wireless voice services and many already had experience with the BlackBerry so the thought was that corporations might add high-speed data services to their existing wireless tools. But corporations are slow to adopt any new technology and pilots and sales cycles took months of effort.
When enterprise adoption of high-speed data was slow to materialize, network operators began wooing the consumer market with new devices, ringtones, ring back tones, games and then audio and video services. As they began to focus more on the consumer market, so did the CTIA with the addition of the entertainment segment, which increased attendance and breathed new life into the conference.
Each year since, the show has been more about the consumer side of the industry and less about the business or enterprise market. This year was no different. Had it not been for Microsoft's announcement of its new System Center Mobile Device Manager, the business side of the show might have been devoid of announcements. Ericsson and Nokia were both showing their end-to-end solutions for the network operator market, but both of these ecosystems are still about consumer applications, games, ringtones and audio and video content wrapped around a complete ecosystem for provisioning, billing and delivery of consumer content.
This part of the system is exactly what I have been writing about as needed for consumer phones. It enables the IT department to configure the wireless device and download all of the configuration information to the device over the air. An added feature is the ability to provide over-the-air software downloads as well. The final features include a helpdesk console and role-based administration, which provides different sets of administrative privileges for different roles in the organization. Finally, a "device wipe" is included in the package-the ability to remotely wipe the device clean of data and information if it is lost or stolen, which is an important feature in this type of administrative package.
Most of these features and functions are available on enterprise servers today for managing internal networks. However, with the advent of this new System Center and Windows Mobile version 6.1 due out in early 2008, all of the desktop and server-based features are being extended out to mobile devices. Additional mobile device-only features are also built in, as described above.
Microsoft has done a good job with this suite of features for the mobile environment and it is clear that it is catching up to the capabilities available to RIM BlackBerry customers. RIM has been focused on security, management and configuration of devices for a long time, primarily because its core business is in the corporate world where these features and functions are key factors in buying decisions.
For quite a while now, the industry has thought that location-based services (LBS), based on GPS location fixes and integrated into devices, would be a huge market. At the show, it was evident that the LBS industry believes this as well and is working diligently at integrating LBS into almost any application and device. The day before the show, Navteq held its annual event and on the first day, SiRF and Andrew Seybold, Inc. hosted the SiRF Location 2.0 Summit at the St. Regis Hotel across the street from the show (not affiliated with the CTIA in any way). This Summit was to bring together all of the companies involved in providing LBS to wireless customers-both business and consumer. The afternoon session was attended by 300 people representing almost 100 companies engaged in one segment or another of the LBS ecosystem and the sessions were on target with the message that LBS is not only about standalone applications, it will be embedded into any number of business and consumer applications. CTIA had several sessions on LBS as well, and the next evening Tele Atlas hosted a dinner for the LBS industry.
LBS was everywhere this year. The perceived issues with privacy have subsided now that LBS is based on opt-in location (customers determining whether they want the network to know where they are in order to take advantage of location services), turn-by-turn traffic directions are being provided to the major networks by TelNav, Networks In Motion and Telmap are becoming more popular and it appears as though the industry is ready to start really pushing these types of applications.
The other hot area is mobile advertising. No one knows how big mobile advertising will be, nor how it will be received by consumers, but everyone seems to think it will be big. When you integrate the ability to locate a wireless device with mobile advertising, the marriage has the potential to provide some interesting results. I am sure we will see targeted advertising relevant to each of us on an almost personal basis, and I also expect to see advertising related to our location as well. The most typical applications seem to be coupons or discounts offered as you walk past a store, but I think more than likely we will see location and mobile advertising creep into our searches for nearby restaurants, movie theaters and others places we want to find and visit.
There is a perception in the industry that some advertising may be used to defray the cost of a service or even contribute to lowering our monthly wireless bill. Will we accept advertising for a discount on a music or video download? Will we accept advertising in exchange for a lower monthly phone bill? I am not sure anyone knows the answer to these questions, but the industry is getting serious about mobile advertising. With Google having an interest in wireless, one would suspect that it will want to extend its revenue model, which is a pure advertising-based model, onto the wireless devices we carry.
Some Final Thoughts
There was not really a theme around this year's CTIA Wireless I.T. & Entertainment, nor was there a lot of hype (which is good). Everyone was busy conducting business, trying to figure out what is next, what the next big thing will be and how to make money in wireless as the industry changes over the next few years. Wireless network operators will not let themselves become dumb wireless pipe providers, no matter what the Internet community thinks and no matter how the open access issue plays out. Their networks cost $billions to build and they will do everything they can to protect their return on investment.
It will be more difficult than ever to maintain today's ARPU (average revenue per user) and even more difficult to keep voice ARPU up and increase data ARPU at the same time. The Internet community is nipping at the heels of the wireless industry and it will find its way into wireless one way or another. The question is how this will play out between now and the next CTIA Wireless I.T. & Entertainment, which is scheduled for early September back in San Francisco.
A number of people who came to the show left early and some did not come at all due to the fires in Southern California, but I have heard that there were 10,000 people in attendance this year. There are reports that the show floor was not very crowded much of the time, but there was a lot going on―conference sessions, private meetings and, of course, parties.
I, for one, would like to see the CTIA make a bigger push to attract IT professionals in larger numbers. The network operators have virtually ignored this group for the past two years while they built their high-speed data installed base from consumers and have not yet turned their attention back to businesses large and small. Perhaps next year there will be more focus on the show's original purpose. I would like to see that.