What To Write About?Monday, July 28, 2008
Should I write about AT&T asking the FCC to block the Clearwire/Sprint merger? AT&T contends that this "merger" does not take into consideration all of the spectrum involved in the deal. However, my understanding is that this is not a merger of the companies, it is a merger of the Clearwire WiMAX 2.5-GHz system and the Sprint WiMAX 2.5-GHz system. Sprint will end up owning 51% of this new company and Clearwire will own none of Sprint's CDMA/iDEN network even though it may sell services over it as the new Clearwire gets WiMAX up and running.
Or what about the rumors that Sprint is looking to dump its iDEN (Nextel) network now that it has QChat push-to-talk up and running? Who would buy the Nextel network that is using twenty-year-old technology and is losing customers? Could there be a plan afoot to use the Nextel network for First Responder interoperable voice along with the 700-MHz D block for interoperable data services? Who could afford this network? Could the federal government buy it or have a network management company buy it? What would happen to the rebanding efforts that were supposed to have been completed this year but most likely will run well into the next decade?
Should I write about Sprint divesting itself of about 3,300 of its towers to a tower management company? Sprint is trying to lower its debt by getting rid of the towers, which it will now lease, but this should not be news. Many of the other network operators have already done the same thing and it makes sense. Is the next step to outsource its network management as many other operators around the world are doing? Ericsson has become the leader in providing managed network services and running most if not all of the day-to-day operations so network operators can concentrate on other things. But to my knowledge, Ericsson does not manage any CDMA networks so Sprint would probably have to look at other options. Sprint's goal certainly is to reduce its debt, increase its subscriber base and reduce churn, so I suspect selling off its towers is not the last cost saving move we will see.
And then there is Verizon being asked or volunteering to shed some of its combined Verizon/Alltel network assets in 38 mostly rural markets, and its statement that it would keep Alltel's existing roaming agreements in place with the rural wireless providers who have extended Alltel's network and provided roaming for Verizon's customers in rural America for many years.
And I keep asking for test results for the Sprint WiMAX cities that are up in soft launch mode. I have been told by the WiMAX folks that "testing is underway" and the results are blowing EV-DO Rev A and HSPA out of the water. But insiders are telling me that the WiMAX performance in these markets is not a whole lot better than on Verizon, AT&T and even Sprint's existing wireless broadband networks, and that after the next rev of EV-DO and UMTS/HSPA, data rates on the incumbent networks will be better than on the Clearwire/Sprint WiMAX network. I have yet to see a single independent test of the three technologies side by side. I find this to be very interesting.
Meanwhile, I could write more on LTE since it seems to be capturing everyone's interest of late. But I think LTE will be slow to roll out. I don't think that either Verizon or AT&T is going to go full bore with LTE in 2009 or 2010 in the United States. There is still a lot of life left in UMTS/HSPA, HSPA+ and EV-DO Rev A and B. It will take time to get LTE devices into the market, and even then, I think LTE will be used only where there is an issue with network capacity. Add to this that femto cells are coming on strong and I really don't expect to see LTE being a major portion of anyone's network until 2012 or so.
Then there is Intel. For some reason, Intel is still talking about a combination WiMAX/LTE chip and I have heard from inside the company that Clearwire might want to add LTE to its WiMAX sites so it can provide both WiMAX and LTE. Well, that might make sense except for one thing. If LTE is going to be a slow roll-out in the United States and elsewhere, having a combination WiMAX and LTE network makes little if any sense unless large population areas are covered. Why? Because AT&T will be providing voice on GSM and data on UMTS and LTE, which means that the chipsets in devices sold on AT&T's network will have all of these capabilities built in and the networks will be able to move customers from EDGE to UMTS to LTE and back again as they move through various parts of the nation. Verizon will be able to do the same thing with CDMA 1X/EV-DO and LTE. This means that in order to be competitive, Clearwire will have to use Sprint's CDMA and EV-DO network along with WiMAX and LTE. If Intel's only offering is a WiMAX/LTE chipset and a second chipset with CDMA capabilities is needed, I don't think Intel will sell many WiMAX/LTE chips.
There has been more talk about the wireless Internet. As you must know by now, I don't believe in providing the desktop Internet experience on a handheld or pocketable device. Short-term experiences with the iPhone are not a true measure of this concept. People will use the Internet as they have for a while and then grow tired of it. At some point, we will have a smarter, more user-friendly Internet that can be delivered with less bandwidth because it will be smarter. I think we have to live through the wireless Internet first, but once we have learned how to deliver this real wireless Internet experience, it will work so well we will also want it on our desktops. Today we can sample this experience on our desktop by combining information from several websites into a single view, and being able to book a flight, a hotel and rent a car all from one site. Next we will be able to enter all of this information in our calendar and have it updated in real time, including monitoring the traffic on our route to the airport and advising us if we need to leave earlier than we planned, or even monitoring the lines at the TSA check points at the airport to make sure we will be prepared for any delays.
I still have issues with the new breed of devices some are calling MIDs or Mobile Internet Devices. These devices are larger than smartphones and smaller than even the smallest notebook. There are only a few examples in the market today, but more are promised. The ones that are coming run standard applications, but their prime design feature is that they have embedded broadband wireless. Some will have built-in WiMAX, some CDMA and some UMTS. Some, of course, will have the Qualcomm Gobi chipset that provides GSM/UMTS and CDMA/EVDO and contains radios to handle wireless broadband almost anywhere in the world.
We will have to see how these devices fare. In the 1990s, we had the HP-XX LX series of palmtops as they were called and the Poqet sub-notebook that ran on AA batteries and supported DOS and applications made for DOS. Then we had a slew of Windows CE-based machines that were instant-on in a small form factor and many had wireless capabilities. All of these systems were build prior to the World Wide Web (not the Internet), none had color screens and the connections to the Internet and email, etc. were wireless with blazing speeds of up to 19.2 Kbps. HP sold more of the LX palmtops than all of the others combined, but it was still a small market.
This time around we have color, faster processors and hi-speed wireless access to the Internet. Perhaps all of this will be enough for this new-again class of products to do well. I am a skeptic though. For years, I have divided mobile devices into two classifications: unconscious carry and conscious carry. Unconscious carry means you don't even think about taking it with you-your phone or pager, your BlackBerry or other smartphone and even your iPod simply go with you. Conscious carry, on the other hand, means that as you pack your briefcase for a trip and prepare to go mobile, you look at the device and think about if you really it this time.
General attributes for conscious carry devices are that they tend to have larger screens and keyboards, necessary for those who have to create work while mobile as opposed to those who need only to access information. Most of us take our notebooks with us to use when we get to our destination or on a plane when we have time. The rest of the time we use our unconscious carry devices.
So where do these new devices fit? The MIDs I have seen so far are too big to fit into the unconscious carry category as they cannot be worn on a belt or carried easily in a purse. Some who are designing these devices are calling them pocketable, but I, for one, am not going to carry something in my pocket that is larger and weighs more than my current BlackBerry. Even so, there is an entire industry getting ready to explode around these devices. The rationale is that since we have wireless access to the Internet, we will want to carry an MID with us all the time so we can use it to access the Internet any time we get the urge. Being able to surf the Internet is the first design criteria for these devices, and they will also run business and consumer applications. They are larger than smartphones and smaller than notebooks, with small keyboards and an expected battery life in the one-day range. (There are rumors of some MIDs not based on Intel processors that will run longer on the battery supplied.)
I guess I don't share the industry's conviction that it will sell millions of MIDs. My reasons are many, portability being one and another being the introduction of new smartphones such as the iPhone on AT&T's wireless broadband network, the Instinct on Sprint's EV-DO network and the LG Dare on the Verizon network. I think these phones, led by the iPhone, may have taken some of the thunder out of the Internet Mobile Device market. These particular smartphones cross the barrier and become very good Internet web-browsing devices (if that is what you're interested in) and they run standard applications. While their keyboards are small and sometimes difficult to use, they are not that much smaller than keyboards on the MIDs I have been shown.
It still amazes me that so many companies are developing products to help us take the Internet mobile instead of developing back-end systems to make the mobile Internet smarter. Yes, there are times when I want a browser on my phone to get some information I didn't know I needed until I needed it, but for the most part, I want the information that helps me run my life more efficiently pushed down to my device-I don't want to have to go and get it. RIM's BlackBerry and others set the bar. First with email, then with calendar and address book, then with attachments that can be opened and read on the device. Now we need to go beyond this so other information we want and need day in and day out is there on our device, updated, when we need it.
In the meantime, the forecasts for MIDs are huge-it seems we will all want at least one. If I were still in the business of forecasting device uptake (which I am not), I would probably take those forecasts and divide by ten.
I realize this Commentary has been all over the map, but I had a few words to say about a number of things going on in this industry. Some of them make sense to me and some do not. There is one thing for sure, wireless continues to be an exciting industry to be a part of and it will continue to be so as we watch wireless invade almost every part of our lives, mostly for the better.
Andrew M. Seybold