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MWC: Mobile operator CEOs look to openness

Tue, 02/15/2011 - 7:25am
Monica Alleven, Wireless Week

BARCELONA – The CEOs from some of the world's largest mobile operators took the stage at Mobile World Congress (MWC) Tuesday morning, with a common theme being their desire for openness and cooperation on major industry objectives.

Vodafone CEO Vittorio Colao noted that it's a bit ironic that a few years ago, operators were accused of being the walled gardens, and now they're providing the billing mechanisms for third parties and trying to avoid vertically integrated, closed systems.

Moderated by Telecom Italia CEO Franco Bernabe, the panel featured Colao, America Movil CEO Daniel Hajj, AT&T Chairman and CEO Randall Stephenson, China Mobile CEO and Chairman Wang Jianzhou and Telefonica CEO Cesar Alierta.

Most of the executives seemed to agree that today's economic climate looks much more promising than it did a year ago, when CEOs gathered here to contemplate the overall economy and impact on wireless. After a period of uncertainty and crisis in some regions, the industry has done much better than other industries, Bernabe noted.

Of course, given the tidal wave of mobile data demands, much of their discussion focused on how operators will deal with those traffic demands. Wi-Fi and LTE are at least a couple of strategies that are currently, or soon to be, in the works.

China Mobile's strategy for dealing with all the smartphones, tablets and dongles accessing the Internet involves extending Wi-Fi coverage, which has proven to be an important sub-segment to cellular, the chairman said. China Mobile wants to have 1 million Wi-Fi hotspots nationwide in three years, with the aim of having phones identify Wi-Fi as the priority way to access the Internet where available. It is urging handset providers to make Wi-Fi embedded in all devices with easy authentication. China Mobile is in discussions with others for international Wi-Fi roaming, Jianzhou said.

Executives also discussed ways to respond to the changes in business models derived from the mobile Internet, with the desire to build an ecosystem that is beneficial to the industry and encourages open systems.

Colao said that initially the industry got it wrong by assuming people would not want to pay for content. On the Internet, everything was given away for free, and the perception was nobody would pay, but that is not the case, as evidenced by the paid apps that are downloaded and by the newspapers, music and video now being sold over digital networks.

Stephenson brought the U.S. perspective, commenting on the very rapid pace of change driven by the smartphone phenomenon, which probably has happened as fast as any transformation he's seen in his 28 years in the industry. "We're really on the cusp of taking this to a different level," he said of 4G speeds. AT&T will be deploying LTE by mid-year in the 700 MHz spectrum.

AT&T is investing heavily in the cloud, and he emphasized its role as a linchpin or a vital element going forward. A study that AT&T commissioned looked at how people are consuming content, and they're doing so on three or more devices – PCs, tablets, smartphones. Customers are saying they don't want to be limited by the type of device or OS in terms of how they access content. Their expectations for open and seamless access are only going to increase, he said, and the more operators facilitate openness, the more they stimulate demand.

He used text messaging as an example. At the beginning, text messaging was closed, and you had to be on the same network to exchange messages. But when operators got together on interoperability and made it happen, usage and demand just skyrocketed, creating a new business model for companies like Twitter.

When you combine mobile broadband and Internet, you see the next area of growth, manifested in Amazon and Kindle, what he called the "poster child." When the iPad came out, Amazon made the Kindle available as an app, so you can buy a book on an iPad and read it on a smartphone or a Kindle – the point being the customer's experience is OS- and network-agnostic.

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