A new Europe-wide rule to prevent mobile phone users from building up large bills for surfing the internet via their handset has come into force. Customers can now require their phone firm to cut them off when their bill reaches a certain level after accessing the internet in other European nations. If users do not put in place a limit by 1 July, it will automatically be set at EUR 50. The phone firms will have to warn users when their bill hits 80 percent of the limit. Accessing the internet via your mobile phone while abroad is called “data roaming”. European Commissioner for Digital Agenda, Neelie Kroes, said: “Protection against data roaming bill shocks is a useful step towards building customers’ confidence to use mobile networks to surf the internet when travelling around Europe. “Such confidence is essential if people and businesses are to use the internet to its full potential.” The Commission added that if service providers did not honour people’s set spending limits, national regulators would deal with complaints and impose any necessary sanctions. Commission spokesman Jonathan Todd said the move was likely to reduce the cost of data roaming across Europe
Google’s much-hyped Nexus One smartphone is set for UK launch in April, according to a new report in The Daily Telegraph, with the web giant no doubt hoping the device will make a bigger splash than it did on its US launch. At present UK consumers can purchase an unlocked version of the phone from Google’s website, although Google has been in discussions with network operator Vodafone for some time now about providing the device on contract to its customers
However, despite Vodafone being keen on a March launch, sources close to both companies confirmed to The Daily Telegraph that April is the more realistic time frame for the UK launch. According to the official Google site for the Nexus One, the device is still listed as “coming soon to Europe” in spring 2010.
Despite huge expectations of the smartphone, Google’s first own-branded device has met with a fairly luke warm reception from commentators and been beset with support and 3G connectivity issues. Many users complained that it is unclear which company is responsible for customer support; the phone manufacturer, HTC, the US network carrier, T-Mobile, or Google itself.
Others complained about the slow response times from Google to complaints and the lack of a manned customer service support line, although this latter problem has now been addressed. The web giant also released an over-the-air software update for the handset to enable new features and fix the widely reported connectivity problems, although sales still remain sluggish compared to the huge numbers of iPhones that Apple shifted on its launch.
Cellphones and the internet are muscling in on more traditional media as ways to see the Olympic Games, and the trend will only deepen, organizers said on Tuesday. Timo Lumme, head of TV and marketing for the International Olympic Committee, said non-traditional media had already matched the 20,000 hours from traditional broadcasters so far these Games, contributing to a total audience he expects to reach 3.5 billion – or half the world’s population. “We’ve had a continuing digital explosion,” Lumme told a news conference. “We now have the same amount of hours covered globally on digital media – internet, mobile – as we have on the old media broadcasting, and a quarter of that is mobile.” “People are accessing this in different ways during different times. It does mean more is being consumed.”
The world’s biggest social network has revealed details of a stripped-down, text-only version of its mobile site called Facebook Zero. The low-bandwidth site is aimed at people viewing Facebook on their mobile and will launch “in the coming weeks”. The social network recently said that more than 100 million people now access Facebook from their phone. Analysts at CCS Insight said that the new site could help operators free-up critical bandwidth on their networks. Data from industry body the GSM Association recently revealed that Facebook accounts for nearly half of all the time people in the UK spend going online using their phones. The data showed that people in the UK spent around 2.2bn minutes browsing the social network during December alone. Facebook said the new site “omits data intensive applications like photos”. Facebook already offers a slimmed down version of the version of its site – called Facebook Lite – for people with slow or poor internet connections. It is aimed at users in the developing world. The site was announced at the Mobile World Congress in Barcelona, which runs from 15-18 February.
The European giants that pioneered the mobile telecoms industry are now stumbling in the wake of American and Asian rivals
When Eric Schmidt, chief executive of Google, takes to the stage in Barcelona on Tuesday evening to deliver the keynote address to hundreds of mobile phone industry executives gathered for the Mobile World Congress the industry’s biggest trade show, the message will be clear: well done, Europe, for getting mobile communications this far. We’ll take it from here.
For two decades, Europe’s mobile telecoms sector has considered itself to be a world leader. It had the biggest names, the technological knowhow, the most customers. Over the past year, however, that hegemony has been smashed. At a time when Europe is mired in economic turmoil and facing a demographic timebomb, one of its great hopes for fuelling future growth is slipping away.
“Europe has become the ‘flyover states’ of the mobile industry,” says a senior European executive, referring to the disparaging term used to describe middle America by high-powered business travellers shuttling between California and New York.
“All the service innovation is being done on the west coast of the US, and all the manufacturing and technical innovation is being done in the Far East. All we’re doing is selling other people’s products.”
His customers now care only about access to services such as Google, Facebook and Twitter on their phones, and the devices they covet are the iPhone or the latest BlackBerry, which has proved a great hit with teenagers. This year’s hot handsets, the executive says, are being made by HTC, the Taiwanese manufacturer, which will use this week’s show to unveil its latest devices, featuring Google’s Android software. While Apple lords it over the high end of the market, China’s Huawei and ZTE are creating cut-price smartphones that will democratise the mobile internet in the coming years.
Sensing the change blowing in the wind, even Microsoft’s chief executive, Steve Ballmer, is turning up in Barcelona to front the software group’s latest attempt to break into a market that it was once shut out of by Europe’s gatekeepers, Nokia and Ericsson. As for Apple itself, the iPhone maker would never do anything so vulgar as actually appear publicly at the event, or have a stand in one of the eight exhibition halls; but its executives will be in town, holding meetings behind closed doors with suppliers and networks as it looks for more wireless partners to back its latest invention, the iPad, outside the US.
After a week in which the turmoil in Greece has shown the fragility of the eurozone and a new acronym, “Pigs”, has entered the economic lexicon as a harbinger of doom, the evidence the Mobile World Congress will provide of Europe’s loss of control over the mobile phone industry is a harsh blow.
It leaves European policymakers, many of whom have bought in to the idea that the future lies in the creation of innovative technologies, to pin their hopes on new areas such as green energy or fall back on old stalwarts such as biotechnology. But the green sector has yet to prove the breakout success that will give Europe its own version of Silicon Valley, while biotech has always been the saviour that never quite seems to arrive. After the dotcom crash at the start of this century, biotechnology was looked to expectantly, especially in the UK, as the next big thing. In America, meanwhile, graduates from Stanford and drop-outs from Harvard were quietly getting on with building Google, Facebook and Twitter.
The impressive lead in mobile communications that Europe once held over the rest of the world was created by the European Union. In the 1980s, when wireless communications went mass-market, America’s Motorola vied with Finland’s Nokia and Sweden’s Ericsson for dominance of the nascent global market. Europe’s players were handed the advantage when the EU officially adopted and set aside specific wireless spectrum for a digital mobile technology called GSM.
The first networks appeared in 1991 and overnight the European technology players that had helped create the standard had a huge market. Seeing its success, other countries soon adopted GSM, expanding the market for Ericsson, Nokia and others throughout the 1990s. Even America’s largest network, Verizon Wireless, is switching to the super-fast version of GSM later this year. So where did it all go wrong?
“As soon as the mobile business opened itself up in such a way that internet technology could become available on mobile networks, that was the end,” according to Mark Newman, chief research officer at Informa Telecoms & Media. “Maybe Europe had a chance but it blew it, in my view, because there are too many sets of interests, each so obsessed with their own sphere of influence that they could not co-operate.
“You had operators and device manufacturers never pulling in the same direction, and I cannot see any way in which Europe can regain the ascendancy. Essentially the future of communication services is that people want access to the cloud of services called the internet.”
The industry did see it coming. It tried several times to create a mobile internet that was not going to be beholden to the American giants. In the late 1990s, a pared-down wireless internet service called WAP was being pushed by several GSM operators. Customers, many of whom were used to dial-up internet access, were unconvinced and soon started summing up the service by replacing the “w” with “cr”.
A few years later, O2 tried to create its own mobile web by importing the i-mode standard from Japan. Again, it was a dire failure. When the “true” web started turning up on the next generation of 3G phones, the operators tried to keep their customers within “walled gardens” – as they were called – creating content portals that offered customers what the operator thought was the best of the web. Usage was paltry. Having spent billions buying licences to run 3G services, the operators had to prove to investors that there was consumer appetite for mobile internet services, so they demolished their garden walls.
Ironically, the operators’ initial intransigence over the mobile web brought both Apple and Google into the industry. The former saw a way of bringing the vertically integrated approach that had worked so well in music – where it controls both the device, the iPod, and the store, iTunes – into the mobile market. The latter made its move because it feared that the combined effect of Apple and market leader Nokia could shut it out of the mobile internet altogether.
In fact, Google needn’t have worried about Nokia because the runaway success of the iPhone changed the game. The arrival of the 3G version of Apple’s device a year and a half ago dramatically altered the mobile industry and proved that consumers, given the right device, will do much, much more than use their phone to make calls and send texts.
Nokia is still the largest mobile phone manufacturer in the world. But the Finnish giant, a former rubber boot manufacturer whose success created hundreds of millionaires and helped pull the country out of recession when the Soviet Union collapsed, has been sideswiped by the success of Apple and the encroachment of Google’s Android platform. It has been forced to make Symbian, its own software platform, free to developers and handset manufacturers, as Android is, and last month took the desperate decision to give users of its smartphones free access to its satnav services to make its devices as attractive as the iPhone. Only three years ago it spent €6.5bn on the map firm Navteq but it is now effectively giving that intellectual property away as it tries to protect its market share.
The crisis into which Nokia has been plunged by Apple has pushed it into bed with another American giant, Intel. The two companies will use Mobile World Congress to announce new microchips that Nokia hopes will help it to compete with HTC’s latest devices. Apple already has its own in-house chip design team, having bought fellow Californian company PA Semi two years ago.
Ericsson, meanwhile, spun its handset business into a joint venture with Sony. However, after initial success with ”featurephones” based on Sony’s Cybershot (camera) and Walkman (music)technologies, Sony Ericsson’s share of the billion-device-a-year market has collapsed under the onslaught of Apple and BlackBerry, halving from about 10% three years ago.
But it’s not all doom and gloom, says Olaf Swantee, who runs Orange’s mobile operations across Europe. He reckons that Europe’s big mobile phone operators, such as Orange, Vodafone and O2, have the opportunity to leverage their huge customer service bases to get themselves back into the game.
“Yes, the [US] west coast and Asia have really taken very strong positions,” he admits. “If you take equipment manufacturing, companies like Huawei have grown really strongly and we have seen traditional software manufacturers like Google and Apple enter the mobile market as it becomes a more software-driven environment. But, as the market moves to a more mature phase, what is becoming more and more important is the customer interface.”
The importance of direct customer contact, whether that be through shops or call centres, was proved this year when Google launched its Nexus One mobile phone. It sold it only through its website, and those customers who had problems with the phone had to email Google, rather than talk to its network partner, AT&T. Many found themselves waiting days for issues to be dealt with.
In the race to increase revenues – not least to pay for the network investment required to deal with the traffic generated by devices such as the iPhone – the mobile phone operators have the chance to claw back money from the likes of Apple and Google, which aggregate other people’s content through their iTunes and Android marketplace stores.
“Once the markets top out,” says Patrick Bossert, director of strategy at global billing services expert Convergys, “and growth slows and margins get tighter, then those aggregators will be looking to solutions for local-language customer care and marketing.
“They cannot afford to establish a base in every market in which they operate, but the service providers are already there. They may not have a lot of leverage now but, boy, do they have a lot of assets that are actually quite desirable.”
It’s a theme that the GSM Association, which represents all these networks, will be picking up this week as it tries to wrest some of the initiative back from Google and Apple.
“I don’t feel that we are being left behind, but there are areas that the mobile operators need to address,” says Michael O’Hara, the GSMA’s chief marketing officer. “And getting their assets into the developer world, finding a way to get into the value chain, is really key.”
Being great at customer service is hardly the white heat of technology, but for Europe it might just be the start of some sort of fightback. For now, though, the story is going to be – for home-grown talent, at least – depressingly familiar. As Informa’s Newman warns: “In 2010, Apple is going to make hay. I can’t see anyone catching them up this year.”
In the wake of the launch of Google’s Nexus One “super phone”, Microsoft has attacked the company’s mobile strategy. Google’s Android mobile phone software will struggle to make a major impact in the market now that the company has launched its own mobile phone, the Windows manufacturer has claimed.
Robbie Bach, the President of the company’s entertainment and devices division, said that so long as Google makes its own handsets, such as the new Nexus One, other phone manufacturers would hesitate to work with the Android mobile software platform because they would fear that they would never be a top priority for the search company.
“Doing both [software and hardware] in the way they are trying to do both is actually very, very difficult,” Bach said in an interview yesterday at the Consumer Electronics Show in Las Vegas. “Google’s announcement sends a signal where they’re going to place their commitment.”
When Google launched the Nexus One on Tuesday night, however, both Motorola and the phone’s manufacturer, HTC, joined the search giant on stage. Motorola Chief Executive Sanjay Jha confirmed that his company was already working on a range of new Android devices, even though many in the industry consider that the new Nexus One has largely stolen the thunder of the Motorola Droid handset.
Mobile network operators around the world, too, are apparently keen to get their hands on the Nexus One. Vodafone have confirmed that they expect to be the first to bring a Nexus One-subsidizing tariff to the UK market, although T-Mobile, which is already partnering with Google in the USA, has also held advanced talks with the company in Europe.
Google has stated that it is keen to work with as many network operators as possible.
For Apple, there’s now an ad for that.
Apple’s purchase of mobile-advertising firm Quattro Wireless demonstrates, for anyone out of signal range lately, just how much mobile is shaking up the tech industry. It is telling that Apple, best known as a hardware-software company, for the first time in its history bought an ad-sales company. On the same day, online-ad company Google unveiled a new phone, the Nexus One, it will sell online. Uncertainty about how the mobile market will evolve is forcing companies to diversify out of their comfort zones.
Apple has a big head start in mobile with its lucrative iPhone business. It is expected to extend that with a tablet computer, complete with TV and film offerings as well as other features already available on the iPhone. But hardware is likely to be only the starting point in making money out of mobile. Selling ads, particularly on mobile apps, is emerging quickly, with e-commerce not far behind. Apple presumably sees potential in selling ads on the tablet, in particular, given the entertainment features it will offer.
Apple’s purchase of Quattro, which follows Google’s agreement to buy another mobile-ad firm, AdMob, ensures direct exposure to the still-small mobile-ad market. How well Apple’s culture meshes with the ad-sales business is a big question. Meanwhile, ad-expert Google has avoided entering hardware directly, by using HTC to make the Nexus One with Android software. But selling phones directly to consumers, instead of through the traditional carrier route, could pose a challenge. That said, with mobile so hot, it makes sense for both companies to spread their bets.
The mobile telephone industry is joining the HD wave as Orange announces today that it will make high definition calls available in 2010.
The HD voice service, which will require customers to buy new handsets, promises to make callers feel as if they are in the same room. France Télécom-owned Orange is the first mobile phone company to announce a British HD voice service and it hopes the clearer calls will usher in a new standard throughout the industry.
“HD Voice really does inject a level of innovation into mobile phone calls, making it sound as if callers are actually in the same room. Once people have tried it, they won’t want to go back,” said Tom Alexander, Orange UK chief executive .
Orange plans HD voice trials in the new year and a nationwide introduction later in 2010. It is working with handset manufacturers to develop devices that can support the new service.
HD voice provides better audio quality thanks to a wider speech bandwidth. Explaining the service, Orange says: “High definition voice doubles the spectrum devoted to the spoken voice, making it possible to transmit all the nuances of the human voice.” It also fades background noise to provide clearer conversations and even if only one of the two phones in a conversation is HD-enabled, the sound quality will still be significantly better than it is now, the company claims.
The Orange announcement comes just days after rival network O2 apologised to customers who could not make phone calls because its London network was overwhelmed by smartphones such as Apple’s iPhone.
Analyst Ben Wood, at telecoms consultants CCS Insight, said Orange would be looking to use its HD voice service to tap into reports of customer frustration with O2. “This underlines our belief that quality and performance will be key battlegrounds among the UK network operators in 2010,” he said.
“The iPhone has emerged as the catalyst to a renewed focus on network quality, performance and coverage; HD voice is another tool in that battle. Orange is bound to use this to compete with O2” Orange launched the world’s first high definition voice service for mobile phones in Moldova in September. It chose the country because its network is state of the art, having only started in 2008.
The British launch follows two years of “considerable investment” in its mobile network, says Orange. It has sought to differentiate itself in Britain’s fiercely competitive mobile phone market by flagging up its wide high speed 3G coverage. When Orange started selling the iPhone last month, ending O2’s two-year long exclusive grip on the handset, rather than try to secure new customers on price it attempted to lure customers on to its network on the promise that it has better coverage than any of its rivals.
Prices for its HD calls have yet to be set and it is not yet known whether they will cost more than standard calls or if Orange will use the higher quality promise to differentiate itself from rivals. In Moldova the cost of calls did not change when the HD service launched
Google has invited journalists to an event next Tuesday, prompting speculation that they will announce the launch the Google Nexus One mobile phone. The Google Nexus One is the first mobile handset designed entirely by Google. The phone runs Google’s Android operating system and the hardware was designed in collaboration with HTC.
The invite says: “With the launch of the first Android-powered device just over a year ago, we’ve seen how a powerful, open platform can spur mobile product innovation. And this is just the beginning of what’s possible.” Since details of the phone emerged earlier this month, rumours suggested that it would go on sale in early January. Rumours on gadget blogs today suggest that the phone will go on sale in the US on January 5. There’s no word yet – even as a rumour – about whether the phone will be available in the UK or whether Britons will have to wait to get their hands on it.
Gadget blogs are also quoting leaked documents saying that the phone will be available unlocked for $530 (£334) and for $180 (£113) as part of a contract with T-Mobile. The unlocked phone will work on any GSM network, allowing users to simply insert their SIM and start using the phone. (As Ron Maltiel points out via Twitter, the Nexus One won’t work on every network. CDMA networks, such as Verizon, don’t use a SIM so the phone will not be compatible.)
Again, there is no word on UK pricing or which network, if any, will supply a subsidised version of the phone. Google has so far declined to comment on rumours about the Nexus One
The British government’s plans for providing fast broadband internet connection to each and every British household by 2012 have run into a major roadblock. Britain’s telecom giant, BT, has threatened to take legal action against the government if it goes ahead with its plans to liberalise the country’s mobile phone spectrum.
According to the plans under the “Digital Britain” scheme, the government plans to provide universal broadband access of at least 2mbps to every household by the time the London Olympics begin. However, in order to provide universal access, changes have to be made in the way UK’s five major mobile networks distribute the airwaves between themselves, so that they are able to offer mobile broadband services in rural areas where fixed line broadband is extremely slow.
The universal access will also require the sale of new space on the spectrum that will available when the analogue-TV network is switched off in 2012. BT has sent a “letter before action” to the business secretary Lord Mandelson in which the company has asked the government not to use the soon-to-be-available spectrum for to serve this purpose and has threatened to take legal action if the government goes ahead with these plans. The company believes that the government is granting unreasonable subsidies to the mobile phone companies because if these plans go-ahead, they will have their 3G licenses extended indefinitely.