HONG KONG--The number of new mobile users and devices may be growing by the dozens every minute, but the number of mobile applications developed for enterprises continue to trickle in--at a snail's pace.
Motorola Chairman and CEO Edward J. Zander said Tuesday that "the next 10 years is about mobile Internet", and where many users worldwide will access the Internet for the first time via a mobile device.
During his keynote address at the American Chamber of Commerce IT Leadership luncheon, Zander said it took over 20 years to get the first billion mobile users, and only three years to reach the second billion. According to market projections, the next billion will be reached within the next two years, he said.
He added that while four newborns are added to the world's population every second, 25 new mobile devices are purchased at the same time.
Zander also said that bandwidth capacities are increasing, mobile infrastructures are now getting upgraded and moving to an Internet Protocol platform, and everyone--and every thing--is getting connected to each other.
To tap on the growing mobile market, mobile operators and device makers alike have been feverishly touting the benefits of high-speed mobile networks and emerging wireless technologies such as WiMax, 3G (Third Generation), HSDPA (high-speed downlink packet access) and IMS (IP multimedia subsystem).
However, much of the marketing activities and services on high-speed mobile networks have so far been developed and targeted at consumers.
Navin Mehta, Motorola's vice president of applications services, networks and enterprise, said Tuesday in an interview that there was "some truth" in market observations about the lack of mobile applications being developed for businesses.
Cisco Systems CIO Brad Boston, in his speech the 3GSM World Congress in Barcelona, Spain, held early this year, had said that he was stunned to see exhibitors at the show focusing mainly on consumers instead of the enterprise market. Boston is currently the company's senior vice president of global government solutions and corporate security programs.
He related how hard-pressed he was to identify mobile applications developed specifically for enterprises when he initiated a workplace strategy for Cisco's employees. Boston noted that his counterparts in the industry faced the same challenge.
The Cisco executive added that his team ended up building several applications on their own by piecing together various programs and components.
The landscape remained unchanged some months later at CommunicAsia.
According to Motorola's Mehta, much of this is the result of operators focusing most of their attention on consumers and on driving consumer entertainment applications.
Indeed, device makers and mobile operators have been keeping a hectic schedule in the past year, launching multi-colored devices designed for the fashion-conscious and mobile phones that double up as audio players and cameras, and rolling out consumer-targeted applications and services such as mobile TV and ringback tones.
In fact, Informa predicts that the global mobile entertainment market will be worth US$23.1 billion in 2007 and US$38.1 billion by 2011. Gartner also estimates that the number of IPTV subscribers worldwide will grow from 13.3 million next year to 48.8 million in 2010.
Despite the potential returns that can be found in the consumer market, Mehta believes that business mobile applications are "just starting to emerge" even if it is still at an early stage. He added that operators will realize that they need to start looking at this market segment in order to sustain their investments in the long run.
Sorting out relationships
Apart from that, operators will also be kept busy trying to work out new business relationships--and challenges--that are likely to emerge from the new converged infrastructure and marketplace.
Yen Tseng, Motorola's Asia-Pacific vice president for network services and application management, networks and enterprise, noted that the "lines are blurring" in an environment where telcos could also play the role of the traditional broadcaster or the bank by providing services such as mobile TV and m-payments.
But that poses several questions. For example, he said, which party deserves a bigger share of the revenue in the provision of mobile TV services--the content provider or the telco? There are also other areas that need to be addressed such as copyright issues, he said.
According to Chris Lewis, enterprise practice leader at analyst company Ovum, it is no longer simply about entering a new era for the telecoms industry but rather, an entirely new industry.
In a recent research note, Lewis said the US$1.4 trillion telecoms market is "now rubbing shoulders" with the IT and media markets, and together, the three market segments--telecoms media and technology (TMT)--are worth US$4.1 trillion. Of this, Ovum estimates, US$1 trillion will be contributed by the "true converged" component of the new market.
"Putting telco activity into this sort of context, where [there are] no guarantees where revenue will come from, means that several scenarios for the next generation of telcos exist," Lewis said. First, he suggested, the telco could move into consumer media and business ICT services in order to extend its reach into applications and content development.
Second, it could end up playing the primary role of a wholesaler of communications services. Third, in what Lewis dubbed the "eco telco", telcos could work through an ecosystem of partners "to build the appropriate consortium [of services] for a particular client".
Mehta noted that it will take time for new relationships to be formed and new business models such as revenue-sharing structures, to be sorted out. "At the end of the day, [the various players will realize that] the customer is only willing to pay so much," he said.
Until then, Motorola has taken to working with operators that have businesses across various market segments such as content distribution and Internet services, and are therefore, able to immediately engage in trials without having to worry about issues such as copyright infringement. This way, Tseng said, the company can get in the game early, learn from the trials and transfer the experience to other markets worldwide.
Eileen Yu of ZDNet Asia reported from Hong Kong.
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