13 July 2012
Call of the smartphone
- report from CommunicAsia and BroadcastAsia 2012, Singapore
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| Smartphones to the fore. |
The new services include "Over the Top" (OTT) offerings: OTT essentially provides value-added services sitting on top of basic telecom services and machine-to-machine (M2M) communications. M2M means connected devices talking to each other without human intervention.
The revenues generated are not to be ignored, and they don't necessarily go to the telecom companies. "Last year, value-added services (VAS) generated US$125 billion. In 2020, this is expected to triple to US$420 billion," said Oliver Johnson, CEO of UK-based Point Topic.
By 2020, Internet Protocol TV (IPTV) will be the leading service, overtaking Voice over Internet Protocol (VoIP), said several experts.
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| Mobile strategies discussed. |
In Q4 2011, China became the top IPTV market with 16.5 million subscribers. "China is the fastest growing market by far for IPTV, adding three times as many subscribers in Q1 this year than anybody else," said Robin Mersh, CEO of Broadband Forum.
In addition, New York-based ABI Research predicted that in 2015, US$119 billion-worth of goods and services will be purchased on a mobile phone.
UK firm Juniper Research forecast that by 2014, mobile payments will reach US$630 billion. Consulting firm Analysys Mason predicted that M2M revenues will increase from US$5.7 billion in 2011 to US$50.9 billion in 2021.
The smartphone is also the driver. Aliza Knox, Managing Director of Commerce for the Asia Pacific arm of US-based firm Google, said: "by 2015, one of every two smartphones in the world will be in Asia. Asia is taking up smartphones, tablets and other mobile devices faster than anywhere else in the world, supplanting computers as the primary device."
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| Knox: Asia goes mobile faster. |
China is said to be already the world’s largest smartphone market, accounting for one in three of the handset on the global sector. In Singapore, half the mobiles are smartphones, reportedly offering the world’s highest penetration.
Technology shift
Suresh Pinto, Director and CEO of the US business communications company, WaveNET, said: "the technological shift means that rather than providing calls and data, telecoms are now a platform for other players." He warned that: "many industries have gone bust by failing to define their business in light of technological change."
"For example Kodak [the iconic US photographic company] used to think its business was selling photographic film, rather than capturing images, and missed the transition. Telecom companies need to define their business from their 'connectivity pipe' to their 'rich interactive experiences'."
For Michael MacDonald, CTO of the Chinese mainland firm, Huawei, believed: "the growing popularity and power of OTT services are eating into the revenues of telecom companies. They still have a role to play beyond simply providing bandwidth, but finding that role begins with understanding what OTT players want."
The way forward for telecoms is to "focus on their core assets and capabilities, and develop simple and open application processing interfaces (APIs) and help integrate OTT developers into their network."
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| Focus on telecom strategies. | Deal making at CommunicAsia. |
Sandeep Lal, Managing Director for the Development Bank of Singapore, believed that mobile commerce really took off last year, due to smartphones. In 2009, for example, e-Bay did US$1 billion of transactions. By 2011, this jumped to US$4 billion.
As well, PayPal jumped from US$1 billion to US$3 billion and may reach US$7 billion in transaction revenues this year. "Consumers now have a 'mall in their pocket', and I believe the next area of growth will be in proximity payments, which again, is mobile dependent," Lal forecast.
Hong Kong's fibre attractions
The increase in mobile apps means more bandwidth, which in turn will see an increasing adoption of fibre-driven technologies, could provide as much as a 1GB pipe to homes and offices.
Craig Thomas, Head of International Marketing for Calix – said to be the largest fibre provider in the US – plans to replicate that success in Asia. "We have over a thousand customers worldwide. Five years ago it was [for] about 80% copper. Now we are seeing between 70% and 80% of telecoms [require] a mix of copper and fibre. Across Asia, fibre is the means for the entrepreneurial to bypass traditional telecoms."
Thomas said that the corporate "race" is to be the first to install fibre systems, because the cost factor prevents a second operator.
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| China is leading fibre-to-home market. |
Fibre is fine for urban areas, but for rural coverage the answer appears to be satellites. The world's largest satellite communications providers include Luxembourg-based SES, which will launch its sixth satellite to cover the Asia-Pacific region in Q1 2013, adding to its global fleet of 50.
SES is one of 100 satellite companies at the event, with the others including Hong Kong-based Comba and Sinosat.
"The best way to link up remote locations is via satellite," said Ken Man, Corporate Marketing Director for Comba. "It's cost effective, robust and scalable. Hong Kong and [the Chinese mainland] remain our focused markets, with Latin America and the Middle East as new growth markets."
"Sinosat has a fleet of eight satellites and will launch two more by next year," said EZ Gao, Vice President of the company. "Our new growth area is in providing maritime communications for ships and installations far out at sea. We are seeing strong interest from partners and customers; we intend to provide for the world's busiest shipping lanes, from the Bay of Bengal to the coast of Africa and the Middle East."
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| Gao: strong interest in maritime satellites. | Satellites an issue at BroadcastAsia. |
Although smartphones are seen as a key industry driver, only two comparatively smaller players were present, being China-based Huawei and ZTE.
This was unlike last year where huge players such as Nokia, RIM and Samsung chose the event to launch their new products.
Said Paul Michael Scanlan, Vice President of Solutions, Sales and Marketing for Huawei: "this year we have no technology on display. Our focus is on devices and enterprise solutions. We are a US$32.5 billion company that nobody knows of; we are extending our brand with a focus on affordable, high quality consumer products and on services."
Huawei is unfazed by the economic uncertainties ahead. "We had a healthy 12% growth last year, while the target this year is for 20%. We sold 20 million smartphones last year, this year we expect to sell 60 million."
Scanlan said the company spends 12% of revenues on R&D, and has its own chip sets. "This allows us to build better hand phones and add value."
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| Scanlan: unfazed by economic uncertainty. | Showcasing Huawei's latest smartphone. |
Today, Samsung is the world's no 1 mobile company; Huawei has said its goal is to overtake Samsung by 2015.
So, with all that is happening in the industry, how does the customer fare?
For Rob Tarkoff, President and CEO of Lithium, a social media solutions company, "you have customers connected every moment, are easily distracted, expect instant gratification, multi-task, and don't believe what companies tell them. Are your systems designed to handle that?"
Tarkoff advised companies to acquire their audiences from all avenues, as there's no certainty which social platform will grow and which will fade. The next step is to move beyond ‘like' to engagement.
The two tech shows were held from 19 to 22 June at the new Marina Bay Sands Singapore and at Suntec City Convention Centre. The event saw a slight decrease in size and attendance from last year to just fewer than 2,000.
from special correspondent Ronald Hee, Singapore
| Contact: |
| Company | Tel/Fax/Email/Web |
| ABI Research | Tel: (1) 516-624-2500, (1) 516-624-2542 Fax: (1) 516-624-2501 Web: http://www.abiresearch.com |
| Analysys Mason | Tel: (65) 6493-6038 Email: singapore@analysysmason.com Web: http://www.analysysmason.com |
| Broadband Forum Robin Mersh, CEO |
Tel: (1) 336-288-8013, (1) 510-492-4020 Fax: (1) 510-492-4001 Email: info@broadband-forum.org Web: http://www.broadband-forum.org |
| Calix Craig Thomas, Head of International Marketing |
Tel: (1) 707-766-3000 Fax: (1) 707-283-3100 Email: craig.thomas@calix.com, info@calix.com Web: http://www.calix.com |
| Comba Ken Man, Corporate Marketing Director |
Tel: (852) 2116-6024 Fax: (852) 2116-6055 Email: ken.man@comba-telecom.com Web: http://www.comba-telecom.com |
| Juniper Research | Tel: (44) 1256-830-001, (44) 1256-475-656 Fax: (44) 1256-830-093 Email: info@juniperresearch.com Web: http://www.juniperresearch.com |
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Lithium Technologies |
Tel: (1) 510-318-7010, (65) 6408-0710 |
| Point Topic | Tel: (44) 20-3301-3303 Email: info@point-topic.com Web: http://point-topic.com |
| SES | Tel: (65) 6593-3600 Fax: (65) 6593-3610 Web: http://www.ses.com |
| Singapore Exhibition Services Pte Ltd | Tel: (65) 6233-6638 Fax: (65) 6233-6633 Web: http://www.sesallworld.com, http://www.communicasia.com, http://www.broadcast-asia.com |
| Sinosat EZ Gao, Vice President |
Tel: (852) 2110-3506 |
| WaveNET Suren Pinto, CEO |
Tel: (94) 117-526-044, (94) 117-526-000 Fax: (94) 117-526-099 Email: suren@wavenet.lk, info@wavenet.lk Web: http://www.globalwavenet.com |
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