Wireless Generation Gap

The wireless industry must think beyond the present to make enterprise gains.

Remember attending a rock concert and "flicking your Bic"? The sea of flames was a sight to see. Today, however, no one is flicking—theyre clicking. As I saw at two concerts at the recent CTIA Wireless conference, the flash of Bics has been replaced by the glow of the Sanyo VM4500, the Motorola V400 or the Samsung E715.

Arms in the air, fans grabbed pictures and video clips of Train and Alanis Morissette in crystal clarity to send to their friends. I couldnt help but think about friends sneaking in cassette tape decks to bootleg a show. It wont be long before whole concerts can be recorded onto a single handset.

This new "flame" is not lost on Steve Largent, the former NFL star wide receiver who is the new CEO of CTIA, the wireless advocacy group and conference host. Wireless is going to be "the third screen in peoples lives, right behind the TV and computer screen," Largent predicted during his keynote address.

The growth is certainly there. There are now 163,000 cell sites in the United States, up from 13,000 10 years ago, Largent said. In that same time span, industry revenue has grown to $87 billion, up from $12 billion; subscribers have grown to 160 million, from 16 million. More camera phones (75 million) were sold last year than stand-alone digital cameras (50 million), Largent said.

The problem: The fastest-growing wireless-related add-on service is ring tones, including ring-back tones, which Largent pins at $3.5 billion worldwide, or 10 percent of the recording industrys annual revenue.

The ring-tone business has little to offer enterprises that are desperate for productivity gains. Thats why the news is welcome that wireless carriers such as Cingular, Verizon, Sprint and T-Mobile are embarking on new partnerships with handset makers and software developers to deliver enterprise applications.

The carriers, or "operators," as the handset and software partners like to call them, have been slow to involve such partners, but fear of being marginalized as "bit pipes" has spurred the carriers into involving the experts to develop sales force automation and similar applications for mobile professionals.

Still, the enterprise is not a main focus of any of these players. Much of the talk at CTIA Wireless was about what is the "killer app" of mobility. For now, that app is still just "talk," with a little e-mail or text messaging thrown in.

Another mobile application is "location, location, location," said Alan Gatherer of Texas Instruments. "Location in terms of being able to know where you are, have the phone [know] where you are, tracking weather and traffic." This knowledge is nice, but it doesnt generate enhanced productivity for many enterprises.

What consumers want from wireless now is personal convenience, a fashion accessory and cachet with the hip crowd. FCC Chairman Michael Powell is right when he says we are working to build out wireless mobility, ubiquity, convenience and reliability for when todays teens enter the work force, perhaps five years from now. Thats when there will be a true demand for making mobility an inseparable part of the enterprise.

Thats about how long it may take to get the networks and other infrastructure ready. As networking pioneer Bob Metcalfe noted at the conference, network integration of cellular, wire-line, cable, satellite and the Internet is key, but it will take some work.

"IP needs to be fixed," Metcalfe said, pointing to IPv6 as a remedy. Also on his to-do list are security, quality of service, billing and spectrum. "Internet invaders view spectrum as the incumbents withholding technology," Metcalfe said. "The good news is that the FCC has a good attitude about liquidity and spectrum."

For all the bright spots of the future, theres much work to be done to get there. In addition, each new advance of technology brings new problems, as we see from todays camera phones, which are beginning to be banned from corporations that want to protect sensitive information. "As bandwidth goes up, the file sharing of video will also go up," Metcalfe said. "And Hollywood is doomed."

News Editor Scot Petersen can be reached at scot_petersen@ziffdavis.com.

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Scot Petersen

Scot Petersen

Scot Petersen is a technology analyst at Ziff Brothers Investments, a private investment firm. Prior to joining Ziff Brothers, Scot was the editorial director, Business Applications & Architecture,...