Turkish 3G Mobile Operators Move Quickly to Restore Service After Floods
I landed in Istanbul the night the rain began to fall. By the next morning, Istanbul had experienced its worst flooding in 80 years. Many parts of Istanbul were underwater, more than 20 people were dead, and several of the leading telecommunications providers had service interruptions, as floods destroyed equipment rooms. Dilithium was asked to quickly re-supply equipment as service providers are in the midst of 3G launches with attendant multimedia services.
Istanbul is steeped in history with the first settlements dating back to 6500 BC. However, today it is a modern city with a very well developed telecommunications infrastructure. Turkey is the 5th largest telecom market in Europe and one of the 15th largest markets in the world, with nearly 100% mobile penetration rate. It is a very competitive market and due to this fact and mobile saturation, service providers are racing to offer multimedia value added services as a way to differentiate their offerings and attract new customers and new revenue sources.
The major service providers are aggressively pricing multimedia services equivalent to voice pricing, as well as offering bundled voice, data, and video plans, with some premium options. The lead applications include Facebook mobile apps, portal access, mobile tv, video mail, and video conferencing. With relatively low internet and broadband penetration in Turkey, mobile phones will be the key to accessing content from the web.
Live Video Casting – the New TV
Imagine being the owner, executive producer, director, actor and programmer for your own live TV station. Stop imagining. No, the FCC didn’t offer you a free license to operate neither did Rupert Murdoch just toss you the keys to one of his TV channels. You are now streaming your video content live on one of the available channels on such web services as LiveStream, Ustream, Stickam and Justin.tv to the entire world. Not much capital investment needed (3G phone or webcam) and no license to operate required. Live video casting is not new to the internet but what’s new is that 3G technology expands the boundaries to provide and view content anywhere anytime.
This isn’t blogging – this is live which is quite a different social dynamic. For example, you’re a talented musician and want to get your material recognized. By advertising a free live concert with the service provider, you perform and people can see your raw talent knowing there has been no editing to fudge the performance. Not everyone is plugged in to a broadband connection because they’re at the local pub but 3G puts the performance in your hand. Of a more corporate nature, a CEO wants to address all his employees with the latest company news. Some of his employees are at their desks and others are on the road with their 3G handsets. An announcement is sent out that the boss wants to address the entire company and you can tune into www.livevideocast/XYZcorp at 1PM and he’ll also field the IM questions you may have. Or perhaps there’s that once in a life time event – your 5 year old daughter is performing her first ballet recital and you have family that can’t be there because they live all over. Imagine the joy your daughter will have when she knows grandma, grandpa, aunty May, uncle Buck and all the cousins are watching her live. People can host their own cooking shows, sitcoms, provide coverage for their son’s little league final (CBS didn’t want to pick up the rights) or offer a home improvement show with advertising for carpenter services. With 3G, you can view or stream live from anywhere. All these scenarios have recording options as well.
For a provider of live video casts, the opportunities for some sweet moolah are as limitless as the imagination. There’s the advertising, airtime, recording fees, etc. How people watch video has change considerably in the last few years. How they watch live video is about to change thanks to live video casting value added services and 3G.
Good Morning Vietnam
As I rolled out of the airport on my way to downtown Hanoi, the rice paddies and lush green vegetation were familiar images from the past. Vietnam is peaceful and thriving these days, but as you get closer to downtown Hanoi, it is clear there is a new war going on – and the weapon of choice is mobile phones. Vietnam has a population of nearly 90 million, and while 75% still live in rural areas, the country has more than 80 million mobile phone subscribers, with many people holding multiple numbers. Eight service providers are battling for the hearts and wallets of the people of the Socialist Republic of Vietnam. The rural areas are largely untapped, which means that many city dwellers have multiple phones and subscriptions.
A throng of motorcycles and bicycles choke the bustling streets of Hanoi, and the drivers have one hand on the handlebar, and the other on a mobile phone pressed to their ears. While these drivers are making voice calls as they drive, Vietnam, like India and the Philippines is dominated by non- voice traffic, particularly SMS. This is why the next battleground in Vietnam revolves around the imminent launch of 3G Value Added Services, as it will be a natural for consumers to migrate from text to multimedia services.
Multimedia services such as live TV, portal access, video ringback tones, video blogging, and video surveillance will be rolled out over the next 6 months initially in Ho Chi Minh City, Hanoi, and Da Nang, and then nationwide. Smartphone and netbook vendors as well as VAS providers are elbowing for position, as Vietnam is one of the top 15 most populous countries in the world. While inflation has recently become a problem and slowed the high growth rates of the last few years, the outlook remains strong and growth is still projected at 5%+ this year.
In Vietnam, the government controls the service providers and has granted four 3G licenses: Mobifone (mostly state owned by Vietnam Posts and Telecommunications Corporation), Viettel (run by the military), Vinaphone (which will be the first to launch and is also state owned), and a joint venture between Hanoi Telecom and Electricity Vietnam Telecom. Expect fierce competition between these four operators as they compete to hold existing subscribers and capture new ones through the offering of a range of multimedia services at very competitive prices. Subscriber growth is booming, but ARPU continues to drop sharply. Vietnam is poised to become one of the largest mobile markets in Asia, as well as one of the most innovative.
Global and Local Market Trends
When people talk about the latest market trends with regards to multimedia, they often speak in terms of global or macro usage. One of the things that we have seen is that while there are broad changes and usage patterns for video services that are driven by devices, networks and applications, most of the real news comes from individual markets.
From a global perspective, we can look at the increasing number of 3G subscribers and especially relative to the total number of mobile customers. The percentage of 3G subscribers is almost reaching 20% which is the point where people start to say there is a tipping point. New smartphones from iPhone to G1 to RIM’s Blackberry are showing people how easy it is to access quality video on a daily basis. Prices for these services are generally falling and all-you-can-eat pricing plans are making multimedia more accessible to the masses. New codecs such as H.264 are providing a near-HD experience which helps to promote increased usage.
Then we have the local markets driving local services. It’s easy to point to India and China where more than a billion people will eventually have access to next-generation mobile broadband, and their networks are being built out now – but these services are yet to be launched – though there are high hopes. We see very specific applications tailored to a country in markets such as the Middle East and in South East Asia. There are also cultural norms that have be followed – including the allowance of adult services in Western and Northern Europe (UK, Germany, Switzerland, Austria for example), which would obviously not be permissible in countries such as Saudi Arabia, Kuwait or Bahrain.
What do you think and see? Which markets are truly leading this revolution? How much do global trends apply to local markets?
Growth of Mobile Services in India
Since I joined Dilithium Networks in June, in the exciting field of mobile video, I have had a chance to reminisce about my 15 year on and off association with the telecommunication industry in India from a vendor perspective.
Going by the saying “numbers never lie”, the growth in the mobile space has been mind-boggling. By 2010, India is expected to have 500 million mobile subscribers, growing at the rate of 10 million new subscribers a month. 40% of these subscribers are expected to use their mobile phone for something more than just making a basic call. The cost of making a mobile call is the lowest in the world and mobile devices are expected to be the primary device for internet access for a big section of the population.
The auction of 3G licenses in the 2H,09 is expected to provide a major boost to mobile video and related value added services (VAS) that are unique to the socio-economic set-up for the cost conscious Indian consumer.
One of the big challenges facing India is the inadequate power/electricity production, where rural areas receive less than 8 hours of powers a day on average. Since television cannot be turned on for most of the day, mobile devices are expected to provide back-up entertainment as well – from watching cricket snippets and getting the latest scores in a cricket crazed nation, to watching news or getting the latest on the ongoing soap operas.
Mobile video and VAS are also expected to play a major role in the small business and services sectors. Some possibilities include: construction contractors making a video call to their sub-contractors and monitoring progress from their phones rather than visiting each of their sites everyday; plumbers rather than visiting multiple shops for parts can make video call to check out the available choices; farmers can call experts and show them field conditions and get advice without traveling; explaining medical conditions to experts in the cities… the possibilities are endless.
The way to I think about it is that the pipes for mobile infrastructure are ready. The next step for the service providers is to enable video and VAS that are relevant in the context of India’s socio-economic set up. The mobile revolution is just beginning in India……..tighten your seat belts and get ready for the ride.
Hottest Video Applications
For several years now, we’ve been in discussions with service providers, value added resellers, partners and content owners on what multimedia applications customers want. We’ve further defined this into not only what customers want, but what they are willing to pay for, actually use, and the revenue potential to providers of these services. What has become very clear is that the list of these services has continued to grow on a global, regional and local level, and the expertise in developing, marketing and pricing these services.
In the “early days” of 3G networks (think 2003-2005) there was a lot of talk around person-to-person and related services. These included video telephony, video mail and video conferencing. One of the issues that quickly emerged was the “fax machine” syndrome – one needed someone else to video call, and the amount of 3G subscribers compared to 2/2.5G was very limited. Also, video quality given mobile phone codec capabilities was less than optimal, pricing and tariffs were too high, and there was no way to know who had video services or who was on-line. Since then, network capabilities including Video Call Completion to Voice (VCCV) and presence using IMS have greatly increased the potential usage – but we have also seen the extreme take-off of other machine-person services.
While video portal and video streaming were available also from the beginning of 3G networks on circuit and packet access, we have seen the massive take-off now of video blogging (uploads and download access), live TV streaming and video push of personalized video clips. While we’ve seen some traction for video/multimedia ringback tones – especially in Asia – this is a market that is still emerging being as it is dependent on person-to-person video calling and cultural norms.
So … what do you see as the hottest and most used video applications? How are they being used today and what do customers want most in the future? In other posts you can find more information about multimedia applications and how they are being marketed and sold today.
Multimedia Market Trends
The world of mobile multimedia has been around largely since the launch of the first 3G networks ten years ago in Japan. During this time more, than 100 operators and service providers have sold video services to their subscribers and a number of trends are starting to emerge, especially during the past year.
While it is easy to throw out words such as personalization, social networks, and communities of interest – there is little consensus on what this means for multimedia services to mobile phones, PCs, and televisions (the three-screens). However, we are seeing massive take up currently in all kinds of new video services to both 2.5 and 3G handsets.
A number of factors contribute to this market increase including: easy-to-use, simple and great video quality smart phones (think iPhone e.g.), better pricing by service providers, and even a good degree of marketing to promote these services.
Multimedia market trends is a very broad topic and we will be writing much more about this in the coming weeks and months. For now, suffice it to say that we believe the market for multimedia across broadband and mobile is taking off now!
So what will the next 18 months bring for video services? Which kind of services will people be using? What macro economic and social trends are coming that will drive new services?
Mitch Lewis – video interview
Mitch Lewis discusses the market for video services, and the barriers to mass market adoption, with Telecommunications International.