Mike,
re: QCOM: Competitive Technologies - Christensen & GPRS - GPRS Status
<< The one point I thought was humorous is that a person asking questions and Christensen made the mistake of referring to the longevity of GPRS as if GPRS is a commercial product in use. >>
Not to nitpick, but ... GPRS is a commercial product in use.
You generally post with an enviable degree of precision.
Perhaps you should consider removing the "as if" when referring to the commercial status of GPRS.
I mean it's like software. Ya hear about Microsoft's NT5, and ya hear about it. The product slips right on the roadmap. and it slips right again. Beta 2 finally gets released and the 1st CD ROM is pressed. It slips right again. You almost give up on its ever being a "commercial product in use". Then, all of a sudden - Voila! - Windows2000 is on the shelves. Much later than expected, and impacting on many major and allied vendors and Mirosoft partners plans, but commercially available and in use none the less, even if not bug free, and lacking some of the plug and play that was promised and thet one might desire.
And so it went with GPRS ... and now so it goes with GPRS.
GPRS is now commercially in use, and it has been for a period of time, and now it is in use with commercial handsets and WIDS that are compliant with the latest 3GPP GPRS standards revision, and interoperable with a variety of different manufacturers infrastructure.
How many commercial handsets and WIDS that are compliant with the latest GPRS standards revision are currently available, you might ask?
The answer would be relatively few (just like it would be for 1xRTT), but it does include at least handset models from 2 major manufacturers - Motorola (the T260) & Ericsson (the R520) - and at least one special purpose WID from another - RIM (Blackberry). There may be more.
The Motorola & Ericsson handsets are all tri-band which means that they can be sold worldwide and are capable of both voice and data roaming in 171 countries including of course the United States. RIM has a model available for the Americas and another for overseas.
There are expected to be about 20 handset models or WIDS from at least 8 manufacturers available for this holiday season, and several modem cards from multiple manufacturers as well.
As of April 30, 2001, there were 65 "Live" or coming "Live" GPRS Operators. The status at that time was:
* Live & Commercial 44
* Live & Testing 19
* Implementing 2
Source: John Hoffman, Senior Director, Technology Evolution, GSM Association.
GPRS has been in use commercially with data roaming using GRX (Global Roaming Exchange) since November 2000. GRX data roaming has now also been successfully tested with compatible 3G WCDMA & GPRS.
GPRS was made "commercially available" (to use an old Qualcomm" term - long since expunged from their web site), in June of 1999 by BT Cellnet.
When GPRS was made "commercially available" by BT Cellnet, it was with prototype handsets kludged from 2G models, assembled to an early version of the GPRS standard, just like the limited quantity of 1xRTT handsets of a single model that were available (but not very available) in Seoul, last September 30. The initial handsets were in the hands of developers and friendly users in both cases, and not in stores, initially.
I have never favored the term "commercial availability" and I am generally able to distinguish when the term "commercial launch" as used in Press releases, is really a "commercial launch" by the standards of reasonably informed people, like the Korean Press for instance, which as late as February of this year was conjecturing when SKT would "commercially launch" 1xRTT, discussing the postponements of the planned "commercial launch", and the reason for same.
One can now say, that GPRS has not just "commercially launched", but is in the early stages of "commercial initial deployment", and will no doubt be legitimately in "commercial general deployment" by Thanksgiving at the latest, and will probably be in "mass deployment" by the following Thanksgiving.
GPRS handsets, like their 1xRTT counterparts will be WAP enabled, and will use the same version of WAP (1,2.1) which is pretty crummy (pretty crappy actually). Like their 1xRTT counterparts, they will evolve to WAP 2.0 when it is available, which may provide some relief. WAP 2.0 will include cHTML (borrowed from DoCoMo i-mode) and xHTML.
Shortly - if not initially - they will be Java enabled, and all will be capable of using Java SIM, like the FOMA card used in the new 'i-mode' today.
Why is all this important, and germane to this thread?
Because many of us hold Qualcomm, and consequently an accurate assessment of where GPRS is at is essential to assessing the short, medium, and long term value of our investment in same.
GPRS is a mixed blessing for Qualcomm shareholders.
On the positive side GPRS gets us to WCDMA (from which Qualcomm derives royalty and licensing revenue, and eventually chipset revenue) because it is the bearer service for WCDMA, without which there is no WCDMA.
In addition, multi-mode GSM/GPRS/WCDMA handsets ("promised" by Ericsson H1 2002, and "promised" by Nokia H2 2002) will allow GSM/GPRS subscribers to practically use WCDMA even when WCDMA infrastructure is relatively lightly deployed, and potentially much earlier than Dr. Irwin Mark Jacobs would have led us to believe (or believed himself).
In addition, there are many Qualcomm shareholders that believe that as a wireless access technology, GPRS is significantly inferior to 1xRTT. Certainly from the standpoint of access rates, and spectral efficiency, that is true.
These same individuals believe passionately that as a result, 1xRTT will show so well against GPRS, that some technology flips will occur, overlays will be added, and where the two technologies compete in the same geography that 1xRTT subscribership will increase disproportionately to that of carriers deploying GPRS, and that GPRS users will churn to 1xRTT carriers.
This remains to be seen, but it is a possibility (assuming commercialization of 1xRTT for GPRS and standardization of 1xEV followed by commercialization of same) and so represents additional potential upside for Qualcomm.
On the downside, GPRS is a competitive technology to CDMA, no revenue flows to Qualcomm from it, and despite the fact that research houses vary all over the place in their estimates of GPRS uptake, virtually all are in agreement that it will be the dominant wireless technology deployed in the world by the end of 2005.
As DoCoMo has shown with 'i-mode', practical wireless access to the internet does not require breathtaking speed, spectral efficiency, CDMA, or BREW.
This is why DoCoMo i-mode today has 24 million PDC users enjoying wireless internet access at 9.6 kbps as compared to KDDI/Au's CDMA WAP enabled EZweb which uses packet-switched data at 64 kbps.
<< Christensen made the case that 3G will be delayed because, like any radical technology, it gets deflected by incremental, sustained adoption of the existing product. He was referring to GPRS as the existing product. >>
GPRS is indeed the existing product, and yes. it does exist, and yes the current user base although small, is larger than that of the 1xRTT user base as of January 2001 end.
Its tardy arrival in full commercial garb will delay or at least retard the arrival of 3G, but since it is always on packet-switched, it will also eventually accelerate the acceptance of 3G products, and accelerate the development of products and service that will eventually insure the successful takeup of 3G as the wireless internet market gradually develops the need for higher bandwidth intensive applications..
Or as the helpful staff at WHL interpret:
Said differently, it might be a while until the wireless internet market requires the 384 kbps to 2.4 mbps offered by true 3G networks.
<< It was obviously important to Christensen that he make the point that he expects it to be around a long time. >>
You may recall that he devoted some time to the introduction of cellular technology (AMPS) to the world back in the mid-eighties here in the United States, and I assume that he is aware of the fact that here in the United States a full decade and a half later that analog AMPS is still the predominant technology, not digital TDMA and CDMA which were introduced here respectively in the early nineties and 1996. Its been around a long time. GSM with GPRS will be around for a likewise long time.
<< I wish he had made the point that no end user has adopted the product. >>
Why would he make a totally inaccurate statement?
<< That fact strikes me as very ironic >>
Indeed.
Best,
- Eric - |
