Elmatador infamous Machiavellian Plan to take over data over Wireless.
This is the Plan I was talking about last Aug./September.
I. Executive Summary
The blueprint for the implementation of 3G networks has not yet been written. The technology is in a trial stage. It is doubtful that there will be money to cover the costs of constructing 3G networks as initially planned.
Operators spent 130 billion Euros to keep competitors from entering their existing telephony-SMS markets. These costs start to look more as a protection for their existing markets rather than a sign of the potential future business in mobile wireless data. Initiatives of vendors and operators –WAP and GPRS- are proving harder to show the initially envisaged success. Mobile data is losing its credibility by the day in a series of disappointments and postponements.
Operators are now under pressure to justify the purchase of spectrum to defend their revenue streams and this is hurting their balance sheets. European mobile infrastructure vendors are also in no better shape. 2G markets reached saturation and presently only developing countries remain as a source of revenue. Mobile terminals market is shrinking by the day.
Vendors, regulators and operators have to act. The European Commission already cleared the way for this next move. The European Commission is starting to relax the rules to easier the way for 3G operators deploy networks. To alleviate the financial burden the European Commission has recognized that and what to get “the future regulatory framework right”1
Meanwhile a new breed of unlicensed wireless LAN (W-LAN) operators is springing up. Using equipment based on the globally accepted 802.11b W-LAN (WiFi) standard, a group of largely US and Scandinavian upstarts are racing to roll out short-range, high-speed data access points for business travelers in North America, Europe and the Asia-Pacific region. Because these new systems operate in the 2.4GHz waveband they do not require a license. And because they can offer data rates of up to 11Mbps to wirelessly-enabled laptops or PDAs within 150 feet of any access point, they are threatening to become a thorn in the flesh of traditional mobile service providers.
Competing WLAN technologies threat to render the original 3G concept obsolete even before it starts.I WLAN technology has evolved and matured in the last years and are the best solution to start real networks. It is unlikely that mobile vendors and operators will let a new set of unregulated competitors offering wireless data connections at much higher speeds than the mobile operators could ever hope to achieve. WLAN shows a viable alternative for European operators to kick off 3G by integrating Wireless LANs (WLAN) technologies into 3G and start its rollout. Barriers of entry have been lowered.
Transat Technologies have brought to market a solution that enables GSM/GPRS operators to terminate their services on Wireless LANs. Now it is possible to change the model.
The strategy was to build, in this order, Macro, Micro, Pico cells. The model based in WLAN is: Pico, Micro Macro Cells. Pico cells are WLANs. Besides for WLAN the terminal is already here. The PC that has always been mobile: The Lap-Top.
There is a window of opportunity for operators to profit from deploying WLANs. It has not been made public how crucial commercial buildings are for the success of 3G and mobile data networks. Potential users are concentrated in those valuable high traffic areas. This and the fact that frequencies used have short range of reach and are subject to interference, force the deployment of mobile data infrastructure to be placed indoors. For in-building mobile data access, operators have to deploy micro and pico cells right into the commercial buildings to cover it perfectly.
According to the Financial Times: "Each operator's total network could be 15,000 cells or more.... Contrast this with GSM, where a typical network operator today might have 5,000 cells after nearly 10 years of operation". In 3G, the majority of those cells will be indoors pico and micro cells.
Operators own the spectrum used but do not own the commercial buildings where the most attractive users are located. Neither is in the interest of operators to highlight this since it would increase the costs of acquiring those site valuable sites needed to deploy mobile data systems. But it is in the interest of real estate developers and owners of those properties to leverage them in the market for mobile wireless data.
Cesky Mobil can capitalize on the interests of the real estate, owners of commercial buildings to help them profit from mobile data. By creating this community of interests, it will position itself ahead of the competitor’s non-declared intentions of locating base stations inside commercial buildings. It will take over the infrastructure that competitors will target when they start rolling out 3G networks. It will enhance Cesky Mobil’s presence in the market if those cyber-savvy real estate companies, owners of the most valuable high traffic areas, are part of the community of interests enabled by WLANs. In doing so we will corner the future market for mobile data services.
Cesky Mobil, will seek to sign exclusive agreements with the owners of the high traffic area’s premises. When the competitors start rolling out 3G, they will find these agreements already signed. In order to deploy they will have to come to Cesky Mobil to co-locate their equipment into these premises. Cesky Mobil will be well positioned to negotiate sharing agreements with every single competing operator in advantageous terms. Alternatively Cesky Mobil could consider entering into a revenue sharing agreement with Mobile Virtual Network Operators (MVNO) if they appear in the competing landscape.
The value of those assets, the portfolio of lease agreements of this business is clear. They are the only places where the base stations can be placed. It has value for operator that acts ahead of the pack. |
