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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Tom Chwojko-Frank who wrote (42736)	5/24/2001 1:49:20 PM
From: Eric L	Read Replies (2) \| Respond to of 54805

Tom, re: QCOM BREW - A very comprehensive article by EMC Cellular << I find BREW interesting not from a technological standpoint (it's a mediocre platform for applications), but from the carrier's point of view. >> One of the most comprehensive articles I've read on BREW here: Message 15848376 I've asked Slacker711 who attended the recent developers conference to comment on its objectivity - given the source. EMC Cellular is very tied (contractually) to GSMA, but I generally find them pretty objective. << I have only seen vague ideas on how European carriers will monetize 3G and retrieve their investment in spectrum and infrastructure. (I'd love to see more info on this if anyone has references.) >> I do not have a slew of references but there was a rather positive (which is unusual) but very general view expressed in an article I clipped earlier today, about the 3G picture being less gloomy than some predict. Message 15847873 A ways back I clipped a whole series of more specific links to the Nokia thread to the role of applications development in the success of GPRS. I'll try to find them. Yesterday I did a 2nd listen to the Nokia CEO Roadshow (actually a first listen to the 2nd roadshow). If I heard Jorma Ollila correctly he said that Nokia has 400,000 registered Nokia developers in Nokia Forum. I intend to go back and verify that number is indeed what he stated. Regardless, Jorma made several points about the importance of the developer community ... and of course, likewise this holds for QUALCOMM and BREW. I happen to believe that Java (Java SIM, Java Phone) is going to be very important in the world of wireless mobile data (Nokia does too) and I am glad that BREW is complementary to it. Someone here (the good Uncle ?) asked a bit back if / how SUNW is making money on Java. I'd appreciate if someone might comment. Back to Nokia or a moment: Roadshow slides and webcasts are here. You might be interested in the portions dealing with the software and middleware side of things: nokia.com << Through BREW, Qualcomm has come out and given carriers and developers a slew of business models from which to run the applications. Each of those business models means revenue for all three parties. >> Looks like Nokia has a platform that will (potentially) make money for them and the carriers and the Club Nokia e-business thing could also do the same, Different approach but of course Nokia are in different businesses. << agitation about that control among some of the developers at the conference >> Potentially the same with Club Nokia. Developers v. Carrier v. Nokia. - Eric -

To: Tom Chwojko-Frank who wrote (42736)	5/24/2001 2:43:25 PM
From: Eric L	Respond to of 54805

re: Wireless Data Revenue Stream - A Lucent View << I have only seen vague ideas on how European carriers will monetize 3G and retrieve their investment in spectrum and infrastructure. (I'd love to see more info on this if anyone has references.) >> Excerpts from a LU presentation related to your question. I have not checked out the Lucent site to see if slides or whitepaper drilling deeper are available. >> Market Trends Impacting UMTS Networks e-searchwireless.com At an analyst briefing seminar in London on 11 May 2001, Lucent Technologies promoted its competences in UMTS and its outlook on the market. <snip> By way of introduction, the first area of discussion explored market trends within the UMTS market and identified two forces as having a key impact on UMTS network development and deployment: rapid market subscriber growth and increasing demand for information and data services. <snip> Sustaining strong worldwide subscriber and usage growth adds increasing strain on networks, whilst providing differential services to new segments such as the casual user and prepaid sector and multiplies network and support system requirements. Network voice traffic will continue to grow, with subscriber numbers forecast to increase linearly and average minutes of use per user (MOU) to grow exponentially. Accelerating data traffic growth will see the intersection between mobility and the internet. Increasingly discerning customers will demand internet speed, flexibility and cost combined with landline-like quality, reliability and ubiquity. IP-based multimedia messaging, information services and mobile commerce are expected to become lifestyle tools. The migration towards 3G services is expected to improve average revenue per user (ARPU), which in Europe has more than halved from $63 per month in December 1997 to $30 per month at the end of March 2001 (source: EMC). <snip> Mobile internet services to maximise operator revenue Lucent put forward their stance on revenue allocation and profit maximisation for next generation mobile services. Considering the process of locating a cinema (using a city guide), accessing its home page to study listings and purchase a ticket and viewing a one minute preview of the film, an estimated total of 2760Kbit of data would be required. The vast majority of this data (2500Kbit) would be required to view the preview, although low data speeds and resulting inferior picture quality means that this service would be unlikely to happen before UMTS. The migration from GPRS towards full 3G services however will see costs to consumers fall as airtime is reduced through increased data speed and data size is minimised as a result of improved compression techniques. In this example, Lucent foresees the network operator receiving 80% of airtime revenue, with the remaining 20% being allocated to the internet service provider. The internet content provider (here the cinema) would take the entire value of the ticket (minus any booking discount) and 100% of advertising subscription. Revenue from the subscription to the city guide would be distributed 90% for the content provider and 10% for the operator. <snip> Formulating 3G strategy Lucent's approach to 3G strategy centres around a thorough understanding of demand that is 'key to the successful building of a revenue-generating and profitable service offering'. However, the unforeseen successes of SMS and prepaid were also cited so as to demonstrate the unpredictable nature of the market. Lucent presented a segmentation study aimed at identifying the most profitable services based on consumer willingness to pay and anticipated usage. The results showed e-mail as the most valuable UMTS service, whilst books, games and CDs, sports services, magazines, music, news, and ticket booking were all recognised as key revenue contributors. Three years from launch of 3G services, Lucent forecasts the aggregate ARPU enjoyed by all constituents of the value chain (including network operator and content provider) to rise to GBP 67.60. Non-voice services are expected to contribute GBP 49.30 of this total (almost 75%) although voice revenue will fall to GBP 18.30. Billing and customer services The final part of the seminar discussed the significant impact that increased bandwidth and faster services will have on billing. "If you cannot bill it, you cannot launch it", Ian Johnston (JP Morgan) was quoted as saying. The migration will necessitate the need for new business models to allow operators to bill for content provided by others. << - Eric -