What a fantastic first day at the Mobile World Congress! This was a day when many leaders in mobile technology, telecommunications and media took to the stage to share their views on mobile connectivity, disruption resulting from mobile and connectivity innovation and mobile and the media. I will cover two major themes here but you can watch all the action via Mobile World Live.
Facebook founder Mark Zuckerberg took the stage late Monday afternoon for the 3rd year in a row to update the world on his plans to connect 4Bn unconnected people (through Internet.org). As I write this, the number of people who are connected in 2o15 is ~3bn and this has grown by about 200M. If we are to make greater leaps a catalyst like Internet.org or Project Loon is needed but on what terms? Zuckerberg addressed recent setbacks for his project telling the audience that “Facebook isn’t a company that hits a roadblock and gives up…We take the hits that we get and try to learn from them and just do better.” He also address the industry fixated on connecting ‘things’ to consider ‘connecting humans’ first. I would say the same thing if I were the leader of a media company the size of Facebook.
Zuckerberg offered up two new pieces of information. Firstly Internet.org is going the way of Project Loon but in stead of balloons they looking to use solar-powered drones with laser technology to provide internet access. Secondly, he announced the Telecom Infra Project, a newly-launched engineering initiative designed to bring operators, infrastructure providers, system integrators and other tech companies together to develop new approaches to infrastructure. This second announcement is interesting in that it is Facebook’s response to “slow moving” telecommunications carriers. The founding members include Deutsche Telekom, EE, Globe Telecom, Intel, Nokia and SK Telecom and together may come up with some disruptive innovations. I suspect we will continue to see more partnership models like this one set around defined ecosystems (in this case Telecommunications Infrastructure) where the problem is to big to solve for one organisation.
Product innovation in mobile is a theme year in and year out. For smartphones, 2016 may be the year that innovation has slowed. The industry as a whole is dealing with the dual objectives of mass commoditisation on the one hand and device innovation on the other. As such, the tier 1 players are all trying to add new bells and whistles while the low end of the market learn how to mass produce them. In panel discussions on Monday with tier 1 and low-end players including Samsung, Motorola/Lenovo and Wileyfox, chipset maker Qualcomm, Cyanogen, and mobile operator Telefonica innovation was discussed in a number of contexts. For some VR is where mobile innovation is heading and for others like Stephane Maes, VP of product management and planning at Motorola, building features that meet customer needs (like an unbreakable screen) superbly is of highest priority.
UK smartphone startup Wileyfox provided an interesting perspective arguing that business model innovation not product innovation is where smartphones are headed. Wileyfox is offering affordable smartphones, using cheaper, commoditised components, which allow consumers to avoid the need for a 2-year lock-in contract. CEO Nick Muir said on the panel:
“More and more people are beginning to see the cracks in the standard model – and that standard model being you have to pay for a two year contract to be able to afford the device you want… I know that the bill of materials allows us to be able to sell the device at a reasonable price and the reason we can do that is not enormous scale, it’s not just tier one components, it’s around the fact that we don’t have any sporting contracts, we don’t have legacy pensions, we don’t have glass offices, we all travel by EasyJet and we stay in Airbnb. We are a low cost organization and that low cost gets passed on to the consumer – and that’s part of it.”
That is lean start up at its best…
The Australian market for smartphones is still dominated by Tier 1 devices – Apple and Samsung. However, going with Muir’s philosophy and extending it to the broader trend of commodity vs innovation, it is possible to see MVNOs like Amaysim start to offer ‘reasonable quality’, low cost devices attached to larger data plans with no-lock-in to go head to head with traditional mobile business models.
That’s my take on two major themes from Monday at MWC. Day 2 will showcase mobile security, mobile and the media, industrial IOT and a topic I have recently written about – diversity and inclusion. Enjoy!