The Mobile Web: Limited But Getting Better

Posted by KatrinVerclas on Oct 09, 2008

Brough Turner is a renowned telcom industry professional with a passion for mobile and a very smart guy.  We recently interviewed him about the mobile web for a paper on cell phones in citizen media.  What he said is useful for thinking about this in the context for social benefit, so we post it here for you, before the release of our report. We will also have a workshop on the role of the mobile web for social development at MobileActive08.  

You asked me to elaborate on today's mobile web and how it will change with the advent of 3G networks.  Here we go: Mobile phone networks provide the best telephony coverage in the world and, for more than a decade, mobile operators have had a "data" story.  Unfortunately, the data side of mobile telephony has been slow, expensive and limited in what it can access.

The first widely available mobile data service, called GPRS (for General Packet Radio Service), was launched in 2000-2001.  Typically, GPRS provides 30-40 Kbps data rates with fairly long delays (600ms to 1 second, round trip).  In principal, it can deliver speeds over 100 Kbps but in practice voice service takes priority so usable data rates can drop to zero during periods of peak voice calling.

But the biggest problem with mobile data service is limited access to the Internet.  Today, virtually all GSM networks have GPRS capability but many service providers operate "walled gardens." This means they allow access to their own web pages and those of partners who share revenue with the mobile operator.  Access to the public Internet is either not available or available only at a significant extra cost.

Luckily, this situation is improving and there's good reason to believe we will see affordable open access to the mobile web, i.e. the real Internet, in coming years.  Two things are driving this change -- technology and competition.

Just like computers, the performance of wireless technology regularly doubles, at less-than-two-year intervals.  This means speeds go up and costs come down.  GPRS is so-called 2.5G technology (a bit better than "second generation" or 2G).  Today, 3rd generation (3G) technology is being widely deployed in developed markets and on the verge of sweeping all markets.  (At some point it becomes cheaper to deploy 3G than 2G, so everyone gets the 3G technology).  There are a plethora of acronyms for 3G and 3.5G technology like 3GSM, UMTS, W-CDMA, HSDPA, HSUPA, HSPA and HSPA+.  Clearly the GSM Association doesn't understand branding.  :-)  But what's important is faster data rates are happening.  The 3G network upgrades rolled out in the past year or two typically provide more than 1 Mbps down and several hundred Kbps up.  This matches the speed of many fixed line DSL services.

Even more important, most countries have real mobile competition.  Fixed line services are limited by monopoly or duopoly ownership of the physical cables.  There are regulatory solutions (like "local loop unbundling"), but only with substantial politics.  However, many countries have 3, 4, 5 or more independent mobile operators.  There are more than 200 countries with mobile voice services so we can compare results.  In countries with four or more viable mobile operators, rampant competition rapidly drives prices down and mobile subscriber adoption up.  Now we're beginning to see similar effects on data plans where 3G data services have become available.  

The biggest use of 3G data services is for 3G USB modems.  These devices let you connect your PC to the Internet using 3G data services.  Recent data from Finland shows 3G data usage is soaring, but 92% of all data is USB modems connected to the public Internet.  Of the remaining 8% (mostly for high-end Nokia handsets), 80% is for Internet access, 10% is for email and 10% is for everything else.  So access to the operator's web services (their walled garden) represents just a fraction of 1% of all 3G data bytes.  People don't want a walled garden, they want open access to the Internet!  In competitive markets, people get what they want as soon as it's practical.

Today the US has 3 national 3G networks (AT&T, Verizon and Sprint) with two more networks under construction (T-Mobile USA's 3GSM network and Clearwire/Xohm's WiMAX network).  Already, flat rate Internet access data plans are available, although expensive.  We should expect rapid price declines by 2010 as the fourth and fifth 3G networks roll out.

Globally more than 80% of all mobile phones are 2G or 2.5G GSM phones but that will change.  While it's still a few years before 3G technology costs less than 2G, it's certain that within the next decade, virtually all the 2G phones will be retired.  Everyone in every mobile market will be using 3G technology and, in any remotely competitive mobile market, affordable mobile web access will be available.

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