Content and technology top lists of concerns over the wireless Internet

Wireless carriers in Canada must loosen their stranglehold on web content and give consumers more choice over the information they receive if they want the wireless Internet to take off. That message was delivered by some of the country’s leading infrastructure and application development players at Emerge@Wireless 2 in Toronto nearly two weeks ago. The conference was organized by the Canadian Wireless Telecommunications Association as a one-day follow up to the lobby’s annual conference that took place in May. Speakers criticized the industry’s so-called "Walled Gardens" that limit consumer choice to a handful of web sites. Unlike other portals where web surfers are free to leave their ISP’s homepage at anytime and travel anywhere on the World Wide Web, wireless Internet customers only have access to information that’s offered through arrangements between their particular carrier and its preferred content providers. It’s a situation many identified as one of the main obstacles preventing rapid expansion of the wireless Internet, particularly in North America. Tom Sweeney, president and CEO at Classwave Wireless Inc, told conference delegates that this gatekeeper role effectively gives wireless carriers a de facto monopoly in the wireless Internet business. Control over the content gives carriers control over the wireless Internet. Brad McKee, director of marketing at Wysdom Inc, agreed. By limiting the content that end users can receive, he said wireless carriers are violating one of the main tenets of the Internet, "free access to multiple points of information". Competing network standards are also standing in the way of wider adoption of wireless Internet. McKee said incompatibility between networks and devices means most users are unable to connect with other networks and devices. In North America, consumers must choose between a wireless service provider that uses CDMA, TDMA or GSM. In Europe, he noted that carriers use a single standard for mobile telephony. A higher rate of mobile phone penetration combined with fewer people owning a PC – compared to North America – is another reason more Europeans are turning to mobile devices for their Internet needs, said McKee. The availability of inexpensive landline access, particularly in Canada, is also standing in the way of an explosion in mobile Internet services. Sweeney said that many of these problems will disappear with the adoption of IP-based networks providing always-on capabilities. Reassuring customers, particularly business customers, that the mobile Internet is robust and secure will also help fuel demand, he added. McKee cited several advantages to the wireless Internet and mobile commerce (m-commerce), such as ubiquity, security, convenience, localization, instant connectivity and personalization. But he cautioned that more needs to be done to drive wireless Internet adoption and m-commerce. For starters, he said carriers should provide customers with personalized information in a personalized manner that is both location-sensitive and timely. For m-commerce to take off, McKee said services need to focus more on the consumer, and that means navigational tools that work well on a PDA or other device’s small screen. He also called on carriers to improve their network speeds and to embrace interoperability. Targeting the youth market There are other lessons the North American wireless industry can learn from its counterparts in Europe and Asia, according to George Cope, president and CEO at Clearnet Communications Inc. Specifically, he cited the importance of providing entertainment services and applications to the youth market. He pointed to Clearnet’s success in launching a pre-paid service that included web-access. In the first four weeks, he said more than 300,000 online games were played. Cope also suggested that wireless carriers follow the lead of their landline competitors and introduce flat rate billing for mobile Internet – a pricing option that has proven hugely popular for mobile telephony. Clearnet recently introduced flat rate billing for its post paid air time packages and offers wireless web services to its pre-paid subscribers (RoW, Oct 2/00). Some analysts estimate the value of consumer goods and services purchased over wireless networks or wireless devices will hit US$13 billion annually by 2003. That would put the value of m-commerce at about seven per cent of total e-commerce. Cope told delegates at the Toronto conference that wireless carriers can also look forward to reduced churn, as more people buy wireless devices for their mobile Internet capabilities. "Anything that makes the handset more valuable and stickier to a carrier is a benefit to all carriers. So I think you’ll see a stabilization and over time, as a result of these services, a possible reduction in churn in the wireless industry," he predicted. That same level of stability will also extend to the amount of revenue generated per unit, or per subscriber (ARPU), added Cope, as consumers begin viewing wireless products and services as providing added value.

Content and technology top lists of concerns over the wireless Internet

News | October 16, 2000

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