The Future of Broadband Mobility PTC’09 Tuesday Plenary – January 20, 2009 Honolulu, HI Ken Zita Network Dynamics Associates

Arrival of the mobile Internet The Promised Land is at hand –LTE field tests achieving “ultrabroadband” speeds of MB/s down, 50 MB/s up –Commercial shipments begin 2H09 –What is the route to mass market adoption? How will a “mobile Internet” be different? –For the consumer experience? –For service definition? –For the competitive landscape? The arrival of very high speed and all-IP mobile networks is immanent. So-called 4G will transform markets and the mobile services paradigm worldwide.

1. What is the impact of broadband on mobile business strategy? Switched (closed) => packet (open) Shift to IP allows service creation of content services independent of the access network Gateways for media downloads vs. merely transporters of bits If future market success is tied to application and content services, where will carriers place their bets? The mobile value proposition remains tied to legacy “bandwidth economics” and is relatively untouched by the economics of the Internet.

2. How will mobile business models evolve with broadband? Emerging financial models have many more moving parts, and far less revenue certainty –Subscriptions => to ad-hoc revenue events –Voice, messaging => on demand content –Recurring revenue => commissions, advertising, revenue shares –Per minute pricing => connectivity Timing the transition of revenue composition No “net neutrality” for mobile … today On-demand video, peer to peer communications, user-generated content, and application downloads will displace basic access services such as voice for new revenue growth.

3. Who will “own” what in the new broadband mobile ecosystem? Can mobile operators preserve their closed ecosystems for content? –So far, incumbency has worked –(US) carriers control content, despite pledges to open Apple and Nokia (and Google?) gambling on integrated, vertical services –Operating systems resurgent MVNO for the new world –mobile content without the networks –Who will build the next Apple store? How will the network/device/content/brand/web storefront armistice evolve as the mobile experience is gradually pried open by IP?

4. Search Today mobile search is a drag Contextualize with geography –Find stuff things that can only been ‘seen’ virtually through a computer network Contextual with geography and local life –Social information that “announces” in cyberspace –How can a network (or device) anticipate my search? –“Network push” => human-centered “demand pull” –Geo-data and location tagging Speed to the handset is exciting but mobile search needs to evolve, too. What is required to create “meaningful” mobile search and retain net-centric customers on the move?

5. Operational challenges Facing the on-net/off-net challenge Technology –IMS –Mobile IPv6 –What happens to Wimax? –Do carriers need to be software companies? Video hits the local mobile network –250,000 U.S. cell sites with T-1 backhaul Service delivery involves controlling content through middleware or finding a way to stay relevant as consumers download content from off- network sites.

6. Can Asian mobile SPs globalize? Big differences between U.S. and Japan mobile content strategies Mobile Internet is a platform for delivering lifestyle services and knowledge uniquely appropriate to the local market –Diversity vs. mass market Does network scale have a natural (or optimal) limit when value shifts to services that involve local market knowledge and customization? North Asia is streets ahead of the rest of the world in terms of mobile broadband adoption. But past attempts by Japanese and Korean operators to go global have failed. Why?

What does it mean, really, to create a “mobile Internet”? See: