1. ©LAWanninger 2001 Mobile and Wireless Applications: Design and Integration in the U.S. Les Wanninger Carlson School of Management University of Minnesota Jyväskylän Yliopisto Summer School August, 2001

2. ©LAWanninger 2001 Mobile and Wireless Applications: U.S. Opportunity and Challenges SMS Text Messaging is a “killer app” for MW Tremendous U.S. opportunities in adopting successful SMS and i-Mode applications Focus on existing companies adding WM Channels 3G is long term SMS Text Messaging and i-Mode Application Categories Text messages for social and entertainment Personal and business communications e- or m-Commerce communication channels m-Payments and billing SMS and i-Mode application platforms

3. ©LAWanninger 2001 U.S. MW Applications – Current Status U.S. using e-mail based forms of text messaging “Wireless Internet” applications Extension of Internet and e-Commerce experience Some of the issues Bandwidth, standards, devices – immature Carrier competition and interoperability Latency of e-mail based messaging Hype of MW Crash of dot-coms Always looking for the “killer app” – which is only evident after-the-fact

4. ©LAWanninger 2001 The Global SMS Market SMS messages have exceeded the internet’s killer application, e-mail by more than double! killerMobile has found its killer application… SMS! Messages sent worldwide 19995 Billion2000100 Billion Global revenues from text messages & simple information services: 2000$13bn* 2004 $47bn* Biggest market will continue to be Europe *Source: Ovum

5. ©LAWanninger 2001 US Perspective on Design and Integration of WM Applications Focus on existing companies adding WM Channels Issues – technology, infrastructure, cultural, interoperability across service providers and geographies Areas of required integration Legacy systems Business processes Technical – Wireless - Internet, SMS, WAP, GSM, GPRS, 3G, CDMA, TDMA, iDen, Bluetooth, ….. Mobile Devices – Cell phone, SIM, PDAs, Laptops, … Mobile Devices as New Media User Interface options and design factors Platform options SMS, WAP, Web, TETRA, …… Development tool options

6. ©LAWanninger 2001 Catalog Industry Metaphor: Electronic Servicescapes Marketing: Define Target Markets, Products, Channels Advertising, sales, brokers, bricks: Communication to the Customer Receive Order, Assemble, Pack, Deliver Returns & Customer Service Production, Inventory Management Accounting, Invoicing, Payables, Receivables Procurement, Suppliers Payment Processes Customers & Suppliers Electronic Servicescape Information Systems, Analytical Tools, Customer & Operations Databases Order Fulfillment Customer Relationship Management Web Browser Mobile and Wireless

7. ©LAWanninger 2001 Instead of all these... Debit/Credit cards Access codes to net-bank Loyalty cards Teemu Testihenkilö Nihitsillantie 3 D 00020 MERITA FINLAND 6789 7890 3562 3652 5674 4567 8767 6543 4235 6347 5678 5678 2341 2345 5678 4321 4321 7635 6353 7585 6789 7890 3562 3652 5674 4567 8767 6543 6373 5748 6789 7890 3562 3652 5674 4567 8767 6543 6363 3838 6789 7890 3562 3652 5674 4567 8767 6543 7378 3738 6789 7890 3562 3652 5674 4567 8767 6543 3737 3334 6789 7890 3562 3652 5674 4567 8767 6543 7363 8383 6789 7890 3562 3652 5674 4567 8767 6543 3838 3395 6789 7890 3562 3652 5674 4567 8767 6543 3142 8696 3456 2312 6543 8976 6778 4567 8976 6543 6272 7484 4567 8767 6543 5678 5678 2341 2345 5678 7474 8494 3456 2312 6543 8976 6778 4567 8976 6543 4848 4493 All cards in one chip inside your WAP-phone SIM Debit-/Credit card, bank log-on, club membership, application downloading, etc. …THIS! EMV EMPS : Electronic Mobile Payment System

8. ©LAWanninger 2001 The Enterprise Challenge Enterprise Carriers Mobile ProtocolsDevicesInterface CRM SFA eBiz FSA ERP PM KM SCM Content Email Sales Service Executive Other… Phone PDA Pager Voice Future… CDMA (Sprint, Verzion) TDMA (AT&T) iDEN (Nextel CDPD (AT&T) iMode DoCoMo) GSM (Voice Stream & Worldwide Mobitext (Bell South) Palm.Net (Bell South) CDPD (AT&T) All Telcos HDML 3.0 WML 1.1 HDML 3.0 WML 1.1 HDML 2.0 WML 1.1 eHTML WML 1.1 WML 1.2 HTML WML 1.1 VoiceXML VoxML NeoPoint Qualcomm Audiovox Motorola TouchPoint Ericsson Motorola Mitsubishi Samsung Ericsson Mitsubishi Motorola Samsung Sanyo Alcatel Ericsson Motorola Samsung Nokia RIM Palm VII Palm !!! & V PcketPC Standard IVR Voice Browser V.V.S. Source: META Group Inc.

9. ©LAWanninger 2001 SMS in Use Text Messaging - communications application Contrast SMS with Instant Messaging, Chat, Internet forms, etc. Text Messaging - value added services Sonera m-broadcast of Sydney Olympic results, $3 Sonera ZED Platform for applications that communicate with text Nordea, Yomi examples M-Payments Simple, intuitive, familiar phone interface Keyboard not a significant limitation for entering text (QWERTY is not intuitive) GSM bandwidth not a limitation for text messaging GPRS is here Display screen not a limitation for text messaging

10. ©LAWanninger 2001 Cell Phone – How it Works Phone has hardware-based, multitasking operating system and some writable memory Op System sorts and then processes incoming signals (from wireless service provider) SMS or WAP Tone SMS or WAP Icon or other picture SMS or WAP text message Voice Data Op System processes outgoing signals (keypad, SIM card, voice and data) SIM card provides memory and processing capability Service provider information, security

11. ©LAWanninger 2001 Phone Data Entry

12. ©LAWanninger 2001 SIM Card Current - telecomm operator specific SIM Tool Kit Future –Smart Card, programmable via application developer “Smart mobile clients” Organizations control applications and revenue from them Analogy: Mainframe to PC applications

13. ©LAWanninger 2001 SMS as Application Platform Jups to describe in detail SMS Server – analogous to Web server GSM Phone operating system Currently analogous to Web browser SIM cards Operator specific – therefore differ Different capabilities to process, store and display Mobile phones and other devices Different operating systems Different capabilities to process and display non- text components of text messages

14. ©LAWanninger 2001 Schematic: Web Browsers, Servers, & Internet Addresses Server @ “A” 2. Server @ “A” Sends file “C.htm” to Browser “B” through Internet 1.Local Browser @ Address “B” requests document “C.htm” from Server at Address “A” http://A/C.htm/ Internet 3. Browser @ “B” Reads and displays C.htm text file Local Browser @ B”

15. ©LAWanninger 2001 SMS Platform Analogy to Web Browsers, Servers, & Internet Addresses SMS Server @ “A” 2. SMS Server @ “A” Processes message “C” and prepares response message “D” Sends message response “D” to Individual “B” through Network 1.Individual @ Mobile # “B” Sends SMS message “C” through SMSC to Server at Mobile # “A” GSM Network 3. Phone Op System @ “B” Reads and displays message “D” Person @ Mobile # B”

16. ©LAWanninger 2001 Instead of all these... Debit/Credit cards Access codes to net-bank Loyalty cards Teemu Testihenkilö Nihitsillantie 3 D 00020 MERITA FINLAND 6789 7890 3562 3652 5674 4567 8767 6543 4235 6347 5678 5678 2341 2345 5678 4321 4321 7635 6353 7585 6789 7890 3562 3652 5674 4567 8767 6543 6373 5748 6789 7890 3562 3652 5674 4567 8767 6543 6363 3838 6789 7890 3562 3652 5674 4567 8767 6543 7378 3738 6789 7890 3562 3652 5674 4567 8767 6543 3737 3334 6789 7890 3562 3652 5674 4567 8767 6543 7363 8383 6789 7890 3562 3652 5674 4567 8767 6543 3838 3395 6789 7890 3562 3652 5674 4567 8767 6543 3142 8696 3456 2312 6543 8976 6778 4567 8976 6543 6272 7484 4567 8767 6543 5678 5678 2341 2345 5678 7474 8494 3456 2312 6543 8976 6778 4567 8976 6543 4848 4493 All cards in one chip inside your WAP-phone SIM Debit-/Credit card, bank log-on, club membership, application downloading, etc. …THIS! EMV EMPS : Electronic Mobile Payment System

17. ©LAWanninger 2001 Designing MW Applications Process Iterative 1.Business Case 2.Requirements (Prototyping) 3.Design 4.Development 5.Testing and QA 6.Pilot 7.Implementation 8.QA and continuous improvement

18. ©LAWanninger 2001 Person – to – Person Messaging: Same Carrier Sonera SMSC, Service Center # C GSM Network Person A, Mobile # A Person B, Mobile # B

19. ©LAWanninger 2001 Person – to – Person Messaging: Different Carriers Sonera SMSC, Service Center # C GSM Network Person A, Mobile # A Person B, Mobile # B Radiolinja SMSC, Service Center # D

20. ©LAWanninger 2001 Many Persons – to – Business Messaging: Many Carriers Sonera SMSC, Service Center # C GSM Network Person A, Mobile # A Person B, Mobile # B Radiolinja SMSC, Service Center # D Company or ASP SMS Server, # E Content Provider Operations Database

21. ©LAWanninger 2001 Design the EMPS Application

22. ©LAWanninger 2001 Intercarrier SMS Routing One basic difficulty in developing SMS based services is the variety of protocols used in SMS Centers (SMSC). The European Telecommunication Standards Institute (ETSI) has approved four SMSC protocols, each of which has a slightly different functionality and quite different character conversions: SMPP (by Logica) CIMD (by Nokia) UCP/EMI (by CMG) SMS2000 (by SEMA) Another difficulty is that most U.S. carriers use protocols other than GSM (CMDA, TMDA, Analog, iDen) Not all U.S. carriers have SMSCs and/or do not offer direct high speed connections

23. ©LAWanninger 2001 SMS Message Routing - Present At present, any SMS message sent between two cell phones within the same carrier network is merely routed through the carrier’s network in the carrier’s SMS format (i.e., SMPP). In contrast, when an SMS message is sent to a cell phone in a different carrier network, the message is presently switched to SMTP (Simple Mail Transfer Protocol) and routed through the Internet to the other carrier who in turn switches the message from SMTP to their SMS format and routes the SMS message to the target phone. SMTP is a protocol for sending e-mail messages between servers. Most e-mail systems that send mail over the Internet use SMTP to send messages from one server to another. SMTP is also generally used to send messages from a mail client to a mail server.

24. ©LAWanninger 2001 Current U.S. Inter-Carrier SMS Routing Method

25. ©LAWanninger 2001 Current U.S. Inter-Carrier SMS Routing Method The previous figure is a scenario in which Cellular Operator “A” uses SMPP for SMS messaging and Cellular Operator “B” uses CIMD for SMS messaging. SMTP is a protocol for sending e-mail messages between servers. Most e-mail systems that send mail over the Internet use SMTP to send messages from one server to another. SMTP is also generally used to send messages from a mail client to a mail server.

26. ©LAWanninger 2001 Implications of 2.5G and 3G for U.S. Intercarrier message routing In the case where a carrier’s 2G network and 2.5G network reside on the same physical network (i.e., a card swap is all that is required to upgrade the network), the SMS routing is largely unaffected. In the case; however, where a carrier’s 2G network and 2.5G network reside on different physical networks, the carrier must have an internal routing capability to switch SMS messages between the 2G and 2.5G networks. In this latter scenario, all messages remain in the single SMS format used by the carrier. The same scenarios will apply when upgrading from 2.5G to 3G.

27. ©LAWanninger 2001 Integration between email and SMS – Unisys OMIS

28. ©LAWanninger 2001 Content – how about SMS??? Architecture – Web-SMS flow (Unisys Mobile Business Group) smsc web-sms rexmip 1. Call comes into Web-SMS 5. SMS message with requested content arrives on callers mobile 2. Web-SMS sends a command to REX, which is client to Web-SMS, to fetch content in real time from the MIP 3. Content fetched from the MIP through an HTTP connection in HTML format. REX converts the content into an SMS message 4. Content delivered to the SMSC SMS IVR

29. ©LAWanninger 2001 AS EUROPE ZOOMS AHEAD, U.S. FIDDLES WITH FORMATS (New York Times 07/27/99) Wireless service providers in Europe are pulling ahead of U.S. carriers in developing wireless data services. European carriers plan to take advantage of faster Web transmission technology and general packet radio service (GPRS) to deliver the services. GPRS, which will be available next year, will support transmission speeds fast enough to browse the Internet in full color. Users will also be able to use GPRS to stay connected to the Internet for an entire day. In offering GPRS, carriers will be able to charge subscribers based on the amount of data transmitted, rather than by the minute. While industry players in the U.S. are also pursuing wireless data, the market has been stymied by a lack of standards and carriers' differing opinions over which 3G technology should be adopted. Europe's adoption of a single standard has helped carriers offer built-in paging and messaging functions years before such features were launched in the U.S.

30. ©LAWanninger 2001 Design the application infrastructure for SMS Messages across Carriers in the U.S.

31. ©LAWanninger 2001 Weston Henderek Industry Analyst June 18, 2001 Call in at 8:55 EDT (1) (973) 321-1020 Password: ???? The Giga View High-Speed Wireless Data: What, When and Where?

32. ©LAWanninger 2001 VoiceStream/AT&T Wireless/Nextel Upgradability to 3G International Roaming Coverage International Partnerships Corporate Discounts Bundled Wireline Discounts Internet Commerce Support Prices Total Coverage 0 2 4 6 8 10 AT&T VoiceStream Nextel Scores: 10 = Best ever 7 = Mature 5 = Viable 3 = Immature

33. ©LAWanninger 2001 Sprint PCS/Verizon Wireless 0 2 4 6 8 10 Verizon Sprint Upgradability to 3G International Roaming Coverage International Partnerships Corporate Discounts Bundled Wireline Discounts Internet Commerce Support Prices Total Coverage Scores: 10 = Best ever 7 = Mature 5 = Viable 3 = Immature

34. ©LAWanninger 2001 The Wireless Protocol Hurdle Race GPRS EDGE UMTS iDEN CDMA Euro-GSM 2003 2005 TDMA 2001

35. ©LAWanninger 2001 By 2006, Wireless Standards Will Converge WCDMAcdma2000 3G 2001 WCDMA GSM- GPRS 1xRTT 56-144K 64-128K GSM- GPRS iDEN-GPRSTDMA-GPRS(Japan)115-256K 2002 GSM- EDGE 3xRTT 384-512K 256-512K 2003 HDR 384K-1.5M 384-768K 384-768K 2004 WCDMA 768-2M 2005 1Xtreme 1-5.2M 2006

36. ©LAWanninger 2001 US Wireless Carrier Data Road Map CarrierToday20012002200320042005 CDMA (Sprint PCS and Verizon) 14.4Kbps CDMA data Late year CDMA 2000 1X 144Kbps CDMA 2000 1X 144Kbps CDMA 2000 1X Plus 300- 500Kbps CDMA 2000 1Xtreme 5.2Mbps 1Xtreme 5.2Mbps UMTS AT&T Wireless 19.2Kbps CDPD data GSM/GPRS 115Kbps data (limited availability) GSM/GPRS 115Kbps service (better availability) EDGE 384Kbps WCDMA 2Mbps UMTS GSM (Cingular and VoiceStream) 9.6Kbps GSM data Midyear 114Kbps GPRS Late year EDGE 384Kbps EDGE 384Kbps WCDMA 2Mbps UMTS WCDMA 2Mbps UMTS Nextel9.6Kbps iDEN data 56Kbps iDEN data service EDGE 384Kbps Possible UMTS

37. ©LAWanninger 2001 Incompatible Technologies and Spectrum Shortage Will Delay US Migration to 3G Carrier Q4 2001 Q4 2002 Q4 2003 Q4 2004 Q4 2005 Q4 2006 Sprint PCS and Verizon cdma1xRTT 56-144K cdma1xRTT Enhanced 384-512K cdmaHDR 384K -1.5M cmda2000 1Xtreme 1-5.2Mbps AT&T Wireless and Cingular GSM-GPRS 56-114K GSM- GPRS 114-170K GSM-EDGE 256-384K WCDMA 384- 768K WCDMA/ UMTS 768K - > 2M VoiceStream GSM-GPRS 56-114K GSM- GPRS 114-170K GSM-EDGE 256-384K WCDMA 384- 768K WCDMA/ UMTS 768K - > 2M Nextel iDEN 40-56K iDEN- GPRS 56-114K iDEN-GPRS 114-170K iDEN- EDGE 256-384K

38. ©LAWanninger 2001 Carrier Q4 2001 Q4 2002 Q4 2003 Q4 2004 Q4 2005 Q4 2006 Sprint PCS and Verizon cdma1xRTT 56-144K cdma1xRTT Enhanced 384-512K cdmaHDR 384K -1.5M cmda2000 1Xtreme 1-5.2Mbps AT&T Wireless and Cingular GSM-GPRS 56-114K GSM- GPRS 114-170K GSM-EDGE 256-384K WCDMA 384- 768K WCDMA/ UMTS 768K - > 2M VoiceStream GSM-GPRS 56-114K GSM- GPRS 114-170K GSM-EDGE 256-384K WCDMA 384- 768K WCDMA/ UMTS 768K - > 2M Nextel iDEN 40-56K iDEN- GPRS 56-114K iDEN-GPRS 114-170K iDEN- EDGE 256-384K Incompatible Technologies and Spectrum Shortage Will Delay US Migration to 3G (Cont.) TDMA to GSM transition issues will cause major coverage and service issues for corporate users.

39. ©LAWanninger 2001 Carrier Q4 2001 Q4 2002 Q4 2003 Q4 2004 Q4 2005 Q4 2006 Sprint PCS and Verizon cdma1xRTT 56-144K cdma1xRTT Enhanced 384-512K cdmaHDR 384K -1.5M cmda2000 1Xtreme 1-5.2Mbps AT&T Wireless and Cingular GSM-GPRS 56-114K GSM- GPRS 114-170K GSM-EDGE 256-384K WCDMA 384- 768K WCDMA/ UMTS 768K - > 2M VoiceStream GSM-GPRS 56-114K GSM- GPRS 114-170K GSM-EDGE 256-384K WCDMA 384- 768K WCDMA/ UMTS 768K - > 2M Nextel iDEN 40-56K iDEN- GPRS 56-114K iDEN-GPRS 114-170K iDEN- EDGE 256-384K Incompatible Technologies and Spectrum Shortage Will Delay US Migration to 3G (Cont.) TDMA to GSM transition issues will cause major coverage and service issues for corporate users. Network upgrade times will not be reflective of actual coverage.

40. ©LAWanninger 2001 Incompatible Technologies and Spectrum Shortage Will Delay US Migration to 3G (Cont.) Carrier Q4 2001 Q4 2002 Q4 2003 Q4 2004 Q4 2005 Q4 2006 Sprint PCS and Verizon cdma1xRTT 56-144K cdma1xRTT Enhanced 384-512K cdmaHDR 384K -1.5M cmda2000 1Xtreme 1-5.2Mbps AT&T Wireless and Cingular GSM-GPRS 56-114K GSM- GPRS 114-170K GSM-EDGE 256-384K WCDMA 384- 768K WCDMA/ UMTS 768K - > 2M VoiceStream GSM-GPRS 56-114K GSM- GPRS 114-170K GSM-EDGE 256-384K WCDMA 384- 768K WCDMA/ UMTS 768K - > 2M Nextel iDEN 40-56K iDEN- GPRS 56-114K iDEN-GPRS 114-170K iDEN- EDGE 256-384K TDMA to GSM transition issues will cause major coverage and service issues for corporate users. Network upgrade times will not be reflective of actual coverage. Lack of multimode 3G phones will prevent interoperable global 3G standards. Multinational companies need to plan around this issue.

41. ©LAWanninger 2001 Trends in Wireless Technologies and Services Vendors will make big promises to promote early adoption. Corporate use will shape demand for wireless data. Mobile IP adoption will vary across geographies. Users will opt for “always-on” or international roaming. 3G wireless technologies will converge around two standards.

42. ©LAWanninger 2001 Giga Recommendations Don’t expect 3G data rates before 2006. Opt for short-term contracts and centralized procurement. Plan to support at least two types of wireless devices.