UK: Eye to the Future - How TMT Advances Could Change The Way We Live In 2010 - Part 2

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Communications innovations have enabled some of the most rapidly and widely adopted technologies of all time – the Internet and the mobile phone being the most notable examples. That transformative impact is likely to continue through 2010.

With almost half of the world’s population connected to fixed and mobile networks the volume and value of global voice should continue growing, cementing voice’s status as the most ubiquitous networked application. Mobile voice is likely to take a growing share of total voice volumes; fixed networks may see customer numbers decline, particularly in developed countries; and VoIP may make only modest gains.

Increasing numbers of consumers and businesses are likely to adopt both fixed and wireless broadband services. Fixed broadband is likely to be the more popular means of using web based applications, outcompeting mobile with respect to average downloads speeds and cost per megabyte. Despite this, 3G subscriber numbers are likely to rise sharply, as mobile operators migrate their customers to 3G as a matter of course.

The convenience of broadband mobility may attract more people to wireless LAN, with the number of home and office deployments growing throughout the next five years. But consumers’ willingness to pay for WLAN hardware may not be matched by a willingness to pay for access. Consequently commercial and municipal WiFi networks might struggle.

Overall, people are likely to communicate more in 2010, as their desire to interact is satisfied by a growing array of connected devices offering an ever expanding range of communications applications. In addition, human communications may increasingly be supplemented by machine-to-machine exchanges, as connectivity of all types reaches deeper into the supply chain.

As for tariffs, the age-old equation for charging for communication – distance multiplied by time – is likely to evolve steadily in response to the growing variation in functionality and convenience between different communications media.

By the end of the decade, it is likely that for the first time ever, half of the world’s population will have access to telecommunications services, most commonly via mobile telephony. Citizens in developing countries are likely to represent the bulk of the hundreds of millions of those entering the global telecommunications network for the first time³⁶. While most new connections will likely be to mobile networks, citizens in developing countries are also likely to contract to fixed line networks, growing the overall size of the public switched telecommunications network (PSTN) as a result³⁷.

Voice usage is likely to grow strongly through 2010, because of a rapid growth in the number of connected people worldwide and falling call charges. By 2010, total voice usage could rise to over 12 trillion minutes per annum, up from under nine trillion today³⁸. Callers in the developed world will likely abandon their fixed phone, in favor of mobile. In a developed region such as Europe, 25 percent of homes are forecast to have relinquished their fixed line³⁹. Globally, fixed voice traffic is expected to have declined to just 30 percent of total voice call volumes from almost 60 percent today⁴⁰.

It is likely that the displacement of fixed by mobile will be due, in part, to continued steady declines in the mobility premium – the additional price of mobile calls over fixed. By 2010, up to eight trillion minutes of voice calls may be carried by mobile networks⁴¹ – over 60 percent of total voice volumes.

VoIP will likely gain in adoption, but its revenue impact may still be muted as of 2010. By that time, VoIP is forecast to represent approaching 10 percent of total voice volume⁴², but less than five percent of global voice revenues⁴³. Many corporations may have adopted VoIP; consumers might increasingly subscribe – sometimes without even realizing – to VoIP solutions. But if VoIP continues to be promoted as a low-cost option, there is a danger that few of its advanced features and benefits (such as unified messaging or high fidelity calls) will be actively promoted.

VoIP over broadband mobile networks (3G) and WiFi infrastructure is unlikely to be felt in any significant way by 2010⁴⁴. Users may well find using such services too complex, and any price discount will likely remain insufficient to compensate users for the lower quality, and higher handset prices, that may still characterize the service.

By 2010, mobile broadband is likely to gain ground on fixed broadband in terms of the number of connections. Consumer and business adoption of fixed broadband is likely to continue at a modest pace, such that by 2010, there will be approaching 490 million broadband connections⁴⁵. At this time, there may be as many as 300 million broadband mobile (3G) subscribers, although a proportion of these may not have actively chosen to migrate to 3G⁴⁶.

Both fixed and wireless operators are likely to deploy next generation network technologies over the course of the next five years. Fixed operators will likely move to enhanced asymmetric digital subscriber lines (ADSL2(+))⁴⁷ and to a lesser degree, fiber to the home (FTTH)⁴⁸. Mobile operators are expected to continue building out their 3G networks, and will likely add high-speed downlink packet access (HSDPA) and high-speed uplink packet access (HSUPA)⁴⁹ upgrades to give customers multi-megabit connectivity.

But revenues and margins may not grow in line with increases in bandwidth. Fixed operators are likely to continue to suffer from the commoditization of broadband connectivity, while mobile operators may continue to struggle to launch profitable mobile data services. Only a small number of people may find the highest bandwidth speeds available of practical use and more importantly, worth paying for.

By 2010 consumers are likely to be choosing a preferred set of communications tools. This is similar to the way that they have settled on a set of a preferred dozen or so television channels out of a choice of hundreds. As illustrated in Figure 4, the choices may not be dramatically different from today: however the degree of usage of each communications option will likely have changed.

The communications tools most likely to become established as part of each individual’s preferred list is likely to be those that are easiest to use, offer best value, and are most relevant to that individual. The preferred set will likely evolve as personal circumstances change.

The availability of a wider range of devices, networks and communications options in 2010 may encourage us to communicate more overall. Some of the devices that we commonly use as standalone, unconnected devices today, may have become connected and communications-ready by 2010. Digital cameras with built-in picture messaging and email; games consoles with instant messaging, laptops with embedded mobile cellular access systems and even cars capable of sending and receiving email are all feasible by 2010.

By 2010, video calls may have finally become mainstream, enabled by more widespread fixed broadband connectivity, falling costs, improving quality of service, and the more common integration of a camera into laptop PCs and computer monitors⁵⁰.

Furthermore, the growing availability of standalone, plug-and-play video-calling devices may drive demand for fixed video calls in the home⁵¹.

Video calls will be undertaken within both work and social contexts. Clearly, video is likely to be a far more effective way of conveying non-verbal communications such as body language, facial expressions and other mannerisms.

But while fixed-broadband video calls should grow in volume, they will likely still represent a minority of all calls. This will also be the case on mobile networks. Many mobile phones are likely to be cable of handling video calls by 2010, but this functionality may be little used. Quality and price of mobile video calls may remain poor relative to their fixed line equivalent.

Broadband wireless is likely to have greatest success as an extension to fixed broadband connection, rather than as a wireless local loop. Homes and offices will likely continue to increase their adoption of WiFi connectivity, as prices fall, security improves, installation becomes easier and reliability becomes progressively better. The growing incorporation of WiFi within a range of devices – from laptops to gaming consoles, mobile phones to PDAs – should also strengthen the personal or business case for deployment of WiFi.

Municipal WiFi networks may also become widespread, particularly in the developed world, as local authorities and governments strive to bridge the digital divide⁵². But these schemes’ potential may be blunted not only by targeted users’ inability to afford a PC or other device needed to access WiFi services, but also by the fact that WiFi technology was never designed to provide blanket coverage⁵³. Regulators who sanction the availability of low cost or free wireless local networks where they had previously licensed service providers to operate a paid-for service may find themselves challenged by the latter group.

WIMAX, a wireless technology capable of delivering broadband wireless connectivity over a wide area (up to several kilometres) may prove ineffective as a competitor to established fixed and mobile broadband networks. However, it may well become the most cost efficient approach to delivering broadband to rural areas that are too expensive to connect using wired or broadband cellular technologies⁵⁴. Occasionally, WIMAX may also find a secondary role providing backhaul for metropolitan WiFi networks and other managed data networks⁵⁵.

Steady growth in the range of devices that include some form of connectivity may catalyze growth in the volume of machine-tomachine (M2M) conversations. This could generate an industry worth over $200 billion by 2010 (compared to less than $50 billion today)⁵⁶. By 2010, tens of millions of vehicles may feature an integrated cellular mobile connection, allowing for applications ranging from remote maintenance to vehicle tracking⁵⁷. Furthermore, five percent of the world’s televisions may be connected, directly or indirectly, to broadband networks, allowing remote programing, maintenance and even the insertion of personalized advertising⁵⁸.

Radio-frequency identification tags (RFID) may have become cheap enough for their mainstream use within supply chains – allowing automated systems to interrogate stock levels, check on the status of orders and deliveries, record environmental conditions and track individual items as they move from the factory to the customer⁵⁹.

Historically, the cost of communications has been charged based upon the simple formula of time multiplied by distance. A short, local call was far cheaper than a lengthy, long-distance one. Deregulation, and the subsequent rebalancing of tariffs, changed this relationship a little. But overall the rule still held.

However, the emergence of mobile telephony and VoIP has changed, and will likely continue to change, the criteria by which calls are charged. The greater the ease of placing the call and the immediacy of reaching the called party, the greater the cost. This may mean that calling from or to a mobile will incur the highest per minute charges. Conversely, calling a distant location from a fixed line may be far cheaper per minute. The most inconvenient calls – from PC to PC over a VoIP link, would have the lowest cost per minute.

The communications sector should continue to have plenty of opportunity for growth through 2010, as users are offered, and choose to adopt, an ever growing range of communications devices and services.

However, through 2010, a growing gulf may emerge between what communications functionality is offered, what is actually used and – more importantly – what is paid for. The standard list of functionality, particularly on mobile phones, is likely to expand relentlessly. The latest features to be added into mobile devices include games with 3D graphics and blogging software. But every new feature may add cost, and increase complexity and reduce reliability. As menus and options expand to accommodate the growing functionality list, users may find it harder to access core applications: voice calling and messaging. But these basic services are still likely to represent the lion’s share of usage and revenues in 2010, and the communications industry should recognize that a focus on growing the number of communications functions and features may become an increasingly unhelpful distraction.

Companies should also be wary of becoming distracted by irrelevant goals, such as having the fastest network. Multiplying access speeds is unlikely to lead to a corresponding multiplication in network revenues. The communications companies likely to be deemed winners in 2010 may well be those that have focused on delivering intuitive, mainstream and compulsive services that transform the way the majority of us interact.

Technology is likely to become more pervasive across all areas of education, but is unlikely to have replaced the teacher by 2010. Digital whiteboards, extranets for parents and typed coursework may well have become commonplace by 2010. But it is unlikely that technology will be capable of emulating the interactivity, spontaneity, dynamism or communication skills of a good teacher.

TMT advances may have negative aspects, one of which may be to refine the art of cheating. Wireless technologies will likely facilitate communication with students taking exams; improvements in search engines may encourage plagiarism. Furthermore, where podcasts, online notes and other electronic aids are provided to supplement classroom teaching, some students may choose to use these as a substitute for attendance. Too much technology might also have the impact of dulling analytical faculties, rather than supporting them.

The best teachers may have become global ‘brands’ by 2010, thanks to advances in connectivity. This elite group may be lecturing to a collective class of thousands, using a combination video conferencing, streamed audio and podcasts as well as the traditional lecture theater.

In developed countries, the increasing use of technology within schools may make a PC and a broadband connection mandatory for any pupil⁶⁰. Yet poorer families may not be able to afford either, igniting debate over whether broadband and lap top computers should fall within the scope of universal service provision.

Technology is likely to become more pervasive across all areas of education. However the teacher is likely to still be at the heart of the educational process in 2010. Digital whiteboards, which are likely to be gradually rolled out through 2010 and beyond, will allow the teacher to focus on interacting with the class, rather than the blackboard. Students are likely to be using personal computers more regularly in class, often connected to classroom networks that allow the teacher to monitor progress in real time. School extranets are likely to facilitate communication with parents. Teachers are likely to source teaching material, including professionally developed graphics, video and animations from online exchanges.

Advances in technology and communications will likely present students of all ages with new opportunities for cheating.

Already wireless technologies facilitate communication between students taking exams⁶¹; search engines facilitate plagiarism by enabling rapid retrieval of others’ work; online auctions provide a marketplace for paid-for coursework⁶², and email and instant messaging allow the rapid distribution of leaked exam questions⁶³. By 2010 the range and power of wireless technologies will likely be greater, search should be more efficient and there may be a myriad more ways to exchange valuable information.

As a result, educators and governments will likely have to work together to develop ways of stopping the abuse of powerful technology. Already some schools have deployed software that checks essays for plagiarism. This practice is likely to become more widespread through 2010⁶⁴.

Schools and colleges may also have to crack down on the use of camera phones and other mobile devices, particularly during exam time, in order to stop students sharing their answers. Education authorities and exam boards may have to monitor online auction sites, file sharing sites and even blogs, in order to prevent exam papers from being distributed in advance.

One of the difficulties in identifying cheating lies in the anonymity of the typed response, which has become the standard format for submissions in some establishments. Handwriting, by contrast is relatively unique.

2010 may thus witness a return to the handwritten exam paper, unless examining boards can establish a way of authenticating the authorship of typed papers.

An elite group of teachers, which today is only able to reach a mass market via books, lecture tours and articles, may be lecturing via video conferencing, streamed audio and podcasts to classes of thousands by 2010. Indeed students in the lecture theatre may represent the smallest audience. Recordings and transcripts may also be made available for purchase and download to a global audience.

Faster, cheaper connectivity may also allow greater access to specialist subjects in smaller teaching institutions. Such schools may not be able to justify hiring a teacher in a niche subject, but may be able to afford a share in a teacher whose class would be delivered by video-conference. Video-based classes may not be an ideal method of teaching, but they are still better than none at all.

The increasing use of technology in education is likely to heighten debate over the digital divide, both between developed and developing countries and also between rich and poor regions within each country.

If a PC and broadband connection became mandatory for any pupil, poorer families, who may not be able to afford either, could find themselves seriously disadvantaged⁶⁵. Governments will thus need to consider whether broadband and lap top computers should fall within the scope of universal service provision.

In line with other educational establishments, universities are likely to continue to intensify their use of technology. Currently some are experimenting with podcasts, online lecture notes, videos and other digital materials as means of reinforcing the learning process⁶⁶,⁶⁷. However there is a risk that some students may consider a podcast as a substitute for, rather than a complement to attending a lecture⁶⁸.

As a result, lecturers and educationalists around the world will likely increasingly recognize that although technology has the potential to improve the way educational material is gathered, presented and shared, the teacher will remain the life-blood of education – ensuring that students actively engage and interact with the learning experience. Consequently, in spite of the growth in high-tech digital material, lecturers may revert to distinctly low-tech tactics to ensure attendance⁶⁹, such as headcounts and regular surprise tests that contribute to final grades.

Although the more widespread use of technology in schools will likely translate into higher levels of computer literacy amongst children, concerns may well increasingly be voiced about the effect of technology use on core skills, such as reading, writing and arithmetic.

Some may argue, for example, that word processors have a negative impact on spelling, punctuation and handwriting skills; spreadsheets stunt the development of mental arithmetic, the ease of copying and pasting encourages plagiarism and the use of technology overall can stunt children’s capacity for critical reasoning⁷⁰.

The issue of how best to use technology within education is complex, as technology can both bolster and blunt the educational process. A great deal of work may be required in order to understand fully how technology is best deployed, and how it can improve the dynamics of teaching and learning processes. Companies developing and supplying educational technology should take the lead in answering these and other questions by conducting rigorous, evidence-based research in co-operation with governments, education authorities and academia.

Communicating the results will also likely be key. Helping parents to understand the benefits of technology in education will likely help speed the process of acceptance. Even before the widespread introduction of technology in the teaching environment, the processes and practices of education have changed markedly since most of today’s parents were at school or college. Companies have an important role to play in ensuring that parents are able to keep up with rapid change, and fulfill their part in the education process.

One of the powerful roles that technology could fulfill would be to reduce the administrative burden on teachers, allowing them to spend more time with their pupils. Teachers are already overloaded with work – from marking coursework and exams to preparing classes, handling administration and keeping up to date with changes in the curriculum.

Technological literacy will likely become an ever more important element of education, from primary school onwards. Yet governments, educational authorities and individuals should recognize that technology skills represent just one element of a broader educational program that should also include attaining excellence in fundamental skills such as reading and writing, as well as critical reasoning and knowledge-based learning.

DTT TMT believes that entertainment will likely evolve in a number of key ways thanks to TMT advances. The Internet, once an obscure technical curiosity, may, for some individuals become the single most popular form of entertainment.

The video game market is likely to consolidate, broadening its appeal as new uses for consoles emerge. Indeed devices that once only exercized thumbs, may increasingly be used as a means of exercizing the body and even the mind.

All entertainment formats may become available in ever smaller portions as consumers seek out entertainment that can be consumed in the briefest of dead times: be this waiting in line, commuting or even during pauses in conference calls.

Despite the growing range of alternative distractions, television is likely to continue dominating our entertainment, locking our attention through high definition content delivered via ever larger screens. On-demand television and video will likely grow in popularity, through a variety of technologies, of varying sophistication. In 2010, for some, DVDs delivered by post may still be the preferred route to the wide selection of movies, at the highest resolution. And although ondemand programing and interactive television will likely grow, the scheduler’s job will remain, as many people may be too lazy to watch anything other than whatever happens to be on.

User-generated content will likely also grow in volume. But the large majority of it – from blogs (personal web logs) to home videos – may be of little interest or value to mainstream audiences.

Households with broadband may be spending more time surfing the Internet than watching television by 2010, making Internet-related activities the most popular leisure pursuit⁷¹. Searching, email, instant messaging, exchanging personal photographs, updating blogs, playing games and e-commerce will likely all become mainstream leisure activities⁷².

Much of the excitement around on-demand delivery of content focuses on video, but it is audio-on-demand (AOD) that may have become most significant by 2010.

Despite the roll out of higher speed broadband networks by 2010, the sheer size of video files, along with the growing demands on bandwidth to the home in general, may make video-on-demand (VOD) technically and economically difficult to deliver on a widespread basis by 2010. Audio on the other hand, requires significantly less bandwidth to stream or download. Furthermore, audio files are typically shorter or more easily shortened. Comedy programs for example can readily be cut into individual sketches and soap operas are typically designed to be at most 30 minutes long. Audio archives are also more readily digitized, while presently it is often still cheaper to maintain video archives on tape.

Live concerts may be able to reach audiences in the hundreds of thousands by 2010, thanks to TMT advances. High-speed networks could allow a concert to be relayed to a range of other locations, such as smaller concert halls or public spaces that would show the event on large screens, to televisions in the home to online retail sites (see Figure 6). This could have a significant impact on potential revenues, and should allow supply to start catching up with demand⁷³.

Our media collections start going online

While many consumers will still likely enjoy the collector’s thrill of filling shelves full of DVDs, CDs, books, photographs and other media, by 2010, a bold, trusting minority may decide to have most of their media stored virtually. Access would be on-demand, from any device with a sufficiently fast connection.

Online collections will likely be most prevalent for media that require relatively little bandwidth to deliver immediately. Thus music, talking books and photographs may well be the most common media stored online by 2010.

Consumers may increasingly be drawn to entertainment that can be consumed in small portions: when standing in line, commuting, or even when working. The portable video-games player, MP3 player, portable DVD player, the free newspaper and even online gaming already address this need – but by 2010, there may well be a much wider variety of products and services that are designed specifically to provide entertainment in small doses. Ultra-mobile PCs, portable media players and other devices are likely to deliver an ever wider variety of short-term distractions.

By 2010, the video game will likely have consolidated its position in western countries and should be increasing penetration levels in developing countries⁷⁴. An estimated 80 million adults are forecast to be regular games players by 2010⁷⁵. Playing video games, however, could have evolved from being a largely sedentary activity. A growing range of games may require players to use their bodies to control their virtual player, rather than relying on buttons and joy sticks. The falling price of infrared sensors and video cameras should allow increasingly accurate capture of a player’s movements.

The video game may even become a recognized source of intellectual growth, forming the basis for educational programs, sports instruction and even personal development⁷⁶.

The nuisance of going to the DVD store should have become a distant memory for many people⁷⁷ – but not necessarily because of brand new technology. By 2010, many may still be content to select their DVD online, for postal delivery the following day.

VOD via an IP link may only be an imperative for a highly timeconstrained minority who demand absolute immediacy. VOD via IP may see additional demand as a means of sourcing diverse content that is not available on mainstream channels. Cricket fans resident in North America or baseball fans in Europe may rely on VOD as the only option to obtain live video coverage of their team.

However, program schedulers should consider their jobs safe: they should still have a major role to play, despite the growth of AOD, VOD and increased penetration of digital recorders that facilitate the time-shifting of broadcast content.

Currently the average viewer consumes 24 hours of television and radio per week⁷⁸. If this average is maintained through 2010, the consumption of television and radio will likely remain a predominantly passive activity, as self-programing 24 hours of content may simply take up too much time and require too much effort.

Viewer participation may well have become a more widespread feature in mainstream broadcast programs, as a growing minority of consumers show their willingness to pay for the privilege of control. Voting, participating in competitions and other forms of interaction – particularly where conducted over mobile networks – may become increasingly substantial sources of revenue for program makers and broadcasters. Indeed, there is likely to be a growing move to structure a wider range of programs to exploit consumers’ appetite for participation, in order to increase revenues and fund future program development.

In turn this may lead to more sophisticated ways to participate, allowing viewers not only to influence the fate of individual characters, but also to shape the plot.

User-generated content is also likely to grow in volume. But the large majority of it – from blogs to home videos – may be of little interest or value⁷⁹. However, a gifted few will produce material with broad appeal, and a new category of search business may emerge as a result, helping consumers to avoid the morass, and get quickly to quality material.

Television is likely to remain a dominant entertainment medium through 2010. The growing availability of high definition content (coupled with innate vanity) should drive the average television screen size steadily higher. By 2010 wealthier households may be boasting 100-inch screens⁸⁰ and the majority of new televisions sold in developed countries will be flat panel⁸¹.

Functionality that may emerge by 2010 includes three-dimensional (3D) viewing – without the need for special glasses. The availability of increasing powerful processors in post-production will enable image perspective to be altered enabling images to appear to be in 3D⁸².

Although advances in TMT are likely to change the way we consume entertainment in 2010, the underlying reasons that consumers buy will remain the same. They will still generally want simplicity, value, understandable benefits and thrills. They will likely want as many opportunities to consume entertainment as possible, perhaps to balance out the increasing opportunities provided by employers to work whenever possible.

As a result, the technologies, products and services that have the most profound impact on the entertainment market will likely be those that consumers find easiest to use and access.

Companies that put most focus on how consumers’ entertainment may be maximized as a result of implementing new technology or connectivity are likely to enjoy the greatest success. Companies that are more obsessed with delivering the latest technology, with lesser regard for the user experience or the underlying economics, may not fare as well.

Managing choice, from both supplier and consumer perspectives, should be carefully handled. Suppliers already face a growing number of competing technological standards in television, radio, mobile telephony, storage media and multimedia software. It may not be economically sustainable for an entertainment company to support each of the current standards, let alone the standards that have yet to be invented. Backing too many technologies may prove as fruitless as backing the wrong one: each new technology represents an additional layer of cost and complexity. And with each, not only does management become more difficult, but consumers are given another reason to become either confused or adopt a wait-and-see approach.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.