UK: Telecommunications Predictions 2010 (Part 1)

Last Updated: 9 February 2010
Article by Deloitte Technology, Media & Telecommunications Industry Group

Most Read Contributor in UK, August 2017

Foreword

Welcome to the 2010 edition of Telecommunications Predictions. This is the ninth year in which the Deloitte Touche Tohmatsu (DTT) Global Technology, Media & Telecommunications (TMT) Industry Group has published its predictions for the TMT sectors.

Predicting always presents fresh challenges – which we are pleased to address. This year's report has been shaped by three in particular.

First, the direction of the global economy. If there was one advantage to making predictions for 2009, it was confirming the consensus view that most major economies were expected to fall into recession. (They did, with a few notable exceptions such as India and China.) In 2010, the picture is considerably more mixed. While it is generally agreed that most economies should recover, there do not appear to be enough shapes or letters available to describe the possible permutations that recovery may take – will it be a U, a V, a W, or a square-root recovery? And a double-dip recession is still possible once the stimulus ends. At the time of writing, governments appeared bullish, corporations more bearish, and economists divergent.

The pace of digitization is another major factor shaping our predictions. The conversion of analog data into digital form first occurred in the telecom sector, and had become less of a challenge or opportunity in recent years. But as the technology and media sectors rush to embrace all things digital and face the new challenge of transporting yottabytes1 of zeros and ones, the global telecom industry has emerged as the linchpin. Finding a profitable business model while doing so may be even more of a challenge.

Third, the adoption of mobile broadband is accelerating – too quickly, perhaps – despite uncertain economic times. As a result, the entire telecom industry, from equipment makers and carriers to consumers and even regulators, is trying to cope.

Our telecommunications predictions for 2010 are focused on the consequences of technological change, particularly digitization and mobile data, and are shaped by 2010's economic outlook. The topics we address include the growing importance of mobile search for smartphones, the success of VoIP on mobile devices, changes in network technologies and pricing plans to cope with the explosion of data, changing contracts both in terms of uptime and duration, and the sector's focus on reducing its environmental impact while saving money.

I am often asked about our Predictions' track record. We are never likely to be 100 percent correct. However, a focus on pragmatism and an aversion to hype has meant that we are more often right than wrong. We never include a prediction only because it will come true in the next year. Rather, our focus is on identifying potential "black swans" whose impact could have major, strategic ramifications for companies not just in the coming year, but possibly for many years to come.

As a result, each prediction is designed to start or stoke a further conversation – not to stop it. And we trust that the Predictions' launch, expected to take place in over 50 cities around the world in 2010, reaching over 5,000 industry executives, serves precisely this purpose.

I wish you every success for 2010 and beyond.

The smartphone becomes a search phone

DTT TMT predicts that in 2010 the smartphone will continue to thrive. Its share of the global mobile market is expected to grow, and it should enjoy solid increases in shipments, units, and dollar value. During the year, debates and headlines about smartphones are likely to concentrate on supremacy among devices, manufacturers, and operating platforms2.

We believe that the most important battle to be waged in 2010 – leadership in mobile search – may fall outside of the radar screens of both analysts and the press, possibly because revenues from mobile search are expected to come in at a modest $1 to $2 billion3. Mobile search providers could end up spending several times that amount in order to strategically position their companies to better exploit future income streams4. Existing search engine platforms are likely to acquire additional functionality and capability5. Brand new mobile search engines may be launched6. Mobile search providers may invest in securing favorable positioning on phones7. And a growing range of partners are likely to be signed up as advocates and channels to market for each platform8.

The enthusiasm over mobile search, whose performance has for many years tended to frustrate rather than delight users9, will likely be driven by recent improvements and near-term potential. In 2008, just 7 percent of the U.S. mobile market used search10. A year later, 40 percent of Japanese phone users used mobile search daily11. Also in 2009, smartphone sales overtook portable PCs for the first time, with 180 million units sold, ranking it (by unit sales) as the leading portable computing device12. By the end of 2010, search is likely to be one of the five most-used smartphone applications, along with voice, messaging, calendar, and browsing13. By 2011, smartphone sales are forecast to exceed all PC sales (mobile and desktop combined), with 400 million shipments14. This should encourage PC manufacturers to diversify into smartphones15. By 2012, smartphone shipments could pass the half-billion mark16. In the same year, search is expected to generate the bulk of the $7.2 billion mobile advertising market17.

There are concerns that mobile search could be nonadditive, serving primarily as a substitute for searches that would otherwise be made from a fixed device. This is probably true for some users.

But the impulsive, spontaneous nature of many searches, combined with good-enough mobile search on smartphones, should cause aggregate searches to rise in much the same way that early mobile phones caused the total number of phone calls to increase. We expect that users with both fixed and mobile Internet devices are likely to perform 10 percent more searches than fixed-only Internet users. By the end of 2010, some aspects of mobile search may be superior to search using a PC. For example, mobile search could not only help you choose where to go for dinner or buy a gift, but also guide you there through integrated GPS navigation18, turn-by-turn or even step-by-step19. The value of this function to advertisers and the providers of such services may prove lucrative.

Bottom line

The fight for preeminence among search providers is likely to be fierce in 2010 and for years to come. In the mid-term, just one or two players may dominate the space20, but the contest is unlikely to be settled in 201021. But within three years or so, the gap between the leading players and those lower down the food chain may have become extremely hard to bridge.

The central role that search is expected to play in future mobile platforms implies that arrangements to share revenues will likely be key to successful business models21. Handset manufacturers and cellular operators are likely to have a powerful influence on the outcome22. In 2010, manufacturers and operators may be able to play search platforms off one another, but picking the wrong partner solely on the basis of guaranteed income, for instance, could prove costly in the long run.

The battle over mobile search may also have a bearing on how smartphones are funded. Subsidies on smartphones may be co-funded by operators and search engine platforms. The search subsidy could tip a customer's purchase in favor of a particular model.

For users, a critical area of differentiation is likely to be the user interface23. The challenge – and opportunity – for mobile search engine developers is that smartphones are likely to be used in a variety of environments: at home, in the office, traveling, driving, being transported, or walking. Developers need to offer a variety of user interfaces for each context. A range of technologies would need to be integrated – voice recognition24 for those in charge of vehicles, or visual search – whereby the search would be driven by images, rather than text25. Visual search would work well for those on foot. Existing technologies such as touch are likely to undergo constant iteration and improvement26.

Developers of mobile search platforms should consider how best to adapt search to the unique characteristics of the mobile experience, which include variable network coverage and speeds. Users could be allowed to store up searches, which are only run once the user is back in network coverage. Mobile search should also integrate with searches performed on other platforms, particularly PCs. Saved searches and favorites created on a mobile device should also be made accessible on a user's PC-based search environment.

Search is likely to become increasingly important for application stores, given the rapid proliferation in applications. Developers should consider developing search engine platforms that work within a specific application store as well as across them.

Mobile VoIP becomes a social network

DTT TMT predicts that in 2010, users and usage of mobile Voice over Internet Protocol (VoIP) should start to evolve from niche to mainstream, thanks to the availability of new services that blend a range of IP-based features around the mobile voice experience. In addition to offering low-cost calls, these services will offer a wide range of functionality including one-tomany calls, broadcast voice mail, and voice-to-text. Users of multifunction mobile VoIP services should reach tens of millions by the end of 201027.

Rising adoption of these services could cause a fundamental shift in expectations of what mobile voice can and should do.

VoIP via a mobile phone has been technically possible since the start of the decade, thanks to 3G and WiFi. In the past, it has been marketed mainly as a low-cost service, particularly for international calls28. VoIP is able to offer lower costs because calls are carried over the top of an IP-based network – outside the conventional toll-based network29.

This means that the marginal cost of making a call over VoIP, whether over a fixed or mobile network, is zero if the caller has already made all required investments in devices and data plans.

However, issues such as restrictions on VoIP over 3G in some markets, patchy WiFi availability, the relatively high cost of WiFi-enabled phones, and the falling price of switched mobile telephony, have meant that mobile VoIP revenues have been modest, with turnover estimated at $50 to $100 million in 200930. But within three years, analysts estimate the global mobile VoIP market could be worth over $30 billion31.

One key supply enabler of mobile VoIP's growth may be a rise in the installed base of WiFi-enabled mobile phones. WiFi will likely be widely used as the preferred medium for the functionality available in mobile VoIP services, and shipments of WiFi-enabled phones should exceed 200 million in 201032. Another enabler is the rise in WiFi hotspots, with public hot spots expected to number a quarter of a million at the start of 201033.

Demand for multi-function mobile VoIP is expected to be driven partly by the shifts in communication patterns. Mobile VoIP will be able to accommodate the growing trend of broadcasting to friends, rather than interacting with just one person. Widespread email usage and the more recent rise of social networks have driven the desire to communicate to many people at once. Voice, via mobile or fixed networks, does not readily offer this capability yet – but mobile VoIP can.

Multifunction mobile VoIP can also deliver a range of other functions that consumers have become accustomed to. For example, public Web-based email services offer unlimited storage and search, and mobile VoIP, combined with speech-to-text conversion, could deliver the same.

Mobile VoIP could also offer new services. Consider a system for voicemail storage, in which messages could be stored, searched for, made visual, transcribed, translated, and broadcasted to groups or sent to individuals. Similarly, text and picture messages, voicemails, and call records could all be cataloged by the sender. Incoming calls could be presented not just with the caller's name or number but also with the caller's location, status, and most recent updates. High-fidelity calls at higher prices could also be offered34.

The quality of some of these services, such as "voice-totext," may be shaky in 201035, but should steadily improve over the midterm. The number and variety of services available should rise steadily as well.

Multifunction mobile VoIP is likely to have its challenges. While some operators and service providers may encourage its use, others may restrict36 or prohibit it37. Voice quality over WiFi is still variable, although improving. WiFi coverage is still far from ubiquitous, and WiFi-to-cellular hand-offs may remain problematic. Preconceptions may present another challenge – for some users, perceptions of WiFi's power consumption may have been sullied by the poor battery life of the first WiFi-enabled phones38.

The version of mobile VoIP most likely to gain traction in 2010 is the one that does far more than just make conventional phone calls. In the long term, it could change the notion of voice telephony significantly.

Bottom line

Operators should understand the short- and mid-term implications of mobile VoIP. Routing calls over WiFi could reduce demands on the cellular network, catalyze the disappearance of the voice tariff, and reduce overall termination charges for smaller operators in markets with a "calling party pays" regime.

But operators should consider that companies outside the sector developing mobile VoIP applications may not necessarily be after a slice of the $700 billion mobile-voice market39.

Instead, they could be using the allure of subsidized or free calls to devices to enable the flow of advertising messages, for example40. This approach could bolster the device or advertising sector, but would also have a serious impact on the value of the mobile-voice market. If mobile VoIP results in declining revenues for operators, available investments for the maintenance of current networks could also drop, and funds available for the roll-out of next-generation infrastructure could be threatened. Pricing for data access may have to rise, perhaps by moving to metered bandwidth charges to compensate for the shortfall41.

Companies that promote multifunction mobile VoIP are likely to include traditional operators – mobile providers looking to move traffic off congested cellular networks, for instance, or, standalone fixed-line carriers looking to provide a form of virtual mobile service42. Even classic market disruptors, such as technology companies diversifying their revenue streams, should be considered43.

Portals such as Yahoo or Facebook could promote mobile VoIP applications as a way to encourage the use of smartphone versions of their websites, giving them a way to keep more eyeballs on their sites and create more loyal communication hubs.

Widening the bottleneck: telecom technology helps decongest the mobile network

DTT TMT predicts that in 2010 telecommunication technologies that make existing wireless networks perform better – hardware, software, and radiofrequency solutions – should experience much stronger growth than overall IT spending. Leading pure-play companies in this area are likely to see year-over-year growth approaching 100 percent, and even an average company is expected to grow by 30-40 percent.

The current consensus forecasts 2010 IT spending growing at about 3.3 percent44. Overall, the telecom equipment manufacturing sector is expected to grow at 3.2 percent, with spending on mobile networks growing at roughly 7 percent45. This is an improvement compared to the last two years, but it pales when compared to the double-digit growth rates seen in the late 1990s. There are several reasons why we are expecting certain pockets of technology to grow 10 times faster than the broader category of telecom equipment.

Broadband cellular technologies have been deployed for almost a decade, but it wasn't until 2009 that consumers really began to take advantage of the higher wireless speeds. At the start of 2010, there should be about 600 million mobile broadband connections between laptops, netbooks, and smartphones46. As a result, global cellular data wireless networks will have gone from underutilization to congestion, the wireless equivalent of traffic jams, in 18 months47. But in most of the world, this change in consumer use of mobile broadband was spurred by carriers providing large subsidies on devices and "all you can eat" data plans48.

As a result, wireless providers are now addressing insufficient network capacity. But because data traffic is largely unmetered, there is no commensurate increase in revenues to pay for the required network upgrades. By 2014, network capacity issues should be dealt with by 4G technologies (Long Term Evolution (LTE) and WiMax), but in most service areas neither of those technologies will be fully deployed in 201049. The challenge for carriers is determining what to do in the interim. And the problem is likely to get much worse as smartphones continue to take market share and new high-bandwidth devices like netTabs50 become popular.

The short-term solutions are not as simple as one might think. In many areas, the spectrum is already allocated, fully utilized, and costly to purchase51. Increasing the power of the radios may not be of much help, nor would increasing the number of cell sites. In dense urban areas the radios are already as tightly packed as they can be, even if more sites could be found and permitted. Even transitional 3G technologies like HSPA+ and HSPA7.2 have limited benefits. Although they increase peak speeds for those in close proximity to the towers, those even slightly further away (more than 500 meters) or inside buildings, can experience a sharp drop-off in speed52.

Finally, and most importantly, network congestion issues sometimes have less to do with providing very high broadband download rates to a few users. Instead, they often revolve around providing highly variable two-way bandwidth to many mobile users whose usage requirements change from minute to minute. One study found that smartphones generate eight times the network signaling load of a comparable mobile broadband-enabled computer53.

The specific sectors we believe will see strong growth in 2010 include hardware and software companies. Hardware markets will include various kinds of backhaul, antenna, femtocell, and depending on regulatory decisions on net neutrality, deep-packet inspection and media management technologies. Software markets include policy management, compression, streaming, and caching technologies54. Although not a pure-play, WiFi providers are also likely to grow as a way of moving bandwidth off overstressed cellular networks.

Carriers are likely to embrace any handset or wireless modem technology that is more spectrally and bandwidth efficient.

Finally, there may be continued growth in bandwidthaware applications. When a website is viewed over a high-speed fixed line, it will have all the "bells and whistles" (pop-up ads, pre-rolls, HD video, rich media, and Flash). However if viewed over a busy network, a "leaner" version of the Web, requiring half the bandwidth, would be served.

Bottom line

Manufacturers of traditional cellular network equipment are unlikely to benefit as much as the pure-play network decongesters. When LTE and WiMax networks are fully rolled out, the big telecom original equipment manufacturers (OEMs) should generate billions of dollars in sales. But in the interim, the technologies that are likely to succeed are either coming from new entrants or are too small in dollar terms to affect materially the top line of multibillion-dollar companies. The overall trend of sustained exponential growth in wireless broadband demand is likely to pull forward the implementation of 4G network builds.

Handset-makers, specifically of smartphones, are part of the problem and potentially part of the solution as they may manufacture some of the devices that "strain" the wireless networks. On the other hand, if they adopt technologies that enable lower network usage relative to their competitors, the carriers might focus promotional activities and subsidies on their devices.

Social networking, cloud computing, and streaming media companies rely on mobile broadband networks that work. But they can help by developing solutions that adapt to fluctuating bandwidth in real time, and by offering stripped-down versions of their products that continue to function, even when the broadband pipe turns narrow.

Wireless carriers are in a difficult predicament. They need to respond to customer needs for speed while trying to manage their usage through techniques that some clients may consider heavy-handed, like metered pricing and traffic management. But heavy spending on technologies to improve the mobile broadband experience may be futile in the short term. Based on evidence to date, if carriers improve mobile bandwidth capacity by an arbitrary X percent, consumers are likely to consume at least two times as much data. In other words, in 2010, any sensible increase in network capacity will probably be more than fully utilized by "data-gulping consumers," leaving carriers poorer, and customers just as unhappy as before.

Paying for what we eat: carriers change data pricing and make regulators happy

DTT TMT predicts that in 2010 North American network operators – both wireless and wireline – will likely move away from "all you can eat" data pricing plans. Instead, some customers will almost certainly be billed for how much data they use, and may even be charged for when they use it and also what kind of data is being used55.

These new pricing schemes will likely be encouraged by regulators. Tying bandwidth consumption to the cost of providing it will reduce the need for carriers to use other tools to manage traffic, and may render much of the net neutrality issue moot.

The consensus view on North American data pricing has been that the only way to attract subscribers is to offer unmetered data. Moreover, the consensus also suggests that once made, the offer of unmetered data pricing can never be withdrawn without enormous customer backlash56.

Although the net neutrality debate continues to rage in both Canada and the US, many industry observers believe that carriers are likely to be the biggest losers when the regulators lay down the law57.

Motivated by a desire for net neutrality, regulators may introduce new rules allowing service providers to move to more usage-based pricing, and simultaneously defuse consumer complaints by observing that the carriers were practically forced to do so58.

There is a strong need for more rational pricing, especially in the mobile market. Although consumers are signing up for broadband in record numbers, often encouraged by flat-rate pricing, networks are becoming congested and are either running slowly or denying access entirely. Unhappy customers are voicing their displeasure – but seem unwilling to pay more to improve service59.

This phenomenon is most obvious on smartphonecongested mobile networks, but even high-speed landline broadband is beginning to bump up against capacity – especially as usage patterns shift. Where peak usage once occurred from 6pm to 11pm, it is now two hours shorter, from 7pm to 10pm60. The long-time pattern of some super-users remains consistent: 25 percent of all bit consumption is incurred by 1 percent of the users. But unlike past years, this is no longer primarily peer-to-peer (P2P) traffic. P2P is down from 32 percent to 20 percent according to one study, while video and audio streaming is the new traffic leader, up from 13 percent in 2008 to 28 percent in 200961.

Broadband providers have historically attempted to stigmatize P2P users as "bandwidth hogs"62, suggesting that they are unrepresentative of the broader Internet user. They have even hinted that most P2P users are akin to pirates63. The service providers argued that they were therefore entitled to use various means to manage this traffic by "shaping" and "throttling" certain users or certain types of traffic64.

Consumers and regulators alike have argued that these traffic management solutions are violations of net neutrality – effectively discriminating against certain users, and are possibly even a tool for the providers to steer customers away from cheaper services offered by competitors towards similar revenue-generating services offered by the carrier65.

As 2009 came to a close, both the U.S. Federal Communications Commission (FCC) and the Canadian Radio-television Telecommunications Commission (CRTC) regulators issued draft net neutrality guidelines that, while not identical, were similar66. In each jurisdiction, the regulator was willing to admit that wireline broadband providers had the right to occasionally use traffic-shaping tools to manage their network. The Canadian regulator also said that although the draft rules did not yet apply to wireless broadband, they expect to eventually enforce similar rules on mobile, while the U.S. regulator included wireless immediately. However, the key aspect was that any traffic-shaping needed to be transparent to users and only used as the last resort.

In Canada, the regulator explicitly said that "economic measures" (meaning usage-based pricing) should be the first line of defense in managing network congestion. In the U.S., some of the larger carriers' first reaction was to discuss "pricing options" as the only viable way of handling the "inordinate usage" of some of their customers67.

Although carriers have feared that net neutrality rules would force them to provide services that don't make sense economically, the reality may be that the new rules will make it easier for them to shift customers off the unmetered broadband plans that appear to be breaking their networks.

Bottom line

Moving away from "all you can eat" is only the first step – a key question is what kind of metering will work best. Should charges be similar to water or electricity? Or perhaps more like cell phone bundles?

Many Internet service providers offer tiered service, with various caps on total bits used in a billing period. But, once these caps are exceeded, each additional bit can be prohibitively expensive. These overage charges may make sense from the carrier's perspective as they create an incentive for the consumer to opt for more expensive plans69. But consumers argue that this approach is too costly for users and too profitable for carriers70.

On the other hand, a pure metered "pay per byte used" could dramatically reduce revenues for carriers. Hardware and software providers are likely to benefit, not only those that track and measure the speeds and bits provided, but also those that allow consumers to monitor their bandwidth consumption in real time – to prevent massive overage charges71. In a relatively weak telecom-equipment market, these players could experience much better than average growth rates.

Carriers and handset makers may also need to adjust current sales strategies. Much of the recent growth in broadband subscriptions has come from selling unlimited usage plans, and a move back towards the meter will require a new model, and will likely only work if all providers and device manufacturers cooperate.

The net neutrality debate is primarily a North American issue. Most global wired and wireless providers already have tiered pricing on usage, and therefore have less need for a regulatory incentive to move away from "all you can eat" plans. Also, when carriers do engage in traffic-shaping practices, there seems to be hardly any controversy outside of North America or the UK72.

Footnotes

1 A yottabyte is the equivalent of 1 septillion (1,000,000,000,000,000,000,000,000) bytes.

2 Report: Microsoft, Linux to dominate smart phones by 2010, ZDNet Asia, 21 February 2006: http://www.zdnetasia.com/news/communications/0,39044192,39311380,00.htm ; and Verizon Droid vs. iPhone 3GS Side-by-Side Camera Showdown, The iPhone Blog, 4 November 2009: http://www.theiphoneblog.com/2009/11/04/verizon-droid-iphone-3gs-camera /; and What I Like and Dislike About the Verizon Droid, jk OnTheRun, 6 November 2009: http://jkontherun.com/2009/11/06/what-i-like-and-dislike-about-the-verizon-droid /

3 US Mobile Search Ad Revenues to Reach $1.4B in 2012, Marketing Charts, 11 September 2007: http://www.marketingcharts.com/interactive/us-mobile-searchad-revenues-to-reach-14b-in-2012-1578 /

4 Google, This Side of $100 Billion, Advertising Age, 23 November 2009: http://adage.com/bookstore/post?article_id=140699

5 Baidu's Challenge: Expand Beyond Its Success in China, CNBC, 3 November 2009: http://www.cnbc.com/id/33435385 ; and Google improves mobile search, broadening market for SEO, Brafton, 14 October 2009: http://www.brafton.com/industry-news/google-improves-mobile-search-broadening-market-seo-$1334107.htm ; and Was Apple Seriously Bidding For AdMob? Why?, Business Insider, 9 November 2009: http://www.businessinsider.com/henry-blodget-wasapple-seriously-bidding-for-admob-why-2009-11 ; and Google Redefines Disruption: The "Less Than Free" Business Model, Above the crowd, 29 October 2009: http://abovethecrowd.com/2009/10/29/google-redefines-disruption-the-%E2%80%9Cless-than-free%E2%80%9D-business-model /

6 Mobile search: Here's why Apple may take on Google, Daily Finance, 4 November 2009: http://www.dailyfinance.com/2009/11/04/mobile-search-heres-whyapple-may-take-on-google /; Taptu: new search engine, new partner, Tech Crunch Europe, 11 February 2008: http://eu.techcrunch.com/2008/02/11/taptu-newsearch-engine-new-partner /; and Searchme Launches Visual Search Engine For Mobile Devices, Tech Crunch, 18 September 2008: http://www.techcrunch.com/2008/09/18/searchme-launches-visual-search-engine-for-mobile-devices /; and Jumptap Raises $26 Million Series D To Take On Google In Mobile Search; Strengthens Ties to AT&T, Tech Crunch, 26 August 2008: http://www.techcrunch.com/2008/08/26/jumptap-raises-26-million-series-dto-take-on-google-in-mobile-search-strengthens-ties-to-att /

7 Yahoo Beats out Google on O2 Germany, PC World, 2 November 2009: http://www.pcworld.com/businesscenter/article/181178/yahoo_beats_out_google_on_o2_germany.html ; and Microsoft Close To Blowing Another $1 Billion On Verizon Search And Mobile Deal, The Business Insider, 12 November 2008: http://www.businessinsider.com/2008/11/microsoft-close-to-blowing-another-1-billion-on-verizon-search-and-mobile-deal ; and Some Of Verizon's Google Android Phones Could Use Bing As Default Search Engine, The Business Insider, 6 October 2009: http://www.businessinsider.com/some-of-verizons-google-android-phones-could-use-bing-as-default-search-engine-2009-10

8 Best Buy Lends Google A Hand To Distribute Google Mobile App, eBrandz, 7 November 2009: http://news.ebrandz.com/google/2009/2959-best-buy-lendsgoogle-a-hand-to-distribute-google-mobile-app.html

9 8 out of 10 mobile Internet users frustrated by search, BizReport, 24 November 2009: http://www.bizreport.com/2009/11/8_out_of_10_mobile_internet_users_frustrated_by_search.html

10 Verizon, Google Kiss And Make Up For Search Deal, But Where's Android?, The Business Insider, 22 August 2008: http://www.businessinsider.com/2008/8/verizon-google-kiss-and-make-up-for-search-deal-but-where-s-android -

11 Survey Shows 40% Use Mobile Search Daily, Wireless Watch Japan, 6 November 2009: http://wirelesswatch.jp/2009/11/06/survey-shows-40-use-mobile-searchdaily /

12 PC Vendors eyeing Smartphone market: Gartner, new Kerala: http://www.newkerala.com/nkfullnews-1-139676.html

13 Mobile search: Here's why Apple may take on Google, Daily Finance, 4 November 2009: http://www.dailyfinance.com/2009/11/04/mobile-search-heres-whyapple-may-take-on-google /

14 CHART OF THE DAY: Smartphone Sales To Beat PC Sales By 2011, The Business Insider, 21 August 2009: http://www.businessinsider.com/chart-of-the-daysmartphone-sales-to-beat-pc-sales-by-2011-2009-8

15 Acer expects 2010 smartphone shipment growth to outpace market, Total Telecom, 15 October 2009: http://www.totaltele.com/view.aspx?ID=449877

16 Infonetics: Smartphone sales to overtake standard mobile phones by 2012, Telecom Engine, 6 November 2009: http://www.telecommagazine.com/newsglobe/article.asp?HH_ID=AR_5886

17 Mobile Ad Network JumpTap Goes After Google, The Business Insider, 15 April 2009: http://www.businessinsider.com/mobile-ad-network-jumptap-goes-aftergoogle-2009-4

18 Telling the user where to go, telecoms.com, 26 October 2009: http://www.telecoms.com/15405/lbs-telling-the-user-where-to-go

19 Google's Latest Disruptor: Free Turn-By-Turn GPS Maps, The Business Insider, 28 October 2009: http://www.businessinsider.com/googles-latest-disruptor-freeturn- by-turn-gps-maps-2009-10 19 Google Maintains Wide Lead In Mobile Search Market, Paid Content, 8 July 2009: http://paidcontent.org/article/419-google-maintains-wide-lead-in-mobilesearch- market/

20 Microsoft Signs Mobile Ad Deal With Hyatt, mocoNews, 22 June 2009: http://moconews.net/article/419-microsoft-signs-mobile-ad-deal-with-hyatt /

21 Ibid.

22 How Microsoft Blew Its Verizon Deal, The Business Insider, 16 November 2009: http://www.businessinsider.com/how-microsoft-blew-its-verizon-deal-2009-11

23 Swype: A new way to compose sentences on mobile devices, TechFlash, 23 November 2009: http://www.techflash.com/seattle/2009/11/swype_a_new_way_to_compose_sentences_on_mobile_devices.html

24 Verbalize! Google Mobile Search gets Speech Recognition, OnlyGizmos, 3 November 2009: http://onlygizmos.com/google-mobile-search-gets-speechrecognition/2009/11 /; and Voice recognition gets "cloudy," but is it the "new touch"?, ars technical, 28 October 2009: http://arstechnica.com/microsoft/news/2009/10/voice-recognition-gets-cloudy-will-soon-rival-humans.ars

25 Future of web search is '3D' and 'visual', expert tells C4, Information World Review, 18 November 2009: http://www.iwr.co.uk/information-worldreview/news/2253454/future-web-search-3d-visual

26 For example, see: http://www.swypeinc.com /

27 As of November 2009, there were 1.4 million users of Google's multi-function voice service, Google Voice. Source: Google Voice adds pseudo-mobile number portability, Fierce VoIP, 27 October 2009: http://www.fiercevoip.com/story/google-voice-adds-mobile-number-portability/2009-10-227?utm_medium=rss&utm_source=rss&cmp-id=OTC-RSS-FV0 ; and Skype's iPhone app had been downloaded over 4 million times by July 2009. Source: Google Voice takes VoIP to Android, BlackBerry, internetnews.com, 15 July 2009: http://www.internetnews.com/mobility/article.php/3830086

28 Nimbuzz launches low-cost international calling!, RealWire, 9 November 2009: http://www.itnewsonline.com/showrwstory.php?storyid=1650 ; http://www.truphone.com /

29 For example see: New BlackBerry Bold 9700 VoIP-friendly, about.com. 26 October 2009, http://voip.about.com/b/2009/10/26/new-blackberry-bold-9700-voipfriendly. htm

30 Jajah, a mobile VoIP pure play, has estimated revenues of $30 million. Other major players in the mobile market include Truphone and Skype. Source: Giants vying to buy Jajah, Haaretz.com, 12 November 2009: http://www.haaretz.com/hasen/spages/1127406.html .

31 The inevitability of mobile VoIP, VON, 19 October 2009: http://www.von.com/articles/the-inevitability-of-mobile-voip.html

32 Wi-Fi-Enabled phone shipments continue to double every two years, according to ABI Research, Business Wire, 26 August 2009: http://www.marketwatch.com/story/wi-fi-enabled-phone-shipments-continue-to-double-every-two-years-according-to-abi-research-2009-08-26

33 Wi-Fi hotspot market getting white hot, iTWire, 12 November 2009: http://www.itwire.com/content/view/29275/127 /

34 Mobile VoIP is driving net neutrality, VentureBeat, 11 September 2009: http://venturebeat.com/2009/09/11/mobile-voip-is-driving-net-neutrality /

35 Our favourite Google Voice screwups, The Business Insider, 4 November 2009: http://www.businessinsider.com /our-favorite-google-voice-screwups-2009-11

36 T-Mobile Germany: Play for VoIP usage or we will continue to block it, mocoNews.net, 4 June 2009: http://moconews.net/article/419-t-mobile-germany-pay-forvoip-usage-or-we-will-continue-to-block-you /

37 Google says Apple silenced its Voice, The Register, 18 September 2009: http://www.theregister.co.uk/2009/09/18/fcc_releases_google_reponse /

38 Mobile Wi-Fi battery issues 'solved', ZDNet UK, 12 March 2007: http://news.zdnet.co.uk/communications/0,1000000085,39286265,00.htm

39 Gartner says mobile VoIP poses a huge challenge for traditional mobile voice providers, Fierce Wireless, 5 May 2009: http://www.fiercewireless.com/pressreleases/gartner-says-mobile-voip-poses-huge-challenge-traditional-mobile-voice-providers

40 Google Voice: Next generation telco?, Search Engine Land, 12 March 2009: http://searchengineland.com/google-voice-next-generation-telco-16904

41 Neutral wireless networks will mean higher prices, Broadband, 20 October 2009: http://www4.broadbandreports.com/shownews/Neutral-Wireless-Networks-Will-Mean-Higher-Prices-105064

42 BT squares up to Google Voice with Ribbit Mobile, The Register, 4 November 2009: http://www.theregister.co.uk/2009/11/04/bt_google_voice /

43 Google announces acquisition of Gizmo5. They now have a soft phone for Google Voice, TechCrunch, 12 November 2009: http://www.techcrunch.com/2009/11/12/google-announces-acquisition-of-gizmo5 /

44 Gartner says IT pending to rebound in 2010 with 3.3 percent growth after worst year ever in 2009; Gartner Newsroom, 19 October 2009: http://www.gartner.com/it/page.jsp?id=1209913

45 Ibid.

46 Mobile subscriptions at 4.6 bln by year-end – ITU, Reuters, 6 October 2009: http://www.reuters.com/article/companyNews/idUSL626515420091006

47 AT&T CTO downplays role of iPhone in network's issues, Ars Technica, 10 October 2009: http://arstechnica.com/apple/news/2009/10/att-cto-downplays-role-ofiphone-in-networks-issues.ars (AT&T CTO makes point that it is many smartphones, not just the iPhone).

48 The end of all you can eat, Total Telecom, 9 March 2009: http://www.totaltele.com/view.aspx?ID=443818 . Not all data plans are truly unlimited, but many are.

49 Vendor selection has no surprises, Gerson Lehrman Group, 16 November 2009: http://www.glgroup.com/News/Vendor-Selection-Has-No-Surprises-44840.html

50 Net tablets, or netTabs, will be based on a new form factor and feature significant processing capacity. They will aim to offer an appealing balance of form and function. Priced between $400 and $800, they are likely to weigh less than 500 grams and measure about 20 cm by 12 cm by 2.5 cm. They are expected to include cellular and WiFi access, full-color touch screens, and well-populated app stores. For more information on netTabs, see Technology Predictions 2010, Deloitte Touche Tohmatsu.

51 AT&T: iPhone coverage getting better, faster soon, Gearlog, 23 June 2009: http://www.gearlog.com/2009/06/att_iphone_coverage_getting_be.php . 1900 Mhz is completely saturated, but does talk about moving to old TDMA 850 spectrum as a stopgap.

52 AT&T details speed, capacity upgrades, PC World, 9 September 2009: http://www.pcworld.com/article/171658/atandt_details_speed_capacity_upgrades.html

53 Airvana identifies 8X network load multiplier effect for smartphones, Airvana, 14 October 2009: http://www.airvana.com/news/news_950.htm . As a note, this increase in signalling load is not the same as total bandwidth consumed, but it is nonetheless a strain on the network.

54 There will be many technologies, both hardware and software, that are poised to benefit. Many of them did not exist or had not been announced at time of writing. But if they make current generation cellular networks run more smoothly, then they jibe with this Prediction.

55 The end of the broadband buffet is nigh, Gigaom, 17 November 2009: http://gigaom.com/2009/11/17/the-end-of-the-broadband-buffet-is-nigh / and Welcome to consumption-based broadband, Gigaom, 4 February 2009: http://gigaom.com/2009/02/04/welcome-to-consumption-based-broadband / The regulatory rules around net neutrality are not yet 100 percent clear, but seem flexible enough to allow for quality of service tiers relating to time of day and ability to stream video, etc. as long as customers are made aware.

56 After backlash, Time Warner shelves pricing change, Newser, 16 April 2009: http://www.newser.com/story/56395/after-backlash-time-warner-shelves-pricingchange.html

57 Verizon CEO slams Net neutrality, CNET News, 21 October 2009: http://news.cnet.com/8301-30686_3-10379932-266.html?part=rss&subj=news&tag=2547-1_3-0-20

58 Net neutrality and the spectrum quest, TMCnet, 4 November 2009; http://it.tmcnet.com/topics/it/articles/68228-net-neutrality-the-spectrum-quest.htm ; and Carriers eye pay-as-you-go Internet, The Wall Street Journal, 21 October 2009: http://online.wsj.com/article/SB10001424052748703816204574483674228258540.html?mod=wsj_share_digg

59 The iPhone is not an all-you-can-eat buffet, Slate, 6 October 2009: http://www.slate.com/id/2231646 /; and Orange UK reveals iPhone data limit, Telecoms.com, 4 November 2009: http://www.telecoms.com/16016/orange-uk-reveals-iphone-data-limit

60 Video-on-demand now 27 percent of Internet traffic: Study, Sandvine study, Broadcast Newsroom, 26 October 2009; http://webcast.broadcastnewsroom.com/articles/viewarticle.jsp?id=883568

61 Ibid.

62 What to do about bandwidth hogs?, Network World, 24 September 2009: http://www.networkworld.com/news/2009/092409-intown-suites-bandwidthmanagement.Html

63 For an academic study which shows that peer to peer traffic is not always based on illegal content, see: http://www.cs.rutgers.edu/~rmartin/teaching/fall08/cs552/position-papers/023-01.pdf

64 Traffic prioritisation, Plusnet, 11 September 2009: http://www.plus.net/support/broadband/quality_broadband/traffic_prioritisation.shtml

65 FCC Ready to curb ISP traffic management, msnbc.com, 25 February 2008: http://www.msnbc.msn.com/id/23340949 /

66 FCC proposes network neutrality rules (and big exemptions), Ars Technica, 22 October 2009: http://arstechnica.com/tech-policy/news/2009/10/fcc-proposesnetwork- neutrality-rules-and-big-exemptions.ars; and UPDATE 1 – Canada allows Internet 'throttling' as last resort, Reuters, 21 October 2009: http://www.reuters.com/article/companyNews/idUSN2124382520091021

67 AT&T weighs higher fees for data hogs, Network World, 22 October 2009: http://www.networkworld.com/news/2009/102209-att-weighs-higher-feesfor.html?hpg1=bn

68 When a customer uses more minutes or megabytes in a month than allowed in that month as per the cell phone plan that they have signed up for, the extra minutes or megabytes cause overage charges.

69 Is there a method in cellphone madness?, The New York Times, 14 November 2009: http://www.nytimes.com/2009/11/15/business/15price.html?_r=1&th=&adxnnl=1&emc=th&adxnnlx=1258646546-hqPTRy8UEW0DBK6JlIHmeg

70 Yeah, I'd like metered broadband, too – if it were actually metered, Gigaom, 29 October 2009: http://gigaom.com/2009/10/29/yeah-id-like-metered-broadbandtoo-if-it-were-actually-metered /; and Some metered broadband myths that need clearing up, Broadband, 29 October 2009: http://www.dslreports.com/shownews/Some-Metered-Broadband-Myths-That-Need-Clearing-Up-105215

71 Bridgewater proposes bill shock solution, Mobile Marketing Magazine, 7 April 2009: http://www.mobilemarketingmagazine.co.uk/2009/04/bridgewaterproposes-bill-shock-solution.html

72 3UK shapeshifts on traffic shaping, The Register, 13 November 2009: http://www.theregister.co.uk/2009/11/13/3_traffic_shaping_again /; shows that there is some public reaction to traffic shaping, but it is certainly muted compared to the North American protests.

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