Convergence Conversations '25th September 2008' findings - 'What role does Mobile Broadband have to play in NGA?'

SUMMARY: 'What role does Mobile Broadband have to play in NGA?'

This year for the first time ever more data than voice will be transferred via mobile devices

Phillip Sheldrake eloquently set the scene for September’s Convergence Conversations, before introducing the three expert speakers present to get the juices of debate flowing. Asif Aziz of Orange, Cesar Bauchout of Analysis Mason, and Colin Long of Olswang all gave impressive summaries of how mobile broadband will impact the NGA debate.

Mobile broadband up-take has taken us all by surprise. A market that barely existed just a few years ago has exploded with the advent of cheap dongles. It now accounts for about 15% of all Broadband subscriptions in the UK and shows no sign of slowing down. Estimates suggest that by 2013 25% of European broadband usage will be via mobile access. The impetus towards mobile broadband should be seen as a natural progression from fixed services, reflecting consumer desire and expectations of seamless migratory internet access.

Understanding the Consumer

A key debate emerged in understanding the lessons learnt from fixed broadband and the ability to take them through into mobile broadband. Given the fact that its usage pattern is differnt from fixed, it is essential for Stakeholders to understand precisely what consumers use mobile broadband for.

For many consumers mobile broadband will be their first experience of broadband. Others will see mobile broadband as a complete substitute for fixed, with a percentage judging it a complement for existing fixed subscriptions. With the increasing speeds it can offer, for many people mobile broadband will then be an acceptable substitute for fixed.

The next generation of broadband users will inevitably take the ‘throw away culture’ to a new level. Expectations that the BBC’s iPlayer service would be a predominantly downloader driven service were quickly changed when a majority of consumers streamed services. Business models must then understand the mentality of mobile broadband consumers in order to be successful. What people want to use Mobile Broadband for will reflect in what people are prepared to pay for the service.

Pricing Models

As ever the issue of pricing came to the fore. Pricing is likely to evolve in similar fashions to those models associated with fixed broadband, with usage levels having differing prices attached. Over time capacity problems may develop, but this can be fixed through caps and price increases. Bandwidth too will increase with time and an acceptable balance will undoubtedly be found.

Those operators solely concerned with fixed broadband may be moving towards dangerous grounds with the advent of mobile broadband. However arguments for NGA investment could be strengthened, attracting consumers back to fixed broadband with superfast speeds. Wholesale services may develop for fixed operators, offering backhaul to mobile operators, stabilising revenue.

WiMAX

WiMAX emerged as a key question throughout the debate, with the dangerous potential to swallow large levels of investment. WiMAX in the UK may be stimulated as Ofcom auction the perfect frequency (2.6) for WiMAX. However the fact that 2.6 is currently tied up in the courts may result in interested parties buying cheaper frequencies elsewhere. Since WiMAX is in obvious competition with LTE, any delay in frequency allocation could put WiMAX products in the market at risk. WiMAX then does not look certain to have a long term future.

Mobile Broadband’s Role

Mobile Broadband has stimulated the market with added competition. In time it will help to offer high speed services to rural areas, filling gaps left with Next Generation Access implementation. However, limited spectrum will add further expense to what is the already expensive to serve Rural area. Mobile Broadband will not offer Universal Coverage, but rather help to serve as many people with as fast as service as possible.

To read more about the conversation, visit the blogs of some of our conversationalists:

Caroline Tarbett, Racepoint Group: http://www.convergenceconversation.com/people/caroline.tarbett.2