Cell Life

I have been member of an online group here by the name of Momo - Delhi. For some time there has been a discussion over a technology by the name of ” BlueSky Positioning http://www.blueskypositioning.com/ )” which if used by operators in their SIM cards, can make Location Based Services arena quiet an easy one, for telecom operators around the world. A number of people shared their views on this topic. Some of these are:

” This is a cool technology ..if anyone on this list works with Telecom companies, please forward this link to them,  if they consider to incorporate this technology in their SIM cards than it will open flood gate of LBS Services . Imagine a world where you can do a LBS App for Entry level Nokia Handset.  This is the SIM, Which can do it.”                                                                                                                              …Prashant

“I don’t get it. If the carriers put a little extra software into their towers to monitor signal strength of existing phones, they can know where phones are already. Why would an Indian telecom company want to re-deploy 70m SIM cards when their ARPU/ customer are already so low and getting lower?  Doesn’t a tower of central software solution make more sense to people?”                                                           …Sean

“This scheme of things have few advantages over Cell ID Triangulation:

#1 unlike Cell ID Triangulation  its independent of Network  Signal Strength at any given location [because its GPS assisted] so you can point location to a greater accuracy

#2 DUE To SIM + GPS combo I Think it  will be possible to  provide  location  info even when  you are roaming on other network .

#3 we did some tinkering around with Cell ID info and tried to map it with GPS Co-Ordinates on MY N95. accuracy /precision  was more in GPS mode but funny thing was how fast and randomly the Tower ID changed within a stretch of 2 KM on a HIGHWAY while GPS thing was more steady, so useful for feeding into a Trail kind of application.

Right now when we say LBS we think of only high end phones, this can change it.”                        …Prashant

One of the group members, contacted “Velipekka Kuoppala, Vice President Sales and Marketing of BlueSky Positioning” for the benefit of all of us. Here is a summary of an email conversation he had with Velipekka Kuoppala, Vice President Sales and Marketing of BlueSky Positioning. Some of the doubts about their  technology is cleared  in his replies.  He was kind enough to agree for posting this conversation on blogs and groups and also to answer another round of queries so if anybody wants to ask something specific please let us know.

So, here is the info straight from his mouth:

Does deploying your offering require physically changing/ replacing SIM Card or is it a SIM Tool Kit which can be pushed OTA?
Veli: SIM change is needed. It’s a hardware/ software solution. Afterwards different applications can be handled via OTA.

There was a rumour that it can be detected via GPS even when the Cellphone battery is off?
Veli: Off means off! That rumor is plain wrong.

What is the accuracy  of positioning (Error range ) ?
Veli: Like any other A-GPS technology. From few meters up to ~35meters.

How its better than Cell ID Triangulation?
Veli: The relevant point is: ROI for operators offering LBS will be directly proportional to the number of subscribers who can be located. To enjoy maximum return from location-enabled services, operators should logically select a technology, which is available to all wireless users and which provides the best price/ performance ratio. 

Just think on country side, where you have one base station each 10-20miles – triangulation does not give any needed accuracy for any kind of LBS applications on that kind of conditions. Emergency situations being the most important ones.

Mr. Graham Curry, Assistant Operations Manager for the Lancashire Ambulance Service, offers the emergency services’ perspective: “Over 50 percent of calls to the emergency services are now made via mobile phones, and current estimates suggest that over 1 million emergency callers across the EU are unable to indicate their location each year. In an emergency situation it is critical that we reach the person in distress as quickly as possible, and the ability to provide accurate location information via mobile phones could mean the difference between life and death.”
 
In city areas, some applications (there are hundreds of these) need even a few meter accuracy and some not – when needed, like with several tracking apps,  triangulation is not suitable for that. Cell ID itself is quick and good with its limitations, and is rather complementary than competing technology versus GPS. While starting talk about triangulation – we start as well to talk about additional cost.

Is this available for CDMA?
Veli: Each basestation has GPS receiver build in, and there are many GPS phones available under CDMA technology. Saying that, the business case in CDMA is not very strong.

The above conversation indeed gave some insights on this technology. However, we will have o keep our finders crossed until we see this technology being adopted by telecom companies. I strongly beileve however, that it may be added to the new SIM cards being developed but companies will not be able to do it for the ones already in use…

VS

The cottage industry for used Apple iPhones is no secret, thanks to eBay and a sizable gray market, especially overseas.  A new company, Freeiphoneswap, hopes to simplify the process for sellers by eliminating the need to deal with strangers and by offering enough money to cover the purchase of a new iPhone 3G.

Sam Hickson, who runs the as-yet unincorporated company, said there are two sales methods.  Consumers can mail old iPhones to a location in New Jersey and then receive a check or a PayPal transfer, or they can visit what Hickson calls “street teams” staffed by models and temps who buy old iPhones on-site.  He said teams will open today in Atlanta, Long Beach, Miami and New York.

The current payments are $100, $200 and $300 depending on the exact model of iPhone.  Only a small portion of the phones are resold; most are partially recycled and partially sold for components, with 10% of trade-in proceeds going to youth educational programs, Hickson said.

VS

A report in tech publication Gizmodo on Thursday claimed that not only had the iPhone 3G been jailbroken but that the iPhone Dev Team had managed to unlock the phone, enabling people to use any carrier. At the moment, people wishing to use the iPhone must use Vodafone in India, O2 in the UK and AT&T in the U.S.

VS

Apple Inc.’s new iPhone went on sale on Friday 8 a.m. and that’s when nightmare for many new iPhone enthusiasts started. Since the new iPhone has been subsidized by the exclusive carrier if bought with their contracts, Apple and the carrier had planned to activate the phone right at the point of purchase i.e. the stores.

Result…huge queues of people were seen outside the store ahead of 8 a.m., many even camped out overnight to be first. What happened then???

First…It took the store half an hour to get the phone activated. This itself caused, the enthusiasm of many in queue behind the first person, die down at that very instant.

Second…there was a global problem with Apple Inc.’s iTunes servers that prevented the phones from being fully activated in-store.

Third…The problem extended to owners of the previous iPhone model. A software update released for that phone on Friday morning required the phone to be reactivated through iTunes.

Fourth…”It’s a mess,” said some, who updated their first-generation iPhone only to find it unusable.

Businesses always make more profits when they get early mover advantage in the market for new technologies and ideas. Individual/ end users many a times get benefited when they adopt a technology in later stages of its development. Because by then, most, if not all, lacunae would have been filled by the manufacturers.  I sincerely hope that the reader of this post is getting, what I am pointing at…Yes…U guessed it right…I am talking about Apple’s new 3G iPhone…

In India especially, there is a huge market for second hand phones and Chinese duplicate versions. When iPhone was launched first time by Apple, it became an instant hit everywhere around the world. But since it was on costlier side (Approx. Rs.30000+ in Indian currency), it could be afforded only by either business class people or people in high positions in companies. Surprisingly, it didn’t take even months or weeks but just a few days when iPhone came into market with no guarantees or warranties what so ever. These were imports from United States where iPhone was released first. Many people lost huge sums of money in buying these models just in hope that these may work just as good as the original one. There were hacking programs available in market which claimed to break the iPhone lock and make it work on the usual GSM carriers (similar story occurred in China).

And now…here you go…Apple has launched an all new upgraded version of iPhone and that too at less than half the old price (Approx. Rs.8000 - Rs.12500) in two storage versions i.e. 8GB and 16GB capacities. It has come out with more storage, better features and more affordable rates for everybody. Its 3G iPhone…and more

With fast 3G wireless technology, GPS mapping, support for enterprise features like Microsoft Exchange, and the new App Store, iPhone 3G puts even more features at your fingertips.And like the original iPhone, it combines three products in one — a revolutionary phone, a widescreen iPod, and a breakthrough Internet device with rich HTML email and a desktop-class web browser. It redefines what a mobile phone can do — again.

All these features are making the old iPhone users fume as they spent more to get less and now even if they want to resell their models, they will not be able to get even Rs.5000 for the same as the new upgraded 3G iPhone version with 8GB capacity will be just Rs.8000 approx. so why will anybody buy an old one for almost the same price…This justifies the title of this post…

VS

Federal Communications Commission Chairman Kevin Martin has a love-hate relationship with wireless carriers. Sometimes he is known to help them with corporate plans and growth strategies, at other times, he gets into their cross-hair and creates what mobile carriers may consider obstacles.

Recently he spoke about regulating ETF (Early Termination Fees) fees which carriers charge when customers leave before the end of their contracts. Typically these fees range from $125-$250 per subscriber and are levied when the customer decides to disconnect her or her service before the usual 2 year contract ends. The fee is levied to recoup the discounts provided on phone sales. If a customer gets a discounted cellphone, they have to sign a contract promising to remain loyal to the carrier for a set no of years, typically 2 years. If the customer breaks the contract and leaves before the end of the contract term, they are liable to pay the ETF.

Mr Martin wants to regulate the ETF amount and tie it to the price of the device. It may be logical to suggest that a $200 device does not warrant the same ETF as a $500 device. Also Mr Martin wants to reduce the length of the contracts and let consumers jump ship sooner. It is all about consumer choice.

There have been lot of class action lawsuits recently on ETFs and per Mr Martin’s plan, states won’t be allowed to entertain class action lawsuits on these topics once FCC starts regulating the ETF and contract practices.

On this one, FCC is with the consumers..

MT

The new 3G iPhone is creating substantial buzz. Check out Om Malik’s interview with Ralph de la Vega, CEO of AT&T Mobility.

http://gigaom.com/2008/06/09/att-mobility-ceo-new-3g-iphone-game-changer/

One of the concerns is that increase in mobile data usage for social networking, LBS or streaming video apps is going to cause a lot of network congestion on AT&T wireless network. Mr de la Vega is confident that AT&T network can handle it. For more power users of mobile data, the hope is that they are smart enough to use WiFi connection on the iPhone to download large data files instead of congesting the wireless network. A future filled with FMC devices like Femtocells only makes sense here. Femtocells will allow bandwidth hogging home wireless to pass on broadband wireline connections allowing the wireless network to remain somewhat available.

AT&T is taking some hits on its earnings estimates due to the lowered iPhone price and Apple is taking a hit as well as AT&T will no longer share the subscription revenue. But overall sales volume is expected to increase dramatically with the lower price and that is expected to more than compensate for the lower price on the device.

The new iPhone is loaded with good stuff. The App Store will allow for a slew of cool consumer and enterprise apps. The enterprise support is great with MS-Exchange integration. GPS is cool for LBS accuracy.

Nokia and RIM need not fear however. iPhone will only increase smartphone penetration increasing the size of the market for everybody. We feel the smartphones will cannibalize the non-smartphone cellphone market to some extent.

MT

Steve Jobs of Apple announced today the availability and details of 3G iPhone. It is available in the US from July 11 for $199. Not sure if if AT&T is discounting it or Apple is willing to sell it at a lower price (compared to $399 for the previous iPhone version). The new iPhone is a 3G device with GPS Mapping, a loaded App Store which houses some cool iPhone apps, MS-Exchange integration (attack on RIM turf - the enterprise?), and GPS. Apparently it is a 8GB device at $199. There is a $16 GB version at $299.

GPS is cool - it will drive Location Based Services and related applications like advertising, finder services and social networking.

MS-Exchange support is cool too as it will help in more enterprise adoption and cause some headaches to the folks at Research in Motion (Blackberry manufacturer).

The price is great too for cost-conscious customers.

Apparently 3G iPhone will be released in 20 countries.

We are excited and cannot wait to lay our hands on the new 3G iPhone.

MT

As we reported yesterday, Verizon signed a deal to acquire Alltel for $28.1 billion. Wow..are things fast. The rumor arose yesterday and the deal is done today. Possibly Verizon kept it under the wraps to thwart any competitive bidding. As we suspected, Alltel walked away with a billion dollars more than the figure mentioned yesterday. The two private equity firms behind Alltel - Goldman Sachs and Texas Pacific Group were able to recoup their $27.5 billion and some more in seven months. Nice deal for them. With credit markets in crisis, these firms probably want more cash on hand and they walked away with a nice profit (albeit not a large one) in a short time.

AT&T lost its No 1 leadership mantle. But these things hardly matter. Too much M&A to pin No 1 mantle on any one firm for too long…

MT

Wow.. just read the The Wall Street Journal (www.wsj.com) alert that Verizon may try to acquire Alltel for 27 billion dollars. This southern/midwestern carrier has 13.2 wireless customers and many million wireline customers. A combined entity of Verizon plus Alltel would boast 80 million wireless subscribers as opposed to the 71.4 million subscribers that AT&T has. It would create a wireless giant in Verizon (as if it is not already too big) and give it the bragging rights to being the largest wireless carrier in United States; a right which Verizon lost to AT&T when Cingular acquired AT&T Wireless.

We think Alltel is hot telecom property and may invite a bidding war. There are others who would want additional wireless coverage in USA like Deutsche Telekom or Sprint. Vodafone is another one which is rumored to be wanting to break from Verizon and would like to create a fully owned US subsidiary. We think Alltel may invite a higher valuation and may bargain as such with Verizon. Also it would be interesting to see how the antitrust dept reacts though we presume that Verizon has quizzed them on this topic.

Alltel is currently owned by a group of private equity firms led by Texas Pacific Group (TPG Capital) and Goldman Sachs who bought it earlier for 27.5 billion dollars.

US wireless space continues to be interesting for M&A..

MT