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The Landline is Dead

Mon, 11/24/2003 - 7:35am

Ern Worthman, Technology and Editorial Director

You heard it here first — the landline is dead

I recall a similar prediction, oh, somewhere around the mid-1990s' claiming the demise of the paper office as well (same guys, maybe, but obviously they weren't editors).

Well, as we say goodbye to another teeth-grinding, bottom line-sweating, technological year, I think the one most memorable, "epiphytical" statement that I recall about our industry is one touting the death of the landlines (email me if you want the link). I picked this as the opener because it is so typical of the dozens ... no hundreds of headline-grabbing statements of the demise of this, the shift of that, the meteoric rise something else.

Ok, let me elaborate a bit. Not a day goes by that I see a press release, report or industry analysis for our industry that says another system came on line, another area is wired for high-speed whatever, another technology or feature is available for your wireless interconnect or another gadget is going to make your wireless life faster, easier or enlighten you, or ubiquitous light-speed, broadband, wireless, all-inclusive, does everything, knows everything system that uses spiders, bots, crawlers (ever wonder why we adopted bug names for intelligent AI information subsystems — I'd have preferred Pokemons...) and telepathy to anticipate you every move.
This year was a banner year for statisticians. They were hard at work, churning out reports from miles of piles of statistical volumes that show wireless devices, technologies and deployments are at an all time high — well, knock me over with a brick!

Here are some examples:

"Millions are abandoning their landline phone." According to recent data from the FCC, the number of landline phones has dropped by 5 million (3%) since 2000. And more than half of the world's phones are cellular and 43% in the U.S., up from 37% in 2000. Somehow a drop of a few points in (3%, that certainly tells me that is mass abandonment) got translated into the demise of the landline.

"Japan, Asia and AME Offer Distinct Wireless Opportunities." From the super-heated wireless markets of Japan, to the rapidly growing markets in China and the rest of Asia, and the newly emerging young wireless markets in Africa and the Middle East, opportunities for wireless abound. Superheated? OK, if you say so.

"Next-Gen Services will Dramatically Transform China's Wireless Market." The wireless services market in China continues to grow rapidly, China's mobile market will grow from 206.75 million subscribers in 2002 to 402.28 million subscribers by 2007, a compound annual growth rate (CAGR) of 10.5%. A dramatic transformation? Do these prognosticators know what the population of China is?

Well, times are a bit slow in our industry so I guess I can't really blame them. They have plenty of time on their hands to scour the industry looking for statistics to manipulate into projections.

Those of us that have been in this industry a while have learned to give these headlines a quick glance, yawn and move on. I'm surprised that these screaming B2B headline producers are still at it.

As has been the case for the past few years, 2003 was another sobering year for our industry, as well much of hi-tech in general. We are finding out that value in wireless, be it voice, data, multimedia, mobility — whatever, is the real formula for success. Daily headlines of wireless pandemonium, super heated or dismal, seem so shallow, now.

There seems to be some cautious optimism as the year draws to a close. My friends tell me that they have seen movement in real orders. There is more activity in the quantity and quality of serious FRP and statements of work and the delivery to military, security and aerospace markets are starting to happen.

While military and its peripheries is likely to be a decent market for some players for the next five or so years, to sustain growth for the next decade I think our major challenge is to identify new applications or technologies that pique the interest of the end user (like the consumer, security, automotive, medicine, avionics, etc.) and have sustainable value. There are likely dozens of opportunities that the wireless industry can identify with various levels of opportunity. Some surprising like the fact that there are players actually making money, providing data services over their networks or with their wireless applications.

Some of the rather eclectic services like restaurants tailoring menus to your preferences because a short distance wireless system read your smart card and knows you like raw oysters, or being able to order weenies and beer right from your seat at a ball game (so you won't miss a play) are niche. But other content delivery systems like traveler information and Wi-Fi hotspots have the potential to be fairly ubiquitous, as do advances in messaging services (multi-message services — MMS vs. short messaging service — SMS) for the voice networks.

Content providers are starting to work with wireless network operators to provide consumer and business-oriented content in the wireless pipeline with the belief that they can make money by providing wireless access to information — something I've always thought was a target of opportunity. Wireless information delivery has become an important part of our infrastructure; from Telematics to medicine to location-based services to recreation and leisure activates.

Businesses and business travelers (and consumers, eventually) will benefit from ad-hoc wireless networks in hotels, airports and other (read: coffee shops) to get directions, hotel reservations, flight data, automobile reservations restaurant recommendations, directions and reservations, and the like. Content players are beginning to realize and will be spending their own marketing and advertising dollars promoting this content. This is a big deal because until now these content providers have been happy to let the wireless network operators (who, however, haven't been doing a stellar job, overall) sell the content and do the marketing themselves. Such content providers are beginning to see the wireless channel as having potential (read: profit) and are getting proactive. They will be marketing their wireless content to wide demographic groups, not just existing wireless users.

This smacks of a large enough potential wireless content market to attract direct marketing dollars from these content providers with the expectation of a return on investment. The idea is to market content, wireless-independent, even though it is targeted at wireless infrastructures — make the delivery system transparent. It's kinda like advertising music or DVD releases — forget about the system.

I like this direction. It means that there is confidence in the wireless infrastructure and it can only help the wireless industry grow in terms of data dollars and convince the voice-only wireless population that voice and data are inextricably linked default the wireless device. Data is much more forgiving than voice an if such tactics work, the wireless communicator (in whatever form factor) has the potential to become an indispensable aid to a 21st century two-way multimedia infrastructure.

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