The Shifting Economics of the Mobile Internet
The year 2008 has seen a surge of mobile data in the marketplace. Wireless network operators worldwide are reporting record growth in data traffic. Most operators in Europe have reported an eightfold increase from 2006, with some reporting a three- to fourfold increase from 2007. The phenomenon has also occurred in North America, with tier-one operators reporting data traffic growth of 10% per month.
This explosion in mobile data usage can be attributed to both an increase in network performance and a decrease in data plan prices. Operators in Europe and North America started rolling out high-speed networks in 2006. At the same time, service prices have dropped anywhere from 2x to 16x, making mobile data both affordable and useable. While usability continues to improve, we may not have seen the bottom of the price decline yet.
http://www.unstrung.com/document.asp?doc_id=151534
So, is the much-talked-about threat of operators becoming a dumb pipe real?
As the operators battle it out on the price front, mobile device manufacturers are trying to divert the consumer’s dollar away from the operator’s wallet. A classic case in point is the remarkable success of the Apple iPhone. iPhones have launched a completely new mobile ecosystem where operators are essentially reduced — at least for now — to bit pipe providers. The consumer’s interaction with the operator is limited to voice and billing services. The operator currently plays no role in the mobile content purchase for iPhones other than that of being a data conduit.
With a single product, Apple has transformed the wireless phone into a complete mobile internet device. As other manufacturers follow suit and launch their own super-smart devices, how can operators claim their fair share of the mobile data bounty?
Stay tuned…
Tags: dumb pipe, iphone, mobile data, mobile ecosystem, wireless network operators