I suspect that most people involved in the mobile industry would acknowledge both the phenomenal growth in mobile internet usage and the increase in relative importance of mobile internet services to wireless carriers. With data revenue growing and mobile internet services becoming a larger slice of that revenue, it becomes obvious why this is of increasing interest to carriers. Also, in mature markets, carriers look to offset the erosion of revenue from traditional voice services.

The opportunities for carriers in the new world of the mobile Internet come with their own challenges. The volume of data that must be carried across the network due to the uptake in mobile internet usage is growing at a significant rate. This uptake may seem like a positive trend that would drive an increase in data revenue. It is only when you realize that the increase in infrastructure investment required to support the data growth outstrips the increase in data revenue that it becomes evident that the current model is unsustainable.

There are a number of options available to address this disparity between cost and revenue. For example, one option would be to move away from the ‘all you can eat’ data tariff approach and introduce tiered pricing for mobile internet services. Another approach would be for carriers to determine how they can effectively add value within the content and media ecosystem in order to create new revenue streams around mobile data.

Considering the options available at a conceptual level is one thing. However, carriers will ultimately need to step through a process of evaluation and decision-making regarding their mobile internet services and how they can most effectively monetize their network assets. For such a process to be effective, it must be informed. The carrier must be able to understand its customers in order to provision mobile internet services to address customer needs - while also delivering a commercially viable product.

This is where most mobile internet services fall short. In the vast majority of cases, visibility of user behavior patterns and content consumption is not available. Even where it is available, the level of detail is insufficient to enable effective decision-making and often limited to the carrier’s on-deck content or oriented toward network-focused metrics. Also, the information is frequently suppositional and based on small sample sets. This should not be the case when the data is carried over the carrier’s own network. So how big an issue is this? Should carriers really be that concerned?

I believe that carriers do have an important role to play in the new world of the mobile Internet and that there is enormous opportunity for them. After all, carriers have the potential for an intimate relationship with their customers through what is arguably the most personal communications channel – the mobile device. The perspective that it is just a matter of time before carriers will need to adopt a low-cost ‘utility’ business model is seriously flawed.

Marketing executives and managers within carriers need to be empowered with information and insight so that they can act, ensuring that the industry makes the most of the opportunity for customer intimacy. In order to seize this opportunity, they must have factual data about their users and what they do on the Internet. This is the key to unlocking business value that will successfully address carriers’ current revenue, cost and profitability challenges.

-Kingsley Harding

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The recent edition of our quarterly newsletter was released this week and focuses on network evolution and the ensuing data crunch, with traffic expecting to double in volume every year through 2013. In addition to this headline topic, there’s coverage on the Widget Bar and the new widget applications it includes, how we’ve partnered with operators such as Sprint to help drive their success in the marketplace, and our continued Mobile Minute webinar series with its relevant discussion of the mobile internet ecosystem.

Read the newsletter in detail here or contact us at feedback@bytemobile.com to subscribe.

- Dan Fisher

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3G TD-SCDMA network coverage is rolling out in China, and the country’s (and the world’s) largest operator, China Mobile Communications Corporation (CMCC), is opening a ‘Mobile Market’ application superstore for its products and services.

Details of these and other developments were discussed in a recent meeting between Lu Xiangdong, CMCC executive vice president; Hatim Tyabji, Bytemobile executive chairman; and other senior executives of both companies at CMCC headquarters in Beijing. Bytemobile and Alcatel Shanghai Bell (ASB) have been awarded Phase 1 of the CMCC Web Gateway project, which will enable open web browsing from mobile handsets on the operator’s TD-SCDMA network.

Mr. Lu indicated that TD-SCDMA coverage is now up to 230 cities, and 50 million subscribers are projected by 2011. CMCC will soon launch 36 different models of TD-SCDMA handsets into the market.

CMCC’s one-stop shopping outlet will showcase the mobile Internet for Chinese consumers with personalized services such as search, navigation, games, video, music, ringtones, and wallpapers, as well as mobile enterprise applications for Chinese corporations. In this context, Mr. Lu stressed the importance of localized R&D and recognized Bytemobile’s recent opening of a development center to serve the specific needs of the Chinese market.

As of March 31, 2009, CMCC reported a subscriber base of 477.2 million, having added 19.9 million new customers during the first quarter.

-Jaishree Subramania

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I am pleased to announce two exciting new initiatives in Bytemobile Product Development. We believe that these initiatives will accelerate our momentum in China and advance our efforts to ‘green’ the mobile internet industry.

China Development Center
We have established our fifth development center – after Patras, Belfast, Champaign, and Mountain View – in Beijing. China is the world’s largest market for mobile services, and we are rapidly penetrating the provincial operating companies of China Mobile, China Unicom and China Telecom (see John Cole’s blog post on the China Mobile Web Gateway project). Given the growth of our customer base and the singular requirements of the market, it is only logical that China would be the next destination for the expansion of our global engineering team.

The new development center will focus initially on three areas:

• Customization of our products to meet local market requirements and support mobile devices used in China
• Localization of our product interfaces in Chinese languages
• Custom engineering to respond to customer requests with unique solutions

Our first priority is the adaptation of our products to local handsets. Therefore, our first engineer in China – who started last week – is focused on handset profiling and customization. Until now, we have performed this function in our handset laboratory in Patras. With the launch of our team in China, we will be more efficient and better able to meet local demand. We are also working closely with partners in the region to outsource parts of the process under the direction of the local team. As customer demand increases, we will ramp up the team to scale and manage the workload.

Our next priority will be custom solutions engineering in China. To date, we have performed this function in Patras and outsourced to key partners in Greece. The new center in Beijing will enable us to anticipate and respond to the local market and continue to drive our thought leadership throughout the region. We are actively recruiting solutions engineering candidates in the area and are also seeking candidates with a combination of global and local experience.

Green Network Platform
Greening the Mobile Internet and White Space Innovation are two strategic programs that we have launched in the last year. They intersect in a new research and development project designed to dramatically expand the capacity of the Unison Mobile Internet Platform and make a significant contribution to the sustainability of our customers’ network environments.

We launched the project – appropriately named ‘Fusion’ – on April 1, the day after general availability of the new Unison release. Our goal is to reduce our customers’ hardware requirements as they deploy and scale Bytemobile applications in their networks. The Unison platform is already the most scalable mobile internet gateway in the industry. However, Bytemobile has never rested on its laurels and isn’t about to start now. Rather than targeting incremental improvement, we aspire to the seemingly impossible: a ‘quantum leap’ increase in system capacity, which would yield a proportionate decrease in power, cooling and rack space requirements – and therefore in overall data delivery costs.

Because this is a white space innovation project, there are no limitations on methodology. We will evaluate technical solutions ranging from software changes to new operating systems to custom hardware.

Project Fusion will provide a useful model for white space innovation projects of the future. The ‘greening’ of the Unison platform will further enhance our strategic value to customers as they implement environmental responsibility in their network operations and service delivery.

Building a Great Company
Both the China Development Center and Project Fusion are ambitious undertakings. As such, they are consistent with Bytemobile’s history of global market and technological leadership. They also support our plans to continue building a great company that fundamentally changes the shape of its industry through innovation and localization.

-Chris Koopmans

Image use courtesy of www.flickr.com/photos/dongbin/3296818794/ under Creative Commons attribution license.

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