Statement for Panel The Business of Wireless UBB
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1 Fakultät für Betriebswirtschaft Munich School of Management Statement for Panel The Business of Wireless UBB CITI Annual Conference THE STATE OF TELECOM 2011: ULTRA-BROADBAND (UBB) WIRELESS Arnold Picot Institute for Information, Organization and Management Columbia University, New York, 14 th of October
2 Global mobile data traffic grew 2.6-fold in 2010, nearly tripling for the third year in a row. Mobile Traffic Growth Mobile Challenges Mobile traffic growth outperforms fixed net traffic growth Requirements for additional capacity Spectrum Investment Cell Size Fixed Net Technology Devices Applications Source: Cisco Smartphones shipped in the U.S. are already 4 out of 10 mobile phones. Smart Phone Penetration Additional Pressure on Capacity Source: Nielsen (2011) 3 2
3 Establishing wireless broadband coverage is limited by physical restrictions and a trade off between reach, speed, spectrum available and transmission power. Approach, Relationships & Limitations Wireless Broadband Trade Off Cell Size (Reach) Transmission Power Data Capacity per Unit Area Frequency Range Positive Relationship Negative Relationship CAPEX decrease with lower frequencies, but data throughput accordingly Wireless technologies are less reliable, and by a multiple slower than fixed Wireless access works as shared medium Source: Grove/Elsner/Picot/Jondral (2011) 4 The term Digital Dividend was born by combining the potential benefits from an alternative use of former blocked frequencies. Switchover from analog to digital Broadcasting Digitalization Switchover from analogue to digital TV Digitalization and Compression For same amount of programs and coverage, digital standards need a fraction of the spectrum allocated for analog broadcasting Spectrum has economic value and is regulated, which lead to the term Digital Dividend Digital Dividend in Germany Source: Grove/Elsner/Picot/Jondral (2011) 5 3
4 The pilot project Grabowhöfe shows some major drawbacks of the Digital Dividend to provide a sustainable and powerful provision of broadband to rural areas. 7,2 Mbit/s Downlink 1,5 Mbit/s Uplink 20 km 3 antennas 65 m Grabowhöfe Grabowhöfe: 165 inhabitants on km 2 DSL light partially available (128 kbit/s) E-Plus/Ericsson/Ministry of MWP Cooperation Frequency Range: MHz UMTS HSDPA Technology with 7.2/1.5 Mbit/s Results: 1/5 traffic of normal Internet User Majority connections < 3 Mbit/s Pilot Project Service Capacity Analysis Matching: Minimum requirements of the Ministry of Economy, Labor and Tourism of MWP Capacity of Digital Dividend in Grabowhöfe % 80% 60% 40% 20% 0 Updates WWWVoIP Telework 0% E- Payment File Video Processing Exchange Conferencing Bandwidth Requirements in MBit/s Maximum parallel Users in per cent Capacity does not fulfill requirements of the ministry at all (highest value: 34%, lowest: 1%) Source: Grove/Elsner/Picot/Jondral (2011) 6 Approach of the International Delphi Study 2030 by Münchner Kreis 1. Assessment (> 500 international experts), when selected theses will become reality, 2. Estimation of impact of these theses on various areas: economy, society, science and policy, 3. Evaluation of drivers and barriers for selected theses facilitating or preventing occurrence of those theses. Respondents GER experts EU experts U.S. Experten Further international experts Members of the Group DNAdigital Editors, Partners and Supporters 7 4
5 The Internet will reach almost the entire population within the next decade. More than 95% of the adult population in <country> actively and regularly use the internet and its services. 6 42% 35% 32% % 21% 18% 17% 18% 17% 15% 11% 15% 8% 8% 8% 3% GER experts Further int. experts EU experts USA experts DNAdigital 8 However, the Digital Divide stays persistent. The digital divide of the population in <country> has virtually disappeared. 44% 54% 5% 1 7% 23% 11% 2 GER experts DNAdigital 9 9 5
6 Nationwide mobile broadband access is available areawide within years. In <country>, 50 MB/s are available nationwide for mobile internet use (i.e., equally for uploads and downloads). 63% 34% % 3 33% 21% 18% 15% 15% 1 14% 15% 1 13% 3% 3% 3% 3% 2% GER experts Further int. experts EU experts USA experts DNAdigital 10 Fixed networks will continue to outperform mobile bandwidth significantly. Experts expect a widening gap. Historical correlation between fixed and mobile bandwidth capacity. Bandwidth development as expected by Delphi-Experts Year Fixed Net Accesible Bandwidth (Mbit/s) Mobile Net Fixed Bandwidth Mobile Bandwidth Source: BMWi (2008); Münchner Kreis e.v. (2011) (Avaerage figures for German experts)
7 Traditional media will be consumed via mobile devices. More than 75% of the population in <country> use a multimedia mobile end device as the unifying element for conventional media (books, newspapers, magazines, television and internet) for displaying text, images, music and videos. 45% 42% 40% 20% 3% 18% 21% 18% 20% Deutsche Experten Internationale Experten Europäische Experten Digital Natives 12 Use of Social Networks (e.g. facebook, google+) becomes a general standard. More than half of the population in <country> regularly maintain their social contacts using social media (Web 2.0) applications and services in and via the internet. 57% 17% 38% 3 32% 33% % 17% 18% 7% 3% 14% 11% 11% GER experts Further int. experts EU experts USA experts DNAdigital 13 7
8 Mobile Commerce becomes a standard technology within the next 10 years. A single standard technology makes payment transaction possible in retail outlets and restaurants through mobile devices (mobile wallet). 57% 4 35% 45% 38% 43% 1% 5% 8% 17% 1 14% 5% 2 11% GER experts Further int. experts EU experts USA experts DNAdigital 14 Location-based Services are used on a daily basis. In <country>, 75% of mobile phone users access location-based services on a daily basis through their mobile device. 5 47% 35% 5 15% 20% 20% 18% 20% 7% 3% 13% GER experts EU experts USA experts DNAdigital 15 8
9 Software as a Service becomes reality in general within the next 10 years. Software is no longer used on an isolated basis on local computers or mobile end devices, but rather on an on-demand basis as "webware in and via the internet. 64% 3 27% 7% 11% GER experts 16 Summary Ongoing Mobile Data Growth Voice/Data Convergent Services Mobile Communication as major Driver for Innovations Applications (Apps) Revenue Models Need for additional Capacity Infrastructure (Wireless/Wireline Access) Spectrum Technology 17 9
10 Thank You! The Müncher Kreis Delphi Study (English language) is available free of charge via:
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