» Archive for the 'Strategy' Category

The Third Post-Steve Jobs Era

Thursday, January 15th, 2009 by David Goldes

The third post-Steve Jobs era arrived much sooner than anyone imagined.  Shortly after the markets closed in the U.S. on Wednesday, a news release arrived with a copy of Jobs’ e-mail to Apple employees in which he wrote that he “learned that my health-related issues are more complex than I originally thought.”  The company barely survived his first, and forced, exit  (1985-1997) but did run smoothly during his absence for cancer treatment  (the second era).

It was less than two weeks ago that Jobs sent out a similar note, in which he acknowledged his weight loss and attributed it to a “hormone imbalance” for which he was already in treatment.  He termed the remedy as being “relatively simple and straightforward” and promised to continue as CEO.

Jobs is a popular figure in the computer industry, not only as the cofounder of Apple but as the revanchist CEO who ousted the regime at Apple that had ousted him in 1985, and then returned in 1997 to turn around the company.

Because Jobs is deeply involved (some say too much) in every aspect of Apple’s operations and successfully revived the then-struggling computer maker in the late 1990s with such products as the iMac, his health is a matter of concern, not only to family and friends but to Apple employees and investors.  Since a bout with cancer, treated successfully with surgery a few years back, pundits have counted his every sneeze.  The disclosure immediately sparked new concerns about a recurrence of cancer and about how much information Apple was holding back.  The hormone imbalance disclosure was roundly criticized by medical and corporate-governance experts earlier in the month as having been much too general.

The news caused the company’s shares to drop ca. 8% in after-hours trading.  Analysts suggested the stock could drop further when markets reopen and it was down almost 3% as we went to press.

The company’s COO, Tim Cook, who filled in for Jobs in 2004 when he took a leave of absence to battle pancreatic cancer, will also assume the reins now.  Cook is known more for his operations prowess than design prowess but the company has a skilled team of designers in place, all schooled in the Steve Jobs school of design, so it is likely that innovations will continue to appear from Apple for the foreseeable future.´

We don’t know what’s wrong with Steve Jobs but one doesn’t take a six-month leave of absence if it isn’t serious.  Wednesday’s note also included a promise: “As CEO, I plan to remain involved in major strategic decisions while I am out” so, health permitting, he will still be able to act as a kind of editor-in-chief even if not involved in day-to-day operations.  Change in any organization is a fact of life: at some point, Apple will have a new CEO and the new person will be filling some very large shoes.  Jobs has imbued the company with a mission, a way of doing things, and a very clear sense of good design.  It is likely that all of these will continue as Jobs’ legacy, when and if he should no longer be CEO.

To see how this might work out, Apple has to look no further than Redmond, where Microsoft is getting along quite well on a day-to-day basis without Bill Gates.

David M. Goldes is the president of Basex.

Whither Nortel? Bankruptcy Court

Thursday, January 15th, 2009 by Jonathan Spira

It was clear that Nortel Network’s situation was precarious.  Last November, the company announced a $3.41 billion quarterly loss and laid off 5% of its workforce.  On Wednesday, it and a number of its affiliates filed for bankruptcy protection, one day before it was scheduled to make an interest payment of $107 million.  The company’s affiliates in Asia, including LG Nortel, and in the Caribbean and Latin America, as well as Nortel Government Solutions (NGS) are not subject to these proceedings and will continue operations unimpeded.

As we observed back in November, the company has not caught a break since 2005, when CEO Frank Dunn was “terminated for cause” in conjunction with the discovery of his manipulation of Nortel’s financials to generate higher bonuses for himself and several colleagues.

In addition, Nortel has a decade-long history of failed and expensive acquisitions.  Their strategy, which was to buy established companies, didn’t work, largely due to an inability to integrate products from the newly-acquired entities into a common vision.  In 1998, Nortel purchased Bay Networks for $9.1 billion, quickly followed by the 1999 and 2000 acquisitions of software maker Clarify and then Alteon Web Systems for a total of $10 billion.   (The buying spree continued with Cambrian Systems for $300 million, Shasta Networks for $340 million, all the way to DiamondWare (3-D stereo conferencing) and Pingtel (SIP software) in 2008.)

Nortel’s strategy contrasts greatly with that of companies such as Cisco, which only acquired small and innovative companies at much lower cost and then successfully integrated them into the business.  It is also a stark contrast to Nortel, then Northern Telecom, in 1976 when it announced Digital World, a family of digital telecommunications products that were industry leading.  The DMS-100 became a mainstay of telephone company central offices (thanks in part to its ability to handle 100,000 subscriber lines) and the DMS product line contributed greatly to Nortel’s bottom line for 15 years.

As competition has intensified from North American, European, and low-cost Asian rivals, among them Alcatel-Lucent and Huawei Technologies, the  company’s shares sank into the penny range in recent months.  In addition, the global economic crisis has slowed spending on the gear that Nortel offers (which includes equipment for the enterprise as well as for telephone companies).

Is it too late for Nortel?  The conflation of economic conditions, competition, and scandal may remove it as an industry leader forever but it could still reinvent itself as a strong niche player while it reorganizes under Chapter 11. On the other hand, the company could break itself up and sell its main businesses to rivals. A likely acquirer (at least in my opinion) for Nortel’s enterprise unit would be Siemens Enterprise Communications, which has been in growth mode since it became a joint venture between Siemens AG and the Gores Group.  The next installment will be telling.

Jonathan B. Spira is CEO and Chief Analyst at Basex.

Open Text Wants Social Tools To Bloom

Friday, November 28th, 2008 by Cody Burke

Last week at Open Text Content World in Orlando, I had the chance to hear about some new products and strategies.  Here are some highlights.

Overall, the main take away from Content World is that Open Text is encouraging customers to embrace social tools, and wants to show customers that they can use these tools effectively and in a safe enterprise-friendly environment.

The strategy that Open Text presented is called Bloom.  Bloom is not a product or product family, but a means for bringing social software tools into the enterprise in a safe and auditable manner.  Bloom is intended to enable Enterprise 2.0, which is a blanket term that refers to tacking social and collaboration tools onto enterprise applications and environments.  The message at the event was simple: social tools such as blogs, wikis, RSS feeds, micro-blogging of status updates, social bookmarking, and presence awareness are here to stay, and by bringing them into the enterprise, an organization can improve collaboration, speed up development cycles, and increase knowledge sharing.

Although many of the capabilities that Bloom emphasizes already exist in Open Text products, looking forward the Bloom strategy focuses on the following key areas: Web 2.0 tools, social networking, social analytics, and social compliance.  The foundation for Bloom is the Open Text ECM Suite, which includes integrated tools for document management, digital asset management, Web content management, collaboration, e-mail, and archiving.  All the functionality of the tools is intended to be tied together on a macro level by social software features.

The Bloom and Enterprise 2.0 strategy aims to address the following points: experience and workgroup optimization, content management with 2.0 tools such as blogs, wikis, RSS feeds, communities, and forums, enterprise-level safety of those same tools, and improving search with “find before search,” Open Text’s ideal search situation where relevant content is presented to the user without them having to search for it.  This is in theory accomplished by information being found and delivered preemptively based on the users’ context and role.

Social tools that support Bloom and Enterprise 2.0 are already available in Livelink through Communities of Practice, but the new push includes extending the functionality of social tools beyond the desktop and laptop computers to the mobile device.  To this end, Open Text has developed a project codenamed “Bluefield,” which is a browser-based enterprise-ready workspace and social community builder that consists of profiles with standard contact info and personal blogs, communities that can be formed around projects or teams and feed updates of colleagues and changes that are made to documents or projects.  For iPhone and BlackBerry users, the experience is identical on the mobile device to what one would experience on a laptop or desktop.  Bluefield includes the ability to edit Word or Excel documents through a browser, with changes reflected live on the server.  This eliminates the need to download the document to the device, keeping the experience extremely lightweight.

A weak point for Bluefield (and all browser-based tools) is the lack of offline access.  The ability to access documents and work offline is still important despite proclamations from Open Text that Net access is ubiquitous.  For instance, if I were using Bluefield through a browser on my laptop to edit a Word document, then I would have to remember to save a copy to my hard drive before getting on the plane so I could work on it while aloft and offline.  I would then have to replace the document into Bluefield when back online.

Also shown at Content World was a social analytics tool and search technology that is currently referred to as the “Relationship Engine”, although the name and future product form are still in flux.  What is intriguing is the ability to enter a set of data and create visualizations that show the relationship between nodes, and to switch the point of view to drill down into the visualization.  In the demonstration presented, data from the event was used to create visual maps of the connections among attendees, breakout sessions, conference tracks, and presenters.  The premise is simple, yet fitting; everything is an object, be it a person, document, seminar, or project, and the relationships between those objects can tell us much about how information flows and how best to route it.

Although still in development, the potential to apply the technology to search and social analytics is exciting.  This kind of technology is hopefully the future of search, which is currently a fundamentally flawed tool.  The ability to search for content and see who is connected to that content right from the results page could be a large step in improving the essential but somewhat ham-handed tools we all use everyday to find information.

Although social software functionality and search are clearly not new areas for Open Text products, what came across at Content World was a refocusing on communicating the safety and enterprise capabilities of social tools.  This mirrors what we are seeing across the market, an increased interest in pulling these tools into the enterprise and taming them without losing what drives their value – the ability to facilitate communication, collaboration, and knowledge sharing.

Cody Burke is a senior analyst at Basex.

Whither Nortel?

Friday, November 14th, 2008 by Jonathan Spira

Nortel’s quarterly loss of $3.41 billion came as no surprise and the same can be said for its plans to lay off ca. 1,300 workers.  What is surprising is the inclusion of four top executives on the list of those to be laid off and that these four were recently recruited from other tech companies to aid in what one now might consider Nortel’s futile turnaround efforts.

Nortel has not caught a break since 2005, when CEO Frank Dunn was “terminated for cause” in conjunction with the discovery of his manipulation of Nortel’s financials to generate higher bonuses for himself and several colleagues.  The company has a colorful history dating back to its founding in 1895 as Northern Electric and Manufacturing, a supplier of phones and other devices spun off from Bell Telephone of Canada.  It started looking into ways of using fiber optic cable in the 1960s at which time it also began designing digital telecommunications equipment.

In 1976, the company changed its name to Northern Telecom and announced Digital World, a family of digital telecommunications products that were industry leading.  The DMS-100 became a mainstay of telephone company central offices (it could handle 100,000 subscriber lines without breaking a sweat) and the DMS line contributed greatly to the company’s profits for 15 years.

In 1998, with the acquisition of Bay Networks, the company changed its name once again, this time to Nortel Networks.  It gained prominence in the late 1990s as a manufacturer of fiber optic gear used to transport massive amounts of data over the Internet but was also one of the first casualties when the telecom bubble of the time burst, sending the company’s market capitalization from $398 billion (Canadian) in September 2000 to $5 billion in August 2002.

Now the company, which dropped “Network” from its brand but not from its legal name, will restructure into three business units: Enterprise, Carrier Networks, and Metro Ethernet Networks.  This time it looks like Nortel is preparing to sell off parts of the company as opposed to cutting costs.

Now, about those executives who were laid off: John Roese, Nortel’s CTO, spent the last 28 months trying to make sense of mishmash (yes, that’s the technical term) of technologies he found when he came on board.  He was also the public face of the company’s turnaround.  Chief marketing officer Lauren Flaherty joined Nortel from IBM just two years ago.  She too is leaving, as is Dietmar Wendt, another IBMer, who propelled Nortel into telepresence, and Bill Nelson, a recent hire from EMC and Nortel’s EVP of global sales.

It’s probably far too late for Nortel to recapture its position as an industry leader but it would be sad to see the Nortel name disappear completely from the marketplace.

Jonathan B. Spira is CEO and Chief Analyst at Basex.

The Goldilocks Phenomenon Part II

Friday, June 13th, 2008 by Jonathan Spira

What does this mean for the enterprise?

Last week, we introduced our term for the trend towards increased customization of workspaces by knowledge workers: the Goldilocks Phenomenon.  To recap, as Goldilocks did, knowledge workers want something that is “just right” – in their case tools, not porridge.  If they are not provided with the correct tools, they will find them on their own, or modify the ones they are provided to get the functionality they require.

In the quest for the tools they want and need, they are not likely to ask permission, and will fly under the radar of management and IT departments as they customize software with add-ons, plug-ins, and coding.  This trend towards co-creating workspaces is particulary relevant for the new entries in the knowledge economy, the fresh faces of Generation Y, and those generations that will follow.  They have grown up surrounded by technology that they can personalize – if it does not do what they want, they have the expectation that they can change it so that it does.

For obvious reasons this presents huge headaches for the entreprise.  Many IT department managers can and will cite myriad reasons why computers need to be locked down and all users need to use the same tools.  Allowing employees to customize their work environments might be construed by some managers as relinquishing control and leading to software-use-anarchy.

What needs to be explicitly understood by management and IT departments is that the Goldilocks Phenomenon is not just about improving work tools.  There is a direct correlation to the bottom line; frontline workers know what tools they need, and perform better when they have those tools.  Innovation and increased efficiency are healthy for any organization.

Thus far, the Goldilocks Phenomenon has been happening largely unnoticed.  By and large, managers are not aware of these dynamics and think of any innovation that comes from the bottom up as an isolated case.  Companies are at a great disadvantage when they fail to recognize the innovation and ingenuity that their knowledge workers apply to their work environments.  In the case of Generation Y knowledge workers, if their work style is not supported they may vote with their feet, and go somewhere that allows them to bring the same innovation and talent that they apply to their job to their tools.

Find out more about this trend in Co-Creating the Workspace: The Myth of Standard Desktops and One Size Fits All Work Environments, a new report from Basex.

Jonathan B. Spira is CEO and Chief Analyst at Basex.

The Goldilocks Phenomenon

Friday, June 6th, 2008 by Jonathan Spira

The advent of the personal computer in the 1980s did not, contrary to common belief, personalize the user experience.  Most software tools, in keeping with the data processing mindset of the time, were relatively inflexible.

Knowledge workers found some tools to be so unbending that they either ignored them entirely or had to create parallel systems (usually not computer-based) to overcome obstacles and solve problems.

According to research recently completed by Basex, it appears that such rigidity is no longer the rule: software tools are now flexible enough to allow knowledge workers to mold them in order to meet their needs and knowledge workers possess enough technical skill to make such changes.  In a recent Basex survey, 90% of respondents reported that they have downloaded enhancements, plug-ins, and add-ons, and 80% have written macros and other code, in order to automate and speed up their own work processes.

In fact, the latest generation of knowledge workers has grown up, so to speak, in the workforce with tools that allow the knowledge worker to apply the same cleverness and ingenuity he applies to his job to his use of software.

We call this the Goldilocks Phenomenon, since it makes the software “just right.”  The term derives from the story of Goldilocks, who preferred her porridge not too hot and not too cold.  Also worth noting, the bears didn’t like that she ate all the porridge to figure out which one she liked best; this is true of IT departments and management as well, they much prefer knowledge workers to not go around sampling tools and modifying software when they are “out of the house.”  Unfortunately for bears and managers, one size does not fit all.

Next week, we will examine what the Goldilocks Phenomenon means for the enterprise, and why it is of paramount importance for IT departments, management, and knowledge workers to develop policies to harness the innovation and creativity being shown by those on the front lines of the enterprise.  We’ll also be releasing our new report Co-Creating the Workspace: The Myth of Standard Desktops and One Size Fits All Work Environments, an in-depth look at what the end user knowledge workers, are up to, early next week.

Jonathan B. Spira is CEO and Chief Analyst at Basex.

Did 1997 Stand Still? Looking Forward While Looking Back

Tuesday, January 15th, 2008 by Jonathan Spira

In preparing our annual State of the Technology Industries diatribe, I thought to look back at what I penned one year ago.  It seems that, in many respects, time stood still.  Imposssible, you say.  The industry now moves on Internet Time.  Let me clarify:  the industry did indeed make tremendous progress.  But that seems to have occurred despite itself.  This year, we are changing our perspective: rather than go company by company, we look to the The Desktop to ease us into the year.  In a related article, we’ll review our 1997 musings and see how things panned out.

THE DESKTOP
The desktop computer is perhaps the most important interface that one has, and will continue to have, over the next few years.  Despite promises of body-networks and the like, the average computer user will sit himself before a computer workstation and be saddled with its brief but illustrious user interface history.  With the court’s permission, 1998 should see the advent of Windows 98 and NT 5.0.  For starters, limited self-healing features and self-administration with the attraction of multi-user Windows may make for a more centralized and more easily managed environment (read: significantly lower costs for both hardware maintenance and support).  Both OSes will benefit from a common addressing scheme for hardware, the Windows Driver Model, making upgrades from Windows 98 to NT 5.0 a possibility.  [The most recent Windows 98 beta that arrived at my desk hinted that it has a Windows 3.x migration facility; unfortunately, I don't have any Windows 3.x machines left to try this out on that would support Windows 98's hardware requirements).

1998 will also be a make-or-break year for Java, which is the apparent main alternative to Windows.  A new Java Development Kit (JDK), combined with significant recent product introductions showing a committment to the platform (Lotus' eSuite for one) may signify that Java is now ready for prime time.

For Apple, 1998 may be a true crossroads.  Rhapsody, its multithreaded, multi-tasking, cross-platform OS, will offer developers yet a third alternative to Windows.  Although Rhapsody does not pretend to achieve Java universality, its ability to run on Intel, PowerPC and Alpha will be a plus, since its development environment also runs under NT.  Will the wait Be worth it?  Or will Mac users flock to Be insead of waiting?

Will the hardware be up to the challenge?  Memory prices continue to decrease dramatically, making the possibility of 128 Mbyte workstations reality for some.  [Of course software developers are aware of this and already seem to be increasing minimum memory requirements without recognition that the installed user base of machines has yet to upgrade to 32 Mbytes.]  Intel continues to offer its Motherboard-of-the Month Club option and one of these days the underlying architecture will catch up to the speed of today’s supersonic microprocessors [didn't we say that when 80386's were introduced as well?].

1998 should also be a do-or-die year for diskless network computers and their variants.  Will these turn out to be cheaper and more easily managed the their larger PC cousins?  Or will they turn out to only be a (significant) 3270 upgrade path?

So what’s missing in the Desktop Environment.  Ah, yes.  Bandwidth.  Coming this year:
Gigabit Ethernet at a pricepoint that is implementable
Rotorouter for the Router – better intelligent switching to eliminate bottlenecks
One agreed-upon standard for 56 Kbps modems (ok, this is wishful thinking but we better agree on something before 56 becomes too slow)

THE LARGER PICTURE

1998 should be the year of what we at The Basex Group have named the “Virtual Corporate Community”.  Wipe that smirk off your face:  the picture you should have in your mind right now is not a bunch of funny-looking avatars lurking in The Palace talking about politics or sex.   To learn more about this phenomenon, please click here.

Did 1997 really stand still?  Of course not.  1997 was a year for clarification and regrouping.  But the future picture is much brighter.

Jonathan B. Spira is the CEO and Chief Analyst at Basex.  This article originally appeared in the Basex Online Journal of Industry and Commerce (BOJIC).

Mailbag

Friday, October 19th, 2007 by Jonathan Spira

Our recent look (as well as Part II here)  at messaging and slogans prompted an unusually high number of e-mails from Basex:TechWatch subscribers.  Here are a few we thought you might want to see.

Hi Jonathan,
I read your commentary every week.
As a professional with a social science background working in the technology arm of a biotech firm.. your weekly summaries are extremely valuable in keeping me up to date.
When I read your piece on slogans and then the request to submit ones that I find memorable.. I couldn’t help but jump at the change to share Genentech’s slogan  “In Business for Life”.

Jonathan,
One of my enduring favorites is Alka Seltzer:  “Plop, plop, fizz, fizz.  Oh what a relief it is.”
I think you may have mentioned it before, but I keep using Timex’s slogan half a century later: “Takes a licking and keeps on ticking.”

Jonathan,
I enjoy reading your weekly commentary.  I have a memorable experience with a slogan.  I used to work for a bank in the 1980′s called Ameritrust.  Once we had a meeting and were shown two commercials for our new ad campaign:
“Ameritrust – The Shortest Distance.”  The concept was that Ameritrust could help you achieve your financial goals in the shortest time.  One of the commercials showed someone playing a trumpet.  I remember the look of bewilderment on everyone’s face after the commercials played.  They just didn’t seem to be about banking.  We were handed t-shirts with the new ad campaign slogan and the meeting was over.
The bewilderment must have been contagious, because the TV ad campaign ran less than a week, then disappeared.  And it was never mentioned again, like it never happened.  I decided to call it : “Ameritrust – The Shortest Ad Campaign.”
I still have the t-shirt.

Here are a few slogans that I think are pretty good:

  • “Be all you can be.” (The Army)
  • “The few, the brave, the Marines.” (The Marines)
  • “Quality is Job 1.” (Ford)

Jonathan B. Spira is CEO and Chief Analyst at Basex.

Think

Friday, October 12th, 2007 by Jonathan Spira

THINK was one of the phrases and principles frequently used by IBM founder Thomas J. Watson, Sr.  Others included LEARN, STUDY, and THINK IN BIG FIGURES.  THINK appeared in IBM offices, plants, and company publications (it was the name of the IBM employee publication for many years) starting in the 1920s.  By the 1930s, THINK had begun to take precedence over other slogans at IBM.  It gained new popularity in the 1990s when, according to company legend, a researcher took a notepad with the word THINK written on it from his pocket and came up with the idea of a small, portable tool with which one could read, write, work, and think.  The rest is history.

This week we continue our look at Getting the Message Out.  IBM’s THINK is rare.  Most messages fall flat and miss the mark.  One that comes to mind is United Airlines’ “Rising.”  Do other airlines fail to rise?  Some messages come ever so close, but then ultimately fail.  A good example of that is Miller Beer’s “It’s Miller Time” campaign.  When it was launched, it required a bit of adjustment as people were going into pubs and saying “It’s Miller time, give me a Bud.”

Sometimes companies come really close.  American Airlines’ “We know why you fly” would have been perfect had they only used “We know why you fly American.”  Otherwise, it’s a rhetorical question that many may answer “to get from point A to point B.”

What does the IT industry have?  Apple Computer countered THINK with  “Think Different,” which suited Apple’s iconoclastic image quite well, even if it brought out the grammar police out in droves.  “The Document Company” certainly matched Xerox.

But a quick look at most IT industry messages tells a different story, one that is mediocre at best.  To wit,

  • Verizon – “We never stop working for you.”
  • Microsoft – “Where do you want to go today” or “Your potential, our power.”
  • Siemens – “Be Inspired.”
  • SAP – “The best run businesses run SAP.”
  • Cisco – “The power of the human network.”

What do any of these tell us about the company?  Frankly, not very much.  And why is Intel going away from “Intel Inside” to “Leap Ahead.”?  If “Melts in your mouth, not in your hands” was good enough for the makers of M&M’s for over 50 years, why not “Intel Inside”?  A classic message need not be changed for the sake of change.

While we’re at it, please tell me about slogans you find memorable or abominable.  E-mail me at messages@basex.com.  In the meantime, I’ll leave you with one that requires some more thought: “Nothing sucks like an Electrolux.”

Jonathan B. Spira is CEO and Chief Analyst at Basex.

The Industry is Always Looking for the Next «G»

Friday, September 28th, 2007 by Jonathan Spira

Verizon Wireless and part-owner Vodafone’s recent decision to move in lockstep towards 4G networks may surprise some and move others to believe that this foreshadows a global standard for the telecoms industry, but it’s really just business as usual in an industry that loves having multiple “standards” at the same time.  Many questions remain, namely what, if any, current operability will remain with other “standards,” what will happen to the mobile operators’ core networks, and what technology will consumers feel comfortable with and adopt.

Things in the telecoms industry move far more slowly than most people realize.  Just because new mobile phones are introduced every three months doesn’t mean that there are any new technologies hiding within them.

The industry has been down this road before, moving from analog (1G) to digital (2G), a point upgrade with 2.5G (not a defined standard but a legitimate stepping stone on the path to 3G), and finally to 3G.

We’ve heard the promise of the next generation of mobile services before, although not necessarily from these two players (Verizon Wireless and Vodafone).  2G, no, 2.5G, no, wait, it’s 3G, no, now it’s 4G that will be the great unifier.

What happened to 3G?  We had not one, but two standards, namely W-CDMA and CDMA EV-DO.  Japan’s NTT DoCoMo was the first to launch a 3G network in 2001 (WCDMA), followed later in the year by South Korea (CDMA EV-DO).  3G services in Europe started in 2003 but progress was slowed greatly thanks to the high cost of additional spectrum license fees (3G services in the U.S. use the same spectrum as 2G, so spectrum was not an issue in the U.S.).

One reason 3G caught on in Japan and Korea (both countries built out sufficient network infrastructure at the very beginning) was because there was no need to include roaming capabilities to older networks.  The devices were small and lightweight.  In Europe and the U.S., given limited network infrastructure, multi-mode devices were required, supporting 2G and 3G networks, making the devices themselves larger and heavier, hence less attractive to the consumer.

According to the GSM Association, there are ca. 200 million people using 3G worldwide, mostly in Europe and Asia.  Out of 3 billion subscribers, this is less than 7% of the total.

It makes sense, of course, for companies with as close a corporate relationship as Verizon Wireless and Vodafone to use the same high-speed 4G data network.  They now use the mutually incompatible CDMA (Verizon) and GSM (Vodafone) protocols although there was much speculation that their 4G platforms would also be different.

But 4G will not necessarily bring the industry closer together.  Sprint has already announced plans for its 4G-speed XOHM service, based on WiMAX, and trials are planned for later this year.  Sprint has hinted that this network will be open to any device that supports WiMAX, a wise decision in order to build network revenue.  One thing is certain: 4G will attract many players from outside the traditional mobile telephony industry, such as Google, a company that sees having its own network as a better way of getting new wireless applications to the masses.

As for me, I’m already looking forward to 5G as the platform that will (surely) unify the world.

Jonathan B. Spira is CEO and Chief Analyst at Basex.


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