Fit to burst

3G has been hyped for many years but its promise to enhance enterprise mobility has largely fallen flat as a result of low demand, competing solutions and slow roll out of compelling 3G products. Is the 3G bubble about to burst or will it finally make an impact on the Middle East enterprise? Sarah Gain reports.

  • E-Mail
By  Sarah Gain Published  October 25, 2005

|~|PHOTO-1---Khan-_m.jpg|~|Khan: If they want to grow, telecoms operators have to move into new spaces, offer more services, and charge lower prices.|~|3G is the generic term used to refer to the next generation of mobile telephone technology. In order to qualify as a 3G technology a system must be capable of a minimum download speed of 144Kbps, according to the regulatory and standards-setting body the International Telecommunications Union. The systems are designed to enhance the mobile services available today, offering increased voice capacity and higher-speed data rates by providing greater bandwidth than previous generations of mobile phones. These technologies have the potential to take increased business applications to mobile devices, thereby increasing employee availability and productivity. As companies begin to recognise the significant competitive advantages that mobility can bring, demand for remote access to e-mail, internet access and access to enterprise applications is rising. IDC identifies three main categories of mobile business users: The non-office-based mobile worker; the office-based worker; and the home-based mobile worker. Although the analysts admit the uptake of mobile enterprise solutions is still in its initial stages in the Middle East, by 2006 the number of all these categories of mobile and remote users will increase from 110 million employees worldwide to 162 million, and by then the region will have its share of mobile employees. This represents a key opportunity for telecom providers to capture and retain market share as they diversify as a result of deregulation. Etisalat and MTC Bahrain, for example, are already operating on 3G infrastructures that permit high-quality video streaming, high-speed downloading, and broadband internet access. “If they want to grow, telecoms operators have to move into new spaces, offer more services, and charge lower prices,” says Zoff Khan, director of strategic sales development, Middle East, Africa and Pakistan at Motorola. He adds that these services will not only benefit the operators but will also prove useful to consumers: “The lower prices and improved mobility that they offer will be beneficial to users, whether they choose to take advantage of these new capabilities at home or for business.” Until now, however, not enough has been done to address the needs of mobile business customers, according to Niklas Sonkin, chief strategy officer and director of the business-to-business division at Kuwaiti telco Wataniya. “Globally, the B2B market has not had the focus it should have had,” he says. “There are a lot of companies in the region that need mobile services but nobody is providing them.” Indeed, while some of the region’s enterprises are introducing a level of mobility into their operations, so far the solutions deployed have mainly centred on notebooks and PDAs as opposed to mobile phone handsets. In addition the connectivity of choice is more often Wi-Fi internet rather than 3G. Emirates Airlines, for instance, has deployed a mobile solution for its corporate sales force. The solution is currently used by more than 200 employees to access information residing in various proprietary applications via their notebooks. “The idea is to enable salespeople — who are out in the field most of the time — to have the latest information, every time they walk into a meeting,” explains David Leckie, senior technical manager, Emirates Airlines. Although the company plans to extend this solution to cover a further 300 members of staff within the next year, Leckie does not anticipate that the airline will choose to deploy 3G-enabled mobiles for similar purposes any time soon. Bahrain-headquartered Arcapita Bank has also taken steps to keep its executives connected and increase productivity. The bank supplied BlackBerry devices to key staff and connected the BlackBerry Enterprise Server to its e-mail server, giving executives real-time access to their e-mail on the move. Currently, 35 of Arcapita’s senior management and other key staff get access to their e-mail, calendaring, SMS, and phone from a single handset. The bank is also looking at connecting its customer relationship management (CRM) system to the BlackBerry platform. Although it means paying phone connection charges from the UK because the device’s Canadian manufacturer, Research In Motion (RIM), has not yet set up operations in the Middle East, Vikash Bhandari, head of IT for Arcapita, claims the technology is still proving to be worthwhile. “In terms of productivity, it’s great. It has effectively changed the way people do their work,” he says. “The first thing we saw was that executives don’t carry their laptops around anymore.” Theoretically, this is great news for 3G mobile providers, as it suggests that the next generation of phones could one day have a place in the enterprise. Keen to tap this potential market, a number of early adopter network providers such as Batelco, MTC-Vodafone and Etisalat have combined their technological advancement and their strong relationships with corporate subscribers in order to promote 3G-enabled phones with enterprise components. MTC-Vodafone Bahrain, for example, has launched a corporate push e-mail service, mobile VPN facilities, and mobile connect cards for remote access to e-mail, internet and corporate LAN. “There is no doubt that 3G is the future and what it depends on is the operator, the market and the business case,” says Ismael Fikree, the company’s chief technology officer. Elsewhere in the region, however, research conducted by Spot On Public Relations suggests more still needs to be done to convince mobile phone users of the usefulness of 3G technologies. Interviews carried out among randomly selected members of the public in the UAE and Jordan highlight the fact that although many more subscribers are using MMS (multi-media messaging service) services, few are aware of the potential for mobile internet access and content services. In both markets, over 70% of subscribers did not download content to their mobiles, preferring to use MMS to send and receive pictures on a peer-to-peer basis. In addition, over 60% of subscribers in both countries viewed adoption of 3G negatively and do not plan to buy a 3G telephone at all, with some 58% of respondents claiming they see 3G purely as a videophone technology. In fact, when marketing 3G services, video telephony has often been touted as the killer application for the technology. In reality, video telephony has been slow to take off. Performance is often disappointing and users need compatible handsets to communicate. In Japan, the first country to introduce 3G on a large commercial scale, with approximately 40% of subscribers now using the technology, downloading music has proved to be the most important selling point. This suggests the biggest 3G successes could come from the consumer sector. Proponents of the technology, however, claim 3G’s ability to keep workers connected at all times is a key benefit. The ability to stay remotely connected to the office has proved to be greatly appealing to companies seeking increased operational efficiency. For organisations, the solution can bring improved data collection and accuracy, as data is input directly into applications and can be validated in real time or near-real time. “Being mobile also improves performance, productivity and efficiency at reduced costs, as well as enhancing accountability for work processes, task assignments, resource utilisation and the quality of services to customers,” says Motorola’s Khan. Unfortunately, some of the features that make mobile handheld devices so useful to some companies may at the same time be seen as disadvantages by others. The pursuit of the elusive work/life balance means that some execs find the increased connectivity of handheld devices something of an intrusion. “People already contact me at all hours of the day and night,” says one senior sales executive at a large Dubai-based enterprise with a lot of international clients. “If they can’t reach me on the phone, they will send me a text message. And I feel obligated to take the call because it’s work-related. I do not need to give people another way of contacting me — I would never get any peace,” he complains. Another important point concerning 3G is that there is already a wide and varied selection of competing technologies available. Rather than paving the way for mobiles using 3G, the fact that solutions such as notebooks and PDAs using Wi-Fi and General Packet Radio Service (GPRS) have started to find their way into regional enterprises may in fact mean the new technology is even less likely to find its place in business operations. Not only are there various flavours of 2G and 2.5G available, but wireless LAN (WLAN) systems are also getting faster and becoming more robust. Although 3G systems undoubtedly provide faster access to all types of data and expand the utility of mobile phones compared with previous generations, the improvement does still not compare to WLAN and broadband access rates. There are plans to develop Wi-Fi systems that approach 1.5Mbps in theoretical speeds, which would prove stiff competition for 3G. Wataniya Telecom’s CEO, Harri Koponen, believes the benefits that can be delivered by 3G do not constitute a big enough upgrade to make a significant difference to users. Having joined forces with Nokia for the implementation of advanced technologies that would take the operator beyond 3G, Wataniya not only intends to update its EDGE infrastructure to 3G, but at the same time will further advance its systems to the so-called 3.5G technology, HSDPA (high-speed downlink packet access). He believes the technology, which he says is more likely to remove capacity bottlenecks and allow for the delivery of broadband-type services, will be of more use to heavy data users. “The gap in the time of delivery for 3G and 3.5G is so small that it makes sense to go straight to the superior technology,” he adds. Other telecoms operators are ensuring they have their options covered on both the 3G and WLAN front. Batelco, for example, has launched a business-centric Wi-Fi service, alongside its 3G offerings, which gives a wireless modem access point on the enterprise’s SpeedNet ADSL line. On the device side, vendors are also keen to keep a foot in both camps. Sony Ericsson’s soon-to-be-released P990 smartphone combines UMTS 3G connectivity with Wi-Fi support and will feature video calling, rich content downloads and e-mail and internet access. By 2006, the number of Wi-Fi hotspots globally will reach 100,000, according to a report from research firm Informa Telecoms and Media. Technologies such as Wi-Fi and WiMax are currently generating a lot of attention from enterprises in the region. This may be bad news for 3G and will put pressure on telcos to reduce the prices of solutions to fend off competition. If they are able to undercut WiMax providers on the cost of implementing mobility-enabling technology, and guarantee more reliability, then they might be able to win over the region’s CIOs and CEOs with their offerings, if not with 3G solutions then perhaps with subsequent generations. While 3G competes with other wireless radio technologies, there is also the argument that they will also complement each other. For example, Intel foresees a ‘Russian doll’ model of constant connectivity that will allow users to move seamlessly between various networks utilising whichever connection is most efficient at the time. This model of wireless technologies would start with personal area network (PAN) technologies such as Bluetooth, moving up to Wi-Fi as the LAN technology, then WiMax as the metropolitan area network (MAN) and finally 3G providing almost global coverage. Carl Schmits, service provider marketing for Intel, explains: “A good example of how it can work is someone on a train journey could use Wi-Fi to access the internet while at the station but when the train starts its journey he would switch to WiMax. Then when out of the metropolitan area he would switch to 3G,” he says. “All of this would be happening on the back-end, with the user unaware and seamless handoff between technologies. In each instance the service provider would be delivering the best speed at the best price possible.” ||**||

Add a Comment

Your display name This field is mandatory

Your e-mail address This field is mandatory (Your e-mail address won't be published)

Security code