Mobile Data is evolving in the UK and with that evolution we are seeing many opportunities for resellers to make money. 4G has yet to hit the business market in a big way but slowly but surely the major networks are building out their network infrastructure for widespread coverage. How is this change in data speeds affecting the market? Is 4G the answer to all of our prayers? David Dungay went out into the Channel to take a look at how mobile data is affecting our resellers in the current climate.
4G – Are we nearly there yet?
4G has been out in the market place for over a year now and last September the likes of O2 and Vodafone decided to join the party. Although considered by many as being still in the “early days” is 4G having an impact on the market?
Simon Slater, General Manager of Conect at Exertis Micro-P, says “4G will drive cloud-based working in a big way. It’s about the ability to access content from anywhere, applications such as mobile video conferencing and the creation of a true mobile office thanks to services such as Office 365 and Lync through mobile broadband devices on the go. This will mean business users will be able to do a lot more; they will not be tied to the office.
4G therefore means a big boost to mobile working and the mobile office, plus it will subsequently be a big driver for the use of tablet devices as Office 365 and Lync will require a bigger screen than the mobile phone, but without the cumbersome addition of a laptop. 4G is enabling those software services to really come into their own on the road.”
Julien Parven, Director of Marketing at Daisy Distribution commented on the benefits that 4G have brought to the market, “Speed is undoubtedly the most obvious benefit of the technology, allowing consumers to download more content than was previously possible on a 3G device. In comparison to the quickest forms of 3G, 4G also delivers less round-trip latency, making real-time applications like VoIP and video calls possible. It also helps promote usage of business applications such as SharePoint and Lync on the Windows Phone 8 platform ensuring business doesn’t have to stop outside the office. All these services are made possible through fast connections, delivering an ‘always on’ experience to the user.
These benefits will also help businesses increase their overall productivity; they will reduce costs, allowing employees the potential to work from home and help deliver a better customer service, thanks to the continuous availability.
It is important that providers and distributers don’t forget the role they play in helping the consumer understand the opportunities the technology presents, and demonstrate ways in which they can help improve business. Some of these include increasing employee efficiency, greater collaboration, reducing costs and delivering a better customer experience.”
Piers Daniell, MD, Fluidata added his thoughts about 4G Network congestion, “4G has been heralded as a way to reduce our reliance on Wi-Fi connectivity while new data heavy 4G services grow in popularity with businesses and consumers. Managing this volume of traffic – particularly at a local level – is posing a particular problem for already bandwidth constrained networks. One of the most efficient ways to handle high volumes of data traffic over the 4G network is, ironically, Wi-Fi. Wi-Fi backhaul provides a mechanism to offload data to the wire line infrastructure whilst preserving uplink and downlink speeds.”
We know what 4G is meant to deliver in terms of connectivity and what impact that will likely have on the uptake of bandwidth heavy services but in reality is it living up to the hype? After the 3G debacle have we learnt not to count our chickens?
Parven seems to think 4G delivers what it says on the tin, “In comparison to its predecessor, 4G definitely lives up to the hype. While there are some who would argue that 3G is adequate enough for their needs, I’d argue that, for businesses in particular, 4G can help take it to the next level.
Speed is something I’ve already talked about, however, 4G is also extremely good for remote working, sharing files and documents, or those who use large amounts of data and applications. Improved connectivity allows the user to connect much quicker to services and to conduct business seamlessly on the go. It’s a no-brainer that the technology will soon become ubiquitous, given that it can even provide quicker download speeds than some Wi-Fi connections.
Admittedly, the coverage for 3G connectivity is currently better, so the next stage for 4G is to achieve near full nationwide coverage. But this shouldn’t pose too much of an issue, certainly by the end of the year when the roll out is expected to reach more than 90% of the population.”
Charles Towers-Clark, Managing Director of Podsystem Group says “As far as the technology is concerned, 4G is certainly living up to its reputation of providing the high speeds required to access a whole range of new applications via mobile. The question is; how much will users be willing to pay for video conferencing or streaming HD video on the move? Price is certainly a barrier to adoption with faster connectivity also resulting in the need for a larger monthly data allowance which pushes monthly bills up. Currently, the other major barrier is coverage. Although in individual markets such as the UK, 4G coverage is expanding quickly, international coverage will take a lot longer to reach a homogeneous level whereby international roaming will be feasible on 4G.”
Slater added “4G broadens the range of software and services available to end users; it opens up doors to new opportunities and services to end customers because the access is there. 4G is empowering the channel to offer more joined up services through the cloud thanks to 4G, such as Lync and Office 365, now making these software products an even more useful resource.
Personally, I think consumers are adopting 4G more swiftly than businesses, to get immediate access to data speeds. Businesses will begin to find more ways of using it, but right now the issue is availability. There is currently one network with 4G rolled out across a significant number of cities, and two networks getting there with coverage, so for national businesses, 4G is not ready yet, but will be in a matter of months. At the moment 4G is too location-dependent for mass business focus.”
John Donaldson, Commercial Director of iHub isn’t yet convinced, “So far it is difficult to tell at volume level because there are relatively few users to test the networks at scale. The reality is that current 4G users are enjoying the freedom of an uncongested network; albeit one that for now at least is localised to urban areas.”
It would seem that 4G/ mobile connectivity is getting quicker, but does this automatically equal more revenue opportunity for resellers?
Towers-Clark commented “Not necessarily, the revenue opportunity for 4G is highly dependent on local market conditions. Although in some markets (for example China) operators are reporting that revenues have doubled due to increased usage of data on 4G, in others such as the UK; competition in the local market is pushing prices for 4G down. Overall, it is likely that 4G will drive higher volumes but at lower margins.”
Mark Curtis-Wood, Head of Network Services, Nimans added “Knowing what to do is only half of the solution, resellers need to know how to leverage the opportunity better connectivity will bring, that’s why Nimans have embarked on creating a series of “how to” guides to increase a resellers knowledge. According to the latest industry research there’s been a 60% rise in mobile data usage over the last year and I expect these trends to continue. Interestingly 3G currently has 65% indoor coverage but 4G will eventually have 98% indoor penetration.”
Donaldson thinks the opportunities are plenty, when asked he said “Yes it does. Bandwidth is really the pricing benchmark in the fixed and mobile marketplace. Furthermore with the new generation of devices running on faster networks, users can run more activities concurrently on the device and subsequently are more likely to generate revenue outside their bundle.”
Alexis Argent, founder and director, 4Gon Solutions agrees, ”Internet access is the primary application, upon which all other applications rest. This makes it the primary revenue opportunity, and the reason resellers should be investigating 4G gateways first and foremost, if they want to capitalise on the 4G opportunity.”
Parven has a different outlook “Put simply, no – it’s how you utilise the technology that delivers success. Like any other service, if you don’t maximise its potential, it won’t deliver everything you expect it to. 4G can help improve a business’ service, which in turn should lead to increased revenues, but it is just a tool at the end of the day – just like any other form of technology.”
Is it all about the Applications?
We like nothing better than to talk about speed in this market, but what does that speed enable us to achieve? Curtis-Wood said “Speed will inevitably enable new applications to be delivered as bandwidth capability increases. Nimans will be looking at how we deliver applications like VaaS on tablet devices; however this is only the tip of the iceberg. As 4G starts to have a larger reach, the market will drive the industry to create a new generation of applications to suit the changing landscape. We expect to see more VoIP applications appearing and the desktop being moved to a tablet device to better enable full mobility of the office. 4G will drive customer behaviour.”
Donaldson added “Undoubtedly increased network speed of 4G together with the availability of information will drive the development of new applications. With access to a host of features, mobile devices have moved far beyond merely being a communication tool. As uptake increases we can expect the introduction of many new applications designed to further enhance the seamless transition between work and home for users.”
Towers-Clark continued “Although the speed of the 4G network will encourage users to consume more data, it will be the introduction of applications such as high-definition video conferencing that will drive business executives to upgrade to 4G. Another area in which 4G will have a major impact is VoIP, to the extent that, once 4G is ubiquitous across global networks, users of 4G phones will no longer need to rely on a traditional voice connection, and will be able to take advantage of low-cost VoIP alternatives.“
Mobile data is notoriously expensive when abroad but sometimes when you need connectivity in a rush you just have to use it and then deal with the bill later. In the last year resellers have started to see the international data market as another opportunity and a range of solutions have popped up claiming to have solved the problem…but have they?
Karl McCaffrey, Director of the newly created SimTEQ Ltd commented “For the business traveller today Mobile Telephony and Data Services are an essential tool to enable them to do business but internet access from the mobile phone today surpasses fixed access and this can place a heavy financial cost on the business. The problem is made worse by the unpredictability of roaming costs which makes it hard for businesses to budget effectively and avoid bill shock from international roaming costs. Solutions offered to date typically penalise the user in terms of usability or availability of service and in many cases costs remain high.”
We are in the process of trialling a new solution that works with a range of smart phones and enables the business to provider voice and data roaming services as a low fixed daily rate”, “we are trialling in the Middle East and in Brazil and plan to launch at Mobile World Congress in Barcelona once we are confident this new product is delivering the service and reliability needed,” added McCaffrey.
Tom Linblad, Vice President of Global Marketing & Sales at Goodspeed “They are starting to, as we are seeing with our Goodspeed service: by offering a simple, predictable cost for roaming we are seeing users valuing the service because it is transparent. We plan to deliver a 4G Goodspeed service in the future but at the moment our users are very happy with 3G speeds as these are reliable and more than enough to do the business of emails and web browsing. As people become more accustomed to having video everywhere as part of their business life, that will be the right time to provide a 4G service.”
At carrier level Argent doesn’t think so “Frankly no, roaming is generally still too expensive for most users. For example, O2 recently charged me £3 per megabyte in Europe, but in Brazil (or anywhere outside of Europe) you’re looking at £6 per megabyte. So using just 1gb in Europe is not going to be cheap, and outside Europe, the cost is even more prohibitive.
Because of this, the best option is still to buy a local sim, for which you may well need to show your driving license or passport and ensure the phone you want to use is unlocked.
It’s always worth checking what offers or bolt-ons a carrier may be offering prior to departure, but generally it’s all still too costly. I believe the cost will come down though, as I’d argue operators would be better to capitalise on the universal demand for international usage more sustainably.”
Towers-Clark agrees there are still issues with roaming abroad, “There are still many problems facing users wishing to consume data abroad. For subscribers on a contract, the EU cap has only had a marginal effect on bringing roaming bills down in the EU and for business executives that generally consume large amounts of data per month, hefty charges still apply. Moreover, the cap only applies to the EU with global travellers still subject to roaming charges that can often exceed £10 per MB. Even multi-network roaming SIMs available from a core operator can’t guarantee full control over roaming costs, since agreements between networks are subject to constant change and any issues on the core network will affect the overall connectivity of the SIM. However, the introduction of new Multi-IMSI solutions help to put the control back into the hands of the user, enabling them to roam globally on multiple networks and automatically swap between different operators on the same SIM. This allows them to benefit from the best options available internationally in terms of coverage and price.”
Mobile data is becoming the main conduit to revenue if you take a look at where the market is heading. Whist the connectivity itself may not present the bulk of the opportunity certainly the applications that can be deployed over the top of it will become more relevant to resellers. There is already whisperings of 5G in the air which although we are some way away from will present another vehicle to revenue. Adjust your business accordingly.
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