Living in a 4G World

3G promised us the mobile Internet but, as ever, the hype got ahead of reality. To be fair, by the time 3G was finally agreed upon and rolled out, the speeds it offered seemed rather pedestrian, and most industry watchers are now waiting on a 4G world for a truly global, mobile Internet with access speeds capable of supporting the kinds of applications and services that the iPhone is letting us glimpse.

 

And that might happen faster than we think. The 1.5 billion app downloads on iPhone – a tiny fraction of the total mobile phones in the world – has shown service providers everywhere that there really is a market for mobile content and applications.

 

Now I don’t really want to step into the debate over which flavor of 4G will win – LTE or Wimax – except to say that I think LTE will be a much simpler operational step for mobile operators to roll out and be able to play the same kind of staged deployment as they did with 3G where multi-protocol handsets ‘hide’ the initial patchiness of the network infrastructure.

 

The battle for 4G technology dominance aside, a 4G world will be a very different one from 2G and 3G because several key technologies and approaches are coming together: fast and ubiquitous mobile Internet; powerful smart devices and cloud-based services. Cloud-based services allow the edge of the network – the device – to be smaller, lighter and simpler yet still as powerful because all the heavy-duty applications processing and storage are done inside the cloud. To be useable, it needs fast and reliable communications anywhere the user might be, and hence 4G is a crucial enabler of this approach.

 

Apart from a large screen and keyboard, why would you need a PC when you have a smart phone and all of your information and applications available online anywhere you go? No wonder Google has targeted its focus on the handset (Android) and netbooks (Chrome). If this scenario came about, it would obviously have very big implications for the PC and software industries as we know them today.

 

But there are many new issues to worry about in a 4G world. It’s an all-IP network, so problems like VoIP security and service quality rear their head. In such a radically altered world, what are the implications for charging, settlements and so on? The operational headaches for service providers are likely to grow, so we need to crack on and solve them before these networks become high-volume reality. That starts with the basic infrastructure being manageable in a sophisticated and common way – not having to build different systems to cope with different manufacturers, for example.

 

But the implications of a 4G world go way beyond this. We may see a complete revolution in the business models underpinning these networks and services. Already we are seeing cracks with so-called over-the-top services bypassing the communications provider’s billing system. Do we see a separation between companies that operate networks and players that operate services and market those to end-customers? How will value chains evolve? Even the model for who pays for services may change – already we are seeing more and more ‘free’ applications and content on the iPhone supported by advertising.