What is the Mobile Internet?
The Next Evolution in Connectivity is the Mobile Internet.
Author: Jonathan Singer, Research Analyst & Editor, Yankee Group
Co-Author: Eliot Weinman, Editorial Director, Mobile Internet Trends
Mo·bile |'mO-b&l| - adjective :
1 : capable of moving or being moved : MOVABLE <a mobile missile launcher>
2 a : changeable in appearance, mood, or purpose <mobile face> b : ADAPTABLE, VERSATILE
3 : MIGRATORY
4 a : characterized by the mixing of social groups b : having the opportunity for or undergoing a shift in status within the hierarchical social levels of a society <socially mobile workers>
5 : marked by the use of vehicles for transportation <mobile warfare>
6 : of or relating to a mobile
7 : CELLULAR <a mobile phone>
In·ter·net |'in-t&r-"net| -noun : an electronic communications network that connects computer networks and organizational computer facilities around the world. [It's a series of tubes you know (Apologies. The editor couldn't resist).]
--Source: Merriam-Webster's Online Dictionary (www.m-w.com/)--
"Mobile" and "Internet" are two of the most important words of the last 15 years. Individually they changed the way we communicate, the way we play, and the way we do business. The disruption brought upon peoples' lives by these two simple words is incalculable. Communications improved, communities emerged without concern for geography, old business models crumbled giving rise to new, and movie-goers found more effective ways to annoy each other. Now, just as people and businesses have settled with the massive changes of the past 15 years - these two worlds are coming together to blow everything up all over again.
The Mobile Internet is the inevitable intersection of the power of broadband and the convenience of mobility. Users will be able to take their broadband connection with them anywhere they go. Ubiquitous access to an always-on, all IP, high speed broadband connection will again change the way we work, play, and communicate - and will create an open market for a new host of service and application providers.
Mobile Internet Market Trends
Demographic data supporting the potential demand for mobile applications are provocative. In North America there were approximately 60 million broadband subscribers (business and consumer) in 2006. The number of mobile subscribers far surpasses that - 246 million. In emerging markets the gap is even more extreme. India has only 1.9 million broadband subscribers, but has over 126 million mobile subscribers. China has 53 million broadband subscribers, and 538 million mobile users. That is approximately ten times the number of mobile to broadband subscribers in each country, and these numbers are steadily growing. Yankee Group forecasts a compound annual growth rate of 34.5% in India, and 13.2% in China over the next 4 years. As the Internet meets true mobility it will suddenly be available to a large and untapped portion of the world's population.
Expanding both the reach and convenience of the Internet will not only bring the current Internet experience to a new population, it will open up markets for new mobile Internet specific applications and devices. Consider how Mapquest and Google Maps changed the way people get directions. Now combine that with in-car GPS systems, integrate with a mobile handset, and add in search and advertising. Are you in a social network like Chowhound? Find a restaurant in walking distance recommended by people in your network. The mobile Internet will change enterprise models as well. Over the past few years businesses accepted mobile email and calendar access as a way of life. Now add in field force automation, remote systems administration, and salesforce automation.
Mobile Internet Trends
Some people would say that the mobile Internet is already here today. I can already visit some websites, get email, and download ringtones and games for my mobile phone - but I'm not impressed. How will this be different than what I already have?
Many of the problems faced today by the mobile Internet are the same as those which faced the Internet in its early public stages. In the early 1990s Internet service providers (ISPs) maintained complete control of the experience, which was fed to users over a legacy communications-centric infrastructure. Users entered a walled garden where ISPs like America Online provided limited services and applications to a captive audience. The emergence of the Internet protocol (IP) standard disrupted this market and allowed the development of new players such as Yahoo!, Google, and eBay. This transition to an IP-enabled open system made the internet what it is today.
The mobile Internet currently faces the same challenges. Wireless carriers own complete control of the user experience on a communications-centric network infrastructure. However, two main events will occur to enable the true mobile Internet:
- The network infrastructure will be media-centric - this means a move to IP. Basing the mobile Internet on a new IP-based infrastructure will allow the throughput and bandwidth necessary for a successful user experience. With speeds between 10-100 Mbps, technologies such as 3GSM, EVDO, HSDPA, WiMAX (IEEE 802.16x), 3G LTE, and WiFi (IEEE 802.11) will enable service and content providers to deliver the value of an Internet experience anywhere to businesses and consumers. Carriers such as Verizon Wireless, Vodaphone, China Mobile, and Sprint are working with infrastructure providers such as Motorola, Samsung, and Nokia to deploy these technologies over the next several years.
- The mobile Internet will have an open service delivery ecosystem for third party applications and devices. "Openness" is what makes the Internet successful. An open system allows new business models - such as those pioneered by Google, Amazon, ebay and Netflix - to develop. Innovations in business and technology are most easily facilitated by an open model, and innovation will be key to the mobile Internet's success. Please also note the key phrase: applications and devices. The mobile Internet is not just about phones. Apart from increasingly powerful mobile handsets, laptops and other new networked consumer electronics and enterprise devices will share ubiquitous connectivity to the mobile Internet.
The services provided on the mobile Internet will give rise to new disruptive business models. As mobility moves from communications-centric to media-centric, opportunities exist for services built around commerce, content, communities, ad-support, and even consumer electronics. Once the network is IP-enabled and the service delivery infrastructure is opened a myriad companies will rush in to claim their share of the market and develop their own ways of doing business. As a new mobile Internet ecosystem evolves look for service providers to come in with one of two main perspectives. The first is the traditional network service provider perspective. Companies such as Comcast, Sprint, Telefonica, Verizon, and Vodaphone will focus on core strengths surrounding the network infrastructure and its connection to the device. The other service provider group is the Internet perspective. Companies such as BitTorrent, eBay, Google, MySpace, Salesforce.com, YouTube, and Yahoo! will focus on providing applications and content.
For market players, the transition to the mobile Internet will not be smooth. Although there is great opportunity, there will be many challenges in developing solutions and services that deliver value to the end user at cost. As was the case with the Internet revolution, organizational structures, incentives, and corporate cultures will need to change and adapt to new market structure and business models. Companies that cling to old business models and seek to stymie industry innovation to maintain profits instead of finding new ways to do business will be left behind. In the next ten years, mobile Internet will be the fastest growing definable marketplace in the communications industry, and nimble organizations that focus on channel, technology, and market innovation will see the greatest success.
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