In this instalment of the unread Tech Series we discuss "why would a hand set provider pre-install a cross carrier enabled (copyright) virtual mobile network application and would the HNO let them?"
We know from the SYT web site that the following is suggested as a service offered;
MOBILE DEVICE MANUFACTURERS
Differentiate your products, services, and content from competitors by delivering preinstalled applications equipped with mobile connectivity. Application-specific connectivity drives consumers and businesses to purchase higher priced, higher margin mobile-enabled devices.
You will note that this fails to suggest cross carrier enabled (copyright) connectivity but the inference is clearly implied from the other offerings on the website.
So would a handset manufacturer really consider pre-installing an application that could bypass the networks and would any HNO or MVNO allow this to occur?
Well in 2010 Apple we're reportedly considering doing something along the same lines by considering installing a hard wired sim in phones for Europe.
Apple to offer universal, SIM-less iPhone in Europe?
Andrew Munchbach
October 27th, 2010 at 7:01 PM
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If we know one thing about Apple it is this: they like control… and this latest rumor seems to reaffirm that creed. Blog GigaOM is reporting that Apple is planning to release an iPhone with an integrated SIM that can be used on any wireless carrier — partnered with Apple — in the EU. A universal iPhone if you will. As the report explains:
Sources inside European carriers have reported that Apple has been working with SIM-card manufacturer Gemalto to create a special SIM card that would allow consumers in Europe to buy a phone via the web or at the Apple Store and get the phones working using Apple’s App Store.
So the concept is not new but did not happen. But what has changed for a manufacturer to take this type action?
Well for the first time ever the cost per bit for data is likely to exceed the revenue per bit in 2017. With no profitability in voice SMS and now potentially data, telcos need to find alternative revenue streams, and hence the charge for content and alternate revenue models.
The idea that each new handset purchased will need a carrier specific sim that in anyway reduces cross carrier connectivity seems to fly in the face of the "new" revenue models.
The cost of content and requirement for audience reach means that content providers that have premium content apps installed by hardware manufacturers are likely to see a higher take up and such content needs to be carrier Agnostic. After all the service quality is very important butbdonisbthe data cost to consumers of these services.
As HNO's are now becoming content providers it is likely they will (have?) requested that cross carrier apps are available to ensure that which ever carrier provides voice services is not a limiting factor for the delivery quality of service for content.
An application that allows for cross carrier access for specific applications could be vital for zero rated access for content delivery. For example if a Verizon network is available for a Verizon owned content which the consumer wishes to subscribe, having access to that service directly rather than through a third party MVNO with limited connectivity and increases would be preferable. Therefore app specific cross carrier enabled connectivity will be desirable and, I believe able to be delivered now with better functionality soon by the technical team at SYT IMO.
How does that service become enabled and how is that service secured out of the box? You may recall a post in relation to a poster enquiry about the Gamze patents. I suggested that the following may be an appropriate application developed from the patent;
In general terms Gamze, from what I understand has two patent streams, one that selects the better quality service from multiple different cellular networks and one that receives data from multiple cellular networks (in this case location data). If you would like to read more this post is on this thread.
Therefore while in the early stages a cross carrier enabled SYT Freeway app that connects via an available carrier through the SYT MVNO cross carrier solution could be installed by the hardware manufacturer, I would expect an application that actively seeks out a specific carrier network based on certain criteria for specific applications seeking network access with carriers different to the carrier actually selected by the consumer or end user will be likely in future.
I am not suggesting that SYT are actually doing this but I expect that the boys did not recruit Gamze only for her natural charm and good looks!
In addition it is expected that handset sales have peaked in the more developed economies and mobile connected devices around the IOT and other connected uses for applications such as cars and the like, are the growth areas for hardware manufacturers.
Recall that these are high volume low value transactions and generally these applications do not have traditional voice requirements. Therefore these applications will need to be hard wired to access networks and be either equiped ready to search and connect out of the box.
Carriers could not afford to have a customer service operatives available for consumer start up enquires for every kettle or fridge sold.
While most of these devices are likely to be connected to a hub and that central conduit be the connected device, such device will have to be mobile accessible especially as the percentage of homes with broadband falls over time as 5g becomes more prevalent. Inadditiin as we discussed in the UTS previously, mobile access to these hubs will be essential for use by consumers.
Access for these products will need to be seamless and be able to identify an owner to charge, a carrier to connect to in whatever region that device is located. Installing sims will be out of the question for most of these hub devices due to cost.
However to make a profit from this high volume low value use of spectrum, a HNO will need to provide as little service as possible. In addition a HNO will not want the network clogged with low value transactions at the expense of say premium content delivered through a subscriber model.
Therefore having a cross carrier enabled application installed that is able to connect to a selected carrier with available bandwidth to justify allowing this connectivity will also be important for cost minimisation and efficient use of spectrum. So such a device would need to be able to find available bandwith and that may mean utilising another carrier or satellite or the cloud or some other method of connectivity that is cost effective at that specific time.
As these changes come to fruition, one can see that the likelyhood of preinstalled cross carrier enabled devices will become more than likely.
While there are other benefits such as cost reduction for MVNO catalog and BSS and providing superior user experience and to generate user loyalty to hardware brands and the like, I believe you will see that SYT is not dreaming when contemplating manufacturer installed product.
Look out of the next instalment of the unread Tech Series when we will discuss "will Data be traded on the Futures exchange and should I go long!"
As always the opinions in the unread Tech Series are not to be relied upon and are not an accurate representation of any SYT actual strategic plans. We do our best But it's just a guess!