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Mon, Feb 12, 2007 - Page 10 News List

Mobile industry abuzz with talk of convergence

MORE TO OFFER Facing relentless competition and dropping profits, telecom companies are betting on a set of new mobile services to revitalize the industry


Internet, computer and music giants are expected to flock to the 3GSM World Congress 2007 in Barcelona in an attempt to court the mighty mobile phone industry.

The annual convention, starting today, has in recent years become not only an absolute must for telecommunications operators and equipment makers, but increasingly also for non-telecom companies like Yahoo, MTV and Warner Music, eager to get in on the action.

With 1,300 companies and some 60,000 people expected to attend, this year's 3GSM congress, which ends on Thursday, will for the first time dedicate an entire hall to non-telecom companies providing cellphone content, including TV channels and videogame and music producers.

And no wonder the content providers are lining up to participate: mobile phone penetration has already reached 90 percent in Europe, surpassing even the popularity of the Internet and continues to surge in the rest of the world, especially in India and China.

Last year, the number of cellphones sold jumped 25 percent to more than 1 billion devices, Strategy Analytics said.

Content providers will play a major role at the 3GSM congress, with software companies like Adobe, Internet giants like Google and music and entertainment heavyweights EMI Music and Walt Disney scheduled to tout their recent entry into the sector.

Most widely anticipated, however, is perhaps the planned launch of a new business version of Microsoft's mobile phone operating system, Windows Mobile 6, which will among other things enable users to remotely access e-mails and files stored on their computers.

"We want to reduce the gap between what you can do on your PC and what you can do on your cellphone," head of Microsoft France's mobile division Nicolas Petit said.

Traditional telecom operators and equipment makers, meanwhile, don't seem to mind all the outsiders, hailing the breath of fresh air they bring to a mature market longing for a return to the days of dizzying growth.

Faced with unbridled competition, the telecom companies have had to slash prices and thus also margins and are betting on new mobile services to revitalize their industry.

Instead of just turning out now next-to-worthless phones used only to make calls on, these companies are hoping consumers will soon also use their handsets to download music, watch TV, play videogames, do their online banking and surf the Web.

This so-called "convergence" of services, an industry buzzword, is expected to be at the heart of next week's convention.

The telecom operators might however grab the 3GSM spotlight with the announcement of a new joint Internet search engine, a report in the Sunday Telegraph said.

Vodafone, France Telecom, Telefonica, Deutsche Telekom, Hutchinson Whampoa, Telecom Italia and Cingular will hold "secret talks" in Barcelona aimed at promoting their own Internet search engine rather than use a mobile version of Yahoo or Google on their phones, the paper said.

Such a move would secure the operators a far greater portion of the advertising revenues.

Judging from the industry's past efforts to force Internet companies out of the equation, however, the new search engine plans may not be entirely successful.

Nearly all the operators who previously tried to impose their own instant messaging systems on users have since been forced to integrate Microsoft's Windows Live Messenger into their phones.

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