We are in for a great deal of innovation and change in this industry as we get to 4G. Devices will initially be dongles and handsets; a whole slew of consumer electronics will change the role of the operator within the mobile broadband value chain. And 2010 will definitely be a defining year for the ecosystem in terms of how carrier business models shake out. We sat down with Samsung’s WiMAX and 4G guru, Tom Jasny, to talk about the open-device ecosystem model and what it means for carriers.
XC: The 3G emerging devices opportunity in certain cases is placing the device-maker in the role of controlling the end-user relationship, rather than the carrier. Will this become the norm with 4G?
Tom Jasny, Samsung’s vice president of wireless and broadband networks: We are specifically seeing these dynamics building in the ecosystem, led by OEMs becoming much more aggressive in making go-to-market deals with retailers. And there’s no question WiMAX and 4G will spur that along. Carriers will have to take heed of the new business models emerging, in line with Dell selecting us for go-to-market. Everyone’s connected devices portfolio will have a hybrid selection of strategies.
When the connectivity just runs in the background of a connected device, how does that open up opportunities for carriers when they fear becoming dumb pipes?
TJ: We saw in 2007 when we enabled the iPhone that things were going this way. Even though Apple is the brand when it comes to iPhone, AT&T certainly hasn’t suffered. That gave all of us a sneak peek of how that would work, when an OEM deals with the carrier as just one of many enablement partners.
We also think the Kindle shows the potential of the model. If you ask an end user who provided the access for that device, they wouldn’t know. But carriers are happy because they have another channel of distribution for their connectivity where they’re not involved in the sales process, which is expensive. Customer acquisition is expensive.
Some speculate that the 4G model will be one of devices that can connect to any number of networks, on the fly, regardless of provider — kind of like Wi-Fi. What are your thoughts on that?
Well, in licensed spectrum that will require interconnectivity between networks and programming the API connections on the device to different carriers. That’s not a core competency of most consumer electronics manufacturers, so they will want someone to provide that to them. So there’s an opportunity for someone.
But I think the more degrees of freedom for the consumer there are, the better for all. Let them decide what network, what kind of device, what type of bandwidth they need. This openness is at the heart of 4G. What you’re talking about is a very futuristic outlook, but yes, users will have options as to which network to be in. Because they have a collection of day passes, for instance. It’s better and provides more choice for the consumer.
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