Vendors ponder best route to mobile data market

Mobile operators talk up potential of business market but leave out networking resellers.

After years of anxious expectation, it looks like the mobile workforce has something to get enthusiastic about.

The low price of LCD displays and the increasing power of laptop chips has seen a growth in popularity and a simultaneous fall in the price of laptop computers.

Steve Jobs, Apple's chief executive, has said he wants more than half of the computers his company sells to be laptops within two years.

On the smartphone and PDA side of things, Hewlett Packard's iPaq device has seen success over the past couple of years as well, while offerings from Palm have seen respectable sales and Nokia's line of smartphones lead the European market for mobile devices, according to research firm Canalys.

But all of these devices need bandwidth to become serious business tools.

Wireless local area network (Lan) is growing in ubiquity and operators are piling into the access market with alacrity.

The advent of General Packet Radio Service (GPRS) and Bluetooth has helped a great deal; it is now possible to browse perfectly happily on a Palm or laptop using a GPRS phone linked via Bluetooth connectivity.

The mobile operators are in an excellent position to push interconnecting mobile devices.

The channel should be cock-a-hoop as well. With a new way of getting network access, the chance to add value to plain network access is there for the taking.

It's not just specialist systems integrators that should be happy, either; resellers that cater to small to medium-sized enterprises (SMEs) could also benefit from dipping their toes into the mobile data arena.

But nothing is ever that simple. European mobile operators are in a tricky position; they face a saturated handset market, and have to increase the amount of money they raise from each user in order to survive.

They also have to pay some increasingly large bills, not just for third-generation (3G) licences, but also for the networks that 3G services will use.

All of which, one might have thought, would have these companies champing at the bit to sell mobile data devices and services into the business-to-business marketplace.

After all, if the average consumer won't buy it, businessmen, with their need for increasing amounts of timely, mobile information, are likely to lap it up.

Well, that was the theory with Short Message Service (SMS). Originally used by network engineers, SMS was supposed to be the next big thing for business.

In reality, consumers found they could save money on calls by sending a text message instead.

Fairly soon texting became a big, if not the biggest, generator of revenue for European operators.

A decade or so later, and the same trend seems to be repeating. T-Mobile believes that the big adopters of GPRS and Universal Mobile Telecoms System (3G) data services will be business users.

Fantastic news, one would have thought, for the channel, and for the operator itself. But at the moment, many vendors seem unsure about how they will both sell to and support these business customers.

"We are cooperating with systems integrators on more complex solutions," said Rene Oberman, chief executive of T-Mobile.

"We have a website about business products, and we're selling BlackBerry devices with Outlook optimisation to corporations."

Vodafone has launched a GPRS data card for laptops, which it sells through Vodafone retail outlets.

But the ooperator's customer services department is unable to help with technical queries on the card, and refer users to retail outlets.

"We began offering GPRS through O2 because they had been working on it for longer than the competition," said Keith Yaxley, sales director at wireless VAR Data2Hand.

"Now many operators offer GPRS. How do they differentiate their services?"Yaxley sees the market for mobile data becoming similar to the fixed-line telecoms market for switched minutes.

"In switched minutes, it's a buyer's market," he said. "There has been intense price competition and now the suppliers need to add value to that basic commodity."

BT Indirect Channels (BTIC) recently said the market should not be about price, defending the arguably high set-up charges on its Business Plan service by claiming the service offered customers stability and value-add.

"If you look at what is happening in the switched-minutes market, it's possible that the same will happen in mobile data," said Chris Jagusz, head of business development at BTIC. He added that wireless bandwidth is finite, however.

"There are a few of our resellers around that are really good at this [using mobile data to build solutions]," he continued.

"They are excelling in verticalareas such as retail, point of sale, warehousing and healthcare."

It seems that mobile operators are dealing with systems integrators and allowing telecoms resellers to offer handsets and contracts through specialist distributors such as Hugh Symons and Project Telecom.

However, there seems to be no push towards getting data resellers and those that cater to the SME market selling as well.

Operators have repeatedly claimed that businesses are going to lead adoption.

Large corporations - the firms that can afford to buy a system integrated solution - may be high-profile, but they don't provide the mass-market data revenues that a plethora of SMEs using mobile data as a bearer could do.

Operators are failing to provide answers to the question of who and how they will sell these products to business users.

Perhaps the answer is that business users will, just as with SMS, have to wait until the technology has mass consumer acceptance before they take a bite.

Intel's idea of mobility
Intel launched Centrino last week. Touted as the first architecture designed specifically for mobile computing, it looks impressive.

Battery life on most Centrino machines will be five hours, it has been claimed, and the system will uses MiniPCI to give built-in 802.11b, Intel's 855 chipset and Pentium's M processor.

But there is one catch. Intel is keen to tout Centrino for mobile data, but only in terms of 802.11b.

A representative of the company talks only in terms of wireless Lan avoiding connecting mobile data in the form of Global System for Mobile communications, high-speed circuit-switched data or GPRS.

"We don't see 802.11 as the perfect networking environment by any means," said Sam Bellamy, marketing manager for Intel's reseller channel in EMEA.

"Different ways of connecting need to be integrated. You need to be able to roam between different types of connection."

But for users to see the benefit of mobile data over GPRS networks, they need the sort of seamless connectivity that Intel is offering for 802.11b.

Wireless Lan has seen incredible growth, applications for consumer and business users and sensible pricing structures from suppliers offering public hotspots.

Mobile operators would be wise to look at the methods used by vendors and VARs to achieve wireless Lan acceptance.