GigaOm Mobilize 2011 Conference Day 1 Recap

By Azam Khan 

At GigaOm Mobilize 2011 Conference, various experts from telcos, middleware, and infrastructure providers joined in to share their perspective on the evolving mobile ecosystem, the cloud, new opportunities in the space and mobile payments. Despite the complex nature of the space, the panels and fireside chats were thought provoking and gave a unique insight into areas consumers and application developers should be aware of moving forward. More after the jump.The advent of 4G is supposed to revitalize the consumer experience. According to Cole Brodman, CMO and EVP of T-Mobile USA, there are over 8M 3G and 2M 4G smartphones in their network although 4G comprises 50% of the data traffic. 4G is paving way for rich video experiences that include video, video chat, and T-Mobile TV. In addition, T-Mobile is trying to preserve their unlimited plan and offer various tiered plans as well that consumers can pick from. Over 75% of T-Mobile phones sold are smartphones and 90% of those are Android.

Like T-Mobile, other carriers have also worked to preserve the unlimited plan only to realize that the cost structure is being contiunously re-defined and that the huge amount of traffic cannot be sustained with unlimited plans. Changing unlimited plans into more complex tiered plans, however, can be tedious for consumers and confused consumers are good for no one.

In communication services around the world, there have been 2 major shifts: using cloud infastructure and focusing of the core business on innovating services. Lying between those 2 is middleware and innovation there can really help reduce costs moving forward. Wim Sweldens of Alcatel-Lucent and Iyad Tarazi, VP of Network Development and Engineering at Sprint joined Chetan Sharma of GigaOm Pro to discuss how the cost structures are changing.

Carriers have a job to to innovate on the cost, on the flexibility and so on. According to Iyad, the cost per bit drops 90% every 3 yrs and the space is growing 1000% growth every 3 yrs. Innovation has to occur fast enough for the costs to drop enough so costs do not get passed on to consumers.

Lastly, most panelists agreed 2012 will not be the year for mobile payments, specifically because this is a space that will require years to mature. Many panelists argued about the viability of NFC and merchant adoption but the most solid opinion came from a fireside chat with Keith Rabois, COO of Square, an innovator in the payment system that aims to enable micro-merchants to accept credit cards etc. Keith Rabois feels that NFC doesn’t deliver a compelling value proposition and that merchants lack of inquiry about the technology signals its lackluster.

Panelists argued about ways of increasing consumer awareness, citing how the iPhone introduced keyboard-less touch-based typing typing which consumers adopted over time. Regardless, mobile commerce is on the rise, with 80% of global commerce occurring via Paypal. Intuit also remains strong because it has the existing merchant relations whereas Square will need to build it ground up.

As increased connectivity fuels the growth of mobile data, so will the increase of cloud services which promise access to content anytime and anywhere. To facilitate the delivery of such rich content to consumers will require new infrastructure. The build-out of 4G networks will help, of course, but LTE alone won’t be enough to support demand. Carriers and their partners will increasingly look to off-loading technologies such as femtocells (which route cellular traffic onto fixed-line broadband connections) and Wi-Fi. Compression technologies, small cell towers, and network operators will continue to experiment with ways to minimize traffic and tweak policies and data plans in an effort to maximize revenue while limiting network congestion.