Las Vegas - In the not too distant future, your cell phone provider, most likely, will also provide wireless Internet access for your digital camera, electronic book reader, or any other electronic gadget you are on your own.
During the CTIA Wireless 2009 show here this week, management from AT & T and Verizon Wireless has described a new era in wireless, in which their network is used not only for cellular phones, as well as provide connectivity to all, from e-readers personal navigation devices, heart monitors.
At a press event here on Thursday, Ralph de la Vega, president for AT & T Mobility, said that in a few years, retailers such as Best Buy and Wal-Mart stores will be equipped with electronic devices that provide wireless Internet.
“In the next few years, mobile devices, which are not connected to the wireless Internet will not sell,” he said. “Wireless connectivity will significantly increase the cost of the device. And this is what people want.”
De la Vega said the growth in the market of smartphones, as an indication that consumers are increasingly becoming more accustomed to all connected devices.
“It’s like a PDA market,” he said. “If you add to your wireless handheld computer, it becomes more useful. And smartphone market was born. The same is true for cameras, personal navigation devices and electronic readers. And companies that do not give them the wireless products have gained to be successful. ”
While all the world sounds nice, there are continuing questions about how much this access will cost users and how users will actually pay for it. And if wireless operators are not willing to adapt their business model, it can be difficult to get consumers to sign up for the road data with long term contracts.
Glenn Lurie, president of AT & T in the emerging business of devices, said he was aware that wireless operators will change how they do business.
“This will require a different business model,” he said. “And we must break some rules to enable these devices to market customer-friendly manner.”
In the untapped market is waiting for
Today, nearly 85 percent of the U.S. population has a mobile phone. This penetration rate is 100 per cent, it is unlikely that mobile phone operators will have a lot of new growth just add a new mobile phone subscribers. Adding new devices, such as electronic readers and cameras in the network greatly increases the addressable market. AT & T managers believe that the market for connecting other devices than phones wireless network can be as much $ 90 billion over the next five years.
Verizon Communications’ general director, Ivan Seidenberg said during a press conference here this week that he believes people in the United States will hold several wireless devices, and that, ultimately, the wireless penetration may reach the maximum 500 percent over the next few years.
“I’m not saying that people are carrying around five mobile phones,” he said. “But you might have in your pocket, that negotiations with the thermostat, or any number of devices connected wirelessly through the Internet.”
AT & T has created a special unit to identify and help to get the emerging consumer devices, ready for its wireless network. Lurie Heads Up’s new business unit, and spent the past five months talking to a wide range of devices, from garage start-established bodies of consumer electronics.
Verizon Wireless addresses this new market through its network of Open Initiative, which was launched last year, and is designed to accelerate the process of certifying devices for the network Verizon. Verizon has already dismissed some 36 devices, including smart grid device that monitors energy consumption and wireless tablets health industry, which serves as a portable medical charts.
Tony Lewis, who led Verizon to open network, said that the company is also talking to consumer electronics makers.
One product category can make its way to the carrier networks of the first electronic book reader. Sprint Nextel provides wireless service for the Amazon kindle. And a product that allows users to download books, newspapers and magazines for the Sprint wireless network to 3G, has been a huge hit with consumers. Now, other e-book manufacturers are looking at ways to have their mobile device.
Verizon is currently spoken in the five e-book on making their devices on the network of Verizon, Lewis confirmed. AT & T will not provide information, but the leaders hinted that the e-book could be seen in the network as.
New business models needed
The notion of providing wireless communications to consumer electronics devices has been around for a long time. Chipmakers as Qualcomm have been the development of chips for this purpose. A Wi-Fi is also, finally, to make its way into many consumer electronics devices.
But connected consumer devices, which are not lifted yet, mainly because the media business models are too restrictive. Today, mobile operators tend to offer wireless service for the same device. Phones are sold through the carrier. And the operator subsidizes the cost of the phone in exchange for consumer acceptance of the contract.
But if consumers will own multiple devices that connect to the carrier network, they will not be ready for signature on numerous services. This means that mobile operators will be changing how they do business.
“We can not expect people have five different accounts,” Tony Melone, CTO of Verizon Wireless, said during an interview this week. “There must be a mechanism that allows people to have some attention on a few.”
Managers from AT & T and Verizon acknowledged that some business models are likely to coexist. For example, Amazon, which uses the Sprint Nextel network for wireless service providers to ignite pays Sprint for access to data and bundles that prices in the price of the product. As a result, users do not sign up to stir up by Sprint Nextel, and they do not pay a penny to download books over the network.
“The kindle is a great business model,” said Verizon Lewis. “But it is not only one there.
AT & T in Lurrie said that, as a service to non-marketed will depend on the device used in the network. For example, Lurie said that most consumers do not want to spend an additional $ 10 per month for wireless service for downloading photos from digital picture frame. But they may be willing to pay for one day or even used for multiple uses.
Despite all their talk of new business models and to break the rules, so far, AT & T, seems to be following its traditional business model when it comes to selling Netbooks. Just as it does with smartphones, AT & T is subsidizing the cost of these mini-computers in order to get subscribers to go along with the contract of service.
And he, as a carrier willing to deeply discount these devices just to get people using the network. Earlier this week, he announced a pilot program in Atlanta and Philadelphia, where she will be selling Netbooks at cost $ 50 for customers who already subscribe to its broadband services. In exchange for this rock-bottom prices, customers must agree to two-year contract for its $ 59.95 per month for data services, which also provides access to AT & T in 3G networks, as well as 20,000 Wi-Fi “hot spots” throughout the country.
But Lurie said that the company will not rely on subsidies for fuel, only the adoption of these services.
“I do not think that the grant will stimulate the business model,” he said. “We will provide some subsidy, but we will experiment with different business models.”
De la Vega said that the company is still in its early stages to ascertain the best way to monetize their services. But he said that the old models will not be sufficient to increase AT & T Business in a new era of wireless devices, where each will be wireless connections.
“We should be more flexible,” he said. “This is a new frontier. And we must approach it with new ideas. We can not be forced to descend to the old way. ”
