IT Expo: Advent Of 4G Will Drive New Mobile Ecosystem

Fourth generation wireless (4G) will change the business opportunities in the mobile sector for solution providers, vendors and everyone else with a stake in networking. Those who embrace key trends now, argued top executives from Skype, Digium and Verizon Thursday, will be first in line to cash in.

The morning keynote sessions at IT Expo in Miami Beach brought a range of views on the mobile consumer, mobility in enterprises, the opportunities around 3G, and 4G wireless and the importance of rich applications.

All three speakers, however, agreed that the dynamic changes in networking -- especially related to IP communications and wireless -- will be a rising tide for anyone who gets his boat in the water in time.

There's an "incredible amount of opportunity for those who change and develop new business models" around these changes, argued Christopher Dean, chief strategy officer at Skype.

"We believe that the advent of 4G has the opportunity to truly unclog the network and deliver the underlying promise for the fourth-wave mobile consumer," Dean said. "By 2013, more people will access the Internet over a mobile device than a desktop. The advent of 4G is going to be very important to delivering a usable experience to those users."

Dean suggested that Skype, the popular consumer VoIP application slowly making its way into the enterprise and the channel, was a disruptive product, and one of many. The mobile user of the future wants multipurpose devices that connect from anywhere, he said, which is why cloud services are of such increasing importance.

He cited market research that predicts there will be 4 billion mobile subscribers by 2013, that 38 percent of mobile phones sold in 2013 will be smartphones, and that 90 percent of smartphones would have a Wi-Fi attach rate by 2014.

"People aren't simply going to be connected to the 4G network," he said. "They're going to be running smarter applications ... on phones, e-readers, everything."

Congestion on 3G networks was limiting 3G's advance, he argued, citing how AT&T's data traffic increased 5,000 percent in the last six quarters. That won't do, Dean argued, at least for long.

"We believe there is a lot of opportunity for carriers to accelerate 4G deployments and partner with application developers to offer differentiated services," he said. "4G is leading to a collision of the Internet industry and the wireless market. Whether this will be a collision or a convergence is really in our hands. We at Skype have no apologies for being disruptive."

Next: Software As The 4G Driver

Dean predicted software would be the driver for 4G and that third party app developers will reign supreme, especially if they emphasize consumer applications. That, said Dean, will lead to new partnerships between device operators, app developers and manufacturers -- a remaking of the mobile channel ecosystem.

"The winners will be those that combine and focus on providing rich user experience with flexible monetization models," he said.

Digium President and CEO Danny Windham highlighted just how much the vendor landscape in IP networking has changed in 10 years, with once powerful titans like Cisco and Avaya still strong but facing a changing marketplace less tethered to their legacy systems and intimidating market share.

"The leading market shareholder today isn't one company, it's open source telephony," he said. "We've created an entire industry around it."

The key changes of the past decade, Windham argued, are that data networks became reliable enough to support voice, bandwidth costs plummeted and open source software disrupted proprietary systems.

"The underlying trend is it's all about the money," he said. "Running a single department costs less than running two departments. It's driving the extinction of the voice department. A single infrastructure costs less than installing two. That's driving the adoption of VoIP."

Windham contended that open source alternatives would continue to gain favor among enterprises and SMBs, even as the economy picks up again.

"The downturn has taught companies to do more with less. Discretionary spending has been reduced. Market conditions favor cost-effective solutions over premium branded ones," he said. "Open source shifts the power from traditional, proprietary vendors into the hands of end users and systems integrators creating those solutions."

Mobile VoIP would be a big growth area, he predicted, as would cloud computing's effect on networking.

So, too, will 4G development opportunities, a point also echoed by Brian Higgins, executive director of product development at Verizon.

According to Higgins, Verizon -- which has thrown its support behind the proprietary Long Term Evolution (LTE) 4G platform as opposed to the IEEE standard-based WiMax platform -- sees explosive opportunity for 4G and how it will develop and expand the mobile ecosystem.

"App platforms are not just about smartphones," he said. "We're going to have to think on a device-by-device, service-by-service basis to determine what's the new business model."