30Apr/150

Platforms regulation

Yves Gassot

Yves Gassot
CEO, IDATE

 

Year after year, the economic and financial power of the GAFA  quartet of Internet platforms continues to increase. Which brings two questions back to the fore, again and again: what trends might emerge to counter this seemingly inexorable rise? And do we need regulations that apply specifically to platforms?

A quick reminder of what economists mean by platform economics (digital or not): multi-sided markets (i.e. involving interactions between two or more parties) with reciprocal “network effects”. So the more iPhones that Apple sells, for instance, the more attractive its app store becomes to developers (and so to users), and vice-versa. In digital sectors, this characteristic is typically combined with a reduction in fixed costs (software), generating increasing returns as the platform becomes more successful.

By 2025

Network effects usually go hand in hand with another property: asymmetrical prices. If Apple is starting to earn substantial income from the App Store, its business model and profits are rooted chiefly in the high price of its iPhones. With ad-funded models, one side of the market operates as a free service. As we have seen with Apple, digital platforms are a very efficient means of fostering open innovation, and capitalising on innovations from third parties. All of these aspects, which go some way to explaining why “winner takes all” when it comes to platforms, naturally need to rely on the ability to maintain the role of intermediary, and continue to become more proficient at it. Otherwise, the platform’s customers and suppliers will begin to adopt multiple homes, before eventually moving on to another, better platform. The efficiency of the leading platforms is the very reason for the current ambivalence over how much they are serving the greater good. On the one hand are concerns that a dominant OS will abuse its position while, on the other, this popularity can also mean an opportunity for developers, and can have positive repercussions for consumers.

The dichotomy needs to be resolved by taking account of the Internet’s dynamics as a whole. Windows has been through a number of anti-trust investigations but, today, this is the mobile Internet which has moved down the priority.

Worth reading on this topic is the recent IDATE report on "The future of the Internet: 2025". It takes a detailed look at the key technologies for the coming years, and especially at how development scenarios will be shaped by key variables, such as the openness of the Internet ecosystems, or the impact of restrictive privacy or security-related public policies. Here, we will add two other events that take us beyond a GAFA-centric environment. First, 2014 saw a number of Internet powerhouses emerge from the shadows of the GAFA quartet: in China (Alibaba, Weibo…) and in Asia’s leading markets in general (Rakuten, Line…).

We cannot entirely discount the possibility of these players gradually coming to compete head on with their Western peers. Second, we need to consider the position held by new players moving into vertical markets, many of which have carved out a place of sector-specific intermediary – Uber and Airbnb being two prime examples – and which have no intention of being taken over by Google or Apple or the like.

Nevertheless, faced with the realisation that GAFA continue to become increasingly powerful, the inefficiency of antitrust laws and the regulatory asymmetries compared to those imposed on other players along the chain, the idea of regulation that applies specifically to platforms is gradually coming to the fore. It may not be a good idea. Competition law, even ex post, is not necessarily ineffectual.

Privacy

Plus it will be no simple matter to define the contours of the platform sector. And extending existing sector-specific laws, such as those that apply to electronic communications, to make OTT companies and telcos subject to the same principles, would take us down a path where, as businesses become more and more digitised, every economic sector would be more or less governed by electronic communications laws. Keeping in mind that the upcoming review of the EU regulatory framework for electronic communications is expected to focus on network access conditions and interconnection – and probably put more emphasis on symmetrical regulation. Should voice and SMS products not be removed from the scope of the telecom sector’s ex ante regulation, rather than adding in competing OTT products such as Skype, Viber, WhatsApp, etc.?

It nonetheless remains that in sensitive areas for digital industry players, such as those governing contract law, taxation, public safety and privacy, we can very easily identify laws that should apply across the board, such as what we find in consumer products and the retail industry. Without having to produce laws that are specific to platforms, the current juncture could provide an opportunity to merge national legal provisions with regional (EU) and global ones, and to ensure that they apply equally to all players along the value chain

For the publication of the last study about "the future Internet in 2025" and  the 15th edition of the DigiWorld Yearbook, IDATE is organizing a conference on the perspectives and key trends that will structure the digital economy for the next decade, DigiWorld Future

Register for the Conference in Paris the 16th of June     Discover the programme

More informations about IDATE's expertise and events :

www.idate.org      www.digiworldsummit.com      www.digiworldweek.com

10Apr/150

Mobile Gaming, 23 Milliards d’euros d’ici 2018 !

infog google vs apple 2018

Google versus Apple : les deux géants tirent le marché vers le haut et s’affrontent au travers de business models différents

 

L’économie des jeux sur les plateformes nomades est remarquablement efficace, et la concurrence qui s’exerce entre Apple et Google l’est tout autant.

L’App Store d’Apple et Google Play sont les deux principaux appstores du marché en volume d’applications disponibles et téléchargées.

On notera qu’en juillet 2014, ils comptabilisaient chacun plus de 1 million d’applications, loin devant Windows Phone Store, Amazon Appstore et Blackberry World. Aujourd’hui, ces deux appstores rassemblent à eux seuls  quasiment 80% des applications disponibles.

Les chiffres clés du marché mobile mondial à 2018

•    Le nombre de jeux mobiles dépasse de loin le nombre de jeux disponibles sur les autres plateformes de jeux,  offrant de nombreuses perspectives aux grands acteurs.

•    Le marché du jeu mobile s’élève à 12.8 milliards EUR en 2014. 72.6% de la valeur est générée par le jeu sur smartphone et atteindra vraisemblablement les 15 Milliards d’euros d’ici 2018

global mobile market generated by smartphone and tabletsDes modèles économiques innovants : Le free2play séduit de plus en plus de joueurs

Sur téléphone mobile, les 20 plus gros succès de l’année 2014 aux États-Unis sont des Free2Play. Ils étaient 18 en 2013.

•    Sur iTunes Store d’Apple, les jeux payants ne représentent plus que 8% du catalogue, contre 47% en 2012.

•    Le modèle Free2Play cohabite avec le modèle Pay-per-Download, mais le premier est bien plus répandu. Même les acteurs « historiques » du jeu vidéo investis dans le jeu nomade ou les « pure players » du jeu nomade ont passé le cap du Freemium, EA et Gameloft en tête.

Ce modèle a vocation à d’abord séduire le joueur avant de le faire payer. Une fois conquis, ce dernier paiera des objets virtuels en fonction de son attraction au jeu et de ses objectifs d’évolution à l’intérieur du jeu.

Pour retrouver toutes les informations concernant l’étude Mobile Gaming et les études associées, cliquez-ici

Plus d’informations sur l’expertises et les événements de l’IDATE sur :

www.idate.org          www.digiworldsummit.com          www.digiworldweek.com          www.gamesummit.pro

24Mar/150

In 2015, the key words of the Mobile World Congress were 5G, IoT, virtualization and LTE-U : PART 2

image accroche article MWC part 2

IoT : The Internet of Things

Connected objects were everywhere and IoT is now becoming the Internet of everything.

Connected cars

Connected cars attracted a lot of attention with connected vehicles on most of equipment manufacturers’ and MNOs’ booths.
Renault’s CEO made a keynote where he presented the timetable for assisted driving. According to Mr. Carlos Ghosn, despite their numerous initiatives and some acquisition rumours, Internet giants are not rivals to car manufacturers but allies, as they consider electric cars and they help car makers to promote electric cars.
Ford had even its own booth presenting the electric vehicles (both passenger and entreprise cars) with dedicated solutions. In the meantime, Vodafone presented a Porsche Panamera model equipped with its new Telematics solution since the Cobra acquisition.

Smart home

Smart is also getting traction in the IoT space. In the “innovation city” hall (space dedicated to the connected objects), through the connectedhouseAT&T offering (Digital life) where the home could control through the smartphone and even through the connected car (equipped with an AT&T SIM card). When approaching the home, the car can trigger the opening of gate by itself for instance (pre-programmed distance).

connectedthingsWearables

Several watches and smart objects were also present on the different booths. Only AT&T provides cellular connected wearable on its booth, including the TIMEX and Samsung Gear S.

Alternative technologies

While 5G is already in the tracks, very low throughput network technologies are also under the spotlights. After the recent release of its 100 MEUR fundraising campaign among telecom operators, Sigfox was also on everyone’s lips at the MWC. Among the main new shareholders, Telefonica confirmed its strategic investment and its willingness to integrate the technology into its portfolio to address additional verticals and applications.

Alliances

The GMA (Global M2M Association) also announced a strategic collaboration with Gemalto and Ericsson to provide a Multi-Domestic Service based on a single SIM (using the eUICC technology) helping global enterprises (chiefly from the automotive and consumer electronics segments) capitalize on the growth of connected devices.

Growing market but still key challenges though

During his keynote, if AT&T Wireless CEO predicted that the smart phone will be the remote control of everything in the next few years, he also pointed out the key challenges to address in order to make the IoT market grow significantly:
•    Security
•    Privacy concerns
•    Effortless (ease of use)

Privacy

privacylogoData about devices and their users is generated in real-time, often by default and without the user being aware or having choice (especially for free apps). There is a need for a different approach to giving users transparency, choice and control over their data and privacy.

Generally user has a single choice : accept or not using the service, there should be gradual approach (like sharing some id attributes but not all of them).
Privacy could be a competitive stick for service providers, as users are becoming more aware of privacy.

Facebook in emerging countries

fbFacebook has launched Facebook zero in partnership with mobile operators (Millicom, Telenor, Airtel): data use is free for a limited period, and after that operators can charge data.

•    Airtel: “Operators and Facebook are like the beauty and the beast, but the beast (facebook) is becoming more human nowadays”.  Airtel was reluctant to introduce Facebook because of VoIP threat. Is looking at it like the “boiling milk”.
•    Millicom, Telenor: have seen ARPU rise thanks to facebook launching, very promising for them.
•    Wikipedia has the same approach of “Wikipedia zero”, dealing with operator to provide data access for free.

Financial inclusion

Banks, such as Master Card, provide a global and interoperable solutions. Those systems needs public-private partnerships. Hong Leong Islamic Bank Berhad has launched a solution in Malaysia.

More informations about IDATE's expertise and events :

www.idate.org      www.digiworldsummit.com      www.digiworldweek.com

23Mar/150

In 2015, the key words of the Mobile World Congress were 5G, IoT, virtualization and LTE-U : PART 1

MWC infog

As for each edition, IDATE has been Analyst partner of the Mobile World Congress. A fantastic opportunity for our analysts and experts to interview many professionals coming from their Mobile planet to Barcelona for this intense and tremendous week.

5G Concept

Even though the concept of 5G is still very much under discussion (videos from KT, Huawei presented during conferences), NGMN (next generation mobile networks) Alliance published its 5G white paper which can be seen as the mobile operators “wish list” for 5G. Nonetheless, 5G is scheduled for 2020. Early trials should arrive in 2018, with projects scheduled for the Winter Olympic games in South Korea (4G became real in 2010’s, 3G in 2000’s). Key advantages of 5G over 4G would be a much lower latency (1ms compared to 40 ms in 4G and 100 ms with 3G), the capacity to connect billions of devices, faster response that will boost services like augmented reality, self driving cars and online gaming. Huawei mentioned that 5G should reach 10 Gbps (7 minutes to download a movie with 4G, 6 s with 5G).

5G should better take into account specific requests of vertical markets (healthcare, automotive, energy, government, city management, manufacturing and public transportation) and better manage the Internet of Things.

Equipment suppliers showed first demos of 5G air interface using millimetric bands (70 GHz - Nokia) and 15 GHz (Ericsson). New air interface techniques were proposed by Huawei with the non-orthogonal access technology based on Sparse Code Multiple Access (SCMA), and Filtered-Orthogonal Frequency Division Multiplexing (F-OFDM).

With tvisuel principal idate MWC v2he 5GPPP (Public Private Partnership), Europe is trying to accelerate developments of 5G with fundings of €700 million for R&D. It is expected that the industry will invest five times this amount. According to the 5GPPP, 5G should be based upon a HetNet (heterogeneous network) supporting various radio access technologies and frequency bands ranging from sub-1 GHz bands to 100 GHz. Various traffic profiles will have to be supported:

 

•    Low speed-low energy for IoT sensors
•    High speeds for video services
•    Very low latency profile for mission critical services such as PPDR (Public Protection and Disaster Relief) and for transportation issues

Google will soon become a MVNO

Google confirmed during the MWC that the group is negotiating MVNO agreements with the US mobile operators. Light details on Google plans so far. Further information scheduled for months to come. Nova is not expected to compete directly against US MNOs. In addition, Google do not want to launch a network at scale.
The Google MVNO will only work with the Nexus6. “The focus of Google’s network could be on connecting devices other than phones, as watches, cars and other devices increasingly will include mobile connectivity features”.Mobile Identity

Different methods of identification and authentication, each suited to particular transaction types (from access to social network to official ID) ; biometric authentication as a new solution.
•    Digital identity card exists in Estonia (with digital authentication), biometric card exists in middle east and Africa (Algeria, South Africa)
•    Mobile authentication is a challenge for mobile operators, but the market is far from mass-market: demand is not ready for official ID authentication on mobile, standards are needed, as well as regulation.Mobile Id could be a leapfrog technology in emerging countries where people don’t even have identity papers, and have a mobile phone.
If mobile operators don’t manage to be positioned on this market, banks or social networks could.

Virtualization

PICTO VIRTUANetwork Function Virtualization (NFV) appeared last year during MWC and is now close to commercial implementation by mobile operators. Telefonica demonstrated a full network together with ALU and HP. It will integrate a vRAN, vCDN, vEPC and vIMS.
A first implementation of vRAN was presented by China Mobile which is collaborating with Alcatel-Lucent and Intel on Cloud-RAN, which is seen as a first step towards virtual RAN. NTT Docomo is working with NEC on virtualization of the core network (EPC).

LTE-U

LTELOGO2LTE-U technology is important and was present on many vendors’ booths. It will give free access to additional spectrum in the 5 GHz band currently used by Wifi. This will provide SDL (supplementary downlink) capability, providing extra capacity for downlink traffic, especially video. LBT (Listen Before Talk), the specific function which will allow smooth compatibility between Wifi and LTE in the 5 GHz band will be included in 3GPP Release 13 expected to be adopted in Q3 2016.
LTE and Wifi carriers can also be combined in order to provide higher throughputs but in that case, the benefits of LTE higher spectrum efficiency are not present.

 

20Mar/150

Nouveau cycle de conférences de prospective numérique sur les enjeux de l’Internet, de la télévision et des télécoms à 2025

logo DWFuture generique 2015

A l’occasion de la sortie de la nouvelle édition de son DigiWorld Yearbook, l’IDATE présente son nouveau cycle de conférences de prospective numérique sur les enjeux de l’Internet, de la télévision et des télécoms à 2025 !

La première session DigiWorld Future  se déroulera le 16 juin au Palais Brongniart, à Paris,  dans le cadre du Festival Futur en Seine en partenariat avec la Ville de Paris et Cap Digital.

A partir des analyses des experts de l’IDATE, les débats seront animés par Marjorie Paillon, Journaliste, Tech 24, Philippe Escande, Rédacteur en Chef, Le Monde et Gilles Babinet, avec les contributions exceptionnelles de :

sebastienbazin lowaxellelemaire lowMaurice Levy lowfrederic mazzella lowrichardstephaneOROUSSAT low

 

 

 

 

 

 

 

 

 

 

 

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18Jul/13Off

Interview with Gilles BRÉGANT, CEO of ANFR

Published in COMMUNICATIONS & STRATEGIES No. 90, 2nd Quarter 2013

The radio spectrum: A shift in paradigms?

Summary of this issue: Demand for the use of the radio spectrum is constantly and rapidly growing, not only as a means of carrying Internet traffic, but also for new or expanding use by the military, public protection and disaster relief, at the same time that more traditional applications such as aeronautical, maritime, and radio astronomy remain. Is spectrum policy entering a trackless wilderness, or can a new direction and a new set of paradigms be expected to emerge? The contributions to this special issue of Communications & Strategies cover a great deal of ground. They serve to provide valuable signposts for spectrum policy going forward.

Gilles BRÉGANT CEO of ANFR

Exclusive:
Interview with Gilles BRÉGANT
CEO of ANFR.
(French national spectrum agency)

Conducted by Frédéric PUJOL,

Head of the radio technologies & spectrum practice, IDATE

 

C&S: What are ANFR's main priorities in the coming two years as far as Spectrum management is concerned?

Gilles BRÉGANT:

The Agence nationale des Fréquences (ANFR) is the French public Agency in charge of radio spectrum management. It is placed under the jurisdiction of the Minister responsible for Electronic Communications (Mr. Arnaud Montebourg and Ms. Fleur Pellerin since May 2012) but all the Ministries using spectrum are represented at ANFR's board. Besides, ANFR's decisions regarding spectrum allocation are actually taken by the Prime Minister since spectrum, in France, is a state affair.
Spectrum management priorities will be closely linked to the governmental decisions and digital economy needs for the following years and to the international and European agenda.

A. Create the conditions of mobile broadband (4G) success in France
4G allows very high data flow rates and significantly increased user comfort: lightning-fast downloads, and a more fluid navigation become possible on smartphones or tablets. This opens up opportunities for new services in mobility, such as access to audiovisual content. A factor of innovation, growth and job creation, 4G is one of the priorities of the Government. ANFR has been deeply involved for the development of European harmonized conditions for the usage of 4G and is currently mobilized to make a success for the introduction of this new technology.

Since December 2012, the Agency has published a 4G roll out observatory. This tool will be key to monitor 4G infrastructures deployment, carrier by carrier.
However, the 4G challenge will be a tricky one when it comes to spectrum management since the 800 MHz 4G can interfere with DTT. ANFR uses its resources devoted to the protection of TV reception so that the 4G 800 MHz and TNT coexist harmoniously.

The ANFR intervenes at every stage of the deployment:
- it actively participates in the communication towards local elected officials, professionals and the general public on these operations;
- during the phases of deployment, it collects and instructs the claims of viewers through its call center;
- it oversees the resolution of the problem by operators if the interference comes from the 4G 800 MHz. A professional intervenes, most often to insert a filter in the reception of the TNT facility.
The TV reception is therefore guaranteed for each viewer. The full cost of interventions is supported by mobile operators.

B. Prepare the next World Radiocommunication Conference (WRC)
In 2012, we have drawn the immediate consequences of the WRC-12. In 2014, the delegations will develop first arbitrations of WRC-15. In 2013, national positions must be taken.

One of the challenges of this Conference will be the question of the future of the 700 MHz band. In France, it is now assigned to audiovisual. Since the debates on the first digital dividend, five years ago, the terms of the problem have been well known: the use of mobile Internet is expected to grow regularly in the coming years to meet the expectations of very mobile broadband. But this demand for broadband is common to all sectors: the audiovisual sector wants to keep these frequencies to offer new services: generalization of high definition, introduction of ultra high definition or 4K for example. And Government services, such as those of the Ministry of the Interior, also want to access services such as video for safety services.

In this debate, three ideas seem inevitable:
- there is not enough spectrum available under 1 GHz to satisfy fully each need;
- France is not an island, and it will have to act in harmony with its Western European neighbors;
- Europe will have to play an important role.

ANFR, as it manages the entire spectrum and guaranties technical neutrality, is coordinating the preparatory work at the national and international levels. ANFR, which is already contributing to the preparation of the next WRC, is involved in various entities in CEPT and UIT involved in this process and is bringing its technical expertise to the Government so that a decision can be taken in the best conditions.
ANFR is also an active member of the RSPG ad hoc group, which will provide recommendation to European Commission on WRC issues and on the identification of 1200 MHz for wireless broadband.

C. Facilitate the deployment of the 6 new DTT channels
Since December 12, 2012, 25% of the French population can access 6 new HD channels with their DTT HD TV sets. Free to air TV is no longer limited to generalist channels. Every French citizen, and not only the ones with cable, satellite or IPTV subscriptions, will be able to watch specialized channels on areas such as sports, travels, diversity and so on by 2015.

The years to come will see more of the French population covered by the new HD DTT channels.
The Agency, together with the CSA, has the mission to assist viewers in solving their TV reception problems through its call center and its dedicated website, "www.recevoirlatnt.fr", in collaboration with local aerial installers. If necessary, it will grant funding provided by the State to viewers who have lost DTT reception.

What are the expected evolutions as far as new ways of sharing spectrum are concerned? What are their consequences on spectrum management?

First, it is important to recall that spectrum sharing is already a reality with short range devices operating under a general authorization on a non interference and non protection basis. This is the case for Wifi in the 2.45 GHz and 5 GHz bands. This is also the case of all applications using ultra wide band devices which are sharing spectrum thanks to a very low power density. UWB technology was also used in sectors such as automobile and aeronautics.

What about Licensed Shared Access (LSA)?

The objective of an LSA approach is to facilitate the introduction of additional users operating with individual spectrum rights of use in specific bands and on a shared basis with an incumbent user, thus allowing predictable quality of service for all rights holders. These arrangements will need sufficient flexibility in order to account for national particularities, in relation to the administration of spectrum.

LSA could be introduced as a regulatory approach to release spectrum. In addition to conventional planning methods, cognitive radio technologies and their capabilities (geolocation databases, sensing, etc.) could be taken into account as enablers for sharing under the LSA approach.

ANFR engineers are actively participating in European works, at the ECC level for instance, on this issue, which is still in its early stages.

700 MHz band: what are the stakes and constraints?

World Radiocommunication Conference (WRC) 2012 decided that for the Region 1 the 694-790 MHz band will be allocated to mobile service co primary with broadcast services, this allocation becoming effective after WRC-15.

The issues at stake in the preparatory works for the WRC-15 are each tied to technical and negotiated matters. The possible refinement of the lower band edge (694 MHz) is one issue up for debate during the preparatory works. The second stake is the identification of a harmonized channelling arrangement, that is to say, the uplink and downlink bands. Finally, technical matters such as sharing studies between mobile and DTT at 694 MHz and the consequence of this on the necessary guard band are also to be clarified through the preparatory works for the WRC-15.

Regarding the choice, and its consequences, between IMT and broadcast, WRC was the starting point. The next steps are European decisions and national arbitrages.

2013 will be the year of public exposure to electromagnetic fields in France (ANSES report, Abeille Bill…): what is the role of ANFR as far as exposition control is concerned?

First, the Agency has no sanitary or health prerogatives, its expertise and missions only rely on technical matters.
The Agency monitors the respect by radiocommunication network operators of the public exposure to electromagnetic fields limits. The legal limits are the ones of a 1999 European Recommendation. Besides, by Law, the Agency has to make an inventory of "atypical" points, that is, the points where the exposure is significantly above the national average (while still below the limits). ANFR also elaborates the protocol used to measure the public exposure to electromagnetic fields. ANFR is also in charge of devices monitoring (phones, smartphones, tablets…). We insure that DAS limits (2 W/kg) are respected. We also check if the necessary information is properly provided to consumers.

2013 will indeed be the year of public exposure to electromagnetic fields. It began with the Bill introduced by MP Ms. Abeille from the Environmentalist Party. This Bill was forwarded to the Parliament Economic Commission for further analysis.
In 2013, we will publish our report on technical experiments which were lead in France to assess the possibility to reduce public exposure to electromagnetic fields due to mobile operators antennae without decreasing coverage and quality of service. Such experiment is a world premiere until now. 2013 will also be the year when ANSES, the French sanitary authorities, publishes its new report on the sanitary effects of such a field.

The Agency is a neutral, technical expert in that area. By participating in public meetings, advising elected officials and also the general public through its website Cartoradio, the Agency participates in turning this potential concern into a serene public debate. Finally, in 2013 we will provide a mobile version of Cartoradio, with the location of all mobile based-stations and the results of more than 26,000 field measures.

The ANFR organizes an international Conference on June 26 and 27 2013 entitled "Spectrum & Innovation": what is it about?

The Conference "Spectrum and Innovation" was instigated by Ms. Fleur Pellerin, delegated Minister in charge of Small businesses, Innovation and Digital Economy. We want the Conference to be a major event in 2013 for the digital economy sector in general and radiofrequencies in particular. The objective is to show to a large audience of professionals from the digital economy how spectrum is key to their sector and how this resource is crucial to economic growth in the coming years.

Different themes will be dealt with: how mobility is shaping our society and stimulating innovation, how radiofrequencies constitute a growth leverage for industry and small businesses, or even the spectrum needs for 2020. To debate on these subjects only experts in their fields have been chosen. The Conference will also be a chance to listen to influential and renowned speakers: Ministers, European and foreign institutions officials, renowned academics and business leaders (BBC, Bouygues Telecom, Cisco, Eutelsat, France Télévisions, Free Mobile, IBM, M6, NRJ Group, Orange, Qualcomm, Renault, SFR, TDF, TF1…).

We expect these two days to shows us what exciting new developments can be in store in the coming years. The Conference will prove how spectrum can foster innovation, growth and job creation.

Biography

Gilles BRÉGANT was born in Chambery in September 1963. He graduated from Ecole Polytechnique (1986) and from Telecom ParisTech (1988). Following an 8-year-career at France Telecom research center, Gilles Brégant was appointed technical adviser to the Minister in charge of Research (1996-1997). He had to coordinate international projects and themes in relation with information technology. He then worked for the department of trade and industry as deputy director in charge of Prospective. He was appointed secretary general of the ministerial task force "Digital Economy" (2001-2005). He was then appointed Technical Director of Conseil supérieur de l'audiovisuel (the French Media Regulator) in 2005. Gilles Brégant is the CEO of ANFR since 2011.

Published in COMMUNICATIONS & STRATEGIES No. 90, 2nd Quarter 2013

Contact
COMMUNICATIONS & STRATEGIES
Sophie NIGON
Managing Editor
s.nigon@idate.org

2Jul/13Off

Next Gen Networks : reaching the DAE

CHAILLOU_ValérieValérie CHAILLOU

Head of Research, Telecoms Business Unit, IDATE


Deployment costs & access market revenue in Europe

The goals set by the European Commission for ultra-fast broadband (UFB) are ambitious. By 2020, they aim to provide all European households with ubiquitous coverage of 30 Mbps and 50% of households with 100 Mbps access.

Cost of NGN deployment for reaching the goals of the DAE

NGN deployments are underway in all countries of the European Union but are progressing at very different rates from one country to the other. Some governments have created national programs that lay down their own goals to try and accelerate deployments, through both private operators and public players. IDATE has published a report in which NGN deployment costs have been modeled according to various scenarios. We will look closely at three of these: the "Base Case" scenario, which considers a gradual evolution of current NGN access; the "Vectoring" scenario, which anticipates improvements in copper-based technologies to reach the speeds laid out by the DAE; and the "FTTH" scenario, in which FTTH/B would be deployed on a massive scale and would provide the most future-proof performance in terms of speed. This last scenario is itself analyzed according to two different options (90% or 100% FTTH coverage), which lead to significantly different costs. The cumulative costs of these scenarios between 2011 and 2020 range from 71 to 230 billion EUR.

Cost comparison of NGN deployment scenarios en Europe

Total cost and cost per capita for next gen networks deployment in Europe

Source: IDATE

Revenues tied to the UFB access market

In parallel, IDATE has also conducted a study to evaluate the value of the UFB access market. This study is based on a thorough analysis of UFB services offered by key players in markets that represent different degrees of UFB maturity. This analysis allows us to identify different types of delivery model that may include one or more goals (maintaining positioning, increasing ARPU, reducing churn, unbundling withdrawal, etc.). The commercial positioning of operators will thus match a given delivery type that will depend on the level of competition, in particular. From there, it is possible to determine what the trends will be in terms of UFB ARPU over the coming years and thus assess one of the two key variables of access revenue. The other variable is the number of UFB subscribers, which should continue to grow relatively steadily through 2020 if we take all technologies into account. According to our estimates, the UFB access market is expected to reach 48 billion EUR by 2020.

Costs vs. revenues: Which scenario should we prioritize?

Despite some very interesting revenue potential (combined revenues exceed the cost of the most expensive scenario by 2020), the FTTH scenario is not really feasible (regardless of the coverage option considered) because cable operators—whose infrastructures offer faster speeds, are less expensive to upgrade and offer very good performance—will continue to play a major role in this market. The Base Case scenario seems to be a more feasible option in that it represents a continuation of what currently exists, namely a combination of technologies and accelerating deployment. However, it also presents risks, particularly the possibility of slow migration of broadband subscribers to UFB. Whichever scenario is implemented, operators will still need to invest significantly in deployment while reserving some investment for generating demand, without which their expected revenues cannot be achieved.

This analysis is an extract from our FTTx market insight which we propose within our ongoing monitoring of the worldwide FTTx market.

7May/13Off

World Telecom Services

MANERO Carole
Carole MANERO
Project Leader, Digiworld by IDATE

Global telecom services market to reach over €1,200 billion in 2015

“We have observed that, overall, telecom services are recovering more slowly than the economy as a whole,” reports Carole Manero, head of IDATE’s Telecom Players & Markets report.

Montpellier, 7 May 2013 - IDATE reveals the findings of its world telecom services watch. After a setback in 2009 and very slight growth in 2010, the global market has been inching back to a more solid recovery since 2011, growing by a modest 2.7% in 2012. This translates into telecom services revenue of €1,115 billion for the year.

Now in a recovery phase, telecom markets in advanced countries are proving somewhat resilient, whereas in fast developing markets the increase in volume is so steady that the ripple effect far outweighs any structural obstacles. This phenomenon is telling of a mature industry now driven more by demographics than economics. In Africa/the Middle East, for instance, the drop in regional GDP in 2009 (-6%) and its rebound in 2010 (+16%) had very little impact on telecom services growth rates which remained very high both years: 8% and 9%, respectively.

World telecom services market - 2012

World telecom services market revenue by type and region

Source : Digiworld by IDATE

Majority mobile access

According to IDATE, the number of mobile customers worldwide should top the 8 billion mark in 2017 (+28.0% in 5 years).

• The number of Internet subscribers will grow more strongly (+37.3 % between 2012 and 2017, +6.5% per year on average), reaching 1 billion by the end of 2017.

• Traditional landlines continue to loose ground in the face of VoIP and mobile.

The spread of broadband

According to IDATE, the number of fixed broadband subscribers is expected to reach 957 million worldwide by 2017, for a penetration rate of 14% of the population. The number of 4G mobile subscribers should experience strong growth.

Two major factors will play in favour of the spread of broadband:

• The success of bundled offers (fixed telephony, VoIP, TV, mobile telephony) and the appetite for video applications.

• The investment of telecom operators in the migration of their infrastructures to mobile or fixed broadband.

Revenues from telecom services

According to IDATE, the global revenues from telecom services will grow from 1,115 billion in 2012 to 1,286 billion in 2017, representing an average annual growth of 2.9% in 5 years.

• Revenues from mobile services will grow by 18.7% between 2012 and 2017 (+3.5 % per year on average), reaching 779 billion EUR in 2017.

• Revenues associated with data transmission and Internet will grow more strongly (+32.8% between 2012 and 2017, i.e. +5.8% per year on average), to reach 329 billion EUR in 2017

• The turnover of fixed telephony will continue to decline significantly (-15.9% between 2012 and 2017, i.e. a decline of 3.4% per year on average), to be at 177 billion EUR in 2017.

Scalability of operators in emerging countries, even if the global top three remains unchanged since 2007

A single change in the ranking of European operators: Telefonica overtook Deutsche Telekom in 2011: now the leading European operator, the Spanish group ranks fourth in the world.

Chinese operators regularly win places in the world rankings

Vimpelcom gained fifteen places in 2011 : Owing to the acquisition of a large part of the shares of Orascom Telecom and Wind, VimpelCom moved from 34th place in 2010 to 19th in the world in 2011

Several operators from industrial countries "drop out": The Dutch KPN and Canadian ECB fell back by five places in two and a half years and drop out of the top 20

Classement des principaux opérateurs télécoms

Selon leur chiffre d'affaires au 1er semestre 2012 (milliards EUR)
World telecom operators ranking according to revenues end 2012

Source : Digiworld by IDATE

Five operators in the top twenty worldwide for over 50% of their turnover outside their domestic market:

• Among them, three European operators...

- Vodafone: global operator widely present in Europe, Asia and Africa

- Telefónica: with a widespread presence in Latin America and in some European countries (UK, Germany, Czech Republic, Slovakia)

- Deutsche Telekom: present in Central and Eastern Europe and in several Asian countries

•...and two operators from developing countries:

- America Móvil: present mainly in Latin America (plus participation in Europe acquired in 2012)

- Vimpelcom: already present in Central Asia, with a new presence in Africa and Europe (Italy) thanks to the deal with the Naguib Sawiris group

Carole MANERO
Chef de projet, IDATE
c.manero@idate.org

More information about World Telecom Services

11Apr/13Off

Viewpoint on the latest changes for LTE chipsets device landscape

Basile Carle
Basile CARLE

LTE Baseband market: Race for second position & Technology standards ahead

Following Mobile World Congress 2013, the main trends regarding LTE chipsets and devices are as follows:

Qualcomm is by far the unchallenged leader on the LTE baseband market with more than 80% of the market; it is followed by Samsung and its home-grown chipset strategy. Behind, the race is rather more toward the second position than the first. Major baseband vendors seem ready to embrace the market with multimode FDD/TDD LTE solutions, showing that the market has been entering a second phase.

A situation of oligopsony due to mobile phone market concentration

The concentration of the market around Apple and Samsung makes it even more difficult for LTE baseband vendors to attain volume production. It will be difficult to reach Number Two position on the market without a device win between those two players.

Entrance of Chinese and Taiwanese vendors splits the market between high and low end

In this context, the entrance of Chinese and Taiwanese vendors on the LTE baseband market is even more striking. It suggests that the market will split between the lower-end LTE baseband and the higher-end supporting the latest features of LTE Release 10.

Lack of baseband certifications discredits promising technology developements

While new players are readying to enter the market, others, such as ST-Ericsson and Renesas, are finding it difficult to survive. Despite promising technology developments, they may well either close down their business or find a new life in competitor portfolios. Such difficulties highlight the dual importance of baseband certification by carriers and of securing a quick ‘device win’ to enter a virtuous circle, where certification is easier. There, because the baseband is certified, it is more easily selected by device manufacturers.

LTE Devices compatibility: new standards emerging

While most vendors will have multimode LTE Cat 3 baseband in store this year, being able to face the challenges of LTE Cat 4 while still reducing power consumption will make the difference among vendors. By the end of the year, thanks to carrier aggregation, VoLTE should be supported by most advanced baseband with Qualcomm still ahead – their MDM9x25 baseband is already being integrated in devices for releases during the second half of this year. World LTE devices capable of roaming on the 40 different LTE bands are not for today despite impressive progress in the RF front end. In this field, antennas are still a bottleneck but RF solutions due for release soon have already significantly reduced the number of models required to cover the whole world.

Future of LTE devices

LTE Devices future

Source: Digiworld by IDATE

Basile CARLE

Senior Consultant Telecom Strategies at IDATE

b.carle@idate.org

> More information on LTE Chipset & Devices

27Feb/12Off

Apps & the mobile Internet : The battle of the platforms: both native and Web apps

 Soichi NAKAJIMA

 Senior Consultant - DigiWorld Institute by IDATE

Mobile Internet is here and geared for growth, despite the global recession. For 2016 the worldwide penetration rate of Mobile Internet will reach 34.7% - or 2.89 billion users - generating service revenues (apps and advertising) of 43.3 billion EUR. IDATE has published a report dedicated to the mobile Internet providing its readers with detailed information about market's structure, data & forecasts 2008-2016, player profiles and strategies. It also spotlights the current and upcoming trends and the different kinds of mobile Internet usages. 

“Since the introduction of the Apple App Store, the focus in the mobile Internet has been mainly on the ‘Battle of the OS’. This is now seemingly all but over, with Apple and Google in a victorious duopoly. The scenario has now shifted to the ‘Battle of the platforms’, with players such as FaceBook and Amazon, who do not own an OS, joining the fray, and who are providing alternative platforms which aim to bypass the native OS system”, says Soichi Nakajima, senior consultant at IDATE

Focus on the tablet market

It is just recently in 2010 that the tablet market started growing with the introduction of Apple iPad. In 2010, around 19 million tablets were sold, 16 million of them by Apple, which even in 2011 remained the clear leader.

Contrary to the smartphone market where Android has reached a leader position, the tablet market is still by far dominated by one manufacturer. Apple indeed has the advantage of being the first mover and different factors have hindered any significant growth by Android.

  • Even when the Android Honeycomb was released, the Tablet OS was still a beta version, which found it difficult to compete with the already mature iOS. Because of this beta status of Android for tablets, Google only distributed the OS to selected partners. This resulted in some manufacturers launching products powered by the smartphone version of Android. This also led to voices being raised against Google for not respecting the Open Source agreement that tied it to the developer community. Although several improvements were gradually brought to Honeycomb, the next version of Android, known as Ice Cream Sandwich (Android 4.0), should bring more maturity to the system.
  • The delayed and restricted release of Honeycomb along with its associated SDK did not help, leading to a lack of available apps adapted to tablets. While Apple App Store and Google Android Market are more or less on a par on the smartphone segment, they are still worlds apart in terms of tablet specific app catalogues. As of end Q3 2011, the App Store referenced 140,000 different iPad specific apps while there were comparatively few of them on the Android market
  • The fact that the tablet is a new segment has enabled other tablet operating systems to gain some visibility, such as QNX OS that powers RIM Playbook or WebOS which powered HP Touchpad devices. Although these tablets were not hugely successful, they brought differentiated user experience in a world where it is very difficult to differentiate oneself in the Android ecosystem

Worldwide tablet sales ('000)

Source: IDATE

In the near future, it can be expected that Apple will gradually lose its market share as their competitors gradually come up with better counter-offers. What happened on the smartphone market will be repeated on the tablet market, although probably at a quicker pace. On the smartphone market, it took two years before competitors started having true ‘iPhone killer’ products. For tablets we expect Android to pass iOS in terms of sales in 2013. One big question mark is related to legal disputes on the market for patent infringement issues.

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Soichi Nakajima - Project Manager - s.nakajima@idate.org

Jeremy Georges - j.geroges@idate.org