jack barse

Ovum’s lead analyst for wireless data, Julian Hewitt, argues that growing numbers of data-ready handsets and WiFi-equipped notebooks will make 2004 the “defining year for wireless data.” He claims application and content developers will be motivated by the size of the potential market to build new products and apparently believes that the mere presence of the applications will cause users to adopt them. I think he’s mistaking the effect for the cause. He cites fax, Minitel, the Internet, and SMS as examples telecom services which grew because of a critical mass of terminals. Humbug! Office managers didn’t buy a fax machine and leave it idle, they bought a fax machine because they wanted to send and receive faxes. Machine sales followed service availability. Same thing with the Internet — the steep ramp in Internet usage came because people wanted to participate, not because there was a huge installed base of terminals. Most people had to either buy a modem to add to their PC or go buy a new PC. And SMS was widely available long before it became the juggernaut it is today. Nobody used it because it had a terrible user interface and it wasn’t reliable. Remember, it was derided as the “Someday Message Service” for a reason! Then the kids, er, youth market, adopted it and the operators had to respond. (I’ll grant him Minitel.)

Hewitt writes, “The key question with wireless data is that we still have no idea what people will pay for. We have established that people will pay for person-to-person text messages. But beyond this?” Operators have known for years that email is the killer application for wireless data. But email requires a decent user interface, and that’s impossible to do on a device the size of a handset. If the user is willing to carry a larger phone (BlackBerry, Treo, P800/900, etc.) then he can have his email, but otherwise he’s out of luck. So the cellular industry resorts to games and ringtones to drive its data strategy.