Wayne Perry, CEO of EDGE Wireless and a member of the board of ATT Wireless (not to mention part owner of the Seattle Mariners and private pilot), is giving the keynote address at eBusiness Day at the Rollins eBusiness Center at BYU.
The cellular concept was invented in 1948 by Bell Labs. Cells allow reuse of the frequency. Previously, there could only be 500 mobile phone uses per frequency. In New York City there was a 25 year waiting list for a mobile phone. The FCC didn't allocate spectrum until 1982. Another major development was the DSP chip. ATT expected up to 1 million cellular subscribers by the year 2000.
By 2000, there were 97 million subscribers, almost a factor of 100 greater than predictions. Today 157 million people (55% of the US population) have cellular phones. That's more than wireline telephone users in 1994. In 2001, for the first time since the Depression, the number of wireline phones decreased. In 2005, the number of wireless phones will surpass the number of wireline phones. On average we use the phone about 600 minutes a month. Worldwide, this amounted to 100 million years of talking.
On top of this, the US is behind the rest of the world. In Taiwan, there are cellular users 110% of the population. China has 250 million subscribers and China MobileCom is expected to add 35 million subscribers next year. Verizon has 35 million subscribers total.
While voice lines are down, 22% of US households have a high speed data connection. US broadband penetration is higher than most of the rest of the world. The exceptions are Korea (80% penetration) and Japan.
Mark Twain said he loved to talk about the future because no one can call you a liar. Not surprisingly, Wayne is very bullish on wireless carriers, not 802.11 carriers, but cellular providers. What's really telling, I think is that he turns to things that are currently happening in other countries to point to what will happen in the US. The question that is left unanswered is, who's fault is it that the US is so far behind? I have to point to the wireless carriers. They all want to keep you inside their walled gardens and give you just the services they think you want now.
Wayne speaks to the privacy issues of location-aware phones. Parents will buy a service that alerts them when their daughter goes to her boyfriends apartment. Of course the daughter will buy an alibi service that says she's at the library. Wireless providers are like arms merchants---they win either way.
Wi-Fi is popular because its perceived to be free. The total CAPEX to install Wi-Fi at the United Airlines terminal in Denver is less than $50,000. That kind of CAPEX won't support charging for Wi-Fi in general (because someone else will offer it for free). Wi-Fi will drive down the cost of other wireless options.
DoCoMo predicts 500% penetration. How do you get there? Lots of wireless devices. In five years, no child will leave the house without a location-aware wireless device. No one will be allowed in the national forest without one. He tells the story of a dairy farmer who installed a pager on his lead cow. Instead of going out to get the cows, he trained the lead cow so that when he paged it, it would come in and bring the herd. The moral of the story: don't assume you know how people will use wireless. To which I would add, don't install barriers to people doing interesting things.
Why would VodaFone (largest wireless provider in the world) by ATT WS? VodaPhone wanted to be in the US. They own a 40% ownership in Verizon, but their phones didn't work with Verizons system so Verizon wasn't cutting it. The world is moving toward consolidation of wireless systems and standards. CDMA is probably better, but better doesn't cut it. GSM is going to win.