GSMA drives embedded-module takeover

On the role of a trade association: You do need a set of common guidelines for what an embedded module needs to look like. We want to avoid fragmentation across the market and actually get people building and designing to a common specification. The second piece of that is then giving them an API specification for those modules so consumer electronics manufacturers and the like can program successfully and interface with the embedded modules. That is essentially the aims of the GSMA initiative. If we are successful in establishing these frameworks, you’re essentially creating the volume. And we’re talking significant volume here. We’re anticipating around 50 billion connected devices by 2025, so huge volume there, but you also drive the cost down because everyone is building to the same specification. We can make these modules cheaper and that makes it easy to move them from consumer electronics into areas like smart metering where it’s more cost dependent.

On moving beyond being a transport pipe: These tend to start as a transport-pipe conversation. We are certainly working hard to encourage our association members to think about how they can play a part in the application that gets developed and how applications play on top of that. We strongly advocate a move away from the applications world in the mode of the Apple App Store, which is essentially an application that just runs on top of the network, to a view where we actually get applications that invoke the network capabilities and use them to make it more effective. For example, location and messaging capabilities built into the network can make applications stronger and more interesting.

On thinking in a new data-driven way: It’s a new area and it raises a number of questions. You are moving from your traditional business, which is selling voice and, more recently, selling data minutes, to a very different model where you may have a customer who literally may have tens of thousands of SIMs connected to meters that are accessing your network for very short periods of time with little bursts of information. It changes a lot of dynamics and the way that operators need to think about these things.

On driving volume to lower prices: You have to get scale on the modules. A year ago, when we first started to see the adoption of these embedded modules in laptops, the module price was something around about $70 in volume. We are expecting to see that next year head down around the $35 range. You are starting to come down, but I think the key here is getting the standardization of modules, which allows you to get the volume, which we hope will bring the prices down into the $20s or even the $10 range. The standardization will drive the volume, and when you have the volume, you will be in good shape.