The 3G Connection

Although 3G affects voice as well as data communications, it seems to have become synonymous with really fast wireless data. Using the term 3G somehow is less threatening than "wireless data," and somehow everyone goes about feeling quite confident, if not certain, about its success. In fact, few speculate whether 3G will be a success; they speculate only about how it will be achieved, when and what standards will prevail. There is a natural assumption out of this community of technocrats that 3G's success is inevitable.

It's time for some introspection about high-speed wireless data applications. What is it that will repay the millions of dollars spent on 3G infrastructure and devices? Build it and they will come?

Three primary applications will drive next-generation handset designs: advertising, e-commerce and entertainment. All three will benefit in some way from a higher transmission rate coupled with increased local processing power of the phone device, which will be more of a wireless multimedia play station rather than a souped-up wireless phone.

These three applications will co-exist harmoniously, each one loosely dependent upon the others for success. There is so much pent-up financial muscle behind these three applications that they can't help but be successful.

A major roll-out of second-generation microbrowser-based phones is forthcoming -- a charge led initially by Phone.com (formerly Unwired Planet) and now backed by the WAP Forum, with support from Microsoft. Yet those phones will not have the muscle, nor will they have the data rate to support advertising.

FOOTING THE BILL The future phone will have a display that is customizable almost entirely by the user. In a recent poll of 500 users conducted by Zsigo Wireless, 90% of respondents said they would customize their phone's display using a carrier's Web site if given the opportunity. High-speed-packet-data access to the phone allows streaming content to keep the interface alive, providing a point cast-like interface. Instead of wading through menus to request information, the phone always will have information available on the screen.

But who wants to pay for that? The solution is to do what every medium has done -- sell advertising. At 384kb/s, you can send a commercial to the phone, complete with audio, video, color and call-to-action controls. What makes advertising so compelling is that it is direct marketing to a consumer who can take immediate action. Most of the media today is not 2-way in nature, and advertising is billed on a cost per thousand impressions. In direct advertising, companies can pinpoint the user and create commercials that are customized appropriately. Technically, this means that there will be servers that will create multiple high-speed data sessions with phones to produce customized content. This is the most powerful form of advertising ever conceived, which leads to the second application, e-commerce.

If a subscriber sees an advertisement with a call to action, he wants to be able to take that action immediately, and there's no better way than to press the "buy" button on the phone. Subscribers don't need high-speed data access to do that, but they're not likely to buy unless they get a great commercial advertisement, and they do need high-speed data for that. The two are intertwined.

DON'T FORGET TO HAVE FUN The last of the big three applications is entertainment. Ten years ago consumers were entertained by watching the Sonny & Cher show on television as a family. Today, the pace of life has increased. People complain about being overworked, and they can't always get their entertainment in chunks of time. Rather, they need to use interstitial times, those minutes while they are waiting in traffic, in the lunch line or getting the oil changed in their cars. For those precious few minutes, people will turn to their phones for fun, if you provide that utility.

High-speed data to multimedia-enabled smart phones redefines fun. Subscribers can watch 3-minute episodes of Laurel and Hardy on their phones. (See www.laurel-and-hardy.com if you doubt.) Would subscribers pay 50 cents per view? Would they pay $1 to listen to a CarTalk radio episode from the archives? How about a real-time, 4-player, simultaneous Donkey Kong game from Nintendo for $2? It's all coming, and it all requires a high-speed, instant-on wireless data transport to a phone that has a great display, significant on-board memory, and solid computer processing power.

What does all of this have to do with e-mail and Web browsing? These applications benefit tremendously from high-speed data, but there is an important twist. These applications are best managed from a device that has an easy-access physical user interface such as a mouse or keyboard. One could argue for voice-recognition-based computer control, but it's uncertain if that will be the user interface of choice for many years to come.

THE CONNECTION Thus, for traditional corporate wireless data applications such as e-mail, LAN/host database access and Internet/intranet access, the phone will act as a portable network adapter for the laptop or palmtop PC. With technologies such as Bluetooth in full operation, the mobile PC will remain virtually connected to the Internet by the wireless tether between it and the phone, and the phone and the Internet. In other words, the phone will act as a data-transport bridge.

As a carrier, you would sell a wide-area wireless Ethernet adapter. There likely will be products embedded within PCs to do the same thing, using the mic/speakerphone capabilities for the support of wireless voice and/or video conferencing. The larger market, however, will be the Bluetooth-enabled phones that remain physically detached from the computing product of choice and that have separate valuable functions in the desired form factor.

Three classifications of end-user devices will make use of the high-speed data access afforded by the network: the tiny phone with a Bluetooth tether, the multimedia phone with color display and the embedded phone module sold to OEMs.

This field eventually will merge to only two classifications as the multimedia phone collapses to the size of any mainstream phone. Imagine a wireless phone similar in form factor to a Motorola StarTAC that's mostly screen on the top part of the flip and mostly navigational/input buttons on bottom. It stays flipped open on your desk, and the color screen changes constantly. The speaker is loud enough so you can hear without putting it up to your ear, and the phone responds to simple voice commands. The laptop is wirelessly tethered to it and is virtually connected to the Internet. Although it is not an easy thing to build, the manufacturers can do it in time. Then everyone will be using high-speed wireless data services, a.k.a. 3G, whether they realize it or not.

It seems everyone is in a "harmonizing" effort for 3G standards. Find out what several organizations and companies are doing to help create a global 3G wireless solution.

* The 3G Partnership Project 2 (3GPP) is a cooperative effort created to prepare globally applicable technical specifications for 3G mobile systems based on evolved ANSI-41 core networks and the relevant radio-access technologies. These specifications will serve as the basis for global 3G wireless standards.

Several standards development organizations are involved in 3GPP, and two partners recently have joined: the GSM Association as a market representation partner and the China Wireless Telecommunication Standard group as an organizational partner. The Telecommunications Standards Advisory Council of Canada also is participating in 3GPP as an observer.

Nokia has thrown in its support of 3GPP. Nokia aims to create a volume market and accelerate development of 3G for industry players including manufacturers and operators.

* The Operators Harmonization Group (OHG) recently held meetings that resulted in a framework for a harmonized 3G CDMA standard with three optional modes. About 30 carriers are involved, including AirTouch, Ameritech, Bell Atlantic Mobile, BellSouth, GTE Wireless, Omnipoint and SBC Communications. Manufacturers such as Ericsson, Lucent, Motorola, Nokia, Nortel, Qualcomm and Siemens also have added their support.

* The CDMA Development Group (CDG) has announced that cdmaOne technology has gained momentum in Japan as a result of the recent cdmaOne nationwide service launch by DDI and IDO. The region will benefit from the recent 3G harmonization efforts.

* Dophin Telecom has completed a transatlantic 3G wireless phone call using a W-CDMA trial network in Canada and Dolphin's TETRA network in the United Kingdom. The 3G trial network is being used to test next-generation voice and high-speed wireless data services under a developmental radio license from Industry Canada.

* Qualcomm has introduced a semiconductor and software solution for the 3G air interface standard. The chipset solution is fully backward compatible with existing IS-95A and IS-95B networks, providing a seamless migration path to 3G. The system software will include support for packet data, a full Internet protocol suite and voice recognition.