ODI Field of Dreams

Tony Lewis of Verizon Wireless has the enthusiasm you'd expect from someone with a new-age title like “chief evangelist.” His actual title — executive vice president of open development initiatives — may sound more traditionally corporate, but his position is a newly created one that doesn't exist at some competitive carriers. And the goals set for his new unit ultimately are aimed at overturning the business model that has served wireless carriers for more than two decades — potentially making obsolete standard performance metrics such as average revenue per user.

“As we approached 2008, we knew the marketplace was changing dramatically,” Lewis said. “The traditional wireless marketplace had been centered around the handset and voice. But over 20 years the industry had developed very sophisticated handsets that are mini PCs and can do as many or more functions than a desktop computer. [These devices] also can communicate in more than one fashion, including [short message service], e-mail and video. If you open the network and start to capitalize on a very intelligent ecosystem with lots of brilliant people with brilliant ideas, they will want to bring devices and applications we may not have thought of.”

The ODI will enable end users to bring any approved device to the network rather than be limited to devices offered only by Verizon Wireless. The goal, Lewis said, is for the entire industry to grow and for Verizon Wireless to “capitalize on our greatest asset, which is our network.”

The Verizon Wireless decision to open its network also came, at least in part, in response to pressure from Google and other software developers that saw a mass-market opportunity to provide software for mobile devices if they could shift decision-making from mobile operators to end users. Google was unable to provide an executive to be interviewed for this story, but a spokesman said, “Our view is that users would benefit from a wireless world that mirrors the open platform of the Internet. Allowing consumers to select their own applications and handsets will enable them to get the most out of their wireless experience.”

But the initial outcome of the Verizon Wireless initiative has been quite different from Google's vision. As of early December, Verizon Wireless had certified 10 devices for use on its network. Although the company declined to reveal the specific devices, Lewis said they're not consumer mass-market products. Instead, they are devices made for tasks such as inventory and inmate tracking. Virtually all of them are designed for machine-to-machine (M2M) communications, a market that has been quietly growing as much as 50% per year and in which traditional wireless carriers have played a relatively minor role — at least until now.

“The cork is off the bottle,” said Michael Lang, executive vice president of sales and marketing for Numerex, a communications service provider that specializes in the M2M market. “There's no question M2M is the new frontier.”