56 million LTE mobile phones by 2013: a dream come true or nightmare

Recently I came across an article from Phonemag, it forecasts that LTE enabled mobile phones will reach 56 million by 2013. (see the original here: http://www.phonemag.com/lte-phones-will-hit-56-million-by-2013-079673.php). This is great news for mobile phone users who love to surf Internet on their mobiles.

Unlike WiMAX, which is focusing on enabling open Internet services at anywhere and anytime, LTE is all about providing mobile services. There is clear difference between the WiMAX and LTE in terms business focus. WiMAX is mostly about ensures the availability of the Internet services, which provide personal broadband in mature market and enables broadband connectivity in emerging markets. LTE is all about mobility due to its DNA inherited from mobile phone industry, which is a fascinating industry that has more than 4 billion voice subscribers globally.

Mobile operators today offer mobile “Internet” in a walled garden fashion; for LTE to enable true open Internet services, the question is whether or not mobile operators will offer true OPEN INTERNET services, and how mobile operators are going to deal with the potential voice revenue cannibalization by free Internet voice applications such as Skype. Imagine a Skype client installed on LTE mobile phone, I bet the user experience for voice services and contact list will be better than traditional voice services and the phone address book assuming LTE can deliver its promised data speed like mobile WiMAX.

Voice revenue cannibalization is a big issue for incumbent operators to offer either LTE or WiMAX on a mobile phone. Fortunately, for WiMAX operators, either they are Greenfield who has nothing to lose that allow them to try pretty much everything, or they are mostly focusing on computing devices such as USB dongles, embedded notebooks or Netbooks. Incumbent mobile operator who wants to do rollout LTE or WiMAX services probably should focus on USB Dongle, embedded notebooks and netbooks. To that point, both WiMAX and LTE are addressing the same market including that 4 billion voice mobile users.

The day will come for LTE enabled mobile phones just like GSM/WiMAX, which is already here. However, mobile operators need to figure out how they will deal with skype type of applications. If mobile operators have preference on what applications consumers can use on their network, then they are not really offering OPEN INTERNET services. I am sure Mobile operators are looking into offering data only LTE mobile “phone”. The Next Wireless Paradigm: Data Delivery by Anton Wahlman, discussed in details on the subject. Please see Anton’s article by click the here -> http://www.thestreet.com/story/10541059/4/the-next-wireless-paradigm-dat... The unanswered question remains for incumbent mobile operators to enable LTE on mobile phone definitely requires their business model transformation. Can they justify the huge investment required to build an overlay network and facing tremendous risk of cannibalizing their voice revenue. Does it make sense to trade $55 ARPU from voice + data with $50-60 ARPU from data only?

Providing true OPEN INTERNET services is easy said than done, but if you believe in Internet model, then you have choice but open up…..and to tell whether your mobile Internet is open or not, just see if you can use free skype services or slingbox features (http://www.slingmedia.com/) on your mobile phone.