There has been much furore and inaccurate juxtaposition in the press of announcements by the GSMA and he SIMalliance over the last few weeks, trying to pitch a SIM card v embedded world, an angle that missed many of the key nuances around the announcements. these announcements were interspersed with rumours that Apple’s next generation of iPhone would not incorporate a USIM module.

With responsibility for looking into and forecasting the growth of the embedded market, these announcements got me interested. We have recently written about the consolidation among module makers in the M2M space, with SIM card players such as Gemalto, looking to move up the value chain into being a complete module player.

While the rumour about Apple’s next-gen iPhone is just that (a rumour), it seems as though the SIMalliance and GSMA are on the same page in their approach to the future of the SIM card, namely that personal devices and automated modules will require different means of distribution and activation, but that USIM cards will still have an important role to play.

We recently discussed in-depth the growing importance of M2M service platforms as a means of activating and managing the more than, Strategy Analytics believes, 4.6+ billion connections (excluding handsets and smartphones)  that will likely be in place by 2020. Many of these connections will be legacy M2M applications like smart meters and cars, but many will also be data devices like personal navigation devices (PNDs), tablets, eBook readers and laptops. what is clear is that the Embedded service platforms that are being built today for M2M applications, will tomorrow be used as the de facto means of activating and managing billions of connections globally, including handsets and smartphones.

It is clear that mobile operators are concerned about the possibility of the SIM card being replaced by a vanilla module/soft SIMs, as with it goes not only customer attachment and identity, as well as the SIM-only business, but also lowers the barriers to customers switching carriers and will force selection on key criteria such as quality of service, incentives and best tariffs/deals.

If Apple were to pursue this route, then it would clearly put the balance of power towards the OEM, reducing the power of the carrier. However, not only would this be just one OEM, but Strategy Analytics believes that this vision is over-simplistic and that the SIM market has a longer shelf life than some are predicting, with different distribution channels for high visibility consumer products and B2B M2M deployments (even if consumer activation, provisioning and management will be done via embedded service platforms). Moreover, while consolidation in the M2M module space suggests the model will change, regulation would likely slow the switchover considerably.

It is clear, however, that carriers need to think carefully about their embedded service platform strategy, as the question is less about SIM v embedded, and more about the next phase of building analytics into embedded service platforms to ensure consumer and business customers remain satisfied and that carriers can target them with the right products and services.

Andrew Brown

I’ve been watching RIM’s BlackBerry revolution unfold over more than a decade, to the point where telecom regulators or governments airing their latest complaints in the public domain has become predictable and commonplace. Following the protracted complaints by a minister in the Indian government in 2008, RIM has most recently been in the firing line from the UAE's Telecommunications Regulatory Authority, which claimed that: "As a result of how BlackBerry data is managed and stored, in their current form, certain Blackberry applications allow people to misuse the service, causing serious social, judicial and national security repercussions…" Saudi Arabia may also suspend BlackBerry mobile email and instant messaging services because they are considering the services to operate “outside local laws” and raise “national security” concerns. The services are apparently under scrutiny because they are operated through secure network operations centres around the world, meaning that most governments can't access the data easily on their own, a requirement of local legal interception legislation. This is nothing new for RIM. In my opinion, it is difficult to take these objections at face value. Comments that UAE and Saudi are small markets and do not matter to RIM are also wide of the mark (they still represent around 1.2 million subscribers).

• • There is a broad difference between accessing information on reasonable grounds and unreasonable monitoring of users. Legal intercept is fundamentally complex concept, for which there must be reasonable grounds for investigation, but is not the same as spying on users without reason.
  • A negotiating tactic to drive greater investment in these local country markets, through location of data centres or NOCs in these regions.
  • Business customers, who make up the majority of RIM customers, especially in developing markets, are higher ARPU customers. For a telecom regulator to shut off a high ARPU service for mobile carriers is hardly beneficial to a developing country’s economy.
  • The governments and regulators  that publically object to RIM’s level of content encryption are the same who benefit from RIM’s content encryption.
  • RIM is only subject to this scrutiny, because it is the only company that can meet the rigorous security standards set by national governments.  It is also the only incumbent that has a presence in vertical markets that require tight GRC (Governance, Regulation and Compliance).

Ultimately, RIM will have to allow its carrier partners access to tools that allow them to comply with lawful intercept legislation. However, RIM holds the keys and will likely only offer the tools to carriers that allow access to information that is legally required on a case by case basis. This will allow for reasonable compliance with requests from regulators and governments, whilst avoiding the less than savoury possibility of broad population monitoring, that in itself have broad moral repercussions. What is clear is that the company will not decouple the solution that would create a fragemented entity and damage the company’s USP. What is clear, is that RIM is in a bizarre predicament whereby it’s tight security and GRC adherence, driven by its architecture, which has given it an apparently insurmountable installed base in government, is having a seemingly negative impact on its business. Nevertheless, I believe RIM can and will meet reasonable demands by providing tools to carriers, whilst avoiding the unsavoury business of wholesale privacy violation. The stark reality remains, that RIM is only open to this scrutiny is because it is the only company that can provide this level of security to users, companies and even government agencies!

With so much noise surrounding the sheer number of applications in Apple’s App Store, as well as the ramping of content on Android Market, it has been refreshing to hear more from RIM recently about quality not quantity of applications.

To get this message across, RIM announced the concept of “Super Apps”. Although I am not especially keen on the name, it was absolutely necessary to look at how people use applications and how they should be integrated into the operating environment to offer the richest, most complete user experience, that sits squarely with RIM’s philosophy of offering the richest most integrated user experience available.

Which of course leads to the question “what is a super app?”. According to RIM, a super app must:

1. Offer an “Always-on” Experience: BlackBerry OS allows multitasking, with the idea that a super app can run in the background and even start up automatically with no user action required. This allows for much of the apps work to happen seamlessly, without an app chugging away in the foreground.
2. Tight Integration with Native Apps: The key to the BlackBerry experience is the simplicity, especially core functions such as inbox, calendar, address book, phone as well as camera and browser. RIM’s API frameworks allow developers to include menu/drop-down items into these core functions, reducing the need to constantly switch between applications, integrating seamlessly with the native app experience
3. Proactive and Notification-driven: RIM’s push infrastructure allows for apps to proactively  notify a user of the right information at the right time. They can notify the user in many ways when a certain event occurs or relevant data arrives to the device
4. Highly Contextualized: Utilising RIM’s location APIs allows for app development that is relevant and contextual utilising not only GPS, but cell site location and geo-coding as well as deeply integrated.
5. Social and Connected Allows for integration of third party apps into the email, SMS, MMS or chat clients to enable users to share content from your apps with others in their address book
6. Designed for Efficiency: A core part of RIM’s ethos is efficiency, offered through and end-to-end architecture that is optimized for “always-on environments”. Super Apps should be built with efficiency and scalability in mind.

In many ways, super apps highlight how RIM has opened up more APIs and services, as well as improving tooling resources for developers. The new services go much deeper than before, and offer major opportunities to integrate apps with native functions (such as the email inbox), as well as with payment and advertising functions among others.

It has already been shown how users will pay for richer, more deeply integrated applications: iPhone Users Install Most Applications but BlackBerry Owners Pay for More

Mobile enterprise applications will also benefit dramatically from the deep integration into core functions and resolve the major issues of certain types of applications (especially CRM) behaving “in an offline state”. Oracle demonstrated how healthcare workflow applications can benefit from this level of integration on a BlackBerry, and the results were impressive.

Ultimately, it is about time another OEM (Nokia excluded) started talking about rich, deeply integrated experiences, rather than focusing on sheer app volumes in “app silos”. Surely one deeply integrated, rich application that is genuinely useful holds sway over 200 apps that lack any rich integration whatsoever?

Andrew Brown

Mobility and the “Real Time” Enterprise

A Techcrunch article about Jive’s new app marketplace over the past week got me thinking again about the role of mobility and social media in the enterprise. In another survey concerning “web-workers”, it is alleged that 85% of workers use their mobile phone as their primary communications device, 60% use VoIP with only 46% using fixed line communications as a primary communication tool. Both mobility and social media are important enterprise tools.

• In recent years, as businesses have started evolving toward more people-centric collaborative environments powered by wikis and other social software solutions, real time has become an integral part of the social software stack that colleagues use to communicate and work together.

Not one player has successfully extended a social revolution to the enterprise successfully.

Major ISVs and enterprise vendors have attempted to integrate social media into the enterprise, including Microsoft with SharePoint with its wiki-style pages and built-in messaging, and Salesforce.com with a Twitter-style Chatter service, but nobody has really succeeded.

The challenge for enterprise social media is two fold. First, most enterprises have corporate standards governing firewalls, security and licensed software, which is installed and maintained by IT departments and secondly the web world of beta software, open standards and an “anything-goes” kind of approach to social networks and information sharing is incongruous to corporate IT environments.

Jive are one company looking to change that, but whether Jive’s blend of open APIs, an open app marketplace and installed software can successfully bring these two worlds together remains to be seen. After all, Google is now making inroads into business with the most complete offering of these two components so far, Google Apps.

Essentially, however, the issue comes from the fact that there’s little cognizance of business process activity that generally takes place within traditional ERP, CRM and supply chain systems. These traditional applications address critical functions in the enterprise that are closely tied activities that can be measured in the form of increase revenue or reduced costs. 

• Also, from a user point of view, “making it look like Facebook, doesn’t make it Facebook”, even if it helps a user to navigate through familiarity! Consider that Linked In has 35 million members compared to over 400 million for Facebook!

Mobility is becoming a key part of enterprise strategy, and companies face the simultaneous challenge of trying to integrate both social media and mobility (as well as enabling social media platforms on mobile platforms).

• Add to this the task of managing individual liable devices within companies, and the challenge facing IT departments seems even more daunting. IT managers then face a critical decision between tightly “ring -fenced” corporate environments or take the altogether riskier approach of opening up their environments altogether.

With the ever intensifying app war out in the smartphone marketplace, BlackBerry-maker Research In Motion has upped the ante by offering a new push service for BlackBerry software developers to enable rapid delivery of application-content to BlackBerry smartphones. It’s no secret that RIM has a market leading user experience for mobile push email, underpinned by it’s “ground-up for wireless” network architecture, but finally RIM is taking the game to Apple and Android developers where all the noise is being made, by leveraging its network operations centre (NOC).

Push applications are not new to the BlackBerry, but access to the required BlackBerry APIs and other resources was costly in the past and the necessary fees were prohibitive to many application developers. It seems as though access to APIs in version 5 of the handheld software is going to be a game changer.

The push service is being made available in two tiers:

• BlackBerry Push Essentials is a free service while
• BlackBerry Push Plus has a free tier and paid tiers, but essentially allows a host of monitoring and scheduling tools as well as offering pricing tiers for very high push notification loads (10,000+)

Developers are required to meet some baseline criteria

• Applications must provide a one-time message to indicate push usage to the user
• Software must indicate higher data pricing when roaming and that users should check with their carrier for data pricing
• Apps must allow users to switch pushes on or off
• Users must be able to remove the app and/or change BlackBerry smartphones

RIM is bullish about the offering, which it describes as: “…unlike alternative push solutions that can only notify users that new content is available for download because of push message size limitations, with the BlackBerry Push Service, full content (up to an industry-leading 8KB in size) is pushed to the device and made immediately available for use."

I’m excited by this announcement. As expected, most of the focus has been on consumer content, especially news, stocks and sports, but the real value is in how this changes, or rather enhances the BlackBerry user experience. RIM’s architecture facilitates "listening" for content updates, instead of having to initiate what can be lengthy processes via comparable mobile app push services. The service will run on BIS and BES and will put itself in a strong position for business applications, by bringing updates to the user, rather than a user foraging for information. There are already some solid examples of push app technology, from patient information in healthcare and sales force automation to emergency response.

Competition is fierce, and the number of personal liable devices forcing their way into businesses will keep growing. With BESX RIM is allowing IT departments and administrators to “bend without breaking” while this announcement sees RIM really starting to extract maximum value from its architecture, which will allow the company to differentiate itself from competition. RIM is now effectively placing itself both in the minds of consumers and businesses.

Andrew Brown

The smartphone market just took another surprising turn in a year where the battleground around mobile operating systems has become more intense than it has ever been, as HP acquired Palm for $1.2 Billion.

It has been well documented that Palm’s innovative WebOS has struggled to gain a sufficient foothold in the market, and sell-through has lagged because carrier promotion has been limited. Recently Palm has essentially been shipping a 6 month old device  with limited differentiation along with suffering from mounting channel inventory issues at key carriers such as Verizon and Sprint. Outside North America, sales have also been significantly lower than expected.

While both companies had a proud history in the PDA market (including the iconic Palm V and iPaq), both companies have struggled to gain a serious foothold in the smartphone market.

 

 

Whilst $1.2B seems a high price on the face of it, there is clearly and  it makes sense as there are clear synergies, and almost as importantly, a cultural fit, with various ex-Palm employees such as Todd Bradley and Satjiv Chahil present in HP’s PSG team.

• HP lacks presence and a clear direction in its smartphone business. The acquisition of Palm offers great mobile operating system IP as well as product development. It builds out the missing mobile part of the HP jigsaw.
• Palm lacks the channel distribution, efficient supply chain and reach. It lacked the funds to accelerate its product launches and refresh cycles. HP offers Palm the ability to resolve these issues and extend its reach in carrier channels, as well as opening up new channel opportunities.
• HP has spent years optimizing its supply chain capabilities, something that Palm has found a constant challenge.
• HP could potentially be acquiring Palm as a proactive move to prevent competitors getting hold of valuable IP in WebOS. It also warns competitors away from attacking Palm with patent infringements.
• The move would allow HP will offer the valuable WebOS to licensees, potentially creating a rival to Android? Palm’s perceived value is more closely linked to its software and platform development than specifically to its devices. Under one parent, platform fragmentation could be kept to a minimum. It is unclear if there is an intention to take this path at the moment.
• HP could potentially be acquiring Palm as a proactive move to prevent competitors getting hold of valuable IP in WebOS. It also warns competitors away from attacking Palm with patent infringements.
• The acquisition offers HP the ability to scale, WebOS for an emerging tablet and larger device business, where it is a leader and where Microsoft’s Windows Operating System is not the answer.
• The forthcoming Windows Phone 7 Series looks likely to offer little in the way of customisation for mobile operators. Clearly the acquisition of Palm allows HP to put something differentiated into the market.
• HP now has a mobile piece with which to integrate its enterprise software offerings and target the mobile worker, supported by its global services business.

More details of the deal will obviously emerge in the coming days, but what is certain is that HP will increase investment in WebOS, which it perceives to be the leading mobile platform which will offer a serious and credible mobile string to the bow of a formidable, global, tech giant. Interesting (and competitive) times for the mobile devices market indeed!

Andrew Brown

 

Over the last few years, enterprises and ISVs have tried to figure out how to move “beyond email” for mobile workers (i.e. how to get high value and cost ERP and CRM apps into the hands of users) the term Mobile Enterprise Application Platform (MEAP) has been talked about with increasing frequency, primarily, it seems, as there is little in the way of an alternative term.

                                     Sybase Unwired Mobile Platform.

However, I have never liked the acronym, primarily because it emphasises the application, rather than the complexity in bringing a solution to market, which in reality requires an infrastructure approach and the involvement of several players in the ecosystem. It is also seemingly aligned only with mobile software vendors such as Syclo, Sybase and Antenna software, rather than taking into account how the large business software companies such as SAP and Oracle are changing their approach to the mobile market.

I prefer to use the term “MIP” (Mobile Infrastructure Platform). This is why:

Clearly the mobile worker market is the next critical step in extending simple but rich mobile access to ERP and CRM tools. However, it is also beset by complexity, which explains why some of the largest ISVs are so dependent on partners to deliver not only mobile products but good mobile experiences. For example, SAP has a CRM application that it created SAP Netweaver Mobile, but it was not connected to the back-end database and behaved ostensibly as an “offline” application. Oracle has Business Indicators and Mobile Sales Assistant as well as other tools, but the experience is similar. Indeed, since announcements with RIM in 2007 about native SAP applications running on BlackBerry devices, SAP has been remarkably reticent. The reason? It is very challenging to do.

As a result, companies such as SAP have taken the approach that they took in the adaptive manufacturing sector: build out a comprehensive list of partners to offer solutions. Oracle have done the same. Both companies offer mobile ERP and CRM tools, but have really failed to deliver a rich experience optimized for wireless environments. In March SAP went a step further, when it announced that it will deliver on the mobile CRM application agreed upon a year ago when they announced a co-innovation agreement with Sybase. The result will be Mobile Sales for SAP CRM and Sybase Mobile Workflow for SAP Business Suite, for iPhone, BlackBerry  and Windows Mobile.

This is a step in the right direction, but it isn’t enough. The result of the Sybase agreement may well be an improvement on the partnering model, but companies such as SAP need to acquire the relevant asset (either Antenna Concert, Sybase Unwired, Sky Technologies or another), integrate with their own enterprise software offerings to offer a complete MIP (mobile infrastructure platform) essentially an in-house, scalable turnkey product that can be deployed in many instances. This will require tough choices and no little compromise, but without the industry leaders taking this approach, it will be hard to move the mobile ERP and CRM markets forward. And there is no doubt that the 1 billion+ mobile workers (in 2012) will be the next frontier.

Andrew Brown

Hype surrounding mHealth is at an all time high. Mobile eHealth or mHealth encompasses the use of mobile telecommunications as they are integrated within the health care delivery systems and is part of a movement towards citizen-centered health service delivery. Major trade bodies such as the GSMA are firmly committed to mHealth through a partnership with the Continua Health Alliance, while mobile operators such as Orange are also involved in mHealth initiatives

Every analysis of mHealth I have ever seen begins with the same argument: that there are 6.75B people in the world and 4.6B mobile subscriptions, and that developing markets are showing the fastest growth (obviously as penetration is so low!).

Establishing mobile penetration does not in itself validate the mHealth concept! Moreover, many of the commitments are lukewarm, promising to invest in scalable solutions etc. However, mHealth has been around since 2001, and is clearly a valuable in the fight against illness and disease, but has failed to gain serious traction in that time, so what is next?

Significant sums are being invested in supply chain optimization for suppliers, enterprise IT software (CRM systems), asset tracking, monitoring and proactive maintenance (tissue chambers etc). Moreover, regulation in developed markets such as HIPAA play a key role in the choice of solution. Cellular has a key part to play in these areas, but is only part of something broader. We are only now getting towards the stage where we can talk about monitoring devices or mobile phones in a user’s hand.

To extract the true value from mHealth, mobile applications will need to be part of a broader set of business processes. What is clear is that the concept of mHealth is related to mBusiness as well as to eHealth and eBusiness:

• eHealth refers to healthcare practice which is supported by electronic processes and communication.
• mHealth is the mobile extension of healthcare applications into the mobile domain and is a subset of eHealth.
• eBusiness represents all the technological applications and business processes that enable a healthcare provider to offer a service, including front and back-office systems, essentially the utilization of information and communication technologies (ICT) in support of all the activities of business.
• mBusiness includes the tools required to enable eBusiness applications, such as a mobile application platform (MAP).

mHealth will be extremely viable, and valuable, but it will need to be more than an application that displays a users symptoms on a handset (I will be doing a future post on applications in mHealth, but there are already reports on M2M in healthcare here and a report on mobile healthcare applications here). Indeed,  it will need to be part of a broader mBusiness and eBusiness strategy. Given that these rollouts require significantly more investment, it is clear that the mHealth that can bring real change will need to be part of a broader ecosystem.

Andrew Brown

After much excitement and expectation, Microsoft finally unleashed its “Tron-like” Windows Phone 7 Series Operating System on the world at Mobile World Congress in Barcelona (the term series apparently refers to the phones that will be announced throughout the year, not a variety of OS flavours as in the past).

What is immediately apparent is the look and feel. The main takeaway is that the phone is of secondary importance, with all the focus on the interface. The design and layout of 7 Series' UI (internally called Metro) is original, utilizing what lead project designer(Albert Shum, formerly of Nike) called an "authentically digital" and "chrome-less" experience. Microsoft has been praised for moving away from the stamping its PC legacy all over the OS as in the past, with only a single hardware button indicating it’s a Windows Phone at all.

First impressions are positive-the simplicity leaves the user feeling that the OS is fast and responsive, but there are nagging doubts surrounding what Microsoft has stripped out to make this OS snappy-and clearly the OS won’t be compatible with earlier phones given the high specs that Microsoft will demand of its OEM partners.

The new system, centres on "hubs" designed for specific tasks. For example, Windows Mobile 7 Series' People Hub aggregates social networking and email contacts, from Facebook, Windows Live, and webmail accounts among others, enabling the user to interact with their friends across multiple media through a single application."

Microsoft’s launch has been slick and polished-with the fickle majority now saying that the death of Microsoft’s mobile business has been greatly exaggerated.

 

Certainly the key features are all core consumer in nature: Zune integration and XBox Live integration as well as social networking integration for popular sites such as Facebook. Enterprise is still catered for, but less detail was forthcoming outside the “Office Hub”that was announced. It has been suggested that many non-business users that bought a Windows Mobile phone in the past had no idea who manufactured the phone. However, OEMs aligned with the WP7S launch may see their brand stand out more with an OS that is less obviously has “this is a Windows Phone” stamped all over the UI.

Nevertheless, questions remain:

• Lack of clarity on hardware OEM reference designs
• No surprises in OEM partner line-up (does this really mean a chance for Dell and HP to get into this market-I’m not sure)
• Lack of detail on .net CF framework (core for development and enterprise) and what functionality has been stripped out to sharpen OS responsiveness.
• Backwards compatibility and multitasking
• Business Integration with UC and the Cloud: Azure and OCS

What is clear is that a Microsoft mobile OS will finally sit in a (hopefully) compelling set of devices to go up against Android, Symbian and the new iPhone for the Q4 holiday season. For enterprises, if precious little plumbing has been stripped from the OS, then this could be a very interesting platform for business as well.

Andrew Brown

Recently a number of statistics have been thrown into the enterprise cloud computing debate. Some suggest that 20% of companies will forsake all IT assets and utilise cloud services only. This is a very bold prediction to put it mildly. It is true that over 95% of companies globally are SMEs (over 99% in the EU27) and that cloud computing meets many of their needs at face value, but digging deeper the future of cloud computing in business is infinitely more complex…., and frankly, well, cloudy.

If enterprises do adopt cloud computing, it will likely take the form of private or hybrid clouds.

Despite many companies relaxing their demands of just over 5 minutes of unscheduled downtime per YEAR, it is clear that there is a demand for SLAs by companies for cloud providers, and positioning public cloud services for true enterprise ready adoption is not really feasible. Google’s association with public cloud services, for example, may well limit its attempt to penetrate vertical markets like government (Is Android Well Placed for Google's Enterprise Ambitions?), despite limited success to date with Google Apps.

Alliances are already forming to offer private or hybrid services that match the same level of service as in-house IT. For example, the Microsoft-HP alliance is a great example that presents mutually beneficial offerings to both vendors (HP sells Microsoft optimized servers for SQL Server etc and gets its servers into Microsoft’s Azure cloud),  while Cisco, EMC and VMware have also teamed up to offer a cloud infrastructure. Fundamentally, it's about joining forces to sell the hardware and software that will comprise private clouds. Ultimately, though, many of these IT megavendors are complimenting their latest and greatest on-premise solutions with a cloud offering.

The reality remains that many businesses are still wary of cloud computing. Despite some enterprises becoming more comfortable with the Cloud (such as Panasonic’s shift of 300,000 users to Lotus Live) 

Beyond the lack of control and latency are issues of cyber attacks, which can leave companies very vulnerable. The recent attack on Google shows that there are windows into datacenters and in the cloud, a company is only as secure as its weakest link.

While there is a clear desire to slash CapEx, IT spending is set to grow by 4%-5% in 2010, and surveys from companies such as Symantec suggest that cloud computing is far down the list of priorities for spending in 2010 below security, backup and recovery and continuous data protection, essentially core compliance and governance issues.

Enterprise cloud computing is growing fast, but it will be a slower journey than many are predicting.

Andrew Brown