The Network Helps Dicate the Shape of the Future

Digital downloads are today what CDRoms were in the early days of the Internet – the best digital platform - but are digital downloads the future? It seems to us that it is inevitable as the migration from CDRom to the Internet. Last week Reuters reported that Kevin Martin, the US Federal Communications Commission and a Larry Page Google co-founder said that a decision by the U.S. agency to open unused ‘white space’ TV spectrum will improve Internet access in urban and rural areas. At the heart of this is the use of radio which is undergoing significant development. Page said, ‘new radio technology will soon have more reach than current WiFi, which cannot go through more than two walls.’

"White space" will be capable to detecting local television channels and automatically switching to frequencies not in use, limiting power to avoid interference, send packets of data, and then switch again. Page predicts that prototypes of radio microchips may be available in as little as 18 months.

Before we have the alternative network technologies a report published by UK analysts Point Topic states that worldwide broadband is already getting cheaper and faster. Prices have already fallen by 20% percent in 2008. DSL prices have dropped from $25 per megabit to $18 per megabit, whilst cable prices haven't fallen and are now at $6-7 per megabit and fibre remains the best value at $1 -2 per megabit.

Smaller European operators are now offering both lower prices and faster speeds, whilst in the US, the report notes that "speeds have gone up but the price hasn't changed." There continues to be huge variation between regions with high speed Internet access becoming essential to many Americans, whilst home access remains prohibitively expensive in many parts of the world.

Major provider AT&T has been boosting its network to deliver speeds of 18Mbps in the US. AT&T are now investing $275 million to purchase WiFi hotspot operator Wayport. Wayport who started in ’97 with wired connections in hotel rooms went on to create the world's largest hotspot network, installing WiFi in airports, hotels, coffeeshops, and restaurants including 10,000 McDonalds. AT&T now increases its US footprint to 20,000 locations for its basic free service to millions of its subscribers and is adding the 3,000 hotel, healthcare, and other locations in Wayport's network.

AT&T now becomes the largest hotspot operator in the world. Its main competitor being the Fon network who with 300,000 active hotspots and over 1 million registered users makes it the world’s largest network.

So devices are getting smarter and converging, networks getting more pervasive, cheaper and faster and we are becoming a permanently connected. Some would say that this shows that today’s ereaders are clearly transient in their current form.

Open US Mobile Market

The biggest disappointments this year was not that England didn’t make the soccer European Finals or that they didn’t win the rugby World Cup, it was that Apple decided to launch the iPhone in the US with ATandT and in the UK with O2. Many were put off by the hassle of changing networks, or having to find a man who could make it happen but in spite of this the launch was a huge success and set the design bar for all to follow.

It appears that Apple wanted to break the carriers’ stranglehold on handsets, so that Apple could sell iPhones on any network. Verizon has now announced that next year it would be allowing any phone and any application on any phone, to be used on its network. This legitimately will start to open up iPhones to all.

The question now is whether Apple is already on a solution so the phone will work seamlessly on the different Verizon CDMA network. A mere five months after the launch of the iPhone changes are happening and those subsidised handsets are looking increasingly venerable and the US market starting to resemble those in Europe and Asia, where a carrier’s customers can use any compatible phone and take their phones with them when they switch companies.

Next we must watch Google both in terms of the open software it aims to push at the market and of course its own gPhone. If Verizon’s effort is successful, then content creators, software developers and device makers, who have been restricted under the control of the wireless companies, will have fresh opportunities.