Insights from the New England Mobile Summit
This post is from Schwartz EVP Carol McGarry
A recession may be the time we start to see some true innovation in the New England mobile world, if you believe the panelists at the recent New England Mobile Summit. 
I attended the summit this past month during Mobile Internet World in Boston. The event was organized by Mark Lowenstein, managing director of Mobile Ecosystem, a former Yankee Group vice president and analyst, and previously vice president of Strategy at Verizon Wireless.
Lowenstein assembled a series of lively, informative panels with speakers who included Jon Auerbach from Charles River Ventures; Randy Battat, CEO of Airvana; E.Y. Snowden, Chairman at Tatara Systems; Gennady Sirota, vice president of product management at Starent Networks; and others.
It was interesting to view the mobile marketplace from a regional perspective, and the panelists shared plenty of good news. The New England business ecosystem that supports mobile companies is strong. According to Mark, the region supports about 150 companies in wireless and 170 in related areas, and VCs put more than $1B into Massachusetts companies since 2002.
Plenty of M&A activity has taken place with companies like Nuance making acquisitions. Also, big players like Microsoft, Google and Nokia have opened Boston area offices. Not to mention the successful companies that have spawned startups, like the former Comverse employees who started JumpTap and Airwide Solutions.
That's the history, but what about looking ahead? I was struck by the optimism of the panelists. If you believe them, a recession is the right time to innovate and start a new venture. Randy Battat commented that Airvana was founded and funded during the high tech recession of 2001. Gennady Sirota noted that Starent was formed in the summer of 2001. Large carriers bet on startups during that recession and invested in innovation. Today Airvana generates more than $200M in revenues and Starent employs about 700 people.
The megatrends that speakers pointed to included:
- A sea change in the ability to deliver applications and services for mobile phones-The mobile web is growing 500% per month as devices become more capable and carrier plans become more flexible. Devices like the Apple iPhone and Google Android are providing the full web experience. Meanwhile, open source development for mobile handsets will deliver a better end user experience.
- Access to faster Internet and video-Seventy percent of consumers don't have access to 3G video connections and the vast majority gain access to the web from simple, low-cost devices. According to CEO Jim Ricotta of Azuki Systems, content providers need to repurpose "glanceable" content that works on low and high quality phones.
- Architecture Changes-4G doesn't just mean faster, better and stronger. It also means that the architecture and economics are changing.
- FemToCells are hot-Randy Battat commented that data traffic over cellular networks is growing 60-100% per year, in a trend that should continue strongly through the recession. Tatara Systems Chairman E.Y Snowden described FemToCells as "game changing" in their ability to broadly deliver bandwidth to homes, where 70% of mobile services are consumed.
Untapped opportunities? Panelists cited the ability to access contact databases and location
information from mobile web applications. Another opportunity: cloud services like Google Maps that bridge the desktop and mobile worlds.
A few other interesting insights: One panelist cited TeleAtlas as an example of a company that invites consumer feedback to keep its street atlas information up to date. There were also interesting conversations about global differences. For instance, in India, carriers are sharing their networks to reduce costs in a region where $4/month is the typical mobile phone bill. Getting into regional markets requires adapting business and pricing models.
Who will suffer in the recession? With global carrier consolidation, the infrastructure companies are under enormous pressure in spite of $50B in carrier spending. Nortel and Samsung are showing signs of the strain while Erickson, Nokia and Siemens remain stable. Look to see the infrastructure provider landscape redrawn in coming months.
To see some of the interesting comments by panelists during New England Mobile Summit, check out this video on bnetTV.com.
Posted by Chuck Tanowitz on November 7, 2008 at 2:50 PM
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