Weekly Wrap: Drop That Smartphone
By Carlo Longino, Fri Jun 04 09:45:00 GMT 2004

An analyst contends advanced devices hurt operator revenues as sales of smartphones skyrocket, and more...

Carriers stand to lose revenue by giving their customers useful devices, fear-mongerers Mako Analysis said this week. Since smartphones let users install third-party software they don't necessarily buy from operators, Mako contends this is a bad thing, ignoring most previous research that says users that take advantage of their devices' full capabilities tend to spend more on their mobile bills than other users. So evidently they're recommending carriers crack down on these rogue devices that users actually find, well, useful so that the operator can keep their grubby fingers on every last penny. Come on guys, what was it that made i-mode so successful? Repeat after me -- revenue sharing.

Mako's "analysis" comes as smartphone sales continue to climb, with Canalys reporting first-quarter sales of featurephones, smartphones and PDAs up 41% over last year. But PDA sales only increased 1%, and smartphones leapt 115%. Sony's handheld sales dropped 45% since 2003, perhaps revealing the reason behind their exit from the global PDA market. Nokia, which controls 75% of the smartphone market in EMEA but only 25% elsewhere, was the top seller on the list, followed by PalmOne, then HP.

Smartphones do enable some new possibilities for carriers, though. A startup funded by Siemens, Motion Bridge, has made one -- an application that simplifies mobile surfing. It's kind of a search engine, but really more a surf helper. For instance, a user types in "sports," and gets taken directly to a relevant page (which can be specified by, say, the carrier), or they put in "amazon" and go directly to the site.

NTT DoCoMo said this week a 4G test system delivered speeds of 300 Mbps -- but that wasn't enough as their engineers hope to get 1Gbps from the tests using multiple input multiple input (MIMO) technology. The 300Mbps came from a stationary location, but it drops to only 135Mbps when moving at 30kph.

The wireless broadband hype machine continued in full effect this week as US cellular celebrity Craig McCaw announced a new venture that will provide 1.5Mbps access to small US cities and rural areas. The company, Clearwire, will use OFDM equipment from another McCaw-owned company and features modems it calls "portable" -- book-sized pieces of equipment that require external power. It's hard to see the company finding a lot of success as a DSL or cable-modem replacement.

This week's security scare is brought to you courtesy of WAPjacking -- a new scam that combines the old standby dialer scam from the Net with smart SMS messages. Scammers send out a smart SMS with new data settings to victims' phones that swap out operator GPRS settings for an overseas or premium-rate CSD number. Nice! But Wi-Fi gear giant Linksys did address 802.11 security this week, saying it would integrate 802.1X authentication from an outside vendor into its popular WAP54G router. Users can now add the high-level security measure during initial set-up for $4-5 per user per month, answering the two major criticisms of Wi-Fi security, that it's not especially easy or secure.

Starting next week, Vodafone can exercise an option in its JV with Verizon and force the wireline carrier to buy out its 45% stake in the wireless operator of the same name, though it's unlikely it will do so. Verizon Wireless is contributing solid profits to Vodafone's bottom line, and exiting the carrier would leave Vodafone with no clear strategy for the US market, even though it would prefer to own a GSM carrier than a CDMA one like Verizon.

After delivering all manner of excuses for missing baggage, airlines and airports are turning to wireless technology to help. Delta Air Lines says its fitting its baggage carts at the Cincinnati airport with wireless gear similar to that which it's deployed in Atlanta, resulting in a 13% improvement in handling efficiency. But some airports, like in Las Vegas and Hong Kong, are slapping RFID tags on luggage that lets them track bags' location from the check-in desk right onto the plane.

People have been searching for combinations of mobile and P2P to create a technology uber-buzzword, and it looks like we might be getting closer. A new service called Small Planet uses Bluetooth to let users know when they're near a friend of a friend. The app will then connect the two devices and send each the other's photo and profile. A developer also released some zero-config networking software this week for Pocket PCs that should enable some interesting applications.