I am in Barcelona at Mobile World Congress. They won't give me a press pass since I don't work for a media organization, which means I don't get to go to press conferences like the one on Sunday night where Samsung announced their latest phone, the Galaxy S7. It seems a little underwhelming in many ways, although that is probably the case for any new phone, and even Samsung seems to realize it. If you pre-order a phone, then they will give you a free virtual reality headset. In fact, unless you are one of the leading journalists who get briefed and allowed to play with the phone under embargo, then you are probably just as good reading what those guys write than trying to see for yourself. The Galaxy S5 was waterproof and had a microSD slot, but for some weird reason the S6 had neither. Now both are back, and not just at Samsung, at almost everyone, largely because the iPhone has neither and there are very few other ways to differentiate. Apple, by the way, doesn't show up to MWC (nor to last month's CES). In practice this makes MWC an Android show, at least from the handset side. Of course, Microsoft hasn't actually shut down their operating system yet but with 2% market share and falling, it has to be just a matter of time, even though HP announced a phone running Windows Phone. They apparently didn't learn their lesson with Palm that people don't want phones with orphan operating systems (see also Blackberry). On Monday, the first day of the show, the minibus was late leaving the hotel and the traffic was terrible (the Metro was on strike), so I missed the opening keynote. Actually, keynote is not really the right word for it. They are what anyone else would call a panel session, but with heavy hitters like company CEOs. Later in the morning there was another "keynote." Shaun Collins of CCS Insight moderated a discussion with Ralph de la Vega, vice-chairman of AT&T, Hans Vestberg of Ericsson, and Brian Krzanich, CEO of Intel. The theme was Mobile is Disruption . So there was a network operator, a network equipment vendor (Ericsson no longer makes handsets), and a semiconductor vendor. The choice of Intel is a bit weird though, since Intel doesn't really supply chips into the mobile industry unless you take the 50,000ft view that cloud datacenters are part of the mobile ecosystem and are where Intel makes all their money. If anything, Intel is the poster child of mobile being disruption, and not because they were the disrupter. They have made several attempts to get into mobile, mostly without a lot of success. In fact, I think part of Intel's problem is that the top three handset vendors are Samsung, Apple, and Huawei. Samsung does use some Qualcomm chips but mostly it designs its own application processors. Apple designs its own applications processors, the Ax series. Huawei (through their HiSilicon subsidiary) designs their own application processors. Nobody knows the precise numbers but those three have to make almost all the profit in the handset business. So merchant vendors like Qualcomm, Mediatek, and others are left selling to people who don't really make much money. That is probably not a long-term successful business model. Plus Intel has an additional challenge. They have very high margins on server chips and, if they shipped huge numbers of low-margin mobile chips, their overall margins would decline and Wall Street might punish them. Hans of Ericsson went first and showed a little board that contains much of a 5G base station channel that used to be racks and racks. Not to be outdone, Ralph of AT&T had a chip that was an integrated LTE solution. Brian produced a little Curie chip, smaller than any of the others but serving a totally different market (since Intel is not really in mobile). The Curie is neat but putting chips on snowboards in the X-games is not exactly the same as rolling out 5G. Both Brian and Ralph had drones, too. Brian had the big one he showed at CES (see Drones in the Mini-Forest: Intel's Keynote at CES ) and Ralph had a little palm-sized quadracopter. One theme that I've heard several times through the conference is that 3G was for people making phone calls and texting, 4G was for people accessing the Internet, but 5G is as much about machines. There are 7.9B mobile subscriptions owned by 4.8 individuals (some have multiple phones or at least multiple SIM cards). But there may be 10B or 20B "things" connected to the 5G networks. One of the big attractions of 5G is that it is lower latency. I say that but in fact the standards are not defined yet. But I did see a demonstration in the Nokia booth showing the difference between 4G and 5G. You could roll a ball around and see clearly that the 4G phones had a definite lag whereas the 5G phones did not. I have no idea whether this is actually running actual 5G silicon, I suspect it was more of a "this is what 5G will be like." Nokia, by the way, is really pushing the Bell Labs name. Nokia acquired Alcatel-Lucent and with that Bell Labs and so Nokia is pushing the name as giving their 5G programs a lot of credibility. Yesterday, the transistor; tomorrow, 5G. Despite the topic of the panel being disruption, nobody talked much about it beyond obvious stuff that is already happening, like print media, Uber (the most famous taxi school in the world in London just closed), Airbnb, and more. There is clearly a fight going on between different levels in the value chain for where the money will be made. Brian even admitted that it won't be in the semiconductors. Judging by the size of the booths, there is still lots of money in equipment. Networks are so capital intensive their challenge is to avoid becoming "dumb pipes" and finding ways to add valuable services. Otherwise Facebook and Google will take all the money. I talked above about how the judging by the size of the booths the network industry is where a lot of the money is. Both Ericsson and Huawai had booth fronts that stretched the entire width of a hall with a large invitation-only (I tried) area behind. Here is Huawei's: But look at this map of the hall. That huge block of red that takes up half an entire hall is not some vacant area, it is Huawei's booth. That is on a scale I have never seen before at any trade show. When will 5G arrive? Generally it was assumed 2018 for pilot programs and 2020 to start mass deployment. Ralph warned not to overhype 5G. He also pointed out that we need investment-friendly government environments. 5G has the potential to change countries, but only if government doesn't try and take all the profit in taxes and auctions. Which industries are most likely to be disrupted by 5G? Generally the panelists thought healthcare, although again it is the most regulated industry around and tends to resist innovation except on their own terms. Smart cities (and countries) was the other thing. Tomorrow: Mark Zuckerberg's "keynote"![]()
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