If you want to know how the mobile industry is going to look in a decade’s time, you need to spend some time with 8-, 9- and 10-year old kids today.
Thankfully, amid the changes in society in the digital age, at 8 and 9 years old, ‘most’ kids still have not yet got their first mobile phone. Many do have a mobile, but as far as I can tell, it’s a minority. From anecdotal evidence, it seems to me that currently, here in the UK, most kids are getting their first mobile phone at around 10 or 11 years of age.
However, just because these young kids don’t have a mobile phone, this is not stopping them from making calls and sending text messages to each other. I have 3 children, and my 9-yr old has an iPod Touch, and my wife uses an iPhone. My 9-yr old can call my wife using Facetime, and video chat with her at no cost, if he is at home (or somewhere else with Wi-Fi he can access) irrespective of wherever my wife is. I use an Android phone, and he can Skype with me anytime he likes.
He sends me messages using iMessage, and they arrive in my inbox as emails, but on his iPod, it looks and feels like he is sending an SMS. He can exchange iMessage texts and pictures with my wife, and several other family members who have iPhones. To my 9-yr old, it looks and feels like SMS and MMS, and it is effortless, quick and easy.
I was talking to a colleague in California just the other day. She was telling me that her 9-year daughter takes her iPod Touch to Starbucks with her, where she sits with a milkshake for hours enjoying free, open Wi-Fi, calling her friends on Facetime and Skype, and messaging using iMessage, all courtesy of technology by Apple, and free Wi-Fi from Starbucks.
You know all this already. This is not new. Why am I telling you this?
The rise of OTT apps is not a new topic, services such as Skype, WhatsApp, Kik, BBM, Viber, iMessage, KakaoTalk, Facebook Messenger and others have been on the rise for the last few years, and these services have been causing great concern to MNOs for some time. But the real disruptor here, is Apple.
MNOs worry about the erosion of their much-loved, once-very-high-margin SMS revenues, and it is certainly true that the raft of new OTT [Instant] Messaging apps have stunted the growth of SMS, and even started the gradual decline in a few markets, such as the USA. While SMS traffic and revenues continue to grow at a worldwide level, North America and some markets in Europe and SE Asia have seen SMS abruptly challenged, as many switch to the new, free, services. However, the real worry here is much more serious. Apple have enabled a generation of devices (iPod) that appeal to young children, that enable phone-like communications, yet do not require a phone to use.
These young children are growing up thinking differently to any previous generation. These kids are being taught that in order to make voice calls, send text and picture messages, make video calls and use the web wirelessly, you do NOT need a phone, you do NOT need a contract, you do not need an MNO.
- NO network
- NO contract
- NO MNO
- NO phone!
- NO service provider relationship
As Wi-Fi becomes a cut-price marketing tool, increasingly available openly for free, or in exchange for nothing more than a name and an email address, connectivity to the World Wide Web in urban areas is increasingly open, free and unmonitored. As more young people start carrying devices like iPods, connecting to the net at home, work, school, college and in public places such as cafés, bars, shopping malls and leisure centres, becomes easier and, most worrying, expected. The #1 sales-boom product in consumer electronics now is tablets. With more kids carrying tablets, this trend will accelerate rapidly. Young children and teenagers are extremely cost conscious – either because they have to plead with their parents to pay the bill, or because they are using their own, very limited, budget. Either way, they are now growing up to EXPECT free Wi-Fi to be available almost wherever they go.
Where is this all going over the next ten years?
Almost everyone I know has broadband and Wi-Fi at home. Almost every school and college and university has Wi-Fi. Almost every shopping mall, café, coffee house, bar and restaurant has Wi-Fi. Think how this will expand over the next TEN years. This holiday season, expect to see roaring sales of all consumer electronics, including smartphones, yes, but also iPod, iPad, Kindle Fire, Windows Surface, Galaxy Tab or Note…the ever increasing array of fantastic tablets will reach hundreds of millions more young people over the coming years. Now imagine how many people will own Internet capable devices in TEN years’ time.
Most of us working in the mobile industry today, most of us professionals wrongly think that WE are the people designing, building and guiding this industry, but the reality is that these 8, 9, 10 and 11 year old kids are redefining the industry that we are all going to be working in ten years from now, and we don’t even know it yet.
By the time these kids are 18, 19, 20 and 21, they will have grown up to be the all-important leading edge of the youth market, the young professionals of the next generation.
They are learning now, that they don’t even need an MNO to be a “dumb pipe”. It’s worse than that; they plain and simply don’t need an MNO at all. VoIP apps are leading to a new future. OTT apps are taking us, led by the technology Apple have popularised with the iPod, to a new future, where telephony, the heart of telecommunications for the last century, is becoming just another free web-based service.
There is a very real trend emerging here: the youth market of tomorrow, that vital group of trend setters who generally lead where the rest of the market follows, are going to be a generation who don’t need a phone, don’t need an MNO, don’t need a contract, don’t see why they should pay for voice, don’t see why they should pay for messaging, don’t need a relationship with any service provider. Now, they have brand loyalty only to Apple, and maybe to Facebook, or another leading social network, but in time, all the tech vendors and all the social networks will offer solutions that enable the same freedom.
The power in telecoms is shifting, and fast. Ten years from now, social networks, apps providers and a handful of hardware vendors will enable a new generation to new ways of communicating, ways that are only just coming into existence now. For ALL of us working in the telecoms industry today, the industry we WILL be working in ten years from now, will be very different from the industry we think we work in now.