Chinese Wireless: Business Model, Rather Than Technology, Impedes Innovation

Manoj Menan a partner at Frost & Sullivan, was just on CNBC from the floor at CommunicAsia 2007, and while I missed half of his interview because of a con call, I think I heard the money quote:

Our ability as an industry to visualize [advanced mobile services] exceeds our ability to execute. Asia's carriers need to embrace the open innovation model, rather than take a walled-garden approach.

Well said.

As we've said here before, the biggest barrier between China's mobile phone users and really useful mobile data services is NOT technology: it is, rather, operators' insistence on owning any piece of the mobile value chain that might make a little money.

I see signs of hope, especially in entertainment. With music, the carriers looked into the nasty maw of copyright issues and recoiled in horror, delighted to allow partners to deal with the beast of selection, rights clearances, and the like and happy to partner in the revenue stream without having to own the deal.

Let's hope, for the sake of operators, their shareholders, and users, that this continues.

Related Stocks: China Mobile (CHL), China Unicom Limited (CHU)

Comments

[bagel bagel:]

David,

I don't know where have you been. LTON, HRAY, KONG (and quite a lot of VAS providers) have been getting killed lately precisely because China Mobile/China Unicom (and the government) have been reigning in control, rather than allowing these VAS providers to freely compete with the carriers.

While what Menan said might be true, ideally. However, that is not happening in China. What have transpired in China since last year in the mobile market is actually a step backward.

2007 Jun 19 05:34 AM

[bagel bagel:]

However, I agree with you on your comment below:

"As we've said here before, the biggest barrier between China's mobile phone users and really useful mobile data services is NOT technology: it is, rather, operators' insistence on owning any piece of the mobile value chain that might make a little money."

2007 Jun 19 05:37 AM