RE: Mobile network costs -- was -- MW4D & Accessibility

I'll like to comment on Mira's question.

I feel, WiMAX is out of our scope. This was talked in yesterday cc, but
I'll like to add, that WiMAX is still today "future technology". There is no
mass market for WiMAX today. There are now low-cost mobile
WiMAX devices available today.

We agreed early in our WG, that we focus on current available technology
and we provide additional information how to deliver useful content
(applications) to users at low cost way.

Even in GSM technology (as well in CDMA) there are scalability.
Not all networks have all the features. This is the reason
we cover multiple levels of networks like:

1) Basic GSM (voice, data, SMS)
2) GPRS
3) EDGE
4) UMTS (3G, W-CDMA)
5) HSDPA
The speed of data communication increases in all levels from Basic GSM to HSDPA.
Higher data speed allows more rich applications. But as HSDPA is the latest technology
it is now available mostly in "big cities". Not in rural areas.

Br. Lauri
________________________________
From: ext Mira Slavova [mailto:mira@mmd4d.org]
Sent: 10 August, 2009 13:27
To: Hirvonen Lauri.K (Nokia-CIC/Espoo)
Cc: boyera@w3.org; yoshiko.kurisaki@icvolunteers.org; jbrewer@w3.org; public-mw4d@w3.org
Subject: Re: Mobile network costs -- was -- MW4D & Accessibility

Dear All,

Big thanks to Lauri for sharing his view of competition in the mobile industry!
Given the recovery rates of the set-up costs of mobile networks in rural areas, I was wondering how the group sees the potential for the use of WiMAX in rural areas. Do you think that it might be a technology relevant to our roadmap?

Thanks,
Mira

On Mon, Aug 10, 2009 at 10:29 AM, <Lauri.K.Hirvonen@nokia.com<mailto:Lauri.K.Hirvonen@nokia.com>> wrote:
Hello team

I like to comment the cost (of operation of
the mobile network).

In less populated areas, it is very expensive
to build mobile networks.

In cities, big cities, it is much cheaper.
(= more users to share the cost of
building and operating mobile network.)

This is also true in more developed countries
like Finland. It is always the highest populated
areas, that are built first. The less populated
areas are the last one to be built.

The government of Finland has mandated the
mobile phone operator to offer services also
to less populated areas. Operator do it by
increasing the charges to everyone which
allows them to built mobile coverage to
less populated areas, where the pay-back
by it's use is low. So populated cities
are covering also the cost of running
rural areas.

This allows that the voice call tariffs are
the same in big cities and in rural areas.

I have heard, that in some "developing countries"
the first operator to build a mobile network
do make a contract with country government.

Typically those contracts gives them "monopoly"
for certain period. That means, that the government
will not give license to an other mobile network
operator. So no competition.

But also government want their share. In many
countries the mobile phone is listed in luxury
item category and the taxation is high. They
charge import custom tax for the product and
it can be very high. (So end user has to pay
higher price.) Also the mobile operator's
center equipment can have this high import
tax. It makes it for operator more
expensive to pay back, this means again
higher prices to users.

This is often the situation to have the first
mobile network in the country. Later when the
"first operator is profitable and managed
to cover most of the building costs" the country
can allow new mobile operators to enter
the country mobile market. This then
increases competition and usually lower
the price for use of mobile phone.

It would be nice if organization like "World Bank"
could offer loan for operator to built
mobile network. The loan could be negotiated
to cover longer period (to pay it back). This
means, operator can offer the mobile service
to users with lower prices.

Br. Lauri