It was already clear way back when that Seven's purchase of Unwired was going to lead to some interesting moves on the part of the network-turned-new media innovator. But as Seven firms up plans to deploy high-speed wireless services this year under its vividwireless brand, the big question is whether the service can successfully become relevant in an already crowded wireless landscape.
Whether that landscape will be dotted with the flowers of success or the carcass of yet another wireless wannabe, will become clear by next year. By that time, if vividwireless' plans work out, university students and their neighbours will theoretically have flocked to promised low-cost WiMax-based wireless services that will trump most current offerings by running at 4Mbps-plus. Telstra says its latest Next-G devices can beat that, but real-world tests will surely set the situation straight quickly enough.
Perhaps the most interesting thing about vividwireless, apart from the fact that it relies on on-again-off-again-favourite WiMax, is its scope. While Telstra, Optus and VHA play the numbers game to spruik their networks as go-anywhere solutions for business travellers, vividwireless has more modest ambitions.
vividwireless is the Monaco of Australia's wireless community: tiny, clearly-defined and eager to please those who enter its borders. Its network covers just 471 square kilometres, and is focused on a community of people that travel extensively in a small area. As long as vividwireless can cover this entire area — and the local pubs, pizza joints, and other places where uni students congregate — it can provide the same level of service as the big boys do, at least within its tiny domain.
There are, however, major problems with vividwireless' plan. Most universities already provide free Wi-Fi access to their students anywhere on campus — which would seem to compromise the business case for a third-party wireless service, especially one based on what might as well be a proprietary standard. Those networks don't typically extend to off-campus housing or local hangouts, so some subscribers may value the continuity of service compared with Wi-Fi.
Another problem: competing 3G networks also cover university campuses just as well as vividwireless will. Every incoming uni student will have a 3G-capable mobile, and exactly zero will have a WiMax-capable mobile. This makes 3G the status quo — ditto for the faster LTE services Optus and others will soon begin trialling — and burdens Seven with making the case for change.
Coverage could stop the service dead in its tracks: it seems there will be no option to roam onto other networks since there are no other WiMax networks to roam onto.
Seven's value proposition will be based largely on higher speed, which may be boosted by the relatively traffic-free spectrum the service will use. However, coverage could stop the service dead in its tracks: it seems there will be no option to roam onto other networks — since there are no other WiMax networks to roam onto.
Fallback to 3G services would be a possible compromise, if it's technically possible or even planned, but that would require vividwireless to set up as a mobile virtual network operator and introduce all the complexity of that business. It would also increase prices, negating the wholesale-free aspect of Seven's strategy that will allow it to undercut its competitors.
Ultimately, creative bundling could save vividwireless, just as it helped Hutchison Telecommunications' Orange brand establish its Australian footprint a decade ago with a CDMA network that offered the novelty of local call pricing within a radius around the customer's house or place of business. Similarly, the key here may lie in not only selling vividwireless as a mobile broadband service, but as a fixed-line equivalent whose relatively high bandwidth makes it a step up for those without access to good — or any — ADSL.
Vividwireless could, for example, offer unlimited phone calls or discounted IPTV services within its coverage area — delivering a complete package at what would have to be highly competitive prices given the network's low overheads. Or it could tie up a deal with a tablet PC maker (I'd suggest Apple and its iPad but for the device's inability to support WiMax) and offer the device along with a suitable data package; what better way for a broadcaster to flex its IPTV muscle than to deliver a ready-made content delivery device?
[Seven] could tie up a deal with a tablet PC maker; what better way for a broadcaster to flex its IPTV muscle than to deliver a ready-made content delivery device?
Even then, however, differentiation could be a real chore. Sure, Seven can offer subscribers benefits such as quota-free access to its video content, but much of that content is already available elsewhere and likely to be recorded, if it is to be watched at all, on students' own TiVos or equivalents (Kogan's newly announced $99 HD PVR, to ship next month, will make it dead easy for even budget-challenged people to record shows on Seven, 7Two, and any other channel they want). Seven could deliver pay TV outside of Foxtel's current coverage range, but content rights could be a sticky issue.
There's no doubt about it: new approaches to delivering last-mile services are going to change service delivery dramatically this year. Just consider Google's 1Gbps fibre-to-the-home project in the US, about which Telstra has also been briefed. But will vividwireless be sustainable in the long run? Only time will tell. Google is differentiating itself using speed — as, to a lesser extent, is vividwireless. But with such a glaring compromise in coverage, its long-term viability will depend on Seven's ability to think outside the box. Fast WiMax access is a start, but if Seven is going to enter this space with a bang rather than a whimper, it's going to have to do a lot more than just create a few isolated, high-speed broadband ghettos.
Would faster speeds but limited coverage be an acceptable trade-off for you? Are you hanging out for vividwireless?