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2007: The year in communications

A look back at a year when the communications sector found itself trying — if not always successfully — to change its spots
Written by David Meyer, Contributor

The most audible sound in the communications industry this year has been that of business models starting to crumble.

The old models are not yet gone, by any means, but the cracks are there for all to see. 2007's prime example has been the furore over roaming within the EU. At last, the European Commission put its foot down and forced mobile operators to slash the absurd charges they were levying on those poor souls who dare stray across national borders.

The cuts only covered voice communications, but the European Commission continues to rattle its sabre over the issue of "data roaming" — perhaps an even more egregious example of charging well over the odds. For business travellers, roaming has become a budgeting nightmare.

Far more budgetable is the use of Wi-Fi while travelling, and another significant development began to take shape when BT inked a deal with Wi-Fi-sharing "community" Fon. The deal linked up the burgeoning Fon community with BT's extensive Home Hub user base. The idea is for users to share their Wi-Fi with others, in return getting to use other people's connections for free. As Fon has similar deals with major ISPs in countries like France and the US, the potential is there for a global Wi-Fi-sharing community that could wipe out the idea of costly data roaming.

Mobile operators have been experimenting with other sources of revenue, but new technologies are not always lapped up by the populace. Mobile TV is a case in point. Launched last year, BT's Movio mobile TV service was supposed to capture the eyeballs of the nation. But things did not turn out that way. With only one customer — Virgin Mobile and its clunky "Lobster" handset — the service shut down halfway through 2007. Not only were people unmoved by the prospect of annihilating their handset's battery life to stare at miniscule screens for hours, but the entire scheme had been thrown into disarray by the European Commission, which decided it wanted to back a rival mobile TV standard instead.

Mobile TV now looks unlikely to be bothering our radio spectrum for the foreseeable future, but the airwaves provided the battleground for another titanic clash this year — that of the rival mobile-broadband technologies. Having already paid billions to provide 3G services, mobile operators have been understandably keen to see the long-term evolution (LTE) of 3G become the new mobile-broadband standard, but big hitters like Intel have been enthusiastically backing another technology, mobile WiMax.

No big decisions were taken in 2007 for mobile broadband — next year's spectrum auctions will contribute towards that — but it has been a year of rapid progression for WiMax, which is now being deployed as an alternative to wired broadband in several developing countries. WiMax is also available — on a limited scale — as a commercial service in the UK, but testing of LTE has yielded even more impressive speeds. And, with WiMax being folded into the 3G family of standards, next year could even see both technologies combining to form the elusive "4G".

Another business model that faces extinction is that of the proprietary mobile charger. This may not seem at first to be a significant issue, but entire industries — accessories and peripherals — are built around the premise of having a unique connector. But no longer. This year the industry decided to bow to the environmental lobby and standardise on the micro-USB connector format. Manufacturers will get to...

...save money on cables and packaging by not including their proprietary connectors, and users will finally be able to use one charger for all mobile devices — in theory, at least.

As for the mobile devices themselves, one word came to utterly dominate 2007: iPhone. Apple's unveiled handset was sleek, eminently usable, forward-looking and quickly imitated by a number of other manufacturers. It even got the business community excited, albeit with some trepidation from analysts who tried — largely in vain — to steer the corporate sector away from what was essentially a consumer device.

That said, business applications did not take long to appear, and the IP telephony vendor Avaya is now even offering a way to fold the iPhone into the corporate network.

With the furore surrounding the iPhone, it was unsurprising that Google's rumoured foray into the mobile market was dubbed the "Gphone" by many. But, when the reality arrived, it was not what people were expecting. It was not even a phone, as such, but a mobile platform — Android — with an impressive array of manufacturers and operators already lining up to show their support.

Android looks set to solidify a notoriously fragmented Linux handset market. Mobile Linux is already the dominant platform for consumer handsets, but not in any unified form that can be consistently targeted by developers. However, with Google's backing and a so-called "non-fragmentation agreement" between the members of its Open Handset Alliance, Linux could finally become a serious competitor to the high-end likes of Symbian, RIM and Windows Mobile.

2007 has been a mixed year for the internet telephony industry. On the one hand, VoIP has started to become a serious contender on the handset, particularly for those business travellers who want to maintain a single phone number across their desktop and mobile phones. Wrangling between the upstart Truphone and operators like Vodafone and T-Mobile demonstrated just how worried the mobile industry is about low-cost services piggybacking on their networks.

But, on the desktop, a flaw has appeared in the VoIP business plan, and the problem is the thorny issue of making money. Skype has been the poster child for this, having been bought at an apparently over-inflated price by eBay and then struggling to make a return on that investment. Some new ideas tried out by Skype — notably its video call tie-in with Logitech — spectacularly backfired, to the chagrin of its users.

Skype's business customers also had to contend with not only a serious outage but the withdrawal of thousands of London SkypeIn numbers. In some ways, Skype's 2007 has been symptomatic of wider issues in the Web 2.0 movement, but it has certainly served to warn business users of the dangers inherent in a service which comes with no service-level agreement.

Wi-Fi has also had an interesting year. The premature rollout of 802.11n, the fast, new iteration of Wi-Fi, has been marked by a flurry of mixed messages from the industry, amid compatibility and interference issues.

One company, Aruba, even managed to warn businesses off 802.11n deployment only to try selling the technology to them just weeks later. Even the Wi-Fi Alliance industry body admitted that, when 802.11n is finally ratified as a standard in 2008 — or even, possibly, 2009 — there is no guarantee that the resulting products will fully interoperate with the "draft-n" products being sold today.

Wi-Fi was also accused of being hazardous to health in a flawed Panorama documentary on which the BBC subsequently had to backtrack and in a research paper which claimed it contributed to autism.

On the positive side, government-backed studies suggested that mobile phones and base stations were both safe to use. However, like so many current issues within the communications industry, this one looks set to roll on into 2008 and beyond.

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