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Slide 1: Global moves toward mobile ‘openness’: Unpacking the concept, honing a frame [PRELIMINARY VERSION: PLEASE DO NOT CITE] Russell Newman & Cara Wallis (with input from Wally Baer & Francois Bar)
Slide 2: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Introduction: FCC Chairman Martin makes an announcement Skype: Petitions the FCC in 2007 to allow attachment of any device to a wireless network (not full net neutrality of any stripe)
Slide 3: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Introduction: FCC Chairman Martin makes an announcement Regarding Skype’s request: "In light of the industry's embrace of this more open approach, I think it's premature for the commission to place any other requirements on these networks," Martin said. "Today I'm going to circulate to my fellow commissioners an order dismissing the petition by Skype that would apply Carterfone requirements to existing wireless networks.” (AP, April 1)
Slide 4: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ “Openness” has been in the news a great deal • User to user: Verizon restricts NARAL ability to message its members • User choice of applications and content: Comcast restricts BitTorrent traffic • Driving user decisions: Verizon’s own ‘error’ page online for malformed web addresses sought • Restricting provider-provided content: AT&T censors Eddie Vedder’s anti-Bush comments in “Blue Room” concert
Slide 5: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Unpacking ‘openness’: a start • Devices: What can I use aboard a network? What devices might developers offer to users over a network? • Functionality: What can my device do? What services can be offered that complement or extend device capabilties? • Connectivity: What can I access? Can users access services of alternative providers? • Customization / Content: What can I create or obtain from others? What can application developers offer for particular devices aboard particular networks?
Slide 6: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Three levels of mobile ‘openness’ • Technological: What is possible with a device. • Strategic: What do providers of that service/device permit or restrict me from doing with a device. • Policy: What regulations or regulatory structures permit or restrict me from doing with it. • (Others: Cost, technical know-how, accessibility…)
Slide 7: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ ‘Openness”: Tacking a concept down A couple narratives are thus in play, particularly in the US. • Effectively, the wireline world is evidencing movements toward “closure” • In the meantime, the wireless world is, in some ways, ‘opening up’. But to what extent? Is there a ‘convergence’ in the offing, or is this best theorized as two realms developing in parallel and in reaction to events in each one?
Slide 8: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Evolution of openness in U.S. wireline networks A set of openings, then movements toward consolidation and potential closure: • Carterfone (1968) opened AT&T network to other devices • MCI decision (1969) opened competition in long-distance • Telco Act of 1996 sought to increase wireline competition • Brand X decision (2005) said cable operators don’t have to open their networks to competitors • SBC/AT&T, Verizon/MCI merger conditions (2005); AT&T/Bellsouth (2006) • Net neutrality debate centers on broadband openness
Slide 9: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ The wireless world: movements toward ‘open’? A couple developments in the last year: • Verizon’s November, 2007 / March 2008 announcements • Google Android • AT&T’s announcement of November 2007
Slide 10: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ The state of play: wireless v. wireline We may compare, first, the state of play in wireless to that of wireline; this is a conception as of early 2007, as described by Wu (2007).
Slide 11: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ The state of play: wireless v. wireline 1. Devices: What can I use aboard a network? Wireline Wireless (Wu, 2007) Standards non-interoperable and inconsistent [CDMA (Verizon), GSM (AT&T, TMobile), PCS (Sprint)] Technical barriers: network standards Interface with modem provided by provider; ethernet Strategic barriers: device controls Modem does not limit attachments; Carterfone applies Carriers approve/disapprove devices. "Whitelisting"; phones locked by provider Consumers unaware
Slide 12: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ The state of play: wireless v. wireline 2. Functionality: What can my device do? Wireline Wireless (Wu, 2007) Carriers allow/disallow features (e.g., crippling of WiFi); add undesired features. Strategic: Physical barriers Carriers do not exercise control Strategic: Physical/software interface barriers Strategic: Software barriers Functionality (photo-sharing Device features not directly device-to-device control, data limits) controlled… controlled by carriers Unrestrictive in theory, depending on need to connect to network Carriers control software driven capabilities of devices
Slide 13: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ The state of play: wireless v. wireline 3. Connectivity: What can I access? Wireline Wireless (Wu, 2007) GSM and CDMA providers utilize different, non-interoperable systems (EVDO/EDGE, HSDPA) Technical: standards barriers Strategic: bandwidth usage TCP/IP Present billing model: unlimited (to a limit) Bandwidth limits on all usage Strategic: service access Unrestricted in theory; in practice, determined by provider motivations Carrier determines accessible features; perhaps blocking / degrading
Slide 14: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ The state of play: wireless v. wireline 4. Customization / Content: What can I create or obtain from others? Wireline Technical/strategic: access to underlying technology Strategic/Technical: platform standards No permissions required (putting aside DMCA) Wireless (Wu, 2007) No access to underlying hardware; selective access to Application Programming Interfaces; cost of 'shortcode' Readily accessible; in Web Multiple standards across providers; development, quirks some prequalifications, testing between browsers Developer qualifications/approval requirements expensive; negotiations and requirements not standardized; lengthy waits for permissions Strategic: permissions Cost of server space Strategic: developed feature usage Open to degree decided by developer, cracked, or reverse engineered (DMCA too) Alternative uses of features disallowed by provider; decency restrictions; fees of feature use
Slide 15: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Verizon’s Nov. 2007 announcement • Verizon holds conference for developers, issues preliminary expectations • Verizon to determine what devices meet ‘minimum technical standard’ in new “$20 million lab” • Current average wait time for approval at present: 20 months (BusinessWeek, Mar. 20); Verizon claims will now be 4 weeks • November 2007: “Any application the user chooses will be allowed on these devices”; March 2008: “Will not approve, test, or service third-party applications that customers load onto their Open Development Devices” (BusWk, Mar 20) • Will continue providing own services; pricing schemes for new, approved devices not revealed
Slide 16: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Considering the 700 MHz auction: • Verizon won the prime “C-Block” which had open-devices / applications stipulations applied • Recall: Verizon sued; then backed off, Cellular Telecommunications and Internet Association takes up the cause • Skeptics on the requirements: Susan Crawford notes “reasonable network management” allows some locking/blocking; approval process controlled by provider • Verizon essentially matching these requirements, it seems…
Slide 17: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Google / OHA’s Android • New platform Google and the “Open Handset Alliance” will ‘give away’ to mobile providers; leaves it to others to bring devices to market • Open Handset Alliance: major mobile operators, semiconductor companies, handset manufacturers, software companies, “commercialization companies” • Linux kernel, but developments under ‘permissive’ license: can make applications proprietary • Java will be the language utilized via this interface; offers access to underlying features (SMS, calendar, maps, etc) • Encourages ‘mashups’ across applications • To jumpstart, $10 million challenge issued
Slide 18: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ AT&T makes an announcement • Announces in November it has “flung its network wide open” on heels of Verizon’s announcement • No real change: reflects GSM standard already in use
Slide 19: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Comparisons: Early 2007 vs. new initiatives 1. Devices: What can I use aboard a network? Verizon, Nov 2007 / Mar 2008 Google/OHA Android Wireless (Wu, 2007) Standards non-interoperable and inconsistent [CDMA (Verizon), GSM (AT&T, TMobile), PCS (Sprint)] Technical barriers: network standards Little change. Will publish 'own standards' to interact with network (on top of CDMA standard?) Potentially more open. Android intended to be applicable across cellular telephony standards Strategic barriers: device controls Carriers approve/disapprove devices. "Whitelisting"; phones locked by provider Consumers unaware Little change. Reserves right to 'test' devices and approve Little change. Device manufacturers still at whim of provider
Slide 20: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Comparisons: Early 2007 vs. new initiatives 2. Functionality: What can my device do? Wireless (Wu, 2007) Strategic: Physical barriers Carriers allow/disallow features (e.g., crippling of WiFi); add undesired features. Verizon, Nov 2007 / Mar 2008 Google/OHA Android Little change. (VZ retains right to change its specs) No change. Strategic: Physical/software interface barriers Functionality (photo-sharing device-to-device control, data limits) controlled by carriers No change. Potentially more open. Willingness of providers to allow platform uses to proliferate to be seen Open to all comers in theory; connectivity determined by provider motivations Strategic: Software barriers Carriers control software driven capabilities of devices Potentially more open. Allows unaffiliated content and applications, subject to approval
Slide 21: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Comparisons: Early 2007 vs. new initiatives 3. Connectivity: What can I access? Verizon, Nov 2007 / Mar 2008 No change. Requires interoperability determined by Verizon Wireless (Wu, 2007) Technical: standards barriers Strategic: bandwidth usage GSM and CDMA providers utilize different, non-interoperable systems (EVDO/EDGE, HSDPA) Google/OHA Android Potentially open. Bandwidth limits on all usage No change. No change. Strategic: service access Carrier determines accessible features; perhaps blocking / degrading No change. (Verizon will wholesale access to device makers for resale, however) No change.
Slide 22: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Comparisons: Early 2007 vs. new initiatives 4. Customization / Content: What can I create or obtain from others? Wireless (Wu, 2007) Technical/strategic: access to underlying technology Strategic/Technical: platform standards No access to underlying hardware; selective access to Application Programming Interfaces; cost of 'shortcode' Verizon, Nov 2007 / Mar 2008 Google/OHA Android No change. API gives direct access to certain underlying features. Multiple standards across providers; some prequalifications, testing Developer qualifications/approval requirements expensive; negotiations and requirements not standardized; lengthy waits for permissions No change. Standardized and open. Strategic: permissions No change. Barring others changing development process, same issues apply; likely waits for permissions. Potentially open in theory, subject to desires of host provider Strategic: developed feature usage Alternative uses of features disallowed by provider; decency restrictions; fees of feature use No change. No change.
Slide 23: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Verizon complicates the story, but only a little: • Verizon announces it will accept Android as a platform, late 2007 • But this means little
Slide 24: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Adding some other nuance: • AT&T: While they do lock down phones, it is possible (with effort) to swap out SIM cards between devices • Mobile Virtual Network Operators [MVNOs] such as Boost do make it possible to upload software to phones. • Key takeaway: Current ‘openness’ requires effort many won’t undertake • Key takeaway 2: MVNOs themselves are a dying breed…
Slide 25: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ So we ‘open’ a bit… • Some baseline shift toward openness aboard wireless networks: more access to networks for device makers (Verizon), more access to interfaces for applications developers (Android)
Slide 26: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ But it’s no sea change by any stretch • No new access to new providers • Providers can continue crippling devices (even wireless auction aside: rules not yet set in stone for Verizon, and practicalities are important there) • Bandwidth limits remain, limiting functionality • User agreement restrictions remain • Underlying networks still able to degrade traffic of ‘undersirable’ applications, content • Does nothing to resolve questions of expanding access and other dimensions of equity.
Slide 27: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Closing thoughts: at one level • ‘Openness’ is inextricably linked to underlying networks. Owners of networks still exercise ultimate control; whatever ‘convergence’ is happening is on providers’ terms • Markets play a role… Influence of international business at play too? Google’s moves, iPhone factors for sure… • …but it’s not just ‘market forces.’ Cannot ignore public involvement: 26,000 comments in FCC auction-rules proceeding; comments to legislators. Chairman Martin calls advocates to office to “back off” • Pre-empting regulation? Moves to ‘self-regulate’ before overt regulation?
Slide 28: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Closing thoughts: moving to other levels • Nonetheless, establishing a normative “most open” delineation remains a challenge • “Openness” contained herein is largely technologicallydriven: is this even the appropriate frame as we expand our view? • What should drive notions of ‘openness’? • A look to China: what do we see there?
Slide 29: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ The View from China
Slide 30: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Some Basics about China’s Wireless Industry: • Mobile communication is the most profitable subsector of the Chinese telecommunications market. • China has the largest number of mobile phone subscribers in the world: 556.23 million as of the end of February 2008; about 42% of the population. • Up from 398 million at the end of 2006. • 592.1 billion text messages sent last year (an average of 1.6 billion per day), generating $22.2 million for the two mobile operators.
Slide 31: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Some Basics about China’s Wireless Industry: • Two state-controlled companies: • China Mobile (the incumbent) with 373.4 million subscribers as of Feb. 2008, with about a 68% share of the mainland mobile phone market. It is the largest mobile phone operator in the world. • China Unicom, with about 182 million subscribers. It is the third largest mobile phone operator in the world.
Slide 32: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Openness: Devices • China Mobile and China Unicom both run a GSM network. • China Unicom also has a 2.5G CDMA network, accounting for about 25% of its total customers. • China Unicom sells dual band handsets, but they are pricey: about $500. • Almost all phones in China are sold unlocked (and CDMA phones in China also use SIM cards).
Slide 33: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Openness: Devices • For the most part, you can use any phone with either operator. • But sometimes this can depend on whether the customer uses pre-paid or a service contract. • Increasingly there is mimicking by both operators of the U.S. method of bundling subscription services with certain handsets: • e.g. Research in Motion Blackberry deal with China Mobile.
Slide 34: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Openness: Functionality, Connectivity • Carriers do not disallow features that are in phones. • Carriers do not control functionality (e.g. photosharing). • Most users do not use high-end features, services. • SMS, voice calling, games, and (increasingly) mobile music are the most widely used functions. • Bandwidth limits.
Slide 35: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Openness: Content • Mobile operators attempt to block spam, porn • “Text-message gate” • CEO of China Mobile Wang Jianzhou’s recent comment at the World Economic Forum in Davos. • Communications Short Message Service Management Regulations
Slide 36: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ The Future? • China Mobile is a member of the Open Handset Alliance. • Impending restructuring of China’s telecom industry in anticipation of rollout of 3G technology, in particular China’s own 3G standard: TD-SCDMA. • China anticipated to have 30 million 3G customers by 2011, of which 17 million will use TD-SCDMA.
Slide 37: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ China’s telecom industry restructuring: • China Unicom’s CDMA network will be acquired by China Telecom (a fixed-line provider). • The remainder of China Unicom will merge with China Netcom (another fixed-line provider) and operate a GSM network. • China Mobile will merge with China Tietong (a small fixed-line firm). • The result will be three full-service telecom operators (each with fixed-line and mobile).
Slide 38: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ China’s telecom industry restructuring: • Each of these three full-service telecom operators will then be ready to receive a license for one of the 3G standards. • China Telecom - CDMA2000 • China Netcom/Unicom - WCDMA • China Mobile - TD-SCDMA (which is undergoing trials in major cities in China right now, raising concerns about “technology neutrality” since other 3G technologies are being delayed while this one “matures”).
Slide 39: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Perhaps another way to imagine openness: • User resistance: • iPhone example: Though talks between Steve Jobs and China Mobile stalled, according to China Mobile, by the end of last year there were as many as 400,000 iPhones (cracked and unlocked) being used on the company’s network, over 10% of total worldwide iPhone shipments.
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Slide 41: GLOBAL MOVES TOWARD MOBILE ‘OPENNESS’ Perhaps another way to imagine openness: • Creativity at the margins: • Domestic handset manufacturers and innovation (e.g. 2-SIM card phone) • Brandless phones • Repair shops
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