The Ovum View: Who's the boss? The network versus the device

The shift towards data services and third generation multimedia is forcing devices to get smarter - think Java-enabled with enhanced displays, improved memory and processing power. This trend could change the balance of power in the mobile market from a browsing network-centric world to an off-network environment where most applications are downloaded, says Ovum research director wireless, Jeremy Green.

Ever since the first communications device crawled out of the primordial swamp and attached itself to a network, there has been a fundamental tension as to who was boss. Was functionality and service a characteristic of the device, to which the network added only the dumb pipe of connectivity? Or was the network the seat of intelligence and the home of content, to which the device merely provided access?

In the world of mobile, the balance has long been firmly tilted in the direction of the network. Sure, the devices were smart. They had to be, to play their part in maintaining connectivity. But the very complexity of that task took up most of the processing power and storage that they had, leaving precious little basis on which to build much end user or service functionality. Being able to store a few telephone numbers was the most you got.

The network held most of the cards. It held the authentication information, the subscriber profile and the mobility management information. The poor old device was sweating like crazy managing signal-strength information and handover decisions.

But the story doesn't end here. Network operators and handset and infrastructure vendors have all bet the business on the premise that users can be persuaded to use the mobile phone to access a much wider range of services than boring old telephony. Sometimes the ideas as to what these services might be - and how to persuade users to adopt them - seem a bit fuzzy but everyone knows the simplicity and friendliness of the access device will have something to do with it.

At first, this shift towards data services appears to have consolidated the balance of power. First-generation mobile data applications were all premised on the thinness of the client. The WAP concept as well as the more successful i-mode service exemplify this.

But ultimately, the logic of enhanced data and multimedia services points towards a different kind of device: one that is optimised to support the high demands of a visual communications medium. And we do not have these devices today, despite what the manufactures might say.

All of which points us towards questions that are related to the network-versus-device issue but which are nonetheless separate. Is the appropriate device for accessing mobile data services a phone with a bit of additional data handling functionality added? Or, is it really a specialist data or personal information device (like a PDA) with a bit of communications functionality added? The jury is still out on this one.

The biggest of the mobile phone giants, the marketing-savvy Nokia, is betting a pocket-friendly phone will be the centrepiece of personal life management. It is backing up that bet by producing a dazzling array of segment-specific lifestyle products. Others, including Motorola and Ericsson, have hedged their bets more carefully and have offered to license their own communications 'guts' to the manufacturers of specialist products.

If we choose the first answer then we have more or less chosen our answer to the network versus device question too. A phone-like device, even a smartphone, will have its work cut out sending and receiving data, then displaying it and allowing the user to interact with it.

A data-centric device will be up for a whole lot more local processing - so much so that it may make more sense for it to pull data and even applications off the network and onto local storage. Here the user could interact with them without having to deal with the inherent latency of the network, or to pay network access charges while interacting with them.

So there's the dilemma. The kinds of device which might be best for data services and which will encourage users to adopt them also hold out the possibility of a different paradigm for those services - a download, off-network sort of world rather than a browsing, on-network world. And once you admit this possibility, it's easy to see how well suited it is to lots of potential applications.

Take information - local guides, maps, and so on. Well, you could view them on-network - but then again, why not hold the core information on your device and just download the updates? One company is even proposing the use of locally-stored 'avatars' to offer a kind of client-based video messaging.

Your phone would hold some digitised models of my face so that next time I leave you a voice message your device can show you a wholly constructed 'video' of me speaking my message. (It also offers the intriguing possibility of me using a different persona for my avatar - the demo version includes a talking hamster.)

Download world isn't necessarily bad news for network operators or portals, even if it does transfer the locus of control to the applications running on the device. After all, lots of customers buying even tiny applications and data downloads over the air might fill the pipes just as nicely.

And it might actually fit better with a telecoms business model rather than the advertising and content subscription model often proposed for mobile internet services. However, it does mean the players on the network end of the equation have to re-think what kinds of content they plan to offer and with whom they need to make deals.

They would also need to anticipate more closely the kinds of devices, operating systems and applications platforms that will be in the hands of the end users. Given the current turbulence in the device market, perhaps that is going to be an even bigger challenge than getting the data services mix right.