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Back in October 2008, I wrote about a blog post of David Wood, who is part of the Symbian leadership team, where he said that while smartphones only account for 10-15% of sales units, the sales revenue is between 20-25% and profits may even exceed 40%. Now Moco News reported similar numbers being given by Deutsche Bank analyst Brian Modoff in an article in the Wall Street Journal.

His numbers are as follows:

• Apple and RIM together only have 3% of the mobile phone market share but make 35% of the total profits.

• Nokia manufactured 46% of the mobile phones sold last year (I heard 38% somewhere else) and made 55% of the profits. Note: It would have been interesting to see the split in profits between their smartphones and the rest of the phones they produce. Do they give these numbers in their quarterly reports?

That makes me wonder why there is so much profit in smartphones vs. the rest!? Granted, their price is much higher than that of ordinary phones and thus if the profit percentage is similar, the profit per device is also higher. However, that can't explain it all. Less competition then maybe? Also a bit doubtful as the smartphone market seems to be quite competitive with manufacturers like Nokia, Apple, RIM, HTC (G-phone, WinMob), etc. vying for market share. What do you think?

Every now and then I get an interesting comment for which a typekey id was used as a commenter id instead of an e-mail address. While that is perfectly all right in theory it unfortunately doesn't allow me in practice to reply to you by e-mail in addition to leaving a comment of my own below the poast. That's a bit unfortunate as most people probably won't check back on the blog to see if I have left a response. Therefore, dear readers, please put an e-mail address in the id section of the post if you would like to receive a response in case I have any 🙂 The e-mail address is only shown to me so there is no need to worry about spam. Thanks!

Here's a quick update on my experience with my netbook, Ubuntu and 3G connectivity. As reported previously, the 3G connectivity manager built into Ubuntu works (most of the time) but doesn't have some important administrative functions included such as network and network type selection and some general observational functions such as current network name and signal strength indications.

At least the later functions are included in the Linux 3G Dashboard from Vodafone Betavine, which works great with my Huawei E220 USB 3G stick. The screenshot on the left shows how signal strength and the network name is displayed in the lower left corner of the dashboard. Nicely done!

What's still missing is a network selection dialogue and to be able to lock the USB stick to 3G, which sometimes helps to stay connected in bad signal conditions. It would be nice to see this in a future version. Also, having the possibility to select a different connection profile on the main screen would also be nice, especially for people (like me) who travel a lot.

To install the dashboard go to this Vodafone Betavine project page, and download and install all packages from the download section.

Back in April I ran some tests in London to see how many 3G frequencies were used by the carriers there to get a feeling of how much capacity is offered today. To my great surprise, only one of the network operators had deployed more than one 5 MHz carrier frequency. Recently, I was in Vienna and since the country has many affordable 3G Internet offers that lots of people already use, I was wondering if the situation was different.

It turned out that the situation was pretty similar. Except for T-Mobile, who had two 3G carriers deployed in the center of Vienna, all other operators only used one carrier frequency. Network throughput during the day and in the evening in the A1 network were always good (above 1.5 MBit/s) so the current low capacity build-out from an available carrier perspective can handle the traffic well. To me, that sounds like good news!

As standardized today, LTE does not have built in SMS capabilities. In a recent webinar on VOLGA (Voice over LTE via GAN), Franz Seiser of Deutsche Telekom (formerly T-Mobile International) argued that this might be a significant issue in the future for a number of reasons.

First, he said, there are a lot of systems in the network that rely on SMS such as SIM card provisioning, for updating the roaming operator list and other data on the SIM card for example, SMS subscription to activate/deactivate add-ons, etc.

Second is the EU mandated SMS user interaction while roaming. Introduced during the first wave of roaming regulation, operators are obliged to inform their subscribers by SMS about roaming costs when they start using a network abroad. In the future, notification to prevent "bill shock" (e.g. when using mobile data abroad) might also be based on SMS.

While the roaming tariff SMS announcements for voice and SMS are probably meaningless for LTE networks that do not support voice and SMS, the notification about bill shock might very well apply to LTE as well. Unless of course, the same tariff applies abroad like at home. Unlikely I would say…

So I quite agree with Franz, if a network allows VOLGA roaming in the future, the SMS solution already comes included at no extra price.

Another option is using SMS as part of the CS fallback (CSFB) feature that is already standardized. However, if the roaming country does not support CSFB and the mobile device is mostly data centric, then the SMS can't be delivered. While it's pretty obvious that a USB data dongle is a data centric device, I wonder what an iPhone or an N97 qualifies as.

And then there is SMS over IMS. However, I doubt we will see IMS and mobile IMS clients anytime soon.

Here's a picture of my new netbook, a 10.1" Acer Aspire One D250 side by side with my first notebook I bought 15 years ago. Sizes are quite similar but the interior is quite different. 1 GB of RAM vs. 8 MB, 160 GB hard drive vs. 20 MB, 386 processor running at a couple of MHz against an Intel Atom running at over 1 GHz. About two orders of magnitude apart from each other. Of course, 15 years ago it wasn't called a netbook, even though my 14.4 kbit/s Modem (external) was start of the art then. Surprisingly, the 15 year old notebook still works. MS-DOS and Windows 3.1 boot in a matter of seconds, out of the 8 MB of memory, 5 MB are free once the OS is loaded and Microsoft Word loads faster than anything I have seen in the past decade. Sounds all nice but I don't want to go back. It's just a bit more comfortable today and I am not sure the old Compaq could handle a 6 MBit/s DSL line. After all, at that speed the hard drive would be full in less than a minute 🙂

And here's my LTE thought of the day:

One of the fascinating things about the 3G/WCDMA/HSPA uplink is the 1500 power control commands per second to ensure all devices transmitting at the same time are received with a similar power level. This is necessary as only this way the base stations can retrieve the individual data streams that are stacked on each other in the code/power domain. 

With LTE, however, such a fast power control is no longer required as each mobile sends at a different time or uses different subcarriers (i.e. different time / frequency domains). While it is still necessary that all transmitting devices are received by the base station with "more or less" the same power in order not to overload the A/D converters it is by no means as essential as before. A lot less work and signaling involved that way.

Recently, Aldi supermarkets in Germany have started selling unlocked 3G USB dongles for €59. Yes, unlocked, which means that the buyer is free to either use them with a SIM card that can also be bought in the supermarket or with a SIM card of a different operator. For the details see here (while the link leads somewhere).

The SIM card offered by Aldi is for the German E-Plus network, which unfortunately is quite patchy and not upgraded to HSPA yet. I wonder if it might be the last non-HSPA 3G network left in Europe!? Prices for daily use are €1.99 with a traffic limit of 1 GB or €15 for 30 days with a traffic limit of 5 GB. Stunning prices but don't ask for high speeds.

I am glad to finally see this happening in Germany, after it has pretty much become common practice in Austria for a year or two now already. To my knowledge, Germany is only the second country so far where unlocked 3G dongles can be bought in supermarkets. If you are aware of any other countries except Austria, please let me know.

Let's hope that similarly as in Austria this move will stimulate competition around pre-paid offers where the SIM card for Internet access can be bought independently from the 3G dongle. After all, I feel a bit silly to buy a locked dongle in countries I travel to just to get the SIM card.

Some prepaid offers without a dongle are already available in Germany for some time now and you can find out more on the Prepaid Wireless Internet Access Wiki here. There's information about lots of other countries there as well in case you want to find out what's going on in your country. Have fun!

While doing some background reading I stumbled over the following optional Mobile Terminated Call procedure for a race condition:

The scenario: Just when the mobile network receives an incoming call for a user, the user's mobile changes to a cell which is controlled by a different mobile switching center. This results in a race condition, i.e. the previous MSC receives the call while the mobile is already performing a location update via the new MSC. If this is not treated, the mobile will not see the paging in the old cell and the call establishment fails.

This is where the "Mobile Terminating Roaming Retry Call" feature comes into play: If implemented, the previous MSC which has sent out the paging message to contact the mobile is informed of the location update by a "Cancel Location" message from the HLR. This is standard practice so far. However, instead of failing the paging procedure, e.g. after a timeout, the Cancel Location message is used as a trigger to signal to the Gateway MSC that the subscriber is no longer with this MSC. The Gateway MSC then releases the speech path to the previous MSC, runs another subscriber location search with the Home Location Register and then forwards the call to the new MSC. All quite elegant.

For details see 3GPP TS 23.018, chapter 5.2.1

I wonder, if this feature is widely implemented and used today? If you know, please let me know.

A short post today to link to the "Round the World Connected" Website of NSN. Great videos of how fixed and wireless communication systems are used around the world today and shaping our daily lives. They also have a video of the high-speed satellite based Internet on the Thalys trains which I used and reported on a couple of weeks ago. Have fun exploring!