March 8, 2016
by Dan Hays
Four secrets from Mobile World Congress 2016 that can help you put the media coverage in perspective.
This year’s Mobile World Congress event did not disappoint with showy announcements, towering displays, and powerful keynote speeches. In our first blog post about MWC, we discuss some of the top-line trends. However, the focus of conversation behind the scenes was, at times, quite different than the glamour and glitz of the show floor. Following are four “hidden secrets” we gathered from reading between the lines:
Hidden secret #1 – Device innovation was virtually a no-show.
In years past, MWC has seen the launch of numerous innovations in mobile devices, ranging from second screens and 40-megapixel cameras to nesting phone/tablet/laptop combinations and unusual form factors. This year’s event, however, fell quite short on mobile device innovations. We were left to wonder what the future holds for device sales. Most device OEMs simply displayed “me too” smartphones, though at least one admirable attempt at innovation demonstrated a modular approach with detachable accessories including a high-definition audio processor and camera control unit. With smartphone penetration starting to top out in many markets and low-cost devices placing pressure on margins, could this lackluster showing indicate the end of major advances in mobile devices?
Hidden secret #2 – Are mobile phones the next certified pre-owned car?
Despite the weak display from most new phone manufacturers, the hallways and conference rooms of the conference were abuzz with talk of the used device market and its potential opportunities. Trade-ins of used phones continue to grow rapidly—more than 20% per year by some accounts. The swelling base of high-end smartphones, coupled with new leasing plans in some markets, mean that the supply of used devices is only expected to continue ballooning in years to come. Additionally, new models for collecting, testing, refurbishing, and certifying used devices—including at least one company’s automated kiosk—are making the whole process easier than ever. Will mobile phones be the next certified pre-owned car? With some models approaching $1000 in price, and several hundred dollars in residual value, the answer appears to be a firm “yes.”
Hidden secret #3 – Satellite, balloons, and airplanes could be the new mobile.
Mobile technology is most often equated with terrestrial cellular communications, but this year’s event also saw a lot of chatter around satellite and other technologies that could be used to complement traditional terrestrial networks. While some keynotes spoke of connecting the “next 3 billion” people on Earth who currently lack Internet connectivity and creating a more inclusive society by doing so, numerous private meetings focused on how to integrate satellite technologies with cellular, including providing enhanced coverage for remote areas and economical backhaul for fiber-less cell sites. With new Low Earth Orbit (LEO) satellites promising dramatically lower costs and latency vs. traditional satellite technologies, this could well be the era where satellite becomes part of a truly homogenous mobile network.
Hidden secret #4 – Mobile operators want to slow capital spending as growth declines.
As the mobile industry matures, mobile network operators are increasingly realizing they need to find ways to more efficiently deploy their capital and control operating expenses. Many technologies on display in Barcelona, including self-optimizing networks (SON) that reduce engineering and operations costs, unlicensed spectrum that enables increased capacity without costly spectrum purchases, and advanced analytics capabilities that promise accelerated and more automated resolution of issues with network performance, billing, and customer experience. Operators were also keen to discuss improved methods for capital planning, supply chain management, and even new product development, all focused on conserving funds in an era of increased competition and pricing pressure.
These were just some of the myriad topics on the minds of the mobile industry at this year’s MWC. For more information and the latest insights from our PwC team, please check out www.pwc.com/mwc.