|Latin America 2009
|A wireless world
Chris Pearson, the President of 3G Americas, LLC, is responsible for the strategic planning of the organization and providing executive management in the areas of technology, public relations, finance and regulatory affairs. Mr Pearson has worked in the telecommunications industry for more than 22 years. Prior to this position, Mr Pearson served as Executive Vice President for the Universal Wireless Communications Consortium (UWCC) where he was in charge of strategic management. Before joining the UWCC, he held the position of Strategic Alliance Manager for the Advanced Network Services Provider Program (ANSPP) at AT&T Wireless Services. Mr Pearson also worked for GTE Telephone Operations where he held several senior account management and technical marketing positions. Chris Pearson holds a Masters of Business Administration from The Albers School of Business and Economics at Seattle University, and a Bachelor of Arts, with emphasis in Marketing and Finance, from The Foster School of Business at the University of Washington.
Wireless is enabling considerable efficiencies for Latin American enterprises while improving quality of life for consumers, and it could provide additional benefits in a more progressive and updated regulatory environment. The new wireless ecosystem developing throughout the world will positively influence Latin America’s economy if it is encouraged through appropriate spectrum planning that accounts for mobile broadband data while leaving behind old legacy policies designed for a voice-centric world.
In the health care sector, it is difficult to imagine a workforce more mobile than a hospital’s; physicians and nurses spend their days running from one room to another or from hospitals to clinics. In order to maximize both productivity and the ability to provide the best care, physicians and nurses need anytime, anywhere, access to information such as patient histories, laboratory work, X-rays and diagnostic images, surgery schedules and drug information. For Hospital Espanhol in Bahia, Brazil, the solution was to give its staff smartphones with access to the Internet and MTM Tecnologia’s MedCel application, which provides remote access to medical information. “The … solution provided us with an agile and integrated system that runs according to our needs,” said Dr. Marcelo Zollinger, Medical Staff Supervisor at Hospital Espanhol. “This means our staff can now provide services with greater quality and speed.” Size, security and flexibility Hospital Espanhol’s system uses the GSM family of technologies – GPRS, EDGE, and UMTS-HSPA. Current evolutions of HSPA+ support peak theoretical download speeds of up to 28 Mbps. In the future, Long Term Evolution (LTE) – which will debut commercially in several markets worldwide in 2010 – will support peak theoretical download speeds of 326 Mbps. Why not use 802.11 WiFi instead? One major reason is that despite improvements to the 802.11 standard, WiFi remains inherently unsecure compared to the GSM technologies. It is virtually impossible to eavesdrop on GSM calls or to intercept data transfers, which is essential for a system that carries confidential patient information. Then too, despite the proliferation of public hot spots and private WLANs, WiFi remains a short-range technology with limited roaming. This is a major drawback for health care workers and physicians that need to obtain patients’ information while away from the hospital and to immediately access health histories or check for dangerous drug interactions. With GSM technology, access is not limited to a city or region; physicians can access information from virtually any country in the world using the sort of international roaming that no other cellular technology, or WiMAX, enables. The GSM family of technologies’ nearly ubiquitous global coverage is matched by its customer base: 4 billion subscriptions – including individuals and machine-to-machine devices – or more than 89 per cent of all wireless accounts, according to Informa Telecoms & Media (September 2009). The same 89 per cent market share exists in Latin America, which had 438 million GSM-HSPA mobile connections as of June 2009. For enterprises, GSM’s global scale provides a wide variety of devices with a wide variety of features at a wide variety of prices, along with the world’s largest wireless vendor ecosystem. As a result, business owners can provide each type of employee with just the right tool for the job: low-cost handsets, smartphones, laptops, and netbooks with data cards, dongles or embedded modules. PC and broadband penetration are both relatively low in most Latin America countries, but laptops and netbooks with built – in EDGE – HSPA modems are starting to improve that situation. In fact, in many Latin America countries, these devices that use mobile broadband technology often provide consumers with their first opportunity to go online frequently and affordably. Like smartphones, personal computers are facilitating enterprise and consumer applications for a broad variety of industries. Enabling commerce A unique feature of GSM is the Subscriber Identity Module (SIM), a thumbnail-sized chip, inserted in handsets or other devices, that stores information such as the data services that the user subscribes to. Users can easily remove the SIM and insert it into another GSM-HSPA device (e.g., a new phone), eliminating the need to reprogram all of their information. SIMs also enable applications such as mobile banking. For example, Colombia’s largest banking network, Redeban Multicolor, and mobile operators Comcel, Movistar and Tigo, store an application on the SIM that allows users to transfer funds, check their account balances, recharge their wireless pre-paid accounts and pay bills conveniently and securely from anywhere there is GSM-HSPA coverage. This application is noteworthy for several reasons. First, only about ten per cent of Colombians have access to a PC, so an electronic banking service available only on a PC would have a severely limited market. However, 87 per cent of Colombians have a mobile phone, making it an ideal way for banks and mobile operators to reach as many consumers as possible. Second, the SIM-based architecture complements the inherent security of the GSM-HSPA air-link. The SIM-based solution encrypts messages such as a funds transfer for decryption by the bank’s server, and thus, creates peace of mind for consumers, improving the chances that they will use the service – and consumers are. In the first few weeks after Redeban Multicolor launched its mobile banking service in November 2007, the service handled more than 500,000 transactions, averaging six transactions per user per month. “To us it clearly showcases the winning combination of the solution: convenience, ease-of-use, mobility and security,” said Valentin Echeverry, Technology and Operations Vice President at Redeban Multicolor. Room for improvement Like the rest of the world, the Latin American region is going wireless; it has an average penetration of nearly 90 per cent. For enterprises, this is due to a solid business case, including cost reduction, productivity maximization and improved responsiveness to customer needs. Those benefits are welcome at any time, but in the current economic downturn, they have become critical for enterprises to not only thrive, but to simply survive while increasing productivity. Nonetheless, wireless could provide Latin American consumers and enterprises with much more. Ample spectrum is critical for providing wireless customers with the reliability, data speeds and quality of service they require to use advanced services and applications. To remove these limitations, Latin American regulators need to re-examine their spectrum cap policies to determine whether they enable flexible, efficient use of spectrum by incumbent and new operators. Spectrum is the lifeblood of wireless operators in the sense that it directly affects their ability to support the applications and services that improve both enterprises’ competitive positions and consumers’ quality of life. Spectrum policies also directly affect the investments a country or region can attract in the world market for wireless service growth; if investors or multinational enterprises perceive that a country’s spectrum policies make it difficult to do business there, they are likely to do business elsewhere. The ideal Americas spectrum plan would minimize fragmentation and its costs to carriers and their customers by creating core bands throughout the region at 850 MHz, 900 MHz, 1,800 MHz, 1,900 MHz and 1,710-1,770 and 2,110-2,170 MHz. The ideal plan also would begin allocating spectrum at 700 MHz and 2.5 GHz to support future LTE networks. With ample, region-wide 700 MHz spectrum it becomes more cost-effective to provide advanced broadband services in sparsely populated areas. This is because signals travel farther at lower frequencies, so fewer base stations are required. Carriers can pass on those infrastructure savings to customers in the form of lower rates. Latin American regulators also should re-evaluate interconnection and termination fees, as well as taxes on mobile services and equipment. These costs directly affect wireless carriers’ ability to innovate by using resources that otherwise could be used, for example, to upgrade their networks from GSM to EDGE to HSPA. The less money carriers have to invest in their networks, the less bandwidth they have to support the advanced services that benefit enterprises and consumers. Many of these costs directly affect the affordability and viability of wireless devices and services. The result may be problematic – less spending by customers means less revenue for carriers and, thus, fewer resources for expanding and upgrading networks, including in rural areas, where wireless frequently is the only option for broadband and telephony services. In the 25 years since wireless service was first introduced in some areas of Latin America, mobile penetration today has reached 89 per cent; fixed-line penetration, in comparison, never surpassed 25 per cent in more than 100 years. Considering what wireless has achieved in the region thus far, it would be an unfortunate step backward if appropriate regulatory policies were not established. Overall, wireless operators and their vendor partners are making great progress throughout Latin America in providing vital communications links and applications to subscribers. The region’s regulators have an immense opportunity and responsibility to foster mobile broadband innovation through new regulatory policies facilitating investment in the region. The invention of cellular technology has changed the world for the better, and it will continue to positively impact all industries and citizens in the future.