McGuire’s Law

On Tuesday, I participated in the Connected Planet 4G Salon. My first slide showed two paths the mobile operators could pursue. The starting point was 2006 (specifically chosen as the end of the pre-iPhone era).

One option is what I refer to as the “Big Bell Dogma” path. This path involves making every decision with one goal in mind - maximize control over the ecosystem which allows the operator to maximize its share of the revenues in the ecosystem. This path forces innovation to happen at “carrier speed” and the result is constrained ecosystem growth. As I’ve described before, Big Bell Dogma is named to represent the mindset that telcos have held onto ever since Alexander Graham Bell invented the telephone in 1876 and was really at its prime in the old monopoly AT&T days. However, all carriers suffer from Big Bell Dogma to some extent - some more than others.

The second option is the one I referred to as the “Open Enablement” path. This is the path that Sprint has chosen, perhaps as best represented by our hosting of our 10th annual developers conference this week in Northern California. On this path, every decision is considered with the goal of maxmizing ecosystem growth. Operators must ensure that they’re adding value, both to accelerate growth but also to make sure that our added value translates into an earned share of the revenue in the ecosystem. Along this path, innovation happens at “Silicon Valley speed.”

Later, during the Q&A, someone from the audience asked how Big Bell Dogma was different from Apple’s approach to managing the ecosystem.

That’s an excellent question and the reality is that Apple suffers from Big Bell Dogma. They want to put constraints on how innovation can happen so that they dominate the ecosystem and extract the most value.

The difference is the starting point. Unlike mobile operators, Apple really is an innovative company. They understand the “hits-based” nature of the software industry and therefore the need to enable lots of apps to enter the market so that a few can really make a difference, so they gave application developers the basic capabilities that had previously been missing to allow the app ecosystem to explode. However, on every other dimension, Apple has kept the clamps on, constraining innovation to happen at “carrier speed.”

Unlike Apple, Google has allowed the Android ecosystem to innovate in all dimensions, and even in the app ecosystem, Google’s lack of constraints is winning over developers.

Think about it - Apple makes great handsets. But they introduce one new iPhone handset a year. How much real innovation is represented in that one handset? Only as much as one company can imagine and productize. Now think about all the different Android handsets you’ve seen and the level of innovation that handset OEMs are bringing to market. Consider just the HTC Evo: kickstand, front and rear facing high resolution cameras, HDMI output, 4G network connectivity… Now multiply that by the innovation that Samsung, Motorola, LG, Sanyo, and all the other innovative handset manufacturers that are out there can bring to the table.

Think about it - here in the U.S. Apple has limited the iPhone to one carrier. How much innovation has that operator delivered to customers since 2007? In that time Sprint alone has rolled out 4G nationwide (in 2 months, Sprint 4G will cover 120M people), introduced the first all inclusive unlimited plan (Simply Everything), Ready Now to help customers actually make full use of their advanced devices, Any Mobile, Anytime, and the Sprint Free Guarantee, just to name a few. I imagine T-Mobile and Verizon have each had some innovations as well. The Android ecosystem benefits from these innovations, but the iPhone ecosystem doesn’t.

And even within the application segment, the Android ecosystem can enjoy growth-accelerating innovations, like Sprint ID, which would never be allowed by Apple as they seek to rule the app ecosystem with an iron fist…

Apple makes great products and back in 2007 they gave the entire ecosystem a fast start with the (previously unmatched) enablement they provided to application developers, but they are definitely playing the Big Bell Dogma game.

I’ll be participating in a pretty cool event next Tuesday. It’s called “Building the New Telco Network” and it’s put on by Connected Planet. The full event runs from 10am Eastern to 5pm Eastern (that’s 9-4 for those of us in the middle of the country). My section is the “4G Salon” which starts at noon eastern.

It’s a free event and you don’t need to travel to enjoy it!

The description for the 4G Salon is “An interactive event to discuss and learn about the mobile revolution, its opportunities and its pitfalls, from the service providers, vendors and developers building tomorrow’s 4G networks and services.” I’m in the “Business” section of the agenda, which is described this way: “How will mobile data be monetized as traffic skyrockets and applications become more sophisticated and bandwidth hungry. Will operators work with their Internet peers to create mutually beneficial business models, and if so how?”

Other participants include:

• Ed Chao, Senior Vice President, Corporate Engineering & Network Operations, MetroPCS
• Scott Levine, Vice President of Digital, Blockbuster
• Harald Braun, Industry Consultant, former CEO of Siemens Networks and Aviat
• Bob DiFazio, Fellow, InterDigital
• Susan Schramm, Head of Marketing & Corporate Affairs, North America, Nokia Siemens Networks
• Chris Ebert, Director LTE Strategy, Nokia Siemens Networks
• Christopher Guttman-McCabe, Vice President Regulatory Affairs, CTIA

I hope to “see” you there!

Last weekend I wrote a couple of posts about what we talked about on my panel at Mobile 2.0 and specifically my responses to questions from Tony Fish.

But I didn’t say what I had meant to say…

You see, before I speak at any event, I always prepare my “platform”, a messaging pyramid that represents the key points I want folks to walk away understanding about Sprint’s position. Tony was such a good provocateur that I didn’t stick to my platform.

Anyway, my messaging pyramid always has a top level message - the one thing that I want folks to walk away remembering. For this event, that message was “The mobility revolution requires operators to actively enable innovation by others.”

I always have three second level messages that further explain and prove the top level message. For each of these, I try to have three proof points or examples ready to use in the discussion.

Here were my three second level messages:

#1: Developers: Make it easy for developers to innovate with the full capabilities of Sprint assets.
Proof points:
- Over a decade of leadership through Sprint’s application developer’s program (see developer.sprint.com)
- Our upcoming 10th annual Developer’s Conference (October 26-28 in Santa Clara)
- Our recently launched Sprint Services Framework and Developer Sandbox

#2: Enablers: Nimble partners enable innovation at Valley speed, not Carrier speed.
- Solution Enablers
- App Stores
- Aggregators

#3: Platforms: Don’t lock innovation into a single device, OS, or even form factor.
- Cloud-based Sprint Services Framework
- Emerging Solutions/M2M
- Sprint Virtual Developer Lab

Even though I didn’t stick to my “platform”, hopefully the audience still walked away with a clear idea that Sprint is focused on enabling innovation across the ecosystem.

Next time I’ll try harder, I promise.

Another interesting discussion Tuesday on the Mobile 2.0 Fireside Chat panel was the one that Tony Fish used to lead off the discussion. Tony asked “If Apple is the new Microsoft, and Google is the new Apple, where do Mobile Operators fit?”

My answer was that Mobile Operators are the new IBM.

I assume Tony’s references to Microsoft and Apple were referencing the PC Revolution of the mid-1980s. For decades, IBM had dominated the industry, dictating to the rest of the ecosystem the rules under which they could play. Apple was birthed in innovation that showed the world what was possible in a personal computer world, but it was the open architecture introduced by IBM’s PC group, with Microsoft and Intel at the core, that redefined the entire industry.

The question is whether Mobile Operators will be the IBM that focused on using OS/2 to try to put Microsoft back in their subservient box. Or, will Mobile Operators be the IBM that became a champion of open source, enabling tremendous innovation that only sometimes directly benefited Big Blue.

Unfortunately, most Mobile Operators, by definition, suffer from Big Bell Dogma, thinking they can and should dominate the ecosystem, strong-arming upstarts like Google into staying in a constrained box.

A few operators though, including Sprint and my co-panelist from Telefonica O2, believe that operators have their value-creating role, but we are all best served when we enable innovation that accelerates growth for the entire ecosystem.

Of course, I don’t need to tell you which strategy worked best for IBM…

Tuesday I participated in the Mobile 2.0 “Business Day” in San Francisco. Thanks to Gregory, Mike, Daniel, Peter, and Rudy for putting on another great event.

The industry has come a long way since the first Mobile 2.0 event in 2006 - in fact, it has grown into the vision that was being explored way back then. In 2007, I participated in a “fireside chat” panel moderated by Tony Fish, and on Tuesday, I found myself back on the same panel, moderated again by Tony.

My co-panelists this year were James Parton of Telefonica O2, Fabio Sisinni of Paypal, and David Katz of Yahoo. Tony did a good job of leading us through a broad array of topics. I’ll probably touch on a couple of the other topics in other posts, but for now, I think I’ll focus on the discussion towards the end of the panel that was most thought provoking for me.

Tony provoked us with a statement along the lines of: “I don’t believe that there’s really any innovation in mobile. If the best we have to offer is location check-in apps, we don’t have much to be proud of.”

I responded by identifying four drivers of innovation and growth in mobility. Having had more time to think about it, I’ll add a fifth.

1. The Mobile Internet. Much of the innovation we’ve seen so far is simply derived from mobility catching up with the desktop in terms of processing power, graphics, and of course, broadband with 4G. Much of what we see in the App Stores are simply things we’ve traditionally done on a desktop, perhaps tweaked a bit to work well in a mobile environment. There’s nothing wrong with that and we’ve certainly seen tremendous growth driven by this simple catching up.

2. Context. What sets mobility apart from the Internet is the rich contextual information that has never before been available. Where I am. Who I’m with/near. What I’m doing. All of this context made possible in large part because the mobile experience is intensely personal. So far, the contextual aspects of mobility have mostly played out in location-based apps including navigation and check-in services. But again, nothing wrong with that, and as additional contextual data becomes available, we should expect to continue to see innovation and growth.

3. The Internet of Things, Machine to Machine, Connected Devices, Bandwidth Built In, whatever you want to call it… I believe that every product that today has a microprocessor, in the future will have wireless connectivity. We’ve already seen the impact of the Kindle and other eReaders on the publishing industry. Over the next few years we will see tremendous innovation and growth driven by more and more products having wireless built in.

4. Synchronization/Coordination. As more and more devices around us have wireless connectivity and different pieces of the context, those objects will start communicating with each other to create tremendous new value for the end user.

5. Business Integration. The one I forgot about on Tuesday is the one I’ve probably focused on more than any other the past few years. I believe that mobility will be integrated into every product, every service, and every process by businesses across industries. This will enable tremendous innovation in how businesses compete and will result in significant industry growth.

Thanks Tony! These are the kinds of things I like to think about!

PC World has come out with their list of the top 10 cellphones on the market in the U.S. I guess this helps explain why the Epic (#1) and Evo (#2) are so popular with customers that they still aren’t available for Sprint employees like me to buy.

If you aren’t yet a Sprint customer, now might be a great time to take advantage of my employee referral info to save some money. Go to http://www.sprint.com/everythingplus and enter my e-mail (russ.s.mcguire@sprint.com) and my id (383) and start enjoying the power of either one of the top 2 cellphones on the market today.

I’ve always known that Emily Green was a smart analyst of what’s happening in the telecom industry, but her recent blog post shows she’s also a smart traveler.

Here are a couple of quotes to give you a sense:

“I have been on a family road trip for the past week. Writing today from Richmond, Virginia, I am here to tell you that the best way to vacation in 2010, at least in the U.S., requires the following:” (You’ll have to read the post to find out what 3 things are required for the best vacation…)

“Once you have these three elements … here’s what happens: … You ditch all other means of navigation. … You have a richer view of the changing world around you. … You skip the hotel room Spectravision. In a shocking turn of events, the TV remote has sat untended on the bureau, because no one wants to watch TV. …”

Check it out!

This week I participated in the MobileBeat conference in San Francisco. For the panel I was on, I wanted to find a way to sum up the role of the mobile operator in the application ecosystem.

As I’ve often said, there’s lots of ways that carriers (in their Big Bell Dogma ways) try to force themselves into (or onto) the ecosystem that just plain don’t make sense. As I said at this conference a year ago, application developers want to move at Silicon Valley speed, not carrier speed.

That doesn’t mean that mobile operators are relegated to just being dumb pipes.

Instead, we need to understand where we do, uniquely, create value for the ecosystem. To me, it boils down to Bandwidth, Bills, and Bags.

For starters, we really are network companies. We operate billions of dollars worth of network assets that enable stuff (voice signals, web pages, mobile ads for “free” games) to get from the right point A to the right point B. Clearly, it’s more than just Bandwidth, but for the benefit of alliteration (so at least I can remember it), I’ll use that word to represent this vast array of assets. Carriers can contribute significant value-creation potential into the ecosystem by exposing those assets to developers to enable tremendous innovation (location, QoS, call control, performance data, etc.).

But, we aren’t just network companies. Mobile operators have long term relationships with our customers. I’ve chosen the image of the cellphone Bill to represent a complex set of interactions that provide the carrier with perhaps the most complete view of the customer that anyone has. On one hand, those bills can be a valuable way for developers to monetize their efforts, but even more, the information that the mobile operator holds about each customer is a veritable treasure chest. We have a responsibility to be good stewards of this treasure entrusted to us (consciously or not) by our customers. On one hand, we must defend the privacy of customer data “to the death.” On the other hand, as good stewards, we must enable the maximum value creation on behalf of our customers. We must enable developers to create capabilities that our customers can choose to approve the use of their data to make applications work better (e.g. location-based search) or even enable applications that simply aren’t possible otherwise (e.g. social location services).

Finally, we not only operate networks and maintain relationships with customers, but we also are some of the largest retailers in each of our territories. We operate thousands of stores where customers can walk in and interact with us. Historically, these stores were primarily sales locations. Increasingly, especially with increasingly complex products, these stores have become service locations. And in the past couple of years Sprint has introduced “ReadyNow” services to help customers fully use those increasingly complex products. While not yet on the order of Apple’s Genius Bar, ReadyNow is a valuable way that Sprint helps customers use their smartphones to do more than just talk.

I think my message was well received by the audience. What do you think? Does Bandwidth, Bills, and Bags communicate how mobile operators (like Sprint) are more than just dumb pipes, but rather value-contributing partners in the mobile ecosystem?

A couple of months ago I received a note from Joshua Granick of Eclectic Design Studio. Joshua was working in a space where a couple of my passions collide and was looking for some help.

You see, Joshua was working on a Bible reader app for the Palm WebOS platform. If you regularly read McGuire’s Law, it’s pretty obvious to you that mobility is a passion of mine. It just so happens I’ve also been a big fan of WebOS, so that alone would’ve gotten my attention.

But, I also get passionate about applying modern technologies in Christian ministry. My second startup was called Seek First Networks and was specifically focused on helping small ministries and churches take advantage of web technologies. After I joined Sprint, I kept much of that work alive as a non-profit ministry called Living Stones Ministry.

And that’s exactly why Joshua was reaching out. He’d been using the Living Stones web services interface to a handful (or so) of Bible translations. It worked exactly the way he needed for his Bible Reader product, but he wanted to include dozens more translations

To be honest, I didn’t have the time to do the conversion work and make sure the infrastructure could handle it. But, I was excited about what Joshua was doing, so I gave him access to my source code and database structures, and gave him a very brief lesson in how to integrate additional Bible translations. He was able to immediately run with it and has added bunches of new translations to his product. Beta version 1.4.4 of Bible Reader and Bible Reader Plus are now on their way to the Palm App Catalog. If you’re rocking a WebOS device, check them out!

For years, we’ve talked about the cellphone as the swiss army knife.

And I’ve found the analogy to be really on-target. I’ve told the story many times about how I used to (pre-9/11) always carry a small knife in my pocket that had a small pair of scissors and a tiny screw driver. There were times when I found myself trying to demo the latest telecom applications at a customer site or a trade show and I’d use those scissors to strip a wire and the screw driver to lock down a connection. (Scary, I know…)

But, in reality, those scissors and that tiny screw driver were a poor excuse for real tools. They were incredibly valuable because I had them with me, but given my druthers, I’d rather use a real stripping tool or real screw driver.

Cellphones have been the same way. You can use your cellphone as a camera. You can use your cellphone to watch TV or movies. You can use them as an eReader. You can use your cellphone as a navigation device. And your cellphone is incredibly valuable for those purposes (relative to its quality at each) because it is always with you. (That’s a big part of McGuire’s Law of Mobility, by the way…)

But in reality, given the choice, most people would rather use a “real” camera, a “real” TV, a “real” book or eReader, or a “real” navigation device.

The EVO 4G is the first phone that really changes that reality. Its true broadband connectivity, high powered processor, 8MP camera, huge screen, and HDMI output make it truly competitive as a “real” product in each of those categories. Add in stereo Bluetooth, 720p video recording, an additional front facing camera for video chatting, hot spot capability, a digital compass, and all the applications in the Android marketplace, and suddenly the EVO becomes the ultimate “swiss army knife” capable of credibly replacing a broad range of products.

Wow.