15 August 2009; Licensed under the Creative Commons Attribution 3.0 License
Telecom is evolving into All IP networks. The dominant GSM and CDMA networks are converged in their road-maps to LTE (Long Term Evolution) into All IP based network.
Google on the other hand, have evolved from being a search engine provider, to an email provider, then graduated to User Generated Content host. It then inorganically grew into online document hosting, Blogging and social networking. Now, it has released a browser (Chrome) and a mobile OS (Android). Its working on Netbook OS also called Chrome. It has also launched a Cloud Computing platform, Google Apps. Most of their platforms work on Mobiles as well. They have a payment gateway, (checkout.google.com) and a location based search with Mapping service. Google will be soon launching a next generation communication system called Google Wave.
Google has a great developer community strategy with many open source projects as well as platform to develop and host open source projects. Thus Google already has a VAS (Value Added Service) delivery platform.
Sam Petroda, the father of the Indian first wave telecom revolution, once said that 3G is nothing but a high speed mobile broadband.
Google at first joked about free broadband service as a April Fool spoof. But, it does have a serious mobile wireless strategy in place. Three years ago, in 2006, Google launched a free Wifi service, in Mountain View California USA. The coverage is available here. Google has stated plans to Wifi other cities in near future, see wifi.google.com for details. Wifi or 802.11g is a recognized 3G protocol, see my End-to-End Open Source Telecom presentation.
Google will slowly and surely emerge as a de-facto next generation Mobile Operator. And, to do so, it will not even have to pay the hefty 3G licensing fee to the various world governments.
At present, Google is partnering with existing Telecom operators, to provide emails, maps, location based search, social networking, instant messaging (IM) and blogging services to GPRS, EVDO and EDGE customers. The dominant business model is that of co-branding and advertisement revenue sharing partnership.
Telecom Operators have been moving away from all Capex (Capital Expenditure) to Opex (Operational Expenditure) and converging towards Revshare (Revenue Share) model with core technology providers. Thus, from the Telecom Operator's perspective, it works well in short term. In the long term, the Telcos must have a strategy to compete while co-operating with Google, that is they must have a cooptition strategy in place.
As for the VAS (Value Added Service) providers, they are the natural allies of Google. Google, being a developer friendly open source giant, can help the small and independent VAS operator a good deal. The current revshare model of 30-70 (70% is retained by the Telco) will get inverted to 70-30, as the trend is already been set by NTT DOCOMO and iPhone stores.
Its good for India too! Our Rural Telecom coverage is less than 20% and given the expensive nature of 3G equipment technology, its unfeasible for the Telecos to provide a coverage to Bharat (Rural India). However, slowly and silently Bharat is being Wified (again, see slide 26 of my end-to-end open source Telecom presentation). Just as India skipped the wire-line Telecom era and jump-started with GSM, Bharat will skip the 3G and jumpstart with Next Generation Network (NGN).