Bengt Nordstrom, Chief Strategy Officer, inCode Wireless, looks at the ‘nearly’ concept of Push to Talk over Cellular, and explains the requirements the technology will need if it is ever to emerge as the next piece in the mobile market jigsaw
Push to Talk over Cellular — or the rather more manageable acronym PoC — was mooted as the Next Big Thing in Wireless at the 3GSM World Congress in 2004. Yet the industry was notably quiet on the subject in Cannes in February this year. Like any new development in the GSM industry, PoC has its supporters and its detractors, despite the service being widely used in its less sophisticated walkie-talkie, two-way radio form.
With PoC, we have an existing and successful mobile service that can be enhanced, improved and adopted by the GSM global community. If we consider what PoC provides, we can understand how it will develop.
Mobile communications arguably have one last missing piece of the jigsaw to slot into place before the technology can claim to be all things to all people. Talk, text, videophone — the mobile device enables all these services person-to-person — one-to-one. What it doesn’t do, either easily or elegantly, is communications for a group.
How it works
PoC enables group communications with a single command. Rather than submitting multiple phone numbers to connect, PoC works like a two-way radio with multiple channels. With one push of a button, one-to-one, one-to- many, or group communications are established via a presence-based contacts list. By using the GPRS, EDGE or CDMA 1X always-on connection, users have a permanent channel of communication to any chosen group.
The implementation of PoC requires two major components: a handset application and a network-based application server. The server routes calls, manages which party is speaking, and interfaces to service enhancements such as location or presence information.
What many new entrants have found with PoC is that, although not simple, the network server is actually the easier component to implement. The more difficult task is optimising the handset-based software to coordinate with the network in order to achieve the fastest possible call set up times. Call set up (time between user initiating a PoC session and getting acknowledgement that they can begin speaking) is one of the key elements and unique attributes of PoC.
Where it works
US operator Nextel is usually the quoted model case study for PoC, its success aided by the unique dynamics that have driven PoC growth in the US. Nextel had its beginnings during the time when there were a number of different technologies serving the US market and roaming was very fragmented. Nextel’s offer of seamless roaming, in addition to the new ‘push to talk’ service, appealed to many customers who signed up to the service mainly for the roaming capability. Customers then started to use the PoC feature, became familiar with the service and its usage escalated, especially since the pricing for a PoC call was significantly less than a normal cellular call. In essence,
the seamless roaming became the “magnet” to attract customers to Nextel, but PoC became the “lock” that kept customers with Nextel since they were the only ones for many years with this capability.
Although most PoC success or otherwise is compared to Nextel, it is not a level playing field. Nextel provided a service which did not need to be interoperable with other networks, and that definitely helped the business case. In addition, Nextel’s customer base comprises a high number of small and medium sized businesses, the primary users of PoC, so in effect the operator had a ready-made market.
Many of today’s GSM mobile devices, and primarily Nokia, already include the PoC feature with the specific PoC push button — although operators typically have not launched the service. Since the OMA PoC standard has only just been set, some handsets are using versions of a proprietary solution, not necessarily interoperable across vendors and operators. Vendors are giving different promises about upgrades and backward compatibility, with some stating forward compatibility to the agreed standard.
For GSM there are two main interoperability issues: between the handset and the system, and between operator and operator. Both of these will be solved over time, and it is likely that the handset to network issue will be the first to be addressed, since it is of greatest importance.
The route to consumer adoption
PoC services need four primary components to be successful and drive significant usage: handsets optimised for PoC; a cost per call that is less than cellular; call set-up times that are significantly faster than cellular; and interoperability, or a large enough base of users with PoC capability. With handsets becoming available, and operators looking at attractive tariff levels, enough activity has been around in the market to generate the typical mobile hype. However, because the latter two components of speed and critical mass were not present the hype did not live up to the market expectation — an all too familiar story in the mobile industry.
PoC must have some unique product differentiators from cellular in order to be successful, or customers will see no reason to change their habits and make a PoC call rather than just a cellular call. In addition, PoC grows as a “network effect” so getting to some level of critical mass is essential to making the move from early adopters to riding the growth curve of the “hockey stick”.
European operators have been reluctant to launch proprietary solutions since much of the GSM success is based on interoperability and handsets often move between operators. This has led many operators to wait for the standard to settle, and as this has happened we may soon see renewed focus on PoC.
Making the marketing case
The major difference between Europe and the US is that mobile users have enjoyed the GSM single standard roaming technology for many years, so the PoC service cannot use roaming as an added attraction. There is also the issue of call set-up time. With the Nextel service, which uses Motorola’s proprietary iDEN technology, call set-up occurs much faster than other cellular services. In other technologies, both proprietary and open standard using the new OMA specifications, call set up times can be as long as, or even longer than, the time taken to set up a cellular call, so one of the key incentives to use PoC is not yet technologically present.
The challenge in Europe is to achieve the quality level of iDEN over GPRS networks to ensure the customer expectations are met. Once the technology is up to speed, so to speak, the service must be marketed in a way that creates the right positioning for PoC. There is a key difference in marketing the service as a replacement for standard land mobile radio, as used by taxi cabs, transportation industries and the military, versus marketing the service for the consumer on a voice and instant messaging pitch. Creating a clear marketing plan for each group will be critical for success.
Most new technologies follow a hype curve, where intense market attention is followed by a period of silence, and where technology is tested and plans are under way for roll-out. This is the current situation with PoC in the European market (see figure above).
In summary, from our research and knowledge of the market, we can see an overall significant and global need in the market for PoC. There are many situations, both in Europe and around the world, when mobile users would benefit from, and prefer to use, PoC rather than a SMS or a voice call. Experience has proven that users with PoC features on their phone tend to use their handset more, potentially providing mobile operators with higher average revenues per user. Once interoperability issues have been solved, there is no reason why operators cannot replicate the success of Nextel. We should remember that it actually took about five years from launch of SMS until it was widely used. Look at it now.