Skype Exec Discusses Drivers of 4G, 'Reaching an Inflection Point'

The “ongoing sea of change” in the telecommunications market centers on the rising adoption of Internet mobility and the apparent need for a fourth generation network,  according to Christopher Dean, Skype’s (News - Alert) chief strategy officer, the morning keynote speaker at ITEXPO East 2010.

 

The Skype executive told the standing room only crowd at the Miami Beach Convention Center that mobile consumer changes occurring in the market offer “both immense risk for operators who don’t adapt to change, but also an incredible amount of opportunity for those that do.”

 

Dean said that in the era of the mobile consumer, mobile wireless networks will swell to 10 times the amount of devices over the next 10 years. In addition, an “incredible pent up demand for the iPhone and adoption of smartphone solutions is accelerating, and that adoption rate will drive the need for a 4G network.

 

Although 3G today is “not that broadly penetrated,” Dean remarked, noting about 20 percent of total users are equipped with access, however, metro areas including San Francisco and New York City are “overwhelmed” by iPhone (News - Alert) usage.

 

We are reaching an “inflection point,” Dean said, where 4G will ultimately be driven by integrated network connected consumer device and applications. Mobile phone market penetration is anticipated to grow by 28 percent by 2013, reaching four billion global subscribers.

 

Dean noted some imposing ABI Research statistics: mobile Internet adoption is set to outpace desktop Internet adoption by 2013, when there will approximately 1.7 billion PCs and 1.82 billion smartphones, presenting congestion on 3G and hence driving the advent of 4G “that’s got the opportunity to truly unclog the network,” Dean said.

 

As 4G network deployments gather momentum, a substantial 22 percent of device subscription revenues will come from suites of operator-branded premium services, according to ABI research.

 

“In order to be relevant in the age of the mobile consumer, we believe we have to make Skype easy to use over the 300 to 400 billion devices” that will one day exist, Dean said.

 

Skype’s video segment has grown significantly, further evidence of the case for 4G. Dean noted, “video is really taking off and really growing,” with Skype’s usage up five times from 2007 to 2008, and peaking well over 50 percent on major holidays such as Christmas and New Year’s.

 

Skype recently announced that Panasonic and LG will be integrating Skype into their flat panel televisions. In his blog, TMC (News - Alert) CEO Rich Tehrani wrote: “Dean, the head of enterprise strategy at Skype,keynoted ITEXPO (News - Alert) this morning explaining how his company plays in the communications space and expounded on the company’s software integration with mainstream televisions. In a survey of the crowd by me after the presentation, a full 25 percent of the audience said they wanted Skype in their televisions.”