Wireless Internet and Pervasive Computing
A Framework for Technology Adoption and Integration
M. Krishna Kumar, Information Technology Analyst, Telecommunications Practice, Tata Consultancy Services
Wireless internet and pervasive computing are the new paradigms that are emerging both as a complementing and a potent alternative to wire line internet and fixed computing. In the rarefied field of digital evolution, the traditional logic of economics of demand supply are locked in an interplay of push and pull' forces that keep shaping and reshaping the contours of businesses. On the one hand, with the acceptance and penetration of mobile devices outrunning those of Personal computers, the need to rely on such mobile links to receive or deliver service on the fly is very compelling.
On the other hand, with the world's digital communications infrastructure continuing to build out at a frenetic pace, the focus is shifting from fixed computing to the provisioning of diverse array of networks, services and devices that allow access to data, voice and video. In this milieu, hogging the spotlight are the technologies, equipment and services required to intelligently deliver an increasingly complex menu of applications and content. These promise to open up new vistas of personal and business communications.
Disruptive Technologies Revisited
The internet, wireless telecommunications and mobile and ubiquity - lending computing devices are the three main catalysts of an exciting change, which creates a new powerful way to extend the reach of businesses .Wireless internet and mobile computing are evolving as the classic disruptive technologies that provide an alternative to mainstream and traditional mechanisms.
On the 'push' (supply-side economics) side, the scenario today is characterised by a vendor campaign bordering on the 'cart-before-horse hype' about the new wireless internet technologies and their abilities. On the pull (demand) side, with over five hundred million cellular subscribers worldwide, users have overwhelmingly embraced the concept of having a phone that is always with them. To such traditionally 'dumb' devices has been added intelligence, although residing in the cellular network, through developments like WAP, i-mode etc. This has been logically followed by the service innovations that ride on such enabling technologies.
The hype and unhype witnessed so far only goes to show that though such technologies are initially beset with performance issues, they are quickly leavened by improvements to price-performance ratios, paving the way for their pervasive acceptance. While the extent of acceptance of such service innovations has been a subject of much debate, it is clear that the march of these technologies is inexorable and hence organisations should reckon with the attendant opportunities and threats.
Deconstruction, De-averaging, Disintermediation and Reintermediation - A Brief Overview
Deconstruction and de-averaging in the value chain, terms used by Philip Evans and Thomas Wuster, in their book " Blown to Bits" to convey the phenomenon which ensues when the trade-off between 'richness' (of information) and 'reach' (access to 2 customers/end-users) is blown apart by innovations and disruptive technologies such as internet and wireless data communications. To quote a core tenet of their theory, "in highly integrated value-chains, the aggregate competitive advantage is what determines the market position, and not the competitive advantage at each constituent node in the chain". That is to say "inefficient nodes of competitive advantage attenuate the overall competitive advantage". When these chains begin deconstructing, such subsidizing of competitive advantage leads to disinter mediation by new competitive players. This also leads to realignment of industry and business models and the post-deconstruction period opens opportunities. This could be used for reintermediation by those displaced during deconstruction.
Fresh from assimilating and aligning their organisational weather cocks with the winds of change that visited in the form of e-business and e-commerce paradigm, wireless and pervasive computing is next energetic thrust that needs to be tolerably grasped and profitably moulded by organisations. Hence, it is imperative for organisations to relook at their value-chain and identify the constellation of inflection points where the wireless and mobile computing technologies can be strategically deployed and leveraged.
This article tries to conceptualise the impact of the new paradigm of ubiquity on the various organisational 'value-creating touch points', both internal and external viz. with partners, suppliers, customers and employees, so as to arrive at the segments where the solution space exists for wireless and mobile computing solutions and the entailing changes to the interfaces with value-creating partners in terms of new relationships and collaboration.
The New Channel Challenge-Understanding the Inflection Points for Wireless and Mobile Computing Technology Solutions From the foregoing argument, the 'channel challenge' that manifested with the onset of web-enabled commerce and transactions continues, with the latest frontier to be mastered being multiple-channels of communication with various touch points, offering ubiquity and reach. Ubiquity, reachability and localisation of interactions form the core virtues that will underpin the efforts to un-tether the organisation' channels to lend greater span for customer, partner, supplier and employee interaction with the various arms of the business. (See the Fig 1).
The organisational process wheel is a conceptual representation of all the value-adding processes in a business. The spokes of this wheel interface into the various processes, which terminate at various touch points viz customers, suppliers, partners and employees. These touch points are the venues of interaction between transacting entities to churn out value. Hence, they are 'value-creating' touch points.
In the business to consumer or B2C channel, the key theme revolves around customer relationship management with the objective of satisfying and retaining the customer-this includes managing all the interfaces with the customer for provisioning of information and transaction-enabling environment. The deconstruction here could arise from the new paradigm of anywhere, anytime information and transaction by the customer. The strategy then would be to extend the existing services to the wireless/mobile domain. This apart, a new segment or user base can be acquired with a foray into mobile e-commerce. For example, Banks provisioning for mobile banking and also foraying into payment authentication and consummation of m-commerce, will be enrolling a subset of the Mobile Service Provider's subscriber segment.
Similarly, the business-to-business or B2B channel essentially manages the interfaces with various suppliers upstream the supply chain and value-added resellers downstream with the objective of improving the supply chain effectiveness and efficiency. Deconstruction would similarly set in, with the threat of dis-intermediation. Aligning the supply chain with this new paradigm involves opening new interfaces to supply chain processes by leveraging the wireless and mobile paradigm and managing new business-to-business integration activity. For example, airlines building mobile-ticketing application for information and transaction and also having to tie-up with the new breed of travel aggregators (or becoming travel aggregators themselves) because customer demands a choice of alternatives with price and performance attributes.
Business to employee or B2E channel manages the interface necessary to support the field force. Though depicted separately in the figure, it is actually hidden and can manifest as internal organisational enabler for managing B2B or B2C channels. So, the key inflection points for inducting wireless and mobile computing technologies are the three sweet spots depicted in Figure 1.
B2B, B2C and B2E Sweet spots -Adopting the Right Technology
Having seen where the inflection points could be, the next step would be to ascertain the right technology and process. While a convergence in wireless and mobile devices is happening, there still exist clear demarcation between mobile computing and wireless solutions. By wireless internet is meant applications, infrastructure and devices to support real-time data transfer. Rich computing power may or may not exist. By mobile computing is meant the integrated environment to facilitate rich computing, devoid of connectivity (as a corollary may not be of much relevance in the context of time-sensitive applications).
Considering that both wireless internet and mobile computing are alternative technologies themselves, their suitability to a given context of application and content, needs to be evaluated across the following dimensions to see whether the application that hosts the content is a good candidate for wireless access or mobile computing:
- Time-sensitivity - is a real-time transfer of data required?
- Static or dynamic - is the content on which a transaction hinges, given to frequent updates?
- Location dependency - is the content to be filtered with a personalizing layer of location?
These three parameters sum up the Compelling-ness of the content and hence the appropriate technological option. Most applications vis-a-vis B2E and B2C or B2B, differ on the 'compelling ness' score. Hence, what follows is a description of the scenarios encountered in each segment (viz. B2B, B2C, B2E) so as to help in discerning the trend.
Business to Consumer - New Channel Development Space and Integrated Channel Strategy
Spanning all the customer touch points is the key to expanding the customer base and reducing churn. Leveraging the wireless technology to supplement the existing basket of services can develop new customer touch points. For example (given the proliferation of ATM outlets and the increasing reliance on them for banking), applications like 'FindMe' and proximity services offered by banks to help locate the nearest ATM and other such point-of-sale outlets, is very compelling. This is a move towards more self-provisioning to complement the anywhere, anytime paradigm of service.
B2C space also opens revenue opportunities with mobile e-commerce. Referring to the example of banks again, some banks already have revenues-sharing arrangements with operators for SMS and WAP-banking. In addition, transaction cuts for m-commerce payments is also in vogue for high value-transactions, which cannot be managed by micro-billing (payment through monthly cellular phone bills).
Also, while it is true that wireless carriers dictate revenue-sharing arrangements in a walled-garden scenario (the term used to describe the closed model of content relationships forged by operators with select portals, content and service providers/ aggregators), there is a considerable revenue-generation outside the network operators scope. Users may locate a favorite retail outlet (hotels etc) on their wireless phones but pay for the service at the 'point-of-service' outlet. Or in a scenario where the consumer has already paid for the service, the cost of offering such convenience of anywhere and anytime service is factored in. A case in point will be parcel-tracking services over WAP-enabled phones.
Integrated Channel Strategy
Using the Web medium for personalising the features is already prevalent. So, another complementing feature of wireless internet will be in strategically siphoning users to the web so as to increase customer 'stickiness' by ensuring repeat visits due to compelling wireless service. This helps is assimilating the touch-points and leveraging the inherent synergies.
Business to Business - New Integration and realignment space
Because the linearity in the value-chains has been disrupted due to the direct interfacing of the customer with the service providers, the traditional intermediaries have been squeezed-out from the chain. A case in point is the travel services. No longer is the customer beholden to intermediaries who merely filled the information gap. Airlines and rail services are now proactively able to address the needs of the traveling customer at various points in their itinerary through auto-notification of reservation status confirmation and changes in schedule as well as providing real time alternatives in the event of such changes
On the other hand, a new intermediation witnessed is that of the aggregation services from the likes of Wireless Application Service Providers who would offer one-stop movie-ticket applications, mobile-ticketing and travel guidance. These players apart from speeding up the roll-out of compelling services by mediating between the small content providers and the network operators, also cater to the point-of-need customer demands. In so doing they will need to tie-up with all the major airlines and railways and other service providers to gain real-time connectivity to their database.
Taking the banking analogy again, the blurring of boundaries witnessed between banks and cellular operators in the mobile banking and mobile e-commerce payment through micro-billing, shows that the bank's value-chain is deconstructing. The balance of power currently rests with the service providers/network operators because of the walled gardens.
However, these are likely to crumble and assume a more open and customer-focused configuration. Also, it is very likely that for high-value transactions, banks will still be preferred as the network operator may not be willing to bear such liability.
Business to Employee Productivity Enhancement Space
Much of the need for wireless data transfer emanates from the operational side of the business in markets such as field service, transportation and utilities. A case exists today for automating field activities like order entry and status, pricing and customer problem alerts and trouble-shooting. But the strategic dimension of such wireless applications is revealed in industries where the main driving force is to get as close to the customer as humanly possible - be it through a sales force, account managers or other road-warriors. The competitive advantage is embedded in the mobile force that performs at the cutting edge in the value-chain viz. the customer interface. The key inflection point therefore is to empower the employee with such levels of information and support that mirrors what he would get from the central office. A case in point is the Insurance sector.
Immense potential exists for mobile computing solutions like Quotation Generation Systems, which, to start with, could essentially be creating look-up tables in a PDA and then automatically generating premiums with minimum inputs. But there is also a case for point-of-need data download as to the revised premium rates and other dynamic information. There is also good potential for 'illustrations' - i.e. showing alternative investment scenarios (generated with minimum inputs) to the customer desirous of investing in an insurance scheme so as to make an impact.
Outsourcing of Wireless Infrastructure Hosting
With advent of public wireless infrastructure like WAP etc, organisations are also looking at replacement of their proprietary or private RF networks and outsource it through public infrastructure so as to insulate themselves from the complexity of hosting and managing them. For example, telemetry, remote monitoring and 7 trouble-shooting can now be done on GSM systems. In addition to these class of sales force, there are telecommuters (who work at home for several days), and work extenders (who very often carry home the their work). Organisations will need to provision for remote support and data communication infrastructure.
Any discussion on the business impact of the new paradigm of wireless internet and mobile computing is incomplete without a brief discussion of the enabling technologies. There are two basic components of such technologies -the underlying bearer (CSD, GPRS etc) and the application protocol (WAP, i-mode).
- WAP- quo vadis?
After a hype-fuelled initial progress, WAP is currently lying at the trough of disillusionment in its evolution curve. Most European WAP markets have gone through the acceptance phase and are now going through a reality check. While one can enquire elaborately into the causative factors for such decline, considering the scope and context of this article, only fundamental causes perceived from the critique's diary have been highlighted below.
- WAP was elevated as a wireless internet nirvana by equipment and technology vendors the with the result that the initial roll-out of wireless internet services fell far short of the inflated user expectations. This was manifested in the form factor inadequacy vis-a-vis the richness of content and other compromises. Even though optimised for a constrained bandwidth, there exist performance issues such as call drops, lost sessions etc.
- Out of step evolution between devices capable of supporting WAP and other protocols, the networks and services. Inadequate speed of roll-out of WAP services as the content relationships with the mobile service providers were slow, unlike the web-portals scenario, where content relationships were forged at a blistering pace. Wittingly or unwittingly, the WAP architecture imposes a carrier-centricity to the business model and hence induces sloth in the content-relationship activity.
- WAP on GPRS
The next wave in bearer technology seems to be GPRS and its roll-out coinciding with WAP 2.0 will obviate another instance of out-of-step development between protocols, networks and handsets. Blue tooth is already emerging as a niche enabler of point-of-sale payment. While 3G technologies are coming out of the stables, their future is contingent on the course taken by the more immediate technologies viz. WAP on GPRS and Blue tooth.
The pieces are in place for organisations to design their foray into wireless internet and mobile computing to help increase customer loyalty, generate supplemental revenue streams and reduce operating costs. For businesses, the current shortcomings of wireless devices, networks and enabling technologies presents an opportunity to stop, ponder and develop an integrated strategy for wireless internet and mobile computing before the dizzying rate of enhancements to the technology iron out the limitations and organisations find themselves quivering at the edge of a new wireless revolution.
About The Author
M. Krishna Kumar is a business analyst associated with the Telecom Industry Practice of Tata Consultancy Services and is in charge of Business Development and Consulting for Advanced Telecommunication Technologies for Europe. He holds a Bachelors degree in Mechanical Engineering from Osmania University and a Post Graduate Diploma in Management from the Institute of Management Development and Research.