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Linley Report on Mobile Connectivity Chips Released

I have been working for some time on a report about mobile connectivity chips. This is an interesting market, one that is so hot that it is actually going to continue to grow in 2009 as the overall cell phone market declines by 10%.

The term “connectivity” denotes all the radios in a cell phone that are not cellular radios. There are a lot of them. The main ones are Bluetooth, FM radio, GPS and Wi-Fi. Others beginning to appear in handsets are TV and NFC. Further out in time are 60 GHz and White Spaces radios.

The cell phone market deals in massive volumes – about 1.2 billion handsets were sold in 2008. It also has some stringent requirements. The market demands chips that are small, cheap, battery-life conserving and easy to design-in. These considerations have driven chip vendors to combine multiple connectivity radios onto single chips. The first combo chips were Bluetooth plus FM. Then came Bluetooth plus FM plus Wi-Fi then most recently Bluetooth plus FM plus GPS.

Because the market is so big, the competition is intense. The 2008 leaders in Bluetooth were Broadcom and CSR; in Wi-Fi TI, ST-Ericsson and Marvell; in GPS TI and Infineon; and in FM ST-Ericsson and Silicon Labs.

These vendors are leap-frogging each other on performance and features. 2009 will see major changes in market share as some vendors fail to refresh their old product lines, others refresh their product lines but with inadequate products, and new entrants come in with better solutions.

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Skype on Nokia phones. Video telephony for the masses?

At the end of 2008 there were 415 million broadband subscribers world-wide, and Skype claimed 405 million subscribers after a 47% year-on-year growth. So Skype must be topping out, right?

Perhaps not. At the end of 2008 there were 4 billion mobile phone users. Ten times as many as fixed broadband, and four times as many as PCs. Skype just announced that Nokia will be putting Skype on some of its high end phones. If the idea spreads Skype will still have plenty of room to grow.

But there is bigger news hidden here. Video telephony has been just around the corner for about 50 years. This announcement may soon make it commonplace.

I have written before about Skype sound quality, but Skype’s video capabilities also kick the competition. My children make regular intercontinental Skype video calls to their grandmother, and both the sound and video quality are generally excellent now that I have discarded my Linksys router and got an Apple Airport Extreme. If the numbers don’t convince you that Skype video calling is perfectly mainstream, perhaps Oprah will.

The phone mentioned by Nokia as the first to have Skype built in is the N97. Almost all of Nokia’s high end smart phones (the Eseries and Nseries) have Wi-Fi, and many (including the N97) have a “secondary camera” on the same side as the screen for use in video calling. Video calling is supported by the SIP soft-phone software that Nokia puts in almost all these phones, but SIP VoIP is nowhere compared to Skype. So the news that Nokia will be loading Skype onto some of these phones is tantalizing. The existing base of Skype users on PCs will bestow a massive network effect on Skype video calls from Nokia handsets.

The Wi-Fi aspect will help users to get around the carriers’ resistance, which in any case may be waning if the Skype interview linked above is correct.

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Sharing Wi-Fi 2 – Atheros turns a cellphone into an access point

There are several smartphone applications that allow a cell phone to act as a wireless WAN router and Wi-Fi access point, creating a wireless LAN with Internet access. For the (jailbroken) iPhone there’s PDAnet, for Windows Mobile there’s WM Wi-Fi Router and for Symbian there’s Walking HotSpot and JoikuSpot. Now Atheros has proposed to bake this functionality into their low power Wi-Fi chipset.

An idea that is as patent jargon goes “obvious to one skilled in the art,” can sometimes have obvious handicaps to one experienced in the industry. While exposing a broadband wireless data connection through a smartphone’s Wi-Fi radio is massively useful to consumers, it is unlikely to appeal to network service providers, who would prefer you to buy a wireless data card (and an additional service subscription) for your laptop rather than to simply use the wireless data connection that you are already paying for on your phone.

It will be interesting to see where this goes. I will be stunned if Atheros’ implementation appears on any phone subsidized by (or even distributed by) a wireless carrier, until they can figure out a way to charge extra for it. As Tim Wu says in his Wireless Carterfone paper (the Wireless Carterfone concept was promoted by Skype, and rejected by the FCC last April):

carriers are in a position to exercise strong control over the design of mobile equipment. They have used that power to force equipment developers to omit or cripple many consumer-friendly features.

The billing issue may not be that intractable. Closely related models already exist. You can get routers from Cisco and other vendors that have a slot for a wireless WAN card, and the service providers have subscription plans for them. More similarly, this could be viewed as a kind of “tethering” But tethering only lets one PC at a time access the wireless WAN connection – unless that PC happens to support My Wi-Fi.

Update: Marvell has announced a similar capability for its 88W8688 chip.

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Sharing Wi-Fi 1 – My Wi-Fi

I have written before about Intel’s Cliffside project. This went public at CES in January under the name My Wi-Fi. The idea is to make your one laptop Wi-Fi adapter into two virtual adapters. One of these adapters is a regular laptop Wi-Fi adapter like before. The second turns your laptop into a kind of mini access point. Consumer electronics like Apple TVs and Wi-Fi printers can then stream media directly to and from the laptop, rather than relaying it through a real access point:

Realize first that, from an overall network topology standpoint, a single video stream coursing from source to destination is actually two streams; one going from the source to the router and through its integrated switch, and another heading out from the router to the destination. [Brian Dipert]

My Wi-Fi also allows Wi-Fi to substitute for Bluetooth for laptop wireless peripherals, like mice and keyboards, and this CNET article points out that it can also be used to share paid Wi-Fi connections in hotels and hot-spots.

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Transparency and neutrality

Google and the New America Foundation have been working together for some time on White Spaces. Now they have (with PlanetLab and some academic researchers) come up with an initiative to inject some hard facts into the network neutrality debate.

The idea is that if users can easily measure their network bandwidth and quality of service, they will be able to hold their ISPs to the claims in their advertisements and “plans.” As things stand, businesses buying data links from network providers normally have a Service Level Agreement (SLA) which specifies minimum performance characteristics for their connections. For consumers, things are different. ISPs do not issue SLAs to their consumer customers. When they advertise uplink and downlink speeds, these speeds are “typical” or “maximum,” but they don’t specify a minimum speed, and they don’t offer any guarantees of latency, jitter, packet loss or even integrity of the packet contents. For example, here’s an excerpt from the Verizon Online Terms of Service:

VERIZON DOES NOT WARRANT THAT THE SERVICE OR EQUIPMENT PROVIDED BY VERIZON WILL PERFORM AT A PARTICULAR SPEED, BANDWIDTH OR DATA THROUGHPUT RATE, OR WILL BE UNINTERRUPTED, ERROR-FREE, SECURE…

Businesses pay more than consumers for their bandwidth, and providing SLAs is one of the reasons. Consumers would probably not be willing to pay more for SLAs, but they can still legitimately expect to know what they are paying for. The Measurement Lab data will be able to confirm or disprove accusations that ISPs are intentionally impairing traffic of some types.

This is a complicated issue, because one man’s traffic blocking is another man’s network management, and what a consumer might consider acceptable use (like BitTorrent) may violate an ISP’s Acceptable Use Policy (Verizon:”…it is a violation of… this AUP to… generate excessive amounts of email or other Internet traffic;”). The arguments can go round in circles until terms like “excessive” and “unlimited” are defined numerically and measurements are made. So Measurement Lab is a great step forward in the Network Neutrality debate, and should be applauded by consumers and service providers alike.

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Skype’s new super-wideband codec

I spoke with Jonathan Christensen of Skype yesterday, about the new codec in the latest Windows beta of Skype:

MS: Skype announced a new voice codec at CES. What’s different about it from the old one?

JC: The new codec is code-named SILK. Compared to its predecessor, SVOPC, the new codec gives the same or better audio response at half the bit-rate for wideband, and we also introduced a super wideband mode. SVOPC is a 16kHz sample rate, 8kHz audio bandwidth. The new codec has that mode as well, but it also has a 24 kHz sample rate, 12 kHz audio bandwidth mode. Most USB headsets have enough capture and render fidelity that you can experience the 12 kHz super wideband audio.

MS: Is the new codec an evolution of SVOPC?

JC: The new codec was a separate development branch from SVOPC. It has been under development for over 3 years, during which we focused both on the codec and the echo canceller and all the surrounding bits, and eventually got all that put together.

MS: What about the computational complexity?

JC: The new codec design point was different from SVOPC. SVOPC was designed for use on the desktop with a math coprocessor. It is actually pretty efficient. It’s just that it has a number of floats in it so it becomes extremely inefficient when it’s not on a PC.
The new codec’s design goal was to be ultra lightweight and embeddable. The vast majority of the addressable device market is better suited to fixed point, so it’s written in fixed point ANSI C – it’s as lightweight as a codec can be in terms of CPU utilization. Our design point was to be able to put it into mobile devices where battery life and CPU power are constrained, and it took almost 3 years to put it together. It’s a fundamental, ground up development; lots of very interesting science going into it, and a really talented developer leading the project. And now it’s ready. It’s a pretty significant jump forward.

MS: Is the new codec based on predictive voice coding?

JC: SVOPC has two modes, an audio mode and a speech mode, and the speech mode is much more structured towards speech. The new codec strikes little bit more of a balance between a general audio coder and a speech coder. So it does a pretty good job with stuff like background noise and music. But to get that kind of bit-rate reduction there are things about speech that you can capitalize on and get huge efficiency; we didn’t toss all that out. We are definitely using some of the model approach.

MS: Normally one expects with an evolution for the increments to get smaller over time. With the new codec you are getting a 50% improvement in bandwidth utilization, so you can’t be at the incremental stage yet?

JC: I don’t think we are. We were listening to samples from various versions of the client going back to 2.6, now we are at 4.0. In the same situation – pushing the same files in the same acoustic settings through the different client versions – in every release there’s a noticeable (even to the naked ear) difference in quality between the releases.

We are not completely done with it. There are many different areas where we can continue to optimize and tweak it, but we believe it’s at or above the current state of the industry in terms of performance.

————–

Skype 4.0 for Windows has the new codec.
The current Mac beta doesn’t yet support the new codec.

Update: February 3rd,2009: Here is a write-up of SILK from the Skype Journal.

Update: March 7th, 2009: Skype has announced an SDK for third parties to implement SILK in their products, royalty free.

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Fixed Mobile Substitution and Voice over Wi-Fi

Getting rid of your land-line phone and relying on your cell phone instead is called Fixed Mobile Substitution (FMS).

A report from the National Center for Health Statistics of the Centers for Disease Control (CDC) shows a linear increase in the number of households that have a cell phone but no land-line, starting at 4.4% in 2004 and reaching 16.1% in the first half of 2008.
US Fixed Mobile Substitution 2005-2008 - source: CDC

These numbers match those in a recent Nielsen report on FMS.

FMS will most likely accelerate in 2009 because of the recession. It will be interesting to see by how much. We will reach a tipping point soon. 13% of households have a landline that they don’t use.

There are about 112 million occupied housing units in the US, and about 71 million broadband subscribers.

So what does this mean for Wi-Fi VoIP? One of the primary reasons for FMS is to save money; it is more prevalent in lower income households. There are two kinds of phone that do VoWi-Fi, smartphones and UMA phones. Smartphones are expensive, and probably less common among the cord-cutting demographic – except that that demographic is also younger and better educated as well as having a modest income – many are students.

Wi-Fi VoIP in smart phones is still negligible, but the seeds are planted: vigorous growth of smart phones, Wi-Fi attach rate to smart phones trending to 100%, a slow but steady opening up of smart phones to third party applications, broadband in most homes, Wi-Fi growing in all markets.

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Wi-Fi and the Mobile Internet

Admob periodically publishes numbers on the mobile Internet and its usage. The numbers are badly skewed because of Admob’s customer mix. For example Indonesia lists as the second largest mobile Internet market in the world. But if you make your own mental adjustments for this, the numbers are informative.

Admob’s latest report highlights Wi-Fi use in the USA.

Of the ad requests fielded by Admob, in August 2008 9% came from Wi-Fi capable devices: dual-mode phones, iPod Touches and Sony PSPs. In November this number doubled to 19%. Since the numbers for August aren’t broken down, it is uncertain which devices drove this growth, but my guess is that it is due to the booming sales of the iPhone.

Of the requests from Wi-Fi capable devices, the proportion that came over Wi-Fi varied radically. For the iPod Touch and the Sony PSP, 100% of the requests were over Wi-Fi. No surprise there. But on the phone side, a very interesting discrepancy between the iPhone (42% of requests by Wi-Fi) and the HTC phones (16% of requests by Wi-Fi). Since each of the phones uses the same browser for cellular data and Wi-Fi connections, it can’t be an ease of use of the Internet issue. Two other possibilities come to mind: the Wi-Fi may be easier to set up on the iPhone than it is on the HTC phones, or the cellular data speed may be worse on the AT&T network, driving the users to Wi-Fi, while users on T-Mobile (where all the HTC phones listed in the report are) get acceptable performance from their cellular data connection.

The Blackberry data casts a similar light on the question. The two Blackberries in the report were the 8820 and the 8320. The 8820 had the same profile as the iPhone – 40% of the requests came by Wi-Fi. The 8320 had even less Wi-Fi use than the HTC phones – only 8% of the requests came by Wi-Fi. These two phones are both on the same carriers (AT&T and T-Mobile), they have the same Wi-Fi chip (from TI), and their specs are similar.

The clue is in their release dates. The 8320 has been out on T-Mobile for a year, but was not yet released on AT&T in November when AdMob collected their numbers. The 8820 was released by AT&T a year ago, but by T-Mobile only 6 months ago. There are obviously a lot of other variables at work – like 3G versus 2G, for example, and pricing structure, but this looks like evidence that the T-Mobile data network has a more acceptable performance than AT&T’s.

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A not so perfect Storm

The Verizon Storm may be heading for failure in more than one way. A raft of reviewers, led by David Pogue of the New York Times are trashing its usability. This means that even with the marketing might of Verizon behind it it may not fulfill its goal of being a bulwark against the iPhone in the enterprise.

But the Storm was an experiment in another way by Verizon. The other three major American mobile network operators have capitulated to Wi-Fi in smartphones. Against the new conventional wisdom, Verizon decided to launch a new flagship smartphone without Wi-Fi. The Storm looks like a trial balloon to see whether Wi-Fi is optional in modern smartphones. If the Storm is a success, it will demonstrate that it is possible to have credible business smartphones without Wi-Fi. But if it turns out to be a flop because of other factors, it will not be a proof point for Wi-Fi either way.

But Wi-Fi is a closed issue by now for all the network operators, perhaps even including Verizon. Phones have lead times of the order of a year or so, and controversies active back then may now be resolved. Verizon covered its bets by launching three other smartphones around the same time as the Storm, all with Wi-Fi (HTC Touch Pro, Samsung Omnia, Samsung Saga).

Before its launch, AT&T hoped that the iPhone would stimulate use of the cellular data network. It succeeded in this, so far beyond AT&T’s hopes that it revealed a potential problem with the concept of 3G (and 4G) data. The network slows to a crawl if enough subscribers use data intensively in small areas like airports and conferences. Mobile network operators used to fear that if phones had Wi-Fi subscribers would use it instead of the cellular data network, causing a revenue leak. AT&T solved that problem with the iPhone by making a subscription to the data service obligatory. T-Mobile followed suit with the Google phone. So no revenue leak. With the data subscription in hand, Wi-Fi is a good thing for the network operators because it offloads the 3G network. In residences and businesses all the data that goes through Wi-Fi is a reduction in the potential load on the network. In other words, a savings in infrastructure investment, which translates to profit. This may be some of the thinking behind AT&T’s recent acquisition of Wayport. The bandwidth acquired with Wayport offloads the AT&T network relatively cheaply. AT&T’s enthusiasm for Wi-Fi is such that it is selling some new Wi-Fi phones without requiring a data subscription.

The enterprise market is one that mobile network operators have long neglected. It is small relative to the consumer market, and harder to fit into a one-size-fits-all model. Even so, in these times of scraping for revenue in every corner, and with the steady rise of the Blackberry, the network operators are taking a serious look at the enterprise market.

The device manufacturers are way ahead of the network operators on this issue: the iPhone now comes with a lot of enterprise readiness Kool-Aid; Windows Mobile makes manageability representations, as does Nokia with its Eseries handsets. RIM, the current king of the enterprise smartphone vendors also pitches its IT-friendliness.

Wi-Fi in smartphones has benefits and drawbacks for enterprises. One benefit is that you have another smart device on the corporate LAN to enhance productivity. A drawback is that you have another smart device on the corporate LAN ripe for viruses and other security breaches. But that issue is mitigated to some extent if smartphones don’t have Wi-Fi. So it’s arguable that the Storm may be more enterprise-friendly as a result of its lack of Wi-Fi. Again, if the Storm becomes a hit in enterprises that argument will turn out to hold water. If the Storm is a flop for other reasons, we still won’t know, and it will have failed as a trial balloon for Wi-Fi-less enterprise smartphones.