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4 EBR #3 2010
Ericsson
ERICSSON BUSINESS REVIEW
is Ericsson’s global business
magazine, focusing on thought
leadership and providing a longterm
perspective on business
strategies in telecommunications.
The magazine is distributed to
readers in more than 130 countries.
ADDRESS
Telefonaktiebolaget LM Ericsson,
SE-164 83, Stockholm, Sweden
Phone: +46 8 719 00 00
ADDRESS CHANGES
Strömberg Distribution AB,
E-mail: business.review@strd.se
PUBLISHER
Patrik Regårdh
EDITORIAL COUNCIL
Patrik Regårdh, Ulrika Bergström,
Marcel Noordman, Miguel A
Rodríguez, David Wilson, Robert
Grönborg, Sanjay S Kaul
EDITOR-IN-CHIEF
Mats Thorén
mats.thoren@jgcommunication.se
DEPUTY EDITOR
Nathan Hegedus
ART DIRECTOR
Jan Sturestig
LAYOUT
Maria Andersson
EDITORIAL OFFICE
JG Communication,
www.jgcommunication.se
COVER PHOTO
Chris Maluszynski
CHIEF SUBEDITING
Birgitte van den Muyzenberg
CONTRIBUTORS
Moira Quinn Mawhinney,
Paul Eade, Erin Delahunty,
Benny Ritzén, David Callahan
GRAPHS
Claes Göran Andersson
PRINTER
VTT Grafiska, Vimmerby 2010
VOLUME
12, Issue 3, 2010
ISSN
1653-9486
COPYRIGHT
Telefonaktiebolaget LM Ericsson
ERICSSON BUSINESS
REVIEW was awarded
Best Business-to-
Business publication
2010 by The Swedish
Association of Custom
Publishers (SACP)
[9] Editorial: We can connect everything − but why should we?
In this issue we give you some answers. It is hard to define or gauge the emerging market for
machine connectivity, because the only common denominator seems to be that it will be very,
very big. But acknowledging that fact is a good start.
[10] COVER STORY: The great scare – embracing the internet threat
Having lost the first internet battles, the media and telecom industries are left with declining
revenues. Now, after a history of failed collaborations, both industries have little choice but to
blaze a common trail towards future relevance, says media management expert Lucy Küng.
[20] THEME: Rise of the machines
The vision is clear: network−connected machines will improve our lives in numerous ways.
So what’s the problem then? Put simply, most network operators are not geared up for
handling this radically different line of business. But they could be, and there are very good
reasons for them to get into the race.
[28] THEME: The experience of an early starter
Norwegian incumbent Telenor is an M2M pioneer having installed close to 2 million M2M
SIM cards, with their numbers doubling each year since 2004. Here, they explain why
connecting machines is fundamentally different from what telecom operators traditionally do.
[32] THEME: The Internet of Things in the eyes of the users
The power of the Internet of Things is not in any of its single connections but in the totality of
interconnections. Unless this is made clear to consumers, it will be very hard to create the
mass−market platform the industry is hoping for.
[36] THEME: The Chinese take on connected machines
The mobile channel is a powerful medium, but it is also highly sensitive. In using profile data,
made anonymous, for targeted mobile advertising, operators have found a solution to stay
ahead of the game.
[40] THEME: What operators need to support 50 billion connections
The evolution of an M2M industry ecosystem is closely linked to the role of the network
operator. A closer look at the knowledge necessary to develop that ecosystem gives an
indication of what future M2M platforms might look like.
[45] How Telstra gained speed to market – without blowing the budget
When Telstra set out to transform its transmission network, it was not simply to counter
exploding traffic volumes. Telstra restructured as part of a long−term plan to get ahead of
the competition. This is a lesson in how intimately network strategy is coupled with
business strategy.
[49] The benefi ts and barriers of network sharing
Why have so few network sharing projects been successful? The technical issues between
partners can be resolved, so the real challenge is to make cooperation between competitors
work. A business−focused and structured approach will improve the chances of success.
[54] The value−driving role of devices – and what to expect
Wireless devices have undergone dramatic changes but have still remained core to operators’
value creation. In the new era now taking shape, devices are connected in ever simpler ways.
Telecom players should watch out for what this simplification could do to their value chains.
[58] OPINION: Realize the promise of M2M – make it work out of the box
There is room in the cloud for operators, and it is not a given that integrators will dominate.
Amy DeCarlo thinks the answer comes down to putting productive partner alliances together.
[63] EXECUTIVE SUMMARIES