Will widgets (software applications) allow the emergence of truly global mobile operators? Last week Vodafone and China Mobile (600 million subscribers together) joined with Softbank to launch the Joint Innovation Lab (JIL). Their focus is on improving mobile’s user interface, and in particular enable different widgets and applications to run smoothly on different handset platforms and operating systems across different mobile operators.

Behind JIL’s widgets project something more profound is taking place. Remember that the world’s two largest mobile phone operators entered into a strategic alliance in 2000 (sealed by Vodafone’s USD 2.5 billion acquisition of 2% of China Mobile). They have been collaborating on a number of projects over the years - more recently they jointly backed LTE, preparing the ground for 4G. At stake this time is no less than the development of a universal software specification.

So is this the signal that the two operators are finally coming out of the woods and prepared to use their huge subscriber base to drive the future of the mobile industry? For sure, cooperation will be useful to speed the roll-out of mobile internet services. It will also allow them to better face the upcoming battle with Google and Yahoo  - who are also keen to occupy the mobile space. It is also interesting for China Mobile - and China in general - since it will be one of the first attempt to approach standardization in a bottom-up fashion - from the market - rather than top-down - from the government. We may be witnessing China Mobile’s first steps into becoming a global mobile operator…

Please meet CCSA - China Communications Standards Association - one of the hyper-active Chinese governmental agency in charge of flooding the world of telecommunication with home-made standards. Not long ago it came up with an “earphone access” standard and an “interface data exchange” standard to regulate mobile phone data and transmission. Look out for green and yellow UDX labels (Universal Data Exchange)…

This time CCSA is shifting its focus from traditional telecom services to Internet-related convergent services. Together with major telecommunication operators, the agency is looking into providing convergent communication services through platforms and solutions offered by global suppliers like Cisco, Microsoft, Huawei or ZTE. The move indirectly acknowledges that some domestic companies have reached the technological capacity and maturity of leading international companies. Also, it doesn’t try the usual trick of competing heads on with existing standards - rather it attempts to bring together diverse technologies.

But don’t worry. CCSA has not completely given up on its more traditional business: it will soon issue a series of standards on energy efficiency and environmental protection for the telecom equipment manufacturing and telecom service industries.

Wasn’t the introduction of TD-SCDMA (the Chinese 3G standard) in 2008 supposed to mark China’s technological coming out? Not quite, at least that’s what two weeks of commercial trial seem to indicate.

Complaints about signal standards, restricted coverage and a general lack of content are comforting the eternal doubters of China’s capacity to successfully roll out its own third-generation (3G) service. There is even a kind of Schadenfreude among the watchers of the country’s technological efforts: “I told you so”, “TD-SCDMA was a disaster waiting to happen”…

For sure, TD-SCDMA’s agenda remained dictated by the government, rather than by consumers. The overall drive may also have lacked the necessary back-and-forth between the labs and the market to improve the technology and build on valuable consumer feedback. So, the withholding of 3G network licenses not only results in the non-deployment of more mature CDMA2000 or W-CDMA 3G networks in time for the Olympics. China also lost a chance to prove the openness of its markets and make good on its WTO committment to technological neutrality. Worse of all, the country may be sending techno-nationalistic signals without an ability to really deliver anything commercially viable behind.

Let’s hope that the failed launch of 3G can serve as an example for the deployment of 4G!

Chinese telecommunication operators are continuing on their green track. At a recent eco-friendly conference, China Mobile announced that it aims to reduce its electricity consumption by 40% in 2010 (from 2005). 73% of CM’s electricity is consumed by the 200,000 base stations across China. This measure comes on top of the recycling centers already installed and projects to develop solar power in base stations and telecommunication centers.

The eco-friendly technologies are provided by Nokia, Ericsson, Alcatel and Huawei. Nokia’s solution for 5′000 metropolitan base stations is expected to reduce as much as 73,000 tons of CO2 emissions a year - equivalent to the emission of 21,000 cars. By putting parts of the network not being used on standby mode, Ericsson announces 10 to 20% energy-savings per base station.

But then you hear about Huawei. The company claims that energy consumption of the equipment itself accounts for only 40% of operators’ total cost of ownership, the remaining 60% coming from air conditioners and other equipment. Their intelligent cooling uses fresh air as an alternative to air conditioning, a system that could save 30 to 70% of electricity. So much for high-end technology…

Despite having more than 550 million subscribers, the Chinese mobile market still has a lot of room to grow. Except that it won’t take place where you’d expect it: penetration in rural areas is still around 20% compared to 40% in cities.

Thanks to a 3-year project backed by Ericsson and the United Nations Development Programme (UNDP), lower-income farmers in remote villages are expected to be able to use their mobile phones soon to gain access to rural financial services - financing SME in China is one of the growth bottleneck. The project aims to overcome geographical isolation in the countryside, which has made access to rural financial services such as getting credit, sending remittances or making deposits expensive and difficult for people in rural China. China Mobile already offers an agricultural information service with advice on how to raise crops and animals, weather forecasts, news, and information on market prices for various products - for USD 0.25 per month per information category. 

Developing a mobile rural bank system will also allow Chinese banks to save a lot of money in comparison with having to create a physical infrastructure. The success of catering to lower-income population has already proven a success - bith for operators and for the citizen - in a number of developing countries (like Grameen Phone in Bangladesh).

So, the future is in the countryside!

Chinese authorities are investigating commercial text messages that were sent to more than 200 million mobile phone users (40% of all subscribers) through the networks of China Mobile and China Unicom.

The spamming has angered Chinese consumers. Already dubbed “Text-Message Gate”, the incident has even drawn public apologies from one major advertiser and China Mobile. It has also gotten the attention of the Ministry of Information Industry. Both the government and mobile operators are now working together to clarify regulations on identification and blocking of spam messages - the latter have launched hotlines of their own for users to report spam messages.

Will it be enough? Not as long there is no legal base in China for arbitrary trading of personal information!

What a pity… WAPI seems to be back. A proposal to make mandatory the expansion of WAPI (Wireless Authentication and Privacy Infrastructure), China’s domestically-developed WLAN standard, was submitted to the National People’s Congress this week. 

For sure, China’s domestic market is largely dominated by foreign-developed WLAN products. But the argument that reliance on them is harmful to state security is completely flawed - encryption software being one solution. The second argument, that without government intervention it will be impossible for WAPI to become the national standard, doesn’t either justify such a measure - in the end standards have to make economic sense.

The signs seem to be clear: Previous attempts to impose WAPI already caused severe trade frictions between China and the USA. ISO rejected China’s WAPI as an international WLAN standard in 2006, edaling a blow to China’s techno-nationalism. Even Chinese operators are starting WiFi projects across the country based on 802.11.

Beijing may have to realise that not all standards should be Chinese. Imposing standards will not only hurt the Chinese economy but also damage its image abroad.

Consumer price index (CPI), housing, and health care are some of the themes that attracted most public attention in China’s latest experiment of mobile democracy.  Chinese mobile users have been able to communicate with some political representatives during the annual parliament session using a program called Fetion - a low-price mobile phone interactive service introduced by China Mobile.

Even better! “Ask the Premier” - a joint-project between Xinhuanet.com (the official Chinese news agency) and China Mobile made available to more than 100 million mobile phone users - has collected over 250,000 short messages. In the words of the project’s initiators “Chinese mobile users are thus encouraged to orderly participate in politics”. In the meantime, NGOs all over the world are jumping on the “Olympic opportunity” to portray China as a repressive State where freedom of speech is scorned and democracy a distant dream. In fact, a recent survey by the Chinese Academy of Social Sciences shows that today’s China doesn’t suffer a lack of opinions or ideas, but the channels for the people to express them.

Maybe the historical inclusion of “safeguarding the people’s right to expression” in the report to the Party Congress is a sign of changing times!

Earlier this year China’s National Copyright Administration (NCA) - yes there is such an agency - launched the first phase of the construction of a monitoring platform for the violation of intellectual property rights (IPR) on the Chinese Internet.

The platform is expected to have an automatic search system for music and film products that are being broadcasted online without permission. Once it has detected such products, it will send a notice to the relevant websites and ask them to delete them.

This is theoretically good news to holders of IPRs. China is famous for repeated infringments of IP in the “real world” (pirate DVDs, softwares and even iphones) so one could reasonably assume that it could spread to the web - the difference is that when it comes to the Internet, the Chinese government has been running a very tight operation. Problem is that the Chinese courts have been giving mixed signals about music infringments on the Internet with domestic ISPs and portals getting off lightly compared to foreign ones. Let’s hope that this time the dots are aligned.

Ever wondered why Korean and Japanese mobile phones made it all the way to Europe and the US but not Chinese phones?

Until recently, the explanation was rather straightforward: Chinese phone manufacturers were not competitive in their domestic market; the market was mostly dominated by a few foreign companies like Nokia, Samsung or Motorola. Chinese companies (Bird or TCL) had a hard time capturing sizeable market shares. Fiercer criticics argued that Chinese manufacturers did not master core mobile phone technologies which resulted in a difficulty to reduce production costs.

This may be about to change! With the commoditization of multimedia features, foreign manufacturers struggle to remain competitive when compared to local vendors. The latter seem also to be more pro-active on the localization aspect (like dual SIM handsets). Competition from local firms (like Huawei or Amoi) even seems to increase in the smartphone and PDA market. For the time being Nokia appears to succesfully fight back whereas Motorola and SonyEricsson are in a more delicate situation.

So, the day when Chinese handset manufacturers have become competitive enough in all segments of their domestic market is nearing. From then on it won’t be too difficult to start attacking US and European markets with cheap and good-quality phones.

P.S.: Chinese telecom equipment supplier ZTE Corp has joined the rank of the world’s top 10 mobile phone makers in 2007, becoming the first Chinese handset marker to attain the honor