Mobile Bubbles in Barcelona

[00:00:00] Will Page: Welcome to Bubble Trouble, the conversations between the independent analyst Richard Kramer, that's him, and the economist and author, Will Page, and that's me, and this is what we do. We lay out the inconvenient truths about how business and financial markets really work. We go beneath the clickbait headlines, navigate a counter cyclical path. It goes against the grain of what the sick fans and stenographers on Wall Street would have you believe.

This week, the free ride of Richard's travels, meaning, he's mingled with 100,000 telco executives in Barcelona, so we didn't have to. Thanks for that. On the other hand, I chose to go to the dentist instead. I felt that would be more enjoyable. So, I'm guessing that when you gather the population of a small city into a conference venue for a whole week, there's going to be some bubble trouble brewing amongst the delegates. So, for the next 30 minutes, I'll be quizzing Richard Kramer, to give us a verbal postcard of what he learned from the bubbles in Barcelona. More in a moment.

Welcome back to the show. And we know from our audience's feedback that these post conference podcast really work. You think back to this time last year when I came back from South by Southwest and we discussed NFTs. So, this is a winning formula for us, so let's win it again. And squeeze you like a sponge and find out what you learned from a week in Barcelona with all the seats of the telco world gathered under one roof. Let's put you on the spot. If you had a single word to summarize what you've experienced in Barcelona, what would that single word be?

[00:01:24] Richard Kramer: Well, hello, Will. I'm not sure I can boil it down to a single word, but I think in short, humans crave contact. I think we've all had enough of this virtual meetings and conference calls and so forth. We're bored with it. People want to get together, walk as I did for three days, 20,000 steps, look at what each other is up to and interact. If offices are where commercial ideas have sex, then trade shows are the focal point of real business.

[00:01:56] Will Page: [laughs]

[00:01:56] Richard Kramer: Of getting down to making things happen, but also, of course, driven by sex and money. Wanting to check everybody and everything out and see how it measures up to your own offerings. And hopefully, do deals because a lot of the people at these conferences will be sales or marketing folks trying to make sure they're keeping the money flowing in.

[00:02:17] Will Page: And if I can underline an exclamation point, that remark, even though you mentioned sex twice in the first five minutes of a podcast, which is about as long as sex takes these days, but still can I stress that I was at the ILMC conference with 500 smelly promoters wearing fitting gray T-shirts, all telling me that live music industry is bigger in 2022 than it was it 2019, for the exact same reason, we just crave contact. We love getting around big stages and singing the same songs together. So it's, I think you're onto something.

Now, I wanna step back from the aisles of Barcelona for a quick second. We'll go down those aisles shortly. But talk to me about the conference business. I mean, you're a veteran of three-striped analyst of the game here. Why do people go to conferences? Why are they not on virtually? What... why are we spending so much money investing in an, an event which lasts three or four days and packs up and moves on? Just give me an idea of... uh, put sense into the circus for me.

[00:03:08] Richard Kramer: Well, if we step back from the sex and money, i- incentives, of course...

[00:03:14] Will Page: [laughs]

[00:03:14] Richard Kramer: ... you go to conferences to party, have a good time, get drunk with your mates and bring in the business that you told your boss you'd bring in or else he's going to fire you. You step back from that, and you realize there's some pretty simple logistical reasons why you go to these conferences. Now, I go and have gone to every Mobile World Congress since the ones back in con, I think the first one I went to was in 1995. I've been doing-

[00:03:40] Will Page: Wait. That's when mobile was taking off, right?

[00:03:42] Richard Kramer: That's when mobile was taking off. I'll give you a story about that later. But I've been going since 1995, for a simple reason. I can see tons of people that I wouldn't wanna travel individually to see, but I wanna see them one after another. And you add in the value of face-to-face being 10 or 100 times the value of Zooms and calls and also, the fact that everybody is coming together to have a concentrated focused discussion about an industry.

Everybody is going because they have skin in the game in this wider telco world. They have an application, a piece of hardware, a device, a service they wanna push and they wanna find other people that are equally enthusiastic and obsessive about doing this sorta business to interact with. And you know, it, it is so important to get together with people and exchange those ideas in-person.

[00:04:39] Will Page: Thank you for that digression, but if you can just flip back to the original track of sex and money.

[00:04:44] Richard Kramer: Mm-hmm.

[00:04:44] Will Page: You did remind me of a story about the Republican Annual Convention in Kansas City, where the economist had an exposé about the amount of prostitution that came to town when the Republican Annual Convention came to town and talked about supply and demand. The demand for prostitutes was high, the supply of prostitutes had to meet demand. Prostitutes from states around Kansas were coming in to serve the market. And a letter came into the economist a week after that article was published from those ladies of the night, saying, "By the way, the week after Republican Annual Convention happened, the American Economic Association came to Kansas City, and we all took a week off."

[00:05:18] Richard Kramer: Oh, dear.

[00:05:18] Will Page: It tells you a lot about sex, drugs, rock and roll and economist for AP. Okay. Now, I want to also challenge you on this whole conference circus business to ask about the timeliness of the content that's being debated, discussed, and presented. I have this thing that bugs me, which is you're just trying to teach tech at universities. Well, next year's curriculum's already out of date. You could be learning SQL.

[00:05:38] Richard Kramer: Hmm.

[00:05:38] Will Page: We're onto Google Big Query. You could be learning Tableau. We're onto Google Studio. The tools are accelerating faster than the curriculums. Does that dilemma apply to mobile? Well, congressman, surely, you're planning years ahead of the actual event what you're supposed to be discussing.

[00:05:54] Richard Kramer: You are certainly right to point out the lag effect in these conferences. They're planned a year or more in advance, the stands are built, the demos are planned, the speeches are prepared, the teams are assembled. But that simply reflects the corporate marketing cycle. Big companies are not hopping onto the next big thing and launching products in a matter of weeks. They have their own cycles, their steering groups, their committees, their meetings and the gating process for any release of new technology. So, there is a natural delay to what's being talked about. And also, very importantly, in this world, that constitutes 4 billion mobile subscriptions around the world...

[00:06:37] Will Page: Four billion.

[00:06:37] Richard Kramer: ... in this planet of more of...

[00:06:40] Will Page: A billion.

[00:06:40] Richard Kramer: ... more, of half the world's population having a smartphone in their hands at any given time. One has to realize that the standards and the industry agreement of how this whole field operates is planned years in advance. So, let me give you a very concrete example. A lot of the talk at this conference was about 6G. And you may say, "Hang on a second. We've just had 4G and now we're getting 5G."

[00:07:07] Will Page: Mm-hmm.

[00:07:08] Richard Kramer: "Why are we talking about 6G, which is supposed to arrive in 2028 or 2030, or something like that?" Because the technical inventions that go into and constitute the standards of 6G, so that everybody's 6G can talk to everyone else's need to be planned, literally, a decade in advance. And it has to be worth it. To invest in this Next G, you have to have sufficient leaps of functionality, sufficient new services enabled, something that makes it worthwhile to go to the next generation, because it's going to constitute hundreds of billions of dollars of investment. So, certainly-

[00:07:51] Will Page: There's nothing more interpretable than a mobile phone.

[00:07:53] Richard Kramer: Well, if you think about the first and second generation mobile phone services were largely about making phone calls. 3G started to introduce data, but it wasn't that high speed as yet. In 4G, you could start to realistically see your favorite Scottish rugby team highlights in HD on your mobile device. And in 5G-

[00:08:15] Will Page: [inaudible 00:08:15].

[00:08:16] Richard Kramer: You don't wanna see that, but maybe next weekend, you will. But after you get to 5G, you start to enable a new sets of services. You see how the progression of these technologies needs to be planned a decade or more in advance to find the spectrum, the radio waves you want to use for the technology, to figure out the features and functionality. You need to embed in the technology to support new services. So, there is a lot of planning, there is a lag effect, and that's natural.

There's also, you overlay on top of that, the corporate marketing cycle, which says at the beginning of the year, you're already figuring out what are we going to talk about at Christmas.

[00:08:55] Will Page: Mm-hmm.

[00:08:55] Richard Kramer: All those marketing budgets get planned and approved in the spring for every penny that gets spent in the fall, so whatever we saw at Mobile World Congress in February, was decided by marketing teams and the collateral was planned and the copy was written and the demos were practiced. That all happened at the end of last year and into the early part of this year. Because you can't do it on the fly when you show up at the conference and decide what to say.

[00:09:23] Will Page: Yeah, it sounds to me like you want all the 60 horses pulling the same plow in the same direction, so there's a lot of coordination required. And it also reminds me of that phrase, "If you build a new lane on the motorway, you invite more traffic." And I guess that's what's happening...

[00:09:37] Richard Kramer: Indeed.

[00:09:37] Will Page: ... with these mobile phones. And-

[00:09:38] Richard Kramer: Well, and I think the important thing to understand is, this industry is always selling a roadmap. You never sell what you have today. You're selling what you're promising for the future. That latest phone that was launched a few months ago, well, maybe you're showing it now, but people really want to go into the closed door meetings and talk about what the next phone is going to constitute. The test equipment for the next generation of mobile, you'll need to get that before you start testing 6G. The private network technology you want big enterprises to buy, you have to show them the proof of concepts and the demos and a lot of what's being sold is about futures, not the present.

[00:10:16] Will Page: I feel it. I feel it. Now, a real heartfelt moment for me is when you sent an image to me of Ralph Simon onstage and Ralph is not just a friend, but a mentor to me, a friend of the show as well, a future guest, potentially. But to see him moderating, he'll turn my phone upside down, and that was great to see. But I'm interested to learn who else you see on the stages in Barcelona. Is it the usual suspects or do you get a lot of fresh faces coming with fresh ideas? How diverse is the stages in Barcelona given it's an annual event?

[00:10:44] Richard Kramer: So, the simplest way to reflect that is to say, there's no diversity whatsoever. It's precisely the same as you'd expect to find at a Davos Conference. You're going to see a lot of powerful heads of companies and government ministers making various pontifications about how they think the industry should change or do better, or do more, do something differently. You cannot forget that a lot of the companies that are mobile operators today were, 10 or 20 years ago, state-owned enterprises. So, France Telecom was majority owned by the state until the 1990s privatizations in Europe. Same with Deutsche Telekom. BT was a decade before that, but they were forerunners.

[00:11:29] Will Page: So, so if you did ancestry and there's 100,000 delegates in Barcelona, they would all have state monopolies in their bloodstream.

[00:11:35] Richard Kramer: Almost all of the companies.

[00:11:37] Will Page: [laughs]

[00:11:37] Richard Kramer: Maybe not so much the equipment vendors, but all of the telcos.

[00:11:40] Will Page: Yeah.

[00:11:40] Richard Kramer: And they have the mentality of purchasing equipment and big public procurement tenders. And indeed, one of the leading equipment vendors, Ericsson recently was fined by the US for violating FCPA, which is the Foreign Corrupt Practices Act by paying consultants.

[00:11:58] Will Page: Mm-hmm.

[00:11:58] Richard Kramer: So, you'd say you'd also call them people who take bribes in seven markets.

[00:12:02] Will Page: [laughs]

[00:12:03] Richard Kramer: And that was the way for them to win equipment deals in emerging markets. That was just expected in the system and one doesn't need to refer to Transparency International to look at the fact that there are more than 100 countries of which there's very low levels of transparency about those sorts of public procurement deals. Now, you asked who gets on stage. And the gatekeepers of this conference do not want someone talking about lessons learned from these corrupt practices acts investigations. They wanna talk about the bright, shiny future. They want to talk about all the ways...

[00:12:41] Will Page: [inaudible 00:12:42] that.

[00:12:42] Richard Kramer: ... in which connectivity is improving the lives of people in developing markets. Clearly, the sponsors of these conferences, the people who put up big stands and paid millions of dollars for real estate...

[00:12:55] Will Page: [inaudible 00:12:55]

[00:12:56] Richard Kramer: ... at the trade show...

[00:12:56] Will Page: [inaudible 00:12:57]

[00:12:57] Richard Kramer: ... get speaking slots. And they will, depending on how much they pay, be able to effectively buy access to the stage. Now, that's not to mean there's not other programming, which is not doled out solely according to sponsorship, but that's the reality of the situation as I see it. And frankly, I don't pay that much attention to the formal program because it's a lot of motherhood and apple pie speeches. It's a lot of companies making their formal pitches for why they're doing something wonderful for the world. When in reality, they're mostly at backroom meetings trying to figure out ways, which naturally as commercial enterprises, they can make more money.

[00:13:37] Will Page: Well, when, when we were out running last weekend and you were trying to keep pace me up that hill, I remember, you can be a classic-

[00:13:43] Richard Kramer: I don't ever remember that, uh, keeping... trying to keep pace with you up and that, maybe when I ran backwards, I think...

[00:13:49] Will Page: Yeah.

[00:13:49] Richard Kramer: ... I still was able to run ahead of you and I have video evidence of that.

[00:13:51] Will Page: You running back was [inaudible 00:13:52], but you were trying to keep pace me. But no...

[00:13:54] Richard Kramer: Yeah.

[00:13:54] Will Page: ... you said when you read the small print at the end of any analysts note, you said that it says, "This company, this bank is getting or expects to get funding from the company that they're reviewing."

[00:14:05] Richard Kramer: Correct.

[00:14:06] Will Page: You said, "I can tell you whether there's going to be a bind on the analyst's note." [laughs] And I guess...

[00:14:10] Richard Kramer: Yeah.

[00:14:10] Will Page: ... what we're saying here is when you look at the billboards outside this Barcelona venue, you can tell me who's gonna be on stage because it's who's advertising the most.

[00:14:17] Richard Kramer: Well, and it's natural that if there are 20, or 30 very large telcos in the world, whether it's China Mobile or...

[00:14:25] Will Page: Mm-hmm.

[00:14:26] Richard Kramer: ... Verizon in the US, or EE or BT in the UK, or Deutsche Telekom in Germany or Telefonica in Spain, in their home country, they are going to have the Chief Executive up on stage talking about how tremendous their company is, how many things they can do for the world, agreeing with all the other Chief Executives of how wonderful they are.

[00:14:49] Will Page: Wow.

[00:14:49] Richard Kramer: That's natural. And the program itself is not designed to be controversial. Most of the questions that will be asked by moderators where they have panels will be pre-agreed it. And that is just part of the corporate pitchman ship that these conferences entail.

[00:15:05] Will Page: One question before the break there is in the book, how you talk about how the NPS having net promoter survey somewhere-

[00:15:12] Richard Kramer: Nice, nice little plug for Pivot, The Renamed Tarzan Economics by Will Page out in paperback now.

[00:15:19] Will Page: Because the books with economics are in the toil. They don't sell at airports, as I learned. But yeah, well, in the book, just real quick on this. I remember talking about the NPS, the Net Promoter survey.

[00:15:29] Richard Kramer: Mm-hmm.

[00:15:29] Will Page: And how Vodafone sends me one all the time, but they never asked...

[00:15:32] Richard Kramer: Yes.

[00:15:33] Will Page: ... what I think about WhatsApp, which is the number one reason why I don't have to make cell phone calls. Were WhatsApp at the Mobile World Congress or do they just bypass this thing?

[00:15:42] Richard Kramer: So, the likes of Meta don't tend to have their own stands because they're not selling equipment or telco services.

[00:15:51] Will Page: What?

[00:15:52] Richard Kramer: But they will certainly be present, talking with all the suppliers of that equipment. Trying to encourage them to produce it a cheaper cost, so more people around the world can get access to their services at constantly lower costs.

[00:16:07] Will Page: Got it, got it. All right, last one before the break, and you mentioned your first time at Mobile Congress was 1995?

[00:16:12] Richard Kramer: Mm-hmm. I think so, yeah.

[00:16:17] Will Page: Yeah. All I can think about in '95 is that's when Dennis Bergkamp signed for Arsenal. That said, just give us one reflection on your first Mobile World Congress, given what you saw this week? How much has it changed?

[00:16:28] Richard Kramer: The Mobile World Congress used to be called GSM World Congress. It's exactly the same. It's talking about futures, roadmaps, opportunities, potentials of the technology, which are going to be some months to decades ahead of what we see today. There's always going to be a few discussions of things that are in the visionary fringe, and a lot of very prosaic stuff about what needs to be invented in the next chipset, in the next antenna technology, in the next network service, and so forth.

But one way that it's definitely different is that there were probably 2000 or 3000 people at that first Mobile World Congress that I went to, and as the conference and as conferences generally became this massive industry in the past 10, 20, 30 years, uh, whether it's a boondoggle for people in the states who only have two weeks of holiday, but get to go to a conference as a, as kind of a mini vacation, or whether it's something that is just a, an excuse to focus your product launches, this is the place where you've got to bring out your new wares every year. They took on a life of their own.

And again back in 1995, or whenever I would have gone to my first Mobile World Congress, they were far smaller, more intimate affairs with much less formal programming. And now, it has become an absolute gigantic industry, catering to hundreds of thousands of people, the hospitality industry, the transport industry, you name it, they're all in on it, and they all rely on it. And that's why you go and speak to a roomful of sweaty promoters when they could just read your book.

[00:18:15] Will Page: [laughs] Fantastic. Well, thank you for those reflections on the conference. In Part 2, I wanna get into some of the big themes that were discussed there. I'm sure the words ChatGPT are going to come up somewhere along the conversation. That's all right for Part 1 and we'll be back in a moment. Thank you so much.

[00:18:36] Richard Kramer: Welcome back to the second part of Bubble Trouble where Will Page was trying to get me to remember what I did when I went to my first Mobile World Congress in 1995. I didn't have to share the stage with 80,000 other people in this recent Mobile World Congress, which by the way, was down from 130,000 people that went to the one in 2019. That was way too much. And Will, you've had your own experience of going to these giant conferences, whether they be boondoggles or these vision quests that you have. I think you went to one around this time last year, didn't you?

[00:19:08] Will Page: Yeah, and I wanted to comment on that because last year, I went to South by Southwest and as I said, our famous NFTs are not for me podcast. There was more cues for wearing VR headsets than there was for seeing actual live bands. People who have pulses sweating blood on stage. That was a real sign of the times and I just gotta dive in on this one. How much talk of NFTs and Metaverse did you hear in Barcelona? Is that past the telco community buyers or are there still an excitement about those, that terminology?

[00:19:38] Richard Kramer: So, I have to say, for NFTs and Blockchain and crypto there wasn't much, almost none at all that I saw. Maybe in some of the startup halls that are far away from the main stages, there might have been some Blockchain companies or NFT startups, but I didn't see that. This is mostly an engineering and hardware and services and software led show. It's the consumer tech that's there is mostly smartphones and other devices. And some of the companies there might have had a chief Metaverse officer for a hot minute and then said that was not really a good idea.

[00:20:16] Will Page: [laughs]

[00:20:17] Richard Kramer: Um.

[00:20:17] Will Page: A- after the three cuts that first cut is the deepest.

[00:20:20] Richard Kramer: Yeah.

[00:20:20] Will Page: The first cut out...

[00:20:21] Richard Kramer: Now-

[00:20:21] Will Page: ... is the Metaverse officer. [laughs]

[00:20:22] Richard Kramer: Yes, exactly, especially with tough economic times looming. So, the Head of Strategy at Nokia did talk about three Metaverses. He said there was going to be an enterprise Metaverse for training and education. There was going to be an industrial Metaverse where you'd have replica of the factory floor with digital twins and their consumer Metaverse that we've all heard about. And frankly, the reason he talked about that stuff was because it was in the service of saying, "You need a lot more network infrastructure and the kit we sell to provide it."

[00:20:54] Will Page: [laughs]

[00:20:55] Richard Kramer: So, it was really, yeah, you know, these things are wonderful visions to have in the Field of Dreams, "If you build it, they will come" mode.

[00:21:04] Will Page: Yeah.

[00:21:04] Richard Kramer: In the sense that-

[00:21:05] Will Page: I'm still in trains, so you invest in my tracks.

[00:21:08] Richard Kramer: I'm an arms merchant, and I want everyone to be playing one of those Battlefield games all the time.

[00:21:15] Will Page: I hear it, I hear it. Now, you mentioned the number of billions of people. I think it's 4.2 billion people with a mobile phone earlier in the first half of the pod. And that's always fascinated me by the telco world, about the emerging market potential in podcast. A couple of thoughts. One, when I way back at university 300 years ago, I remember writing an essay saying that telcos were the greatest development tool policymakers had. You can spend money on aid or trade when you invest in telco infrastructure, developing markets can accelerate their growth much faster. Talk to me about what you learned about emerging markets and developing markets in Barcelona.

[00:21:51] Richard Kramer: By the way, just as an aside, before I dive in there, my son just came back from four or five months in Tanzania, and there simply is no Wi-Fi and there is no fixed network.

[00:22:00] Will Page: [inaudible 00:22:01].

[00:22:01] Richard Kramer: It's all mobile. They... The only thing you can do to get data service is to use the 4G. They don't have-

[00:22:08] Will Page: So, there's no [inaudible 00:22:08]?

[00:22:09] Richard Kramer: They don't have copper in the ground and Wi-Fi in many places only really to businesses. For homes, it's all mobile. I can say-

[00:22:17] Will Page: Can I... let me just build on, build on that in a second. When I did my Master's at Edinburgh, a dear friend, Tim Kent, his father was a UN ambassador for Somalia. I said, "What does that involve?" He says, "Well, he sits on a hotel room in Kenya and traces build governments." This is 2002. I said, "What was it like in Somalia?" He said, "They don't have a government, but they have a better mobile phone network than Britain." [laughs]

[00:22:36] Richard Kramer: So, when I first started looking at mobile, the number of millions of subscribers followed Fibonacci. It went from...

[00:22:43] Will Page: Wow.

[00:22:44] Richard Kramer: ... one to two mil- to 10 million to 20 million to 30 million to 50 million to 80 million to 130 million. It followed the Fibonacci sequence perfectly up till 2000, when you had 400 million mobile subscribers in the world. And then it kept going. Now, the curves in emerging markets today largely follow GDP. You get down to a very basic price of providing the most rudimentary networks and devices. And you know, you can get a smartphone for $100 and you can get basic network infrastructure that's cheap, oftentimes decommissioned equipment from developed markets with less bells and whistles. And then it goes mega mass market, 100-ish% penetration in every developed market and moving up the curve and developing markets.

Now, you see handset makers like Xiaomi from China that are desperate to compete with the iPhone. But really, they only do well in markets where that you have a $10,000 to $15,000 a year per capita GDP. They barely make money compared to Apple, which makes 25% margins, but these Chinese vendors have found their sweet spot, which is making very basic devices and selling them to people who don't have as much money in emerging markets. And because you've had a whole volume of ecosystem built to supply mobile service at the lowest possible cost, then those emerging markets have been enabled with connect- connectivity, the way you were talking about for Somalia.

[00:24:19] Will Page: Fantastic. Now, moving on here, I don't think you're allowed to do a podcast in March 2023 without mentioning ChatGPT, so I'm gonna mention it now. Let me guess this, are you determined to train in train tracks, "I want to sell you train, trains, so you invest in my train tracks" would be the sort of bargain at Mobile World Congress. Now, the ChatGPT train is a bit clunky. Its use cases doesn't extend much beyond sort of chatbots at the moment. With better train tracks, it could get a bit more monetizable and maybe entrep... What was the ChatGPT dimension at Mobile World Congress? There must be a role for it somewhere in there.

[00:24:55] Richard Kramer: The reality is there was almost none of it on show.

[00:24:57] Will Page: No?

[00:24:58] Richard Kramer: And that's because the hype around it has been so new, and so recent that it didn't make it into that six- or nine-month corporate marketing plan.

[00:25:09] Will Page: [laughs]

[00:25:09] Richard Kramer: I'm sure we'll go back next year, and you'll see lots about AI chatbots, and there, there was certainly because ChatGPT is not new in this regard. Lots about machine learning or AI. Helping find what piece of equipment in a network might be faulty or might be about to be faulty, or figuring out whether there was one subscriber on the network that was defrauding the network because they were spoofing a paying account. So, some of these technologies are already being deployed, but to market them as using ChatGPT was too new, believe it or not.

Now, the reality about your train tracks analogy is that there clearly is going to need to be an absolute ton of infrastructure investment for both the Cloud computing to make all of these AI services work. And importantly, the distribution of those services to the end markets. That's why you need this incredible data center infrastructure, at the core of these AI services, to, to do all that compute. And you need high-speed broadband networks that distribute the content.

And you think about something like YouTube 15 years ago, didn't exist. It was bought by Google for a billion dollars in 2006 or 2007. And 15 years later, you have 2 billion people around the planet every month that can watch endless hours of HD video with barely a perceptible lag. So, you both have the computing power at the center that can store all this video and then you have the massive distribution that can send that out around the world, so that you can be sitting, having tea with a Somalian warlord and pulling up those Scottish rugby clips to watch in HD.

[00:26:56] Will Page: Yeah, I remember in India, when data costs fell dramatically in India, I think around 2017. YouTube announced there was 240 million people using music on YouTube in India, in the space of like three or four months.

[00:27:10] Richard Kramer: Yeah.

[00:27:10] Will Page: And that was more people that had used Spotify in the space of 10 years.

[00:27:14] Richard Kramer: Yeah.

[00:27:14] Will Page: It was just dramatic. It's like that, that's leap frogging in action. You just flick a switch and hundreds of millions of people dive in.

[00:27:21] Richard Kramer: That was because there was an Indian telco called Geo, which launched then.

[00:27:25] Will Page: That was the one, yeah.

[00:27:25] Richard Kramer: And basically provided free data service to everyone. They shorted the market effectively and they, frankly, forced the business that was a joint venture at that time with Vodafone and another company, basically forced them out of business.

[00:27:41] Will Page: Let me join the dots here before we get smoke signals, which is in the first half, you talked about 6G being the buzzword.

[00:27:47] Richard Kramer: Yeah.

[00:27:47] Will Page: And then in the second half of this podcast, you said that ChatGPT wasn't even a word at this conference. But if you need train tracks for trains, do you think that ChatGPT is gonna be a blessing in disguise. It's exactly what you need to justify 6G roll out sooner rather than later.

[00:28:09] Richard Kramer: So, I wouldn't really connect the two in the same way. Again, thinking about 6G, it's a process of developing standards that everyone in the world agrees on. And I do remember the first time I went to the US, and I got a phone that had a US band to it and I could receive a phone call from Europe, on my US mobile phone. Or the first time I was traveling in Japan, my 3Gg phone from Europe also worked, and that was incredible. It was realizing that we had a global standard. We all agreed things would work a certain way. And wherever I went in the world, I could be confident of having my similar connectivity, even if it cost me a bundle.

And so, that standards process of getting to 6G needs a decade. What we're seeing, on the other hand with ChatGPT, and I do roll my eyes a little bit with everyone talking about how it got to 100 million users, whether they're audited or real users or not, or they're just bots using each other's technology, we don't know yet. But it got to this huge ramp of new and people engaging with it, in a matter of months. And it's a different sort of alternative in the sense that there will be many flavors of ChatGPT with different names that will come up, and there's not going to be one global standard for how AI works.

So, before we get to a 6G world, we'll have many other versions of AI launched in the world. We may all have our own personal chatbot, but they're fundamentally different timescales of development. One goes very quickly and constantly reviews what it's done and learns from itself. The other takes agreement of all parties...

[00:29:58] Will Page: Mm-hmm.

[00:29:59] Richard Kramer: ... over years and years and years.

[00:30:01] Will Page: And I get it, I get it. A bit chalk and cheese there. But I do wonder whether next year you could have ChatGPT give me a keynote at Mobile World Congress and save money on the conference fee. [laughs] Get it going.

[00:30:10] Richard Kramer: It might have been writing some of the speeches of those CEOs given how bland they sometimes are.

[00:30:14] Will Page: [laughs]

[00:30:14] Richard Kramer: But let me also raise, raise one thing. If you went a year ago, there would have been a lot of talk about the Metaverse. If you went five years ago, you would have talked about, well, smartwatches and wearables. I mean, there are always going to be things that pop up as hype. And then there's the really boring work. A lot of it, frankly, done on the... under the auspices of the, the United Nations and the International Telecommunications Union and, and the three GPP standards bodies. Very prosaic dull committees of engineers trying to hammer out the best processes to do things, also for the commercial benefit of their companies.

[00:30:47] Will Page: I hear it.

[00:30:48] Richard Kramer: But all of that hard work has to be done in agreement, whereas a lot of what you hear about as the hype du jour is something that one company is trying to market over another. And by the way, until Mark Zuckerberg piped up, we weren't all talking about the Metaverse, were we?

[00:31:06] Will Page: [laughs]

[00:31:06] Richard Kramer: But one company was trying to get the commercial advantage from something by staking out the field. And Microsoft is doing the same thing by allying itself with Open AI and ChatGPT. They're trying to put down a marker in the field before it gets started, so they have their tariff set aside.

[00:31:22] Will Page: [inaudible 00:31:22]. There's a cool quote for this week's podcast. It's like Hoover vacuum cleaner. You just wanna associate with the brand.

[00:31:28] Richard Kramer: When you blow your nose, it's with a Kleenex, right?

[00:31:31] Will Page: [laughs] It's when you search for something, you Google it. Now, I also, I'm doing a little bit of mental maths here, in that we're not far off a stage where you can finish school with grades, and have only ever lived in the era of the iPhone. I think I'm correct in saying that. And that to me is-

[00:31:48] Richard Kramer: Well, close to it.

[00:31:49] Will Page: [inaudible 00:31:49]

[00:31:49] Richard Kramer: The way I'd put it back when I was doing my own visionary work in the mobile world, we used to say, imagine an alien came down from the sky and looked at people talking. People communicating with these devices and said, "Why are some of them chained to the wall?" And we don't really remember a world where we had devices chained to the wall. When you were growing up, you had the phone in the hallway and it was chained to the wall, right?

[00:32:13] Will Page: Yeah.

[00:32:13] Richard Kramer: And you went to a world of communication where it was to...

[00:32:16] Will Page: I loved that.

[00:32:17] Richard Kramer: ... one person wherever they were in the world.

[00:32:21] Will Page: So, it is possible that you can live an entire life to the school-living age in an era of the iPhone. That also means conversely that you might not have ever known what Nokia meant. Now, you know what Nokia means. They collapsed like Enron. It just seemed to happen overnight. Like they were on top stock picks for one month and then three, four months later, the company was melting. How can you help our audience spot, with regards to telcos that is, the next Nokia? We need a couple of smoke signals, but I wanna sort of put it under the Nokia umbrella. How do you spot a next Nokia on the horizon given how quickly that company fell from grace?

[00:33:00] Richard Kramer: Well, look, I've been an analyst covering Nokia since 1994, so I've seen its spectacular rise, and it's actually rather slow demise. So, I think it took more like five years till it went from the announcement of the iPhone to where it was sold off to Microsoft. So, these things always feel like they happen much more quickly than they do.

[00:33:22] Will Page: Mm-hmm.

[00:33:23] Richard Kramer: That said, there are always companies that fall by the wayside. I think you need to separate out the utility type services that are provided by telcos. That you need your telco service to run the same way you do, your electricity, your gas and your water, and the longevity of those telcos. And indeed, the government's interest in national infrastructure as a matter of competitiveness causes them to make sure that those telcos are very stable.

Whereas on the flip side, you have a long string of technology companies here in the UK that completely fell by the wayside. You had ICL, and you had Marconi. You had all of these native technology companies...

[00:34:08] Will Page: Marconi.

[00:34:09] Richard Kramer: ... that were built and grew up in the UK and now, they're gone. They've all been bought by foreigners or folded into larger companies. So, they're always in the nature of technology companies that iconic brands completely fell by the wayside. Do you know what company Kyndryl is?

[00:34:28] Will Page: Nope.

[00:34:29] Richard Kramer: For about eight years, it was known as IBM.

[00:34:34] Will Page: [laughs]

[00:34:35] Richard Kramer: So, you know, you have companies that need to change their name...

[00:34:39] Will Page: That's not it.

[00:34:39] Richard Kramer: ... to get away from the past.

[00:34:41] Will Page: IBM is not a company you want to see in a business card, right?

[00:34:44] Richard Kramer: Well, you know, it was the training ground and inventor of many foundational technologies and techniques and computing and so forth, and still exists today and partly a pale shadow of its former self. But so many of these companies have a storied histories of phenomenal growth, and then demise. Alongside Nokia, you could put Blackberry, you could put Motorola, which is still a brand, but just clinging on as is Nokia. You put all of these legendary companies that we knew is innovative, as well as so many of the TV makers that were out there, uh, i- i- in the early days. Sony doesn't really make Walkman anymore, do they?

[00:35:25] Will Page: [laughs] So that, that qualifies as smoke signal number one. It's a very much a rear mirror here's retrospective smoke signal. But, but like maybe naming or shaming companies in the future, but is there any themes in the future that you got from Mobile World Congress where you say, "Um, we don't want to go down that road. Find a different route?"

[00:35:42] Richard Kramer: Look, I think there's so much of these trade fairs, which end up being old wine in new bottles.

[00:35:49] Will Page: [laughs]

[00:35:50] Richard Kramer: So, when I first-

[00:35:53] Will Page: You're, you're well-qualified to use that analogy. [laughs]

[00:35:56] Richard Kramer: I like my old wine. And I don't want to put it in a new bottle. Find any old bottle. But when I first got into the telecom technology world, they were talking about doing X25 private networks for banks. So, banks would set up their own telecom networks.

[00:36:13] Will Page: I remember this. I remember this.

[00:36:14] Richard Kramer: So, a- as did the airlines. They set up their own telecom networks that they knew were always reliable, and they would never go down. Because the telecom networks that they bought from the traditional telcos at that time, especially when they were state-owned entities, they were government bureaucracies, maybe weren't always as reliable as they needed. The banks or the airlines or utilities needed them to be.

And fast forward 30 years and the boom topic of Mobile World Congress was about enterprise and private networks and private 5G. And once again, every company because it's easy to manage now and the technology is cheap, is being encouraged to set up its own private network. And configure it to do exactly what they want it to do. So, that's just one of many examples of the old wine in new bottles thing, theme, if you will, to explain how trade shows work.

It's not that someone has a brand new idea to sell equipment to somebody, they have to find a customer for it. I do not want to fall into the trap of being cynical about all of what's being put on offer and show at these trade fairs. There are some tremendous innovations. There are some really novel solutions. Some of it is bat shit crazy and it'd never see the light of day. There's so much to be gained from these little incremental improvements and we never take note of them because we're too busy getting wowed by the spectacular announcement of some, something on the crazy spectrum that sounds so much more compelling.

And if you think about what's happened since GPRS data in 2G, we have just slowly made the speeds and feeds and the bandwidth available to mobile devices better and faster. And we have slowly expanded that screen size from a tiny little grayscale screen to a full color HD display. And putting those two things together has been incredible in terms of the number of services it's enabled. So, but most of that happened in relatively small increments. It didn't happen with giant leaps forward. We're still talking today about how game changing the iPhone was. But what's been the equivalent to the iPhone in the last 10 years? It's hard to think of one thing.

[00:38:37] Will Page: I know tech is lacking a second iPhone moment. Well, walk before you arrive. Work for the common good as opposed to your self-interest. Got a lot of themes in this podcast. And I wanna be grateful that you [laughs] were walking around that huge Congress Hall in Barcelona, not me. But for this week's Bubble Trouble, that's been a wrap. That's been a great insight. A great verbal postcard of what you learn from 100,000 telcos gathered under one roof. We'll be back next week with more peri- piercing of bubbles. And thanks so much for joining us on this week's episode.

If you're new to Bubble Trouble, we hope you'll follow the show wherever you listen to podcasts. Bubble Trouble was produced by Eric Nuzum, Jesse Baker and Julia Natt at Magnificent Noise. You can learn more at bubbletroublepodcast.com. Will Page, and I will see you next time.