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GSM Body Gets Makeover

Describing it as "historic news" may have been stretching it a bit, but the GSM Association, the industry body for GSM operators, is changing the way it operates, in a bid to help streamline market processes (see GSM Assoc. Holds Roamfest).

By creating what it calls a "CEO-level board," the association hopes to harmonize operator developments, technology, and product launches in a way that hasn't happened before. Witness the launch of WAP services and the rollout of GPRS networks.

At a meeting in Istanbul this week, the association's members voted to change the articles of the association to bring about this change, which calls on greater involvement and the dedication of resources from the world's largest GSM operators.

The association has for years been seeking to promote common standards and approaches to GSM developments through its task forces and working groups. However, these have been manned by representatives from GSM Association members who also have full-time jobs, and who, for the most part, have not been top-level decision-makers at the companies for which they work. This has slowed down the process of delivering "findings" and "actions" and has made it harder for the association to create industry-wide strategies that are likely to be adopted.

This was recognized by the association, which put its vice chairman, Craig Ehrlich, the executive director of Hong Kong mobile carrier Sunday Communications Ltd., at the helm of an advisory board that would recommend how the association could be restructured. "We didn't address some of the issues [the association] should have been looking at in the past because of the speed of change in the industry," said Ehrlich in a conference call. "We need to focus on the future as we move into a data-centric environment where 2.5G and 3G will be critical to the success of our businesses, and we need to be ahead of the curve."

In a vote, more than 90 percent of members decided the new structure would be the best way forward. The CEO-level board will comprise representatives from the 12 biggest (by subscribers) GSM operators, plus another nine to be chosen by a nominations committee.

Although the names of the 12 have not been finalized, the following look set to be involved: As for the additional nine, the association wants them to represent "small and medium-sized players, especially those representing the Middle East and Africa," says association chairman Jim Pratt, a consultant at Singtel Optus. It's also eyeing influential 3G players like Hutchison Whampoa Ltd. (Hong Kong: 0013), which holds eight 3G licenses around the world through a number of subsidiary operating companies. The new board will also offer "much better representation for Asia and North America than before," added Pratt.

Despite the name, the board members will not all be CEOs. Indeed it seems unlikely that any will be actual chief executives. But they will be board-level folk with "the authority to commit resources," says a spokesman. Anyone expecting the likes of Vodafone's Chris Gent to attend regular meetings is kidding themselves.

Instead, the board-level representatives will probably meet about every two months or so to make high-level decisions based on the work of a nine-person strong executive committee appointed by the board. These nine will come from the companies that provide board-level members. This executive committee will have the power to commit dedicated resources from the operators represented on the board for specific tasks. This, it is hoped, will help deliver strategies and action points that more closely represent the needs of the GSM operators looking for guidance and help from the association. "Our members are always asking our advice on what to build out and when," said association CEO Rob Conway. "This structure can improve the time to market and help reduce the cost and energy that our members expend."

The new structure comes into effect from January 1, but it seems likely that the members of the board and executive committee will be unveiled at the 3GSM event in Cannes, France, next February, and start work in earnest at the next plenary meeting in Los Angeles next April.

So how exactly will the new structure help the total membership? By guiding vendors, content creators, and applications developers on how to create more revenue and advance the industry as a whole, said Ehrlich. Pratt says this will be achieved by "delivering operator requirements for handsets and infrastructure [to manufacturers and developers] in a more user-friendly way." And before Unstrung could conjure a picture of vendors with their heads in the hands, Pratt added: "We know the vendors are excited about this. [Ed. note:hmmm] They spend billions on R&D so they'll be happier to get guidance [from their customers]." He added that the association never gets involved in striking deals or talking about prices. This is about delivering operator requirements to the suppliers.

There's no doubt that, collectively, the association has some potential clout in the industry. It boasts more than 660 "second- and third-generation" operators as members, as well as having associate members from the vendor community. Those operators collectively have nearly 750 million subscribers, a number set to reach 1 billion some time in 2003 or 2004, it believes. According to its Website, only eight "major nations [have] yet to adopt GSM technology." A smack on the wrist to the major nations of Colombia, Djibouti, Ecuador, Eritrea, Haiti, Iraq, Uruguay, and Zaire.

Taking that potential and delivering positive results for its operator members is what this reorganization is all about. As the association's main concerns at present are GPRS roaming (not a hit so far if Unstrung's experience is anything to go by) and MMS service interoperability, it has its work cut out even before the new board jets to LA with its triband handsets and sets up the next conference call.

— Ray Le Maistre, European Editor, Unstrung
www.unstrung.com
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