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Monday, July 31, 2006

FM Radio & Cellular

How Analogue is that?

CSR announced their results for Q1 last week and they mentioned they are currently sampling FM Radio & Bluetooth functionality on the same chip and expects to start generating revenue from the chip in 2007. They mentioned that the current problem with FM Radio in the phones is the interference from the electronic circuitry produces interference and poor reception.

How about a bigger problem and more fundamental problem – FM is Analogue technology and uses vast prime real estate on the spectrum inefficiently.

I cannot believe with the entire effort going on to convert the UK to 100% digital TV that FM radio is escaping the digitalisation effort. After all we have a perfectly good crystal clear solution that many, many millions have been invested in – DAB radio. Frankly, I am disgusted that OFCOM are still regularly issuing local FM Radio licences – they should really be turning them off. They should be encouraging people to use the digital technologies and look for a plan to turn off both FM and MW technologies. Still I wouldn’t take the fascist move of preventing people to sell products with FM radio and Cellular functionality; however I would tax the chips to pay for the digitalisation effort, say £3/chip.

More importantly what on earth are the cellular operators thinking of subsidising handsets with FM radio? It is worth completely zero and perhaps is cannibalising fee generating services by encouraging people not to buy music tracks from them or registering for their Radio DJ services. Personally if I was an operator, I would charge a minimal price for contract phones with FM functionality otherwise I would risk looking like a complete and utter fool. If the operators charged say £5, then we’ll see how many punters really want this functionality.

I don’t blame CSR either as they are just responding to their customers requirements. In fact I blame Nokia, I believe they were the first to put FM radio functionality into the handset. I believe CSR are just trying to add more functionality to its’ chipset to help its’ main customer, Nokia, and more importantly hold off TI who are Nokia’s key partner and are expanding into Bluetooth.

In fact, CSR are becoming the chip supplier who provides features of dubious value to the operators. I’d love to hear of an operator who is actually making money out of Bluetooth – go to any playground and you’ll see kids exchanges pictures & music (especially ringtones) via Bluetooth for free. I admit that Bluetooth functionality with headsets is good for the operators. CSR’s next big chip is going to be a WiFi chipset which is going to be about as popular with the operators as a cut in termination fees.

I know that Nokia is a big #1 in the cellphone market, but they just cannot go winding up the operators and playing them for fools and not expecting some sort of backlash in the medium term.