While many people in the telecoms industry - along with large numbers of analysts and observers - worry about whether consumers will warm to third-generation (3G) telephony, Jon Moynihan is already thinking about the next steps.
Mr Moynihan is best known as the former McKinsey consultant who has revitalised PA Consulting Group, the London-based management and technology consultancy, since becoming its chief executive 11 years ago. Less well advertised is that he is a Balliol graduate who likes to drive his Bentley to work - although sometimes he uses a bicycle or rollerblades instead. And he is chairman of UbiNetics, a four-year-old Cambridge-based company, majority owned by PA, which makes telecoms test equipment and designs chipsets for mobile phones.
Under a deal announced this week UbiNetics is to work with Japan's NTT DoCoMo to develop test equipment for an experimental '3.5G' mobile system - what Mr Moynihan calls "the big new thing." While 4G remains largely in the realms of blue-sky research, 3.5G is a real technology called HSDPA (high-speed downlink packet access). This can be easily bolted on to 3G networks such as DoCoMo's, in much the same way that GPRS has been overlaid on to the standard GSM networks to allow picture messaging and faster data delivery.
HSDPA will take mobile telephony into a whole new world, promises Mr Moynihan. Whereas the 3G technology being introduced in Europe and parts of the US and Asia - known as UMTS or W-CDMA - will eventually be able to deliver data at 384 kilobits (thousand bits) per second, 3.5G will run at up to 14.2 megabits (million bits) per second, roughly 40 times faster. "This is ultra broadband," he says. "Apart from the size of the screen and the fact that you are mobile, it is completely coterminous with wired broadband. In fact, wired and wireless become a little bit interchangeable."
He says 3.5G could be used to supply broadband coverage to, for example, an island village that would not be worth wiring for fixed broadband access. It would also be faster than the 10-11Mb promised by the latest versions of Wi-Fi (wireless local area networks), which cannot handle voice calls.
UbiNetics' customers - the telecoms equipment suppliers - are "extremely interested" in the company's proposed TM500 network testing device for 3.5G, says Mr Moynihan. This, he says, will provide the 'gold standard' for the technology, in much the same way as its TM100 has done for UMTS. But, mindful of the delays UMTS has experienced, he is cautious about predicting when 3.5G will be deployed: "We won't see any major use of it until 2008-2010 - things always seem to roll out slower than you think."
That caution is not in any way due to scepticism - either about 3G or its mooted successor. Mr Moynihan has never doubted the eventual success of UMTS. None of the reasons offered by critics for why 3G will not happen - that operators cannot afford the cost of implementing it; that there are no "killer applications"; and that competitive technologies such as Wi-Fi are overtaking it - hold water, he says.
Instead, he blames a "drumbeat of negativity" among the media that has focused on the huge technical problems that have delayed the launch of UMTS, rather than the "massive effort" by the industry to overcome the challenges of moving from 8-9Kbps GSM networks to 384Kbps. "Both these stories are true," he says, "but you only read about one. If you'd read the papers over the past two or three years, you'd have to believe there was a very strong chance 3G wasn't going to happen. There is bemusement in the industry that anyone could have said that."
He reserves particular scorn for those who have suggested that GSM operators should switch to CDMA2000, the rival 3G technology pioneered by US-based Qualcomm, because of the glitches that UMTS has suffered. "It's like saying, 'We've got the dam nine-tenths built, let's stop and direct the river through the mountain instead."
The drumbeat is beginning to die down now, he says, helped by developments such as the launch of Hutchison's 3 service in the UK and Italy. But it did have a significant negative on the development of the technology. "People have got cold feet and that has delayed roll-out plans," says Mr Moynihan.
UbiNetics, too, was affected: "We've had to be quite careful over the past two or three years," he says. "We could have developed some of our technologies at twice the pace, had we had more confidence in the future cash flow from customers. In fact for six or nine months last year there was almost a complete 'strike' by customers. Some of them (such as semiconductor manufacturers seeking chipset licences) are only just coming back to the table."
Mr Moynihan admits he is "not the world's greatest technologist," but is confident that the "tons of fine tuning" still needed on 3G, such as ensuring that calls are not "dropped" when moving from 2G to 3G coverage areas, will be completed over the next few months.
It is when considering the business aspects of 3G that Mr Moynihan's McKinsey background, and years spent advising other companies how to improve their business, come to the fore. The "vacuuming of cash" out of the industry - more than Euros 100bn for 3G licences across Europe, including Pounds 22.5bn in the UK - has set it back a couple of years, he says, but any operator seeking to recover the money in its pricing for handsets and services would be making a big mistake.
"It was wrong to charge that much (in the UK), or to have an auction that buffaloed people into paying that much, it was wrong to pay that much, and now it is wrong to price as if it was right to pay that much," he warns. "Finance theory tells you very clearly - write it off - your share price will rise when you do so."
He worries, too, that with only three or four licensees in each major country there will not be enough real competition to drive prices down, which he believes is "absolutely essential" for 3G's success. As for compelling applications, "everybody's got their heads down at the moment," he says, and the lack of creativity is another consequence of the licence payment fiasco. "A tiny fraction - just Pounds 10m - of that money would have got you some of the best programmers in the world to deliver fabulous applications," he says.
Mr Moynihan, a fan of the long-running BBC radio soap opera The Archers, looks forward to the day when he will be able to download an episode to a 3G phone or PDA - the form factor he thinks will eventually hold sway - and listen to it on the way home. "This will only happen when you can go to the BBC and say there are 500,000 3G users out there," he admits, after completing an impromptu rendition of the signature tune. "So it's a chicken-and-egg situation. . . but it's all a function of time, it will all happen, I have absolutely no doubt."
So will Mr Moynihan be an early adopter of 3G? "I haven't bothered to get a 3G phone yet," he admits. "I always regret paying in pounds for anything electronic, and they won't be selling them in the US yet." Besides, he says, "I never like flashing gismos about in a very cost-conscious company. I'll buy it myself - but I want to see the applications first."
So how come this modest, unassuming, man, who seems a little embarrassed by the trappings of success, drives a Bentley? It has been a good investment, he insists - "worth as much as I paid for it 10 years ago."
