MWC 2023 Day 2 – Always frowning

Floor report – No smiles here.

• The buzz on the floor is back but the halls of power seem to be filled with doom and gloom as one presentation after another is bemoaning the difficult situation in which the industry finds itself.
• The Orange CEO gave a dour presentation about the state of operators in Europe while the DT CEO went on to complain about Europe and telecom’s decreasing relevance in the digital ecosystem.
• Ericsson also struck a depressing note urging the telecom industry to regain its relevance by being open and cooperative.
• This is an ironic statement from the one company that the OpenRAN crowd say does not want to play in their space.
• Telefonica also sounded pretty desperate in a presentation by saying that there is no future without telcos.
• Technically this is true but the question remains, will they participate as bit pipes or will they be able to offer some value on top of the packets that they deliver?
• It is not for lack of trying but so far, the operators have been unable to prevent the incursion of Apple, Google et al into their space and the erosion of their relationship with their customers.
• The smartphone landscape is now very well established and mature meaning that this opportunity has long since been lost but there are other avenues to explore.
• I think that two of these are automotive and the Metaverse.
• This is because the technology stack remains wide open in both segments meaning that there is currently no one to really dislodge.
• This makes the opportunity much easier to address but one does have to be more innovative as there is no one to imitate or emulate.
• Both of these segments will also require a reliable connection to the internet that offers good throughput and low latency.
• This creates a foundation from which they have an opportunity to expand, but as ever this will come down to imagination, willpower and the ability to execute.
• The operators’ track record in this department is pretty poor and so I am not confident that they will succeed but given how unhappy they seem to be at the moment, I hope that they will at least put in a good effort.
• I think there is a great opportunity for operators over the next 10 years in these two areas but whether they will be able to make anything of them is another question entirely.

Qualcomm Stable Diffusion – Demo of the day.

• Qualcomm has managed to time market sentiment well with a demonstration that made the most of all the hype and noise that is currently surrounding generative AI models such as ChatGPT.
• Stable Diffusion is a well-known text-to-image generative AI model that has around 1bn parameters.
• This is an image generation algorithm that will generate images based on any text that is thrown at it very much like DALL-E or Mid Journey.
• Qualcomm’s implementation of this model is pretty ordinary except that it is running locally on an Android smartphone using the Snapdragon 8 Gen 2.
• This model runs at a speed at least comparative to DALL-E and Mid Journey in the cloud and it does so without the device becoming hot even after several image requests.
• We can be certain that it was running on the device as the smartphone I saw was in flight mode with no WiFi or Bluetooth connected.
• Qualcomm has managed to do this with a combination of well-known tricks such as converting from floating point to integer but also by using its Qualcomm AI studio tool which is designed for exactly this purpose.
• Qualcomm thinks that it can take this further with more tweaks and optimisations and is aiming at 10bn+ parameters in fairly short order.
• While the current hype persists, this is going to give great airtime and will generate differentiation for Qualcomm at the high end of the market.
• This will be needed to keep margins up in the face of a slowdown in the core market as well as increasing competition.
• Even when the hype starts to die down as it always does, this is a very able demonstration of AI edge which comes with all sorts of data, privacy and speed advantages.
• Hence, whatever happens to generative AI, Qualcomm has set a bar for others to aspire to.