While face-to-face video calling on mobile phones has been available for around a decade now, the technology has never gain substantial widespread public adoption. However, the inclusion of “FaceTime” video calling in Apple’s upcoming iOS 4 for iPhone4, announced Monday by CEO Steve jobs at WWDC2010, may give the technology the prerequisite market penetration to reap positive network externalities.
The concept of video calling has had a long history, for instance the Telepohonoscope from the 1870s, and a number of implementations have been attempted over the years, such as Ericsson’s “Videophone” from the 1960s. The first mobile phones capable of simultaneously transmitting and receiving streamed video were released in the early 2000s in conjunction with the roll out of 3G wireless mobile networks. While the technology enjoyed limited popularity initially, particularly in Japan, issues such as cost, bandwidth requirements and interoperability between networks and devices meant the feature became little more than a gimmick in the long run.
However the technology potentially offers a wide range of practical purposes such as remote medical diagnostics and aiding communication between sign language users, which are difficult with traditional communication technology. The exciting result of widespread adoption of the technology will be increased innovation and reduced costs.
While the announcement by Apple does not signify a significant breakthrough technology-wise, it is the issues related to interoperability which the iPhone implementation, albeit in a roundabout manner, promises to address. While slated to be initially launched exclusively for use over WiFi and between iPhone4 handsets, FaceTime, unlike Skype, is based upon existing open standards including: the SIP standard for connecting and terminating voice/video over IP sessions (launch in 1999 by IETF), the H.264 standard for video compression (used by YouTube, Blu-ray, iTunes, Satellite television, etc.) and the AAC standard for audio compression. Furthermore Apple aims for FaceTime to become an industry level standard and plans to reach out to the wider standards community to do so.
Most importantly however, since the iPhone – which has sold more than 50million units worldwide within 4 years, 8.75 million during the last quarter alone – revolutionised the smart phone industry many players have been playing catch up and will no doubt look to offer the same features as Apple for fear of falling behind.
The success of mobile products relies heavily on network effects. The value of video calling to a consumer rises dramatically as more users adopt the technology. Unlike voice calling however, previous implementations were restricted to a single carrier and often a specific handset. Although the iPhone FaceTime will initially have similar restrictions – most notably it will be interoperable with the Android based HTC Evo’s “qik” application – the immanent flooding of the market with video calling compatible handsets will see increased consumer demand for a common platform. Handset makers will no doubt acquiesce to Apple’s standard given the iPhone’s market lead, particularly if Apple does indeed work together with standards setting organisations towards an industry standard.
