Steve Jobs clearly believes in it, Rupert Murdoch wants a piece and Jorma Ollila has high hopes for it: the executives behind well-known companies such as Apple, News Corporation and Nokia agree that convergence has finally arrived in technology, media and telecommunications.

I think each of these leaders, icons in their industries, is telling us the same thing: the convergence of communications, media and the internet can no longer be ignored. In the global media and communications sector, technology has brought us again to one of those extraordinary inflection points where entirely new mass consumer product categories are created.

If that sounds like hype, just pause for a second and try to remember the world before the internet, before the mobile phone, before the Walkman, before multi-channel television. That was about 20 years ago. That is what technology can do.

While some smart guys are piling in, however, others are in denial. They are dreaming of maintaining the status quo – a cosy world where market share
and margins in both mobile communications and the media can remain predictable, and more or less static – for years.

I believe that the distribution structure for internet, media and communications products has already changed, and has changed for good. All the trends from the music industry, pay-per-view television and internet search indicate that “mobile” is what users want. Mobiles are at the centre of the converged world of communications, the internet and media – not just in Asia but now across Europe and, soon, in America also. Our confidence in this proposition is as robust today as it was five or so years ago when Hutchison Whampoa began investing in third-generation digital mobile licences across Europe and around the world.

From our perspective, customers are leading the charge and where fashion leads, revenues follow – think about the migration of advertising to players such as Google and Yahoo on the web. For everyone in the world of advertising, the present structure of the internet advertising market was unthinkable even a few years ago. It is entirely logical to expect that much the same market will develop in the world of mobile broadband internet – perhaps it will be even bigger.

The sheer ubiquity of the mobile handset as a consumer product is the reason it can claim centre place in the converged broadband world. The handheld device is already one of the most successful and important consumer products in our lifetimes. Now it is becoming a vital platform for the distribution and consumption of advanced communications, the internet, media and entertainment.

New research recently published by Britain’s Royal Society for the encouragement of Arts, Manufactures & Commerce suggests there are more than 2bn mobile phones in use around the world, generating total annual revenues of $550bn for the cellular industry.

Market penetration numbers reflect the potential for traditional media distributors. Analysts estimate that European mobile penetration reached an average level of more than 95 per cent in the first half of this year. And CIBC World Markets in New York predicts a “sharp increase in 3G handset distribution” in the foreseeable future.

No one should be surprised. Even in developed markets in Europe, mobiles reach many more customers individually than television, and far more customers than any cable or satellite multi-channel offering. Depending on where you look, there are anywhere from twice to four times as many mobile customers as internet users.

That transition is being led by the availability of 3G handsets, with almost 200 different devices now available from European wireless carriers alone and data traffic showing strong quarterly growth across the sector. Non-voice services account for 23 per cent of the monthly revenues generated by 3 Group’s 10m customers, equivalent to €9 ($10.63) a month per customer.

Amid all this, I believe next year will mark a watershed. Mobiles are poised to take a significant share from the compact disc market, the personal computer, the iPod and television sets as a principal channel of distribution. Products will include pay-television and services such as “catch-up television”, which summarises topical television events you might have missed, and community television, products where everything from news to entertainment is produced every day, everywhere, by everyone who carries a mobile.

That trend marks one of the first steps towards integration of the home and mobile music, television and filmed entertainment environments. Mobiles will become an interface to products in the home and a channel with high capacity return driving the further development of those products.

We now find ourselves at a similar point to where television was in the late 1940s. In 1949, just 2 per cent of American households had a television set. Five years later, more than half of all Americans were glued to the box. Today, television is ubiquitous globally.

But the winners of this new world order will not be all the “usual suspects”. A mobile operator that does not understand its consumers’ media needs will fail, as will a media operator that does not anticipate what customers want in mobility. An internet operator that does not understand its customers’ needs in mobility will be off-line for much of the time that his customers are online. This will lead to important new alignments between the mobile, internet and media worlds.

The writer is chief financial officer of Hutchison Whampoa Limited

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