Already in 1995, long before UMTS was visible on the public horizon, Gartner Group analyst Jackie Fenn analysed the phenomenon and called it ‘hype cycle’. He derived his five-part hype cycle from the analysis of an over-hyped product called Windows 95, but his conclusions apply also to UMTS and any other hyped technology, product, or service.

The first phase, according to Fenn and the Gartner Group, is the ‘technology trigger’: an announced breakthrough, public demonstration, or product launch that generates significant press and industry interest.

The second phase is the ‘peak of inflated expectations’. This is a phase of exaggerated enthusiasm and unrealistic projections during which hectic marketing activities and high media exposure accompany few successes and more failures. While the technology is pushed to its limits, only conference organisers, magazine publishers, and – though Gartner does not mention this – analysts are making money at this stage. Currently, the Wireless LAN technology is going through this phase.

The third phase is called ‘trough of disillusionment’. This is the point at which the technology becomes unfashionable, because the technology did not live up to its over-inflated expectations.

This is followed by the ‘slope of enlightenment’. In this fourth phase, solid development efforts lead to a true understanding of the technology’s applicability, and commercial tools, which facilitate the development process, become available.

Finally, in the fifth phase of the cycle, the ‘plateau of productivity’ is reached. The real-world benefits of the technology are demonstrated and accepted. Tools and methodologies are increasingly stable as they enter their second and third generation.

Applied to UMTS, we are now in the fourth phase, in which all major players have come to a realistic assessment of the technology’s benefits and push it through solid development of marketable products and services. However, it should be clear that this will take some time. Even for a less complex technology like GSM it took years to debug and stabilise the technology, particularly the software, in order to make it as reliable and user-friendly as it is today. 

Why is it so important for everyone in the telecoms business to understand the hype cycle? The answer is obvious: to avoid the mistakes and damages made in previous hypes. It might sound a bit anachronistic to talk about technology hypes during a phase of economic downturn, in which many companies try to recover from the burst of the Internet bubble.

However, under the surface a number of new technologies are popping up, which have the potential for the next big hype. One of the prospects is XML Web Services. In this issue of Eurescom mess@ge and at a Eurescom workshop in June, the promising opportunities of XML Web Services in the telecoms domain are presented. It may look as if Eurescom participates in creating a new hype, but the opposite is true.

With our projects and public activities in this area, we want to get as fast possible to phase four, the ‘slope of enlightenment’, leaping the detrimental hype phases two and three. Some people might argue why a hype should be detrimental. A hype accelerates demand, and, at least for a short period, leads to rising share prices.

The point, why a hype is detrimental for new technologies is that in the end, customer trust in these technologies and the companies that offer them is undermined, compromising the long-term business prospects of the whole industry.

Fighting the negative effects of hypes does not mean to restrict the enthusiasm of researchers, developers, marketing people, analysts, shareholders and others. It means to put new technologies, products and services into perspective and try to evaluate them in a realistic and accurate way, which will win more customer trust than a short-lived hype. We have to acknowledge the simple fact that only a limited number of new technologies and products will succeed in the marketplace, and nobody definitely knows in advance, which ones this will be. 

As a research organisation and centre of innovation, Eurescom is trying hard to explore, develop and evaluate technologies and services in an unbiased way to give its community of members an accurate and solid basis for their investment decisions in the area of innovative technologies and services. The borderline between healthy enthusiasm and unwholesome hype is narrow. It is essential to respect this borderline, if we want to achieve enduring customer and shareholder satisfaction.