Would anybody else be interested?
This post and this post on the future demand for mobile data services from Rod Hall’s TelcoTech blog got me thinking… (uh-oh)
Basically he’s saying he thinks that the market is possibly vastly underestimating the demand that will emerge for mobile data services as mobile broadband becomes ubiquitous. I agree with him. I think demand will be huge. (IMO, the more interesting debate is to be had around when - what quarter, what year - the tipping point is reached.) Anyhow, back to the thinking…
I wondered how would one best express this view financially. I suppose you could by mobile phone equities, or network infrastructure providers, etc. etc. - this is what you would have done in the 20th century. But I don’t know anything about any of those companies and industries and quite frankly I’m not that interested to find out and more importantly I don’t have the time. And in any event even if I did (know something or have the time), investments like that would still have (considerable) basis risk versus my core view. I just want to be long unit volume of mobile data consumption. I want a market in that. All I need is a unit of trading (terabytes /day or something like that?), a strike date (say March or June 2009 for example) and a robust and independent data provider. Call it a prediction market, call it a long bet, call it what you like…I want to buy these ‘futures’, not Vodafone (nothing personal just don’t want to be bothered managing the specific risk associated to a particular company.)
Whether it is mobile data consumption or cans of soup sold or the number of songs sold on iTunes, I will always have a better view of the possible future outcomes than on the profits of any particular company that competes in that space. I don’t want the basis risk.
Let the professionals convert and transform my ‘investment’ in mobile data into risk capital for the companies providing these services. Let them manage this basis risk. Not the individual investor.
Am I alone in thinking like this?
