This week the eyes of the world's tech sector, well telco at least, are on Barcelona where this year's Mobile World Congress (MWC) has just kicked off.

Announcements that have been made so far include the usual suspects… new handsets, and not surprisingly new tablet devices.

But despite the upbeat brouhaha that surrounds MWC, not everything is rosey in the world of mobile telecommunications.

The basic economics that built the mobile industry are now falling apart. Historically the world was voice-based and was all about customer acquisition - getting mobile phones into as many people's hands as possible... and the handsets were reasonably cheap to subsidise. This has changed dramatically over the last few years and will move again over the next few years.

The dizzy days where everyone was amazed at the 80% penetration levels in the Nordics have been eclipsed by a current position in the UK where penetration is over 100%. This means the balance of effort has had to move from acquisition to selective retention. If you look at the indicators the industry has used over the last few years, they have moved from basic connection volumes to average revenues and are heading toward earnings per user.

Have you ever been refused a killer-deal by your network operator to stop you defecting to the competition?  Now you know why, you're not profitable enough. You see, selective retention.

The market used to be split roughly 70% pre-pay, 30% post-pay - that split is changing in favour of post-pay. For the typical mobile network operator it's currently around 65% pre-pay and it will continue to drift that way.

You may be wondering why this is happening, or even why this is a problem. The finger can be pointed at the advent of the smartphone, and that all customers want to get the most expensive device as cheaply as possible. For the operator that means taking an even bigger hit when subsidising handsets.

Of course, the biggest change in usage the smartphone has brought about relates to data - mobile web, email, social media apps and so on.

The mobile network operators (MNO) sweated badly over the lack of uptake on data on their expensive 3G licences but the arrival of the mobile broadband dongle changed that. The market uptake was dramatic - especially when pre-pay was added. The growth of smartphones (iPhone and Android being primes examples) has compounded the amount of data that is hitting the mobile networks and radio capacity is becoming a major issue as a consequence. Unfortunately traditional solutions (build more cells) are not available - no real sites and the basic profitability of installing a traditional cell don't work.

Again you may be wondering why. The MNOs dropped the price of data to get uptake and, put simply, they over-compensated. Unlimited tariffs were prevalent until last year and bit them hard. The balance of traffic on the networks is now heading to be more data-orientated and the revenue per byte is dramatically lower for data than it is for voice so the basic economics of building a traditional network don't really work, as the price of the cell has remained pretty static.

And let's not forget the other aspect to all this - there is no more spectrum available at the moment, the auctions and refarming have been delayed. Added to which the next wave of network technology (4G) is here too now and that's data orientated as well (in fact, it currently doesn't support voice) so things look, umm… challenging.

So, if you're reading this from your stand at MWC I salute you. The world is inexorably wedded to mobile communications, with data at the heart of things. Yet no one seems ready or willing to pay the true price of your invaluable hard work and ingenuity.

Sean