The way I see it the mobile high speed (>64k) market is mostly fixed or at least stationary...The way I see it the market for high speed truely mobile connections is very small, journalists, police, etc, and not a question of beeing the size of a handset in a pocket...GSM-GPRS with good coverage and higher burst rates takes care of most of this for a long time to come.
I have to disagree. There's a few major, potentially mass-market, bandwidth-intensive applications that are possible for small, sub-150 gram smart phones. Right off the top of my head, on-demand MP3 streaming, streaming video playback, videoconferencing support (I know, this one's a while off), and online video game playing come to mind. These obviously aren't applications which, if implemented correctly (considering how stupid telecom operators in general can be with regards to service deployments, that's a big "if"), will see their popularity relegated to small, vertical niche markets.
Although I don't think that 2 mbps connections are needed for such apps, especially when taking into account the relatively small screen sizes of phones for the video-related ones, 100-200 kbps, which should eventually be possible with a large % of major 3G rollouts, will most likely be required; and even if other technologies such as GPRS, EDGE, and a packet-switched version of IS95/B were somehow able to provide the necessary data rates, cost also has to be factored into the equation. Obviously, even when taking into account the use of a packet-switched architecture, a high-quality MP3 file or video clip that's streamed to a user is going to take up far more capacity than a phone call ever will. To convince consumers to use such services, per-minute pricing will have to be fairly close to what's charged for telephony. For example, I doubt that too many people will be willing to pay 40 cents/minute to listen to an MP3 clip. On the other hand, 10 cents/minute may be tolerable for some people. I doubt that this possible with non-3G technologies.
On another note, the fact that many of the most popular 3G applications may turn out to be consumer-related could potentially alter the manner in which deployments take place. As we all know, it's inevitable that, given the costs, the first 3G rollouts will take place in major metro areas with high population densities and ARPUs. However, where the rollouts go from there could depend on which serices generate demand, and what types of people the demand comes from. If it's found that most 3G subscribers tend to be business users who use the technology mostly for work-related purposes such as laptop internet connections and client/server business apps, then operators will most likely be very slow to expand deployment beyond major cities, given how these cities will always be the ones that act as major business hubs. On the other hand, if it's found that 3G services are devoured to an equal, if not greater extent (as I expect), by regular consumers who use 3G handsets for MP3 streaming, game playing, streaming video playback, etc., then carriers will have a major economic incentive to start making major deployments within smaller towns and suburban neighborhoods, an incentive that's strengthened in certain countries by the huge fees that they may have paid for their 3G spectrum licenses.
Of course, it could be argued that even if such services become popular among consumers, and even if they're cheap enough that many individuals feel comfortable with using them frequently, 3G handsets with support for such features could be so expensive that most consumers won't be able to afford them. However, it should also be noted that since these handsets allow carriers to offer a more diverse array of value-added services to their subscribers, they'll have a major incentive to significantly increase the extent to which they subsidize the cost of buying such a handset. Likewise, carriers could also attempt to entice users by means of subsidizing the cost of new, value-added services that they offer, provided that a given subscriber buys a handset that supports the service. Sprint, which tends not to subsidize handsets a whole lot, has recently done this, offering a music management service for free for one year to those who buy Samsung's new MP3 phone. Either way, the relatively higher wholesale costs that 3G handsets will have may not prove to be as great a barrier to widespread consumer acceptance over the long-term as some might expect.
Eric |
