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To: ynot who wrote (5745)	10/29/1999 4:00:00 PM
From: elmatador	Read Replies (1) \| Respond to of 12823

Mobile Operators Should Compete on Voice Not Data, Says Report By Vanessa Clark 29 October 1999 Mobile operators should use wireless data as a way to increase voice calls and not try to compete with fixed operators in the data market says a new report from U.K. analysts Schema Consulting. The report, Opportunities for Unified Telecoms Services: The convergence of IP, intelligent networks and mobile technologies, sets out to advise mobile operators on business strategies that will justify the investments being made in wireless data technologies. It warns operators that they will not be able to compete with fixed operators in data alone as technologies like xDSL and cable modems mean that wired data rates will continue to outstrip mobile rates. However, Schema sees new technologies like WAP as an excellent chance for operators to drive voice revenues, reduce churn and provide unified telecoms services - but will only ever generate incremental revenues themselves. "Mobile operators are ... going to have to think about the ways in which mobile data can complement the services provided over the fixed network, rather than try to compete with them head on," said Henry Harrison, senior consultant at Schema. Location-based services are going to be crucial here. For example, calls made on a personal mobile phones could be billed to a corporate account when they are used on-site. Another service Schema suggested was that shopkeepers could offer free phone calls from within their stores to attract customers to special offers. The shopkeeper would pay the operator for the calls with the cost off-set by increased sales. Harrison said that pure mobile data is a gamble for operators, especially in Europe where they are being asked to commit billions of dollars to untested networks and technologies as part of the auctioning of licenses. In the U.S. operators are taking a more evolutionary approach to 3G not requiring a massive initial investment. Harrison warns that "expectations for mobile data are in danger of being over-inflated because of a focus in top speeds for new technologies." For instance, GPRS rates, set at around 107.2 kbps, are shared by all the users in the cell - so the more users means a slower actual rate. And although 3G standards make the promise of data rates at up to 2Mbps, this is only under ideal conditions, stationary and at the middle of the cell. It is crucial that operators manage users expectations now to avoid this impacting the market later. Harrison says that operators will have to set up pricing models that charge a premium for higher rates. "Whatever the technology, lower speeds are cheaper and the pricing of data services has got to follow this model," he said. The $500 million study was conducted over the last five months in Europe and the U.S. and consulted operators, ISPs and vendors as well as 700 end-users