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3G's not what you think
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EE Times


MATHIAS_CRAIGOne of the most surprising conclusions that came out of the recent Next Generation Networks conference in Boston was that all of the marketing we've seen surrounding the higher data throughput in 3G systems (mostly defined as raw throughput of no less than 144 kbits/second) isn't really important to cellular operators. Like most enterprise and business users, I had thought 3G was about exactly this, coupled with greater spectral efficiency and more voice capacity. Silly me.

As it turns out, 3G is just another technology, at least for now, designed to boost consumer (read: nonbusiness) spending. Higher average revenue per user (ARPU) is clearly a goal for the cellular carriers, which have seen a decline is this number because of competition and a rapidly maturing voice market.

Data seemed like the best way to reverse the trend: After all, access to the Web is becoming just as important as being able to make a voice call, and more throughput is always better. Both Verizon and Sprint offer all-you-can-eat 1XRTT data plans, albeit at $100 a month for now. It seemed to me that all we'd have to do is sit back and wait for competition to drop the price, and then profit from the arrival of anytime, anywhere access to the Web-and not just the rather primitive experience enabled by the Wireless Application Protocol (WAP).

But if you look at how Sprint and Verizon are marketing their respective 3G services, data (as in Internet Protocol networking) is buried in the fine print. What they really want to sell is screen savers, ring-tone download and the ability to send pictures of one's cat to interested parties everywhere. The participants in the panel at NGN where all of this was revealed were all CEOs of companies that build equipment that makes such services practical for the operators. VPN-based access to one's corporate network from a wireless PDA? It's not really on the horizon. For now, carriers have set their sights firmly on the consumer.

There's more than anecdotal evidence that, from a revenue perspective, such a strategy will work just fine. European consumers are gaga for short-message service (SMS); multimedia messaging service (MMS) is on the horizon. ARPUs are actually rising in South Korea, another bastion of consumer-driven 3G.

But the wait will go on for those of us who just want to get our jobs done. Maybe next year.

Craig Mathias is an analyst at the Farpoint Group (Ashland, Mass.).





The views and opinions expressed in this column are strictly those of the author and should not be taken as an editorial position of EE Times or any of its other editors, publications or Web sites.


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