Will 3G Investments Pay Off?

Carl Weinschenk

Make no mistake about it: The success or failure of consumer 3G will be a big factor in its corporate fate. Indeed, many small businesspeople simply will use consumer accounts, as is the case with older cell phone services.


A while ago, we suggested that slow 3G takeup in Europe is not a sure sign that operators on this side of the Atlantic will have trouble. We stand by that assessment -- for now -- but have to say that the anecdotal evidence suggests 3G as a whole may be experiencing some early growing pains.


One piece of evidence is the creation of the GSM Association's "3G for All" campaign. The idea is to select a reference design for inexpensive 3G handsets and make it available to all vendors. Big U.S. players T-Mobile and Cingular are among the 12 carriers involved. The goal of the project -- $30 entry-level 3G handsets -- is ambitious. It's not proof, but the aggressive price target suggests that 3G players may be seeing a soft market. Carriers wouldn't be pushing $30 handsets if they couldn't keep the $200 models on the shelves.


The other piece to the puzzle is a blog item by Dean Bubley from Disruptive Wireless. The entry in part suggests that smartphone users seem to be far more interested in applications and services that come loaded on their devices. Only aficionados, he suggests, will go hunting for applications from third parties. It makes sense, but adds to the background noise suggesting that the world isn't waiting breathlessly for advanced wireless sytems.


The next year will be critical for 3G as carriers and vendors begin to find out if their investments will pay off and, if so, how long it will take. The key for the success of any new business, of course, is to convince enough people to upgrade from their old standby. Though the jury still is out on 3G, the early signs suggest that this will be a difficult task.

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Oct 3, 2008 6:07 AM ROMEO ROMEO  says:

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