While the world of mobile communications is set to make a qualitative leap with the introduction of high-speed data services, the widespread acceptance of Third-Generation (3G) applications is progressing slowly.
New analysis from Frost & Sullivan - Global Next-Generation Mobile Networks Markets - reveals that this industry generated worldwide revenues exceeding $45 billion 2001 and is projected to near $75 billion by 2007.
While regional markets are set for steady growth over the forecast period, network operators are struggling against a myriad of challenges. One of the most problematic issues is the existence of multiple network technologies across the international marketplace.
"Industry participants are expected to face an uphill task in their efforts to reduce the presence of multiple technologies. The synchronous existence of analog, time division multiple access (TDMA), code-division multiple access (CDMA), and global system for mobile communication (GSM) technologies has only complicated matters for proponents of a common global standard," states Frost & Sullivan Industry Analyst Kshitij Moghe.
Unlike Europe, the Middle East, and Africa, competing network technologies exist in the North American, Latin American, and Asia Pacific markets. The process of converting analog to digital systems in the Americas makes the conversion to 3G even more challenging.
"The transition of TDMA to GSM has helped reduce competition. In addition, the development of a third 3G standard in the form of TD-SCDMA within the Chinese market, if successful, is likely to further fragment the industry," says Moghe.
However, there is a growing climate of uncertainty over the viability of 3G services. This has primarily stemmed from the inability of operators and vendors to deliver on their promises for this technology. High infrastructure costs, delayed network deployments, and reservations about the success of data applications have induced a degree of skepticism.
Furthermore, the much-touted theoretical throughputs and their potential benefits have not lived up to expectations. Initial data speeds have been significantly slower than peak throughputs. Operators will be challenged to restore consumer confidence by educating the market on realistic data speeds and introducing value-d solutions.
"In the years to come, industry efforts are likely to be focused on developing a set of compelling applications for wireless data, as future capital expenditures for 3G are expected to be governed by a solid business case. The primary challenge for market participants will be to identify and foster these applications, in order to continue network expansion," states Moghe.
Frost & Sullivan will hold a conference call at 1 p.m. (EDT)/10 a.m. (PDT) on June 26, 2002 to provide manufacturers, end-users and other industry participants an overview, summary, challenges and latest coverage on, Global Next-Generation Mobile Networks Markets.
