ASIA Reuters - Early signs that mobile phone users will pay for multi-media services are giving telecommunications companies confidence their huge bets on high-speed wireless data will boost revenues, executives said.

Inset above is Jeffrey Belk, senior vice president of marketing for QUALCOMM Incorporated and interviewed by Reuters - more details below.

Industry chiefs at a third-generation (3G) mobile phone conference in Bangkok this week said demand for picture messaging, wireless e-mail and online information backed up their typically upbeat assessment.

Len Lauer, head of U.S. wireless company Sprint PCS Group (PCS), said about 40 percent of Sprint's new customers had signed up for a $15-per-month package offering services such as messaging, stock quotes and weather information. He expects high-speed data to make an increasing contribution to the firm's revenues in 2004 and 2005.

"Mobile data is not a dream, it's not an option. It's a requirement," he told a news conference at 3G World Congress 2003.

The industry's vision of mobile phone users downloading songs and video clips from the Internet or videoconferencing over their handsets has made slow progress to reality since European operators spent billions of dollars on 3G licences three years ago.

Only Japan and South Korea have well-established 3G services, while Europe is just starting to see 3G phones reach the shops. Nearly three-quarters of Japanese and 38 percent of South Korean cellphone users subscribe to data services, compared with around five percent in France and Germany and three percent in the United States, according to data tracking firm EMC World Cellular Data Metrics.

PHONE PRICES FALLING

Jeff Belk, senior vice president for marketing at network supplier Qualcomm Inc (QCOM), said the "success" of 3G in Japan and South Korea boded well for the rest of Asia, while cheaper handsets would make 3G more affordable.

"The good news is the price of colour multimedia 3G handsets are coming down," said Belk, who carries eight 3G phones to show off their ability to download games and video clips and send picture messages.

Many of those services are already available using interim high-speed wireless technologies: Singapore Telecommunications Ltd (TELE) said recently its customers were sending about 200,000 multi-media messages a month.

But consumer interest in photo messaging is encouraging the industry that it can persuade customers to use new data services.

"People are pointing out that it's very early days, but the signs are very strong," said Rick Pryer, a Siemens AG (SIEGn) executive.

Still, analysts said the popularity of wireless data in Japan, most notably at NTT DoCoMo Inc (9437), might be due to local factors such as a lack of desktop Internet connections, and did not guarantee success outside Asia.

"3G is not going to be uniform around the world," said Adam Guy, senior analyst for wireless and mobile services at the Yankee Group.

"In the Asia-Pacific market, where the mass market is less likely to have easy affordable access to the Internet, 3G will provide it with a lot of potential."

NTT DoCoMo gets almost a quarter of its revenue from data services, compared with 15-16 percent for operators elsewhere in the world, such as Vodafone Group Plc (VOD).

Most of the data revenues outside Japan come from text messages, but even in the relatively immature Thai market there is confidence that people will start using more advanced services when 3G comes along.

"At first people won't be that interested because they don't know much about it," said 24-year-old Waravut Tipsoontornsak, a graduate student in telecommunications at Bangkok's Chulalongkorn University.

"But when people start seeing their friends or people on the street using something like video streaming on their phones, they'll want to do it themselves. That's how things catch on." (Additional reporting by Chawadee Nualkhair, and by Doug Young in Hong Kong)
©2003 Reuters Limited.