At
last some good news about 3G¹s prospects in Europe
A new report, published
by London-based consultancy
The Thinking Box, casts a positive light on 3G.
Find below:
- Bottom line of the report
- Some of the findings
- Methodology
- More about us
BOTTOM LINE
We forecasted that
3G penetration would reach 50% of mobile users in Europe
in 2007.
Rather than communicating
with a brand, a service or a piece of content,
what people primarily want to do with their mobile (3G handset included)
is
communicate with other people.
Applications based on self-generated content will meet instant success.
In 2007, we believe
that mobile phones will be still mainly used for the
same reasons as today (communicating with other people). However,
applications based on interaction with a third party, provided they
are
intelligently selected, promoted and managed, will be Othe cherry on
the
cake¹, adding a crucial extra 15% - and more beyond 2007
to mobile
operators¹ turnover.
SOME FINDINGS
APPLICATIONS
3G early expansion will be driven by peer-to-peer applications. We
identified 5 killer applications for the near future (Video calls and
MMS
are included). Regarding video calls:
The interviewees were truly amazed by the possibility of Ovideo call¹:
they
couldn¹t believe that this spectacular innovation would be available
in the
next few months in their country.
Video calls will definitively catch people¹s imagination.
REVENUES
In 2007, ARPU will have increased by 150%.
- Voice will still represent the main source of revenue 62%.
- SMS will predictably disappear and will be replaced by MIM mobile
instant messages.
- Peer-to-machine revenues will only account for 22% of ARPU
TARIFFS
- SMS and voice tariffs on 3G must remain the same (as they are today
on GSM
networks)S if not diminished
- 15 Euros per month for 3G services (on top of current GSM bills) is
perceived as an acceptable expenditure.
HANDSETS
- The fact that 3G handsets will be chunkier than current devices will
not
deter customers on the contrary
- Innovative devices such as ³Danger² with its large
screen and removable
keyboard will draw a lot of attention.
- Dual-band phones seem to be a good compromise.
WHO WILL DRIVE 3G¹S
EXPANSION? OPERATORS THAT DON¹T HAVE A GSM NETWORK
such as HUTCHISON 3G
Because 3G is their sole source of revenue, they will be very aggressive,
especially regarding price. Like it or not, competitors will be obliged
to
follow and even be forced to adjust their strategy.
3G WILL ATTRACT
INDIVIDUAL USERS
Proposing high tariffs supposedly for a rapid ROI and targeting
business
users will not benefit 3G, and the European telecom industry at large.
SCENARIOS FOR 3G
We identified 4 scenarios for 2003, plus 5 long-term scenarios for 3G
(2003
2007). For our most optimistic scenario, 3G penetration reaches
75% in
2007 (of mobile users). Most pessimistic: 15%. Median scenario: 50%.
THE BIGGEST THREAT
TO 3G? 2.5G
Postponing 3G¹s launch will trigger a vicious circle for the mobile
industry
in Europe, in that it will give breathing space for GPRS to expand and
create competition for 3G.
METHODOLOGY
- We did not talk
to experts and telecom executives. In fact, we consciously
disregarded most of the comments often negative that we
read in the
press during the last twelve months.
- We did not interview thousands of people over the phone or use in
focus
groups: we had several lengthy CONVERSATIONS with a concentrated group
of
only 100 representative Europeans. What we learnt is priceless.
- The consumer research only focused on understanding what will happen
in
the next few months
- To provide forecasts for the next 5 years, we used scenario-planning
methodology.
