3G driving mobile broadband uptake

Mar 30, 2009 9:19 AM
Tags: 3g | driving | mobile | broadband | uptake

Mobile broadband is finally delivering on the 3G promise and uptake has exploded around the world over the last 18 months, said research group Ovum.

However, operators, infrastructure vendors and device vendors still need to understand future user demand in order to size-up the opportunity for new services.

Ovum said they also need to address the impact on the operator's network capacity; and future market value to assess the return on investment to be expected from future investments in this market.

Newly released mobile broadband forecasts by global advisory and consulting firm Ovum, show users accessing the Internet via mobile broadband enabled laptops and handsets will generate revenues of US$137 billion globally in 2014, over 450 percent more than in 2008.

However, operators will need to content themselves with the fact that user growth will be far faster than revenue growth, meaning more users and more data traffic, but declining average revenues per user (ARPUs).

Ovum said users of mobile broadband services (3G and 3G+ technologies) will grow from 181 million in 2008 to over 2 billion in 2014, growth of 1024 percent.

In 2014 Ovum forecasts that there will be 258 million users worldwide accessing mobile broadband services through laptops, which are connected via USB modems, datacards or have embedded mobile modules, said Steven Hartley, senior analyst at Ovum and co-author of the research.

"The most aggressive growth comes from emerging markets, where the unavailability of fixed broadband offers a major opportunity to mobile broadband players," he said.

"For example, 40 percent of total mobile broadband laptop users will come from Asia Pacific in 2014.

"The advent of 3G in markets such as China and India, the sheer number of mobile users and poor fixed line penetration in these markets means that broadband access to a very large number of people will be purely 'mobile'."

However, even in mature markets such as Western Europe, the slowest growing region between 2008 and 2014, user growth in laptop access over the next five years is set to reach 747 percent, and 918 percent in handset access.

"Such recession-busting growth will be music to the ears of operators," said Hartley.

"The ubiquity of the Internet and the desire to be connected on the move are key drivers for this, as will the increasing adoption of prepaid tariffs, which support the complementary nature of mobile broadband in such regions with high fixed broadband penetration."

However, on a global level, revenues grow at just 44 percent of the rate of users.

A signpost as to the reason can be seen in the fact that, as with most mobile services the vast growth in mobile broadband user numbers in emerging markets does not provide corresponding revenue growth.

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