The North American wireless data market to grow from 7.3 million subscribers in 2000 to 137.5 million subscribers in 2005, according to Gartner Dataquest, thanks to mobility-focused applications and consumer-based data services and devices.
Increased usage of wireless devices will be driven by the rollout of packet data networks on a nationwide basis, increased overall usage of wireless devices to receive messages and email, inexpensive wireless data devices and company specific applications, which improve the productivity of the mobile worker.
“Increasing mobilization capabilities of work forces, together with additional competitive pressures will drive the adoption of wireless data to enable corporate applications such as email and messaging as well as specific vertical applications such as field service, and sales/inventory programs,” said Tole Hart, senior industry analyst for Gartner Dataquest’s worldwide Telecommunications and Networking group.
Although circuit-switched data service was the leading technology in 2000 with 38 percent of all wireless data subscribers (led in large part by Sprint PCS and Verizon), by 2005, 70 percent of wireless data subscribers will be using cellular packet data networks. These networks provide strong coverage, combined voice and data plans with operators and faster-speed service. According to Gartner Dataquest, many of the subscribers that used circuit-switched service will switch over to packet networks because of their always-on capability.
Handsets will continue to hold the lead in sheer numbers of access devices, but PDAs will quickly gain popularity, as wireless connectivity becomes standard, Dataquest predicts. Application-specific devices, such as wirelessly equipped gaming devices and QWERTY keyboard-enhanced handsets, to take advantage of higher-speed services and application types will also roll out in the 2002-to-2003 timeframe.
“Continued mobile device evolution will have a direct impact on the increasing uptake of mobile data services,” said Michael King, senior industry analyst for Gartner Dataquest’s worldwide Telecommunications and Networking group. “Larger displays, better input capabilities and enhanced form factors will increase usability, thereby adding even more to the expanding mobile data user base. We expect that the data focus and higher-speed functionality technologies will penetrate all segments of the handset market starting with higher-end, higher-cost devices first, but quickly trickling down to the lower-end, lower-cost devices.”
Research by Cahners In-Stat Group found that the next five years will see dramatic wireless subscriber growth, with the worldwide penetration rate reaching 24 percent in 2005. The continued growth will be marked by the long awaited surge by China into first place, with the country passing the U.S. in wireless subscribers during the third quarter of 2001, according to Cahners Report “China. The Sleeping Dragon Arises: ’01-’05 Subscriber Forecast.”
“This five-year forecast period will harbor a number of changes for the industry. The most significant is the roll that will be played by 3G. Today’s massive investments that are required to deploy 3G infrastructure will not yield significant subscriber revenue to offset the short-term expenditures,” said Ray Jodoin, principal analyst for In-Stat’s Wireless Technology and Infrastructure Group.
Europe will have a combined CAGR during Cahners five-year forecast period of 5.8 percentage points. Russia will lead the growth, followed by Eastern Europe and Western Europe.
In-Stat has also found that GSM will leap into second place among air link technologies in the Americas. According to the GSM Association, more than 50 billion SMS text messages were sent over the world’s GSM networks in the first three months of 2001. In the last two years, the number of SMS messages sent worldwide has grown from 1 billion messages per month (in April 1999) to an average of more than 16 billion messages per month in Q1 2001, up fivefold on the same period last year, with no sign of slowdown.
“The continued success of SMS is down to a wide range of factors,” said Rob Conway, CEO of the GSM Association. “Primarily because it is a universally available service and the ubiquity of GSM handsets on offer globally. Other key factors in SMS’ success include interworking between networks and roaming agreements, a host of lifestyle applications coming on stream — where it’s clear that ‘culture is king’ — in addition to competitive pricing, with pre-pay SMS and attractive promotion strategies.”
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