Finally, A Reporter Gets 3G

[Janak Parekh]

<div class='os_post_top_link'><a href='http://www.economist.com/business/displayStory.cfm?story_id=2072901' target='_blank'>http://www.economist.com/business/d...tory_id=2072901</a><br /><br /></div>The problems in rolling out 3G are obvious -- high cost, unclear revenue sources. The question is, will 3G succeed? Most analysts have said "no" up front. They say that consumers won't buy it. The Economist, though, looks a little deeper into the picture.<br /><br />"A far better guide to the prospects for 3G, then, is to look at how quickly data services are being adopted on 2.5G networks. The evidence looks promising. Vodafone's live! service, for example, signed up over 2m customers, primarily in Europe and Australasia, within nine months. Mr Horn-Smith says the signs are that live! subscribers spend 7-10% more than non-subscribers per month. Evidently, many people do want to use their phones for more than just voice calls and text messaging—though whether the huge outlay on 3G licences will be justified is still uncertain."<br /><br />I have a few niggles with the article, but he concludes well: "After all the 3G hype, the mark of 3G's success may be that its adoption goes completely unnoticed." I agree: apart from us early adopters who want high-speed wireless data for our PDAs and laptops, 3G will succeed if people develop applications for it as it rolls out. It's truly astonishing to see how many people today play games or text on the phone in New York. You'd never have seen this a year ago; we were far behind in these technologies, but the advent of GPRS, 1xRTT, and smarter phones is notable. Phones are rapidly transitioning from voice communications to personal assistants, and if done correctly, 3G can fit right into this picture. Now, just give me a CDMA Bluetooth phone already! :evil:

[Duncan]

I have a few niggles with the article, like the assertion that 3G handsets are bulkier

The handsets available for genuine 3G UMTS services - as offered by the Hutchison backed '3' - ARE much bulkier and heavier than standard 2.5G GPRS. Trust me - I've held them!

You may be thinking of the psuedo-3G (more like 2.75G) that is offered by some carriers in the US.

[Janak Parekh]

The handsets available for genuine 3G UMTS services - as offered by the Hutchison backed '3' - ARE much bulkier and heavier than standard 2.5G GPRS. Trust me - I've held them!
Interesting. OK, I'll edit that part. I guess my assertion is, before long, they'll be as small as 2.5G if not smaller.

--janak

[Duncan]

I guess my assertion is, before long, they'll be as small as 2.5G if not smaller.

In the meantime 2.5G services are offering video, picture messaging and more over ordinary GPRS, for less cost and in tiny phones that work everywhere. 3G has an uphill struggle in the UK and '3' UK will die as a company before they can convince people to adopt the first gen of phones.

Sad but inevitable.

What is truly irritating is that 3G phones in the UK cannot be used as data modems for a PDA or laptop - even though some come with BT and DUN built-in. 384K speed (potentially) going to waste showing crappy video of stand-up comedy, porn and football (the real kind) on handsets the size of some PDAs...! :roll:

[Warwick]

Everything Duncan said stands for Australia too, my T68i is much more appealing than any of the '3' phones avaliable, and all of the 2.5 phones with cameras are much smaller than any of the 3 phones.

[Duncan]

my T68i is much more appealing than any of the '3' phones avaliable, and all of the 2.5 phones with cameras are much smaller than any of the 3 phones.

Slightly OT - but have you had the T610 in Oz yet? It is like the T68 on steroids - wonderful phone...!

[maximus]

384K speed (potentially) going to waste showing crappy video of stand-up comedy, porn and football (the real kind) on handsets the size of some PDAs...! :roll:

Not to mention the cheap way of loggin video feed from security cameras. My girlfriend's apartment in tokyo is covered by security cameras hooked into an interlacer/compressor, then into a 3G modem, transmitting to a central logging/recording service. Hence no longer the need for local video taping.

Isn't it awesome to be able to compress the feed from 20 cameras, and pump them out via a single 3G channel ?

[cmlpreston]

What is truly irritating is that 3G phones in the UK cannot be used as data modems for a PDA or laptop - even though some come with BT and DUN built-in

I am in Australia, and have a '3' 3G phone - the NEC e606 (the same phone that debuted in the UK). Just for the record, '3' say that DUN with PDAs is not supported - however, I use it just fine with my iPaq 3870. The setup may not be documented, but it isn't rocket science to make it work.

Are you sure it doesn't work in the UK, or is that just the company line?

Sure, the e606 isn't the greatest phone in the world, but neither were the first Nokia or Ericsson GSM phones, and who has them now? Also, google around a bit for 3G phones available in Asia right now - not so bulky, grasshopper!

FWIW, I think 3G will take off just fine. '3' seem to be doing OK here, and once the public at large get a taste of video calling, I reckon it'll catch on like SMS did.

cmlp

[Duncan]

'3' in Oz may be doing fine but they have flopped badly in the UK.

Frankly the service here (and reception) are very poor - so I haven't got myself a '3' phone to see if I can make DUN work. Company line is that they don't support it and won't for some time...

[freitasm]

my T68i is much more appealing than any of the '3' phones avaliable, and all of the 2.5 phones with cameras are much smaller than any of the 3 phones.

Slightly OT - but have you had the T610 in Oz yet? It is like the T68 on steroids - wonderful phone...!

Not in Oz, but in NZ... I've had a pre-market unit of T610 for review (without all the Vodafone Live! stuff, but the real thing) on Geekzone and I was disapointed. It's a little faster than the T68i, but Bluetooth was not stable, requiring the phone to be paired again every time I wanted to use it - and I've tried it with two USB dongles and my H3970.

Also The screen isn't that great and could be better - resolution and colours. It seemed very "washed".

The T68i looks better too (but this is personal taste and YMMV).

But going back on topic, UMTS phones are bigger than CDMA and GPRS mobile. And yes, streaming on GPRS is possible, although with a very low quality.

[Daimaou]

You want a 3G Phone with BT ? ok come to japan to buy a Nokia 6650 like mine ;) (GSM / W-CDMA)

But what for Bluetooth for hight speed internet on your PDA ? Well you will never go to 348 Kbps, simply beacause the Max speed over BT that I can get on both my iPAQ 5555 and my Vaio Z1 is 115 Kbps, my CF 3G (Airh Unlimited data and Interent) can got a bit faster and so cheaper compare to W-CDMA GPRS (128Kbps and 1Mbps in 2004 :twisted: I love JAPAN, the only real GEEK country)

http://gagay.free.fr/jap/6650.jpg

[mobile]

Please ... 3G is not just data services ...

As you may be aware of, in both Asia and in Europe, despite using two frequency bands (900 and 1800), the available spectrum is almost saturated, sometimes making it hard to make a phone call and even harder to get decent speeds over GPRS. The fact that spectrum is limited is one of the main drivers for 3G. WCDMA (UMTS) networks are much more efficient than GSM networks (a ratio of 8 to 1 I believe). Thus, when 3 uses normal voice airtime cost as the main reason to switch to their 3G network, it's not all that strange. After all, they can use their spectrum up to 8 times more efficiently than a GSM operator, contributing to a higher margin per unit on every call or data transfer on their network. And all this despite the fact that they are charging less than most of their competitors. Granted, 3 does not yet have the critical mass of consumers needed to break even, but according to newly released reports, they will have that before the end of 2004 if subscriber growth increases as projected.

In addition, 3G operators don't have nearly the same problems with data allocation vs. voice allocation, or prioritization between the two, as most GSM/GPRS operators have. Plus, if you're a 3G subscriber, you get much faster data connections.

All in all, whether people want/need 3G or not, operators will transition to 3G because of the significant spectrum usage efficiencies that they can gain from migrating to 3G. If they were to stay with 2.5G systems, their quality of service would deteriorate to the point where they would see higher customer churn and eventually lose subscribers, and most likely also see a lower ARPU. As that's hardly a winning strategy, operators will need to migrate to keep up their ARPU, margins, and subscriber growth.

/// mobile

[Janak Parekh]

All in all, whether people want/need 3G or not, operators will transition to 3G because of the significant spectrum usage efficiencies that they can gain from migrating to 3G.
Eventually, sure. But mobile operators have gotten great success out of using 2.5G technologies, and in fact legacy CDMA technologies (even cdma2000 1xRTT) are spectrally efficient, so why would they want to deploy 1xEV-DO or 1xEV-DV?

--janak

[mobile]

Eventually, sure. But mobile operators have gotten great success out of using 2.5G technologies, and in fact legacy CDMA technologies (even cdma2000 1xRTT) are spectrally efficient, so why would they want to deploy 1xEV-DO or 1xEV-DV?

--janak

Yes, and that's exactly my point. Lately, a few articles have been written reporting on the difficulties subscribers have to get a call through or just access GPRS in major cities in Europe and Asia. Operators have apparently reaped a bit too great success in some markets in Asia and Europe (GSM/GPRS markets), to the point where it is affecting the accesibility and quality of service on their networks. If the problems that have been reported are true, and congestion on the networks become worse, then the case for 3G has really been proven.

That 3G will be deployed at the lightning speeds that most analysts predicted two years ago is quite unrealistic. But that 3G will never be widely deployed, and is nearly obsolete already, as many analysts predict today, is in my opinion as unrealistic as their initial predictions.

When in comes to cdma2000, you're right, it's as efficient as WCDMA for the simple reason it's CDMA. However, most (around 80% or so) subscribers in the world are on GSM networks, which means that GSM operators do have a big incentive to migrate to 3G, especially if it turns out that they otherwise will be victims of their own success.

/// mobile

[Daimaou]

All in all, whether people want/need 3G or not, operators will transition to 3G because of the significant spectrum usage efficiencies that they can gain from migrating to 3G.

Well maybe for the Operators but not for this users, In Japan the biggest complain is:

-Poor quality of Sound on W-CMDA, but not on CDMA 1x (I got Both)
-Network quickly saturated (I can hardly make a call on rush hours in Central Tokyo, Either on J-Phone and tested on a FOMA)
-Not able to make a Data Connection in Central Tokyo on certains times, once again too many voice transmission, which stop every Data one.
-W-CDMA is greedy in Energy, my CDMA 1x is OK but I prefere a 2.5 G Imode like far better.

So... honestly going to 3G maybe but not now

[Janak Parekh]

So... honestly going to 3G maybe but not now
Right. But as good applications develop, that will be the opportunity. I, like Mobile, do believe it will happen, but for slightly different reasons and in a different timeframe. I do see non-voice applications start to take off here in the US, and that gives me hope. :)

--janak

[mobile]

I'm sure there are problems on 3G networks. To be fair to the network providers, it may not be the network's fault that the quality is poor. It could very well be that the handsets are not up to par yet ... which isn't much of a defense for the operators, but still.

It's not much of a surprise that things don't work flawlessly from the start. The transition from 1G to 2G wasn't exactly seamless either. Heck, when digital networks first came around in the early nineties (in Europe), for the exact same reasons people don't believe in 3G today (expensive, bad coverage, and no real need), it was widely predicted by analysts, newspapers, and the general public that digital mobile networks would never take off. Similarly, when the Internet was first brought into the spotlight in the same timeframe, most people dismissed it as a fad and something that would never be of great use to the general public. For the longest time, not even the mighty MS took the Internet seriously. Now they do. Gosh, they even care about mobility ...

Obviously, I'm a strong believer in 3G. In my opion, there is no other technology out there that is technologically superior and with enough momentum and cash behind it that can compete with 3G networks (cdma2000 as well as WCDMA) within the near future. I know some people, including myself, love WLANs and would claim that WLANs are a contender. However, WLANs are just that, a LAN, and not a WAN. Thus, 3G and WLAN are more complements to each other than they are competitors.

Good or bad, believer or not a believer, it doesn't really matter too much if you live in the U.S. Before the operators launch 3G in the U.S. they should seriously consider focusing on improving the spotty coverage that we have here. The coverage here is sometimes so spotty that one would think the operators here are providing WLAN hotspots rather than WANs. :wink:

/// mobile

[Janak Parekh]

Good or bad, believer or not a believer, it doesn't really matter too much if you live in the U.S. Before the operators launch 3G in the U.S. they should seriously consider focusing on improving the spotty coverage that we have here. The coverage here is sometimes so spotty that one would think the operators here are providing WLAN hotspots rather than WANs. :wink:
You'll see 3G before you see the coverage problems fixed. Often, these problems are not the carriers but the strong NIMBY groups that have formed here. You really think T-Mobile likes coverage holes? :lol: There's one spot on my commute every day that every wireless provider drops. I wonder if the same community fighting the installation of towers there then complains about their service. :roll:

That's why AT&T and Verizon have the best coverage in certain parts of the country -- they set up towers before anyone set up opposition.

--janak