According to new reports from two major analyst firms, wireless data will be a huge business in the future, but not before software vendors, systems integrators and-especially-wireless carriers get in gear and make the tough decisions to take advantage of the situation.
The mobile Internet access market is set to explode, with last year’s 2.9 million active subscribers growing to a whopping 136 million by the end of 2007, according to Frost & Sullivan’s “U.S. Mobile Internet Access Market” report. These numbers translate into a jump in carrier revenues from $418 million last year to $26 billion six years from now.
This growth will, unsurprisingly, be driven by the advent of advanced networks, the research firm said. The idea that faster transmission speeds-brought on by network technologies like GPRS and CDMA 1xRTT-will drive up user numbers is nothing new, and has been a rallying call for many in the wireless data industry. However, Frost & Sullivan said, that’s not the only thing that needs to happen.
Because the new network technologies are packet based, carriers will have to create new pricing strategies to regulate traffic and maximize their per-unit revenue. These strategies will likely include bundling voice and data services and will vary in size according to specific user segments, the analyst firm said.
Additionally, and perhaps more importantly, carriers will have to find ways to market “the unique mobile data experience” to users, who now do not understand the full benefits of wireless technology, Frost & Sullivan said. Once educated, these users will likely pay for value-added services and not just generic content, which will force carriers to beef up their offerings.
“It is now the job of the industry to educate potential end-users of the advantages of next generation networks that promise to support value-added mobile content and applications,” the report states.
Another area carriers must focus on to be successful is the business market, which has so far been largely overlooked in favor of wireless entertainment applications for the consumer market. Frost & Sullivan touches on this idea, but research firm Ovum in a new report predicts the opportunities in the business market will soon become too big to ignore.
Ovum pegs the value of the business market alone at $29 billion by 2006, but cautions that carriers and suppliers must work together to take advantage of the fledgling market.
According to the report, “Mobile Intranets: Towards the Wireless Enterprise,” wireless carriers now tend to support online-only products and services, which-unsurprisingly-are very airtime intensive. Conversely, application providers offer solutions that give customers full access to corporate information, thereby ruling out the use of simpler and cheaper devices. These two approaches need to be reconciled before wireless companies can really take advantage of the business market, Ovum predicts.
“Wireless will be an intrinsic part of all future e-business solutions, and those that fail to plan for it will lose out to their competitors,” Ovum said.
