Ericsson Chief Marketing Officer Johan Bergendahl is predicting that as Mobile Broadband takes off (and it is growing faster than mobile or fixed telephony ever did), Wi-Fi hotspots will become as obsolete as telephone booths. The reasoning is simple – As more and more cellular subscribers start using wireless broadband otherwise known as Wireless WAN (WWAN) technologies (e.g CDMA2000 EV-DO, HSPA/HSDPA/HSUPA, WiMAX, LTE) and it becomes available in many areas, WiFi hot spots will no longer be needed. In fact, Bergendahl says that “Hotspots at places like Starbucks are becoming the telephone boxes of the broadband era”.
Skype and UK-based cellular service provider “3” have launched the 3 Skypephone, a mobile phone that allows users to make free Skype calls via the Internet. The 3 Skypephone could also send free Skype Instant Messages (IM). Right now, SkypeOut calls, SkypeIn calls, and voicemails are not available, but the phone makes conventional calls.
The phone is being launched in nine markets including the United Kingdom, Australia, Italy, Hong Kong, Sweden, Denmark, Austria, and the Republic of Ireland. In Britain, the phones will be available for sale in 3’s UK stores on Friday November 2, 2007. It costs 49.99 pounds ($102.6) with pay-as-you-go service, and free with a contract. The company hopes to sell “several hundred thousand” units worldwide in the fourth quarter of this year.
Skype acting CEO Michael van Swaaij expects the launch to boost the group’s 246 million-strong registered user base because “the service was now available to people without computers”. I doubt that the skyphone will make a dent in Skype’s customer base for the following reasons:
- 3 subscribers are likely to have access to a computer. In other words, many of the users of the 3 Skypephone will be current Skype users.
- “3” is a relatively new company and doesn’t have a large subscriber base.
The 3 Skypephone does not work in the U.S. spectrum bands, so Skype enthusiasts in the U.S. will have to wait!
I wrote an article recently on “4 Reasons you won’t have Skype on Cell phones anytime soon”. Interestingly, “3” is the first operator to open up its network to Skype. For “3” it makes sense as an upstart 3G/UMTS operator, but I highly doubt that the major cellular operators will open up their network (hey, they have to protect their primary revenues) anytime soon.
Qualcomm launched on a Wednesday a dual-3G chip with EV-DO and HSPA (High Speed Packet Access) for laptops. This will enable laptop makers to embed a WWAN chip that can handle any of the two most dominant cellular broadband technologies in the world.
Currently, laptops are available with embedded chips that work with either AT&T’s HSPA or Verizon Wireless’ or Sprint Nextel’s or Alltel’s EV-DO network, but no laptop can work with both HSPA or EV-DO networks. Different parts of the world have different broadband networks – the US, Asia (China, India, and Japan) and Australia have both EV-DO and HSPA, Europe is predominantly HSPA (HSDPA and HSUPA), while Korea is EV-DO, making it difficult for laptop users that travel internationally to use the laptop with Wireless Broadband.
Here are the biggest benefits of the dual-3G chipset for laptops:
- Qualcomm’s new Gobi chip can connect to either type of network, so the well-traveled users will have a laptop that will work pretty much anywhere in the world. This would also be a good selling point for wireless service providers.
- Rather than make two separate laptops for EV-DO and HSPA, laptop manufacturers can manufacture a single laptop with both. Each chipset will cost more because it packs more punch, thus the dual-3G laptop will be more expensive, but costs can be lowered through volume manufacturing, and reduced marketing, distribution and inventory costs, and simpler sales process.
- Customers with multiple subscriptions have the ability to choose the best coverage in a given area without having to lug around multiple laptops or multiple USB or PCMCIA WWAN cards, as well as decide on the lowest cost (especially when roaming).
The Gobi chips are available immediately, and Qualcomm expects them to appear in laptops in the second quarter of next year.
Still, the Gobi chip is limited to EV-DO and HSPA, and does not support WiMAX. Wireless carriers are still rolling out WiMAX (the first rollout in the U.S. will be in 2008), and WiMAX will be an important consideration for laptops.
3rd Generation (3G) wireless systems, whose primary focus is wireless broadband (data), arrived on the scene a few years ago. You can say that it’s still at its early stages, but the customer uptake shows a very rosy picture for wireless broadband.
There are many factors driving this. One is mobile music downloading. Following behind but catching up fast is mobile video. Recently, I reported that mobile video subscriptions are surging. On top of that, wireless service providers such as Verizon Wireless are taking advantage of the YouTube craze by Enabling YouTube Video Uploads directly from VCAST enabled phones. Not to be left behind, Veoh Video also recently inked an agreement to provide a Veoh Channel on Verizon Wireless’ VCAST video service. Even handset manufacturers such as LG are joining the fray and enabling YouTube uploads directly from the mobile phone.
In the U.S., Sprint and Verizon Wireless are the unheralded leaders in the quest to build 3G networks. They both cover more than 210 million pops (in other words, a significant part of the U.S. wireless coverage area). Then there’s AT&T, which just rolled out 3G service in 160 markets in the U.S. AT&T recently launched a video calling service that runs on the 3G network, although I doubt that its currently driving much customer demand for 3G.
Another driver of 3G is for use as a broadband link for laptops and personal computers (call them wireless modems and wireless routers).
So How fast is the 3G Broadband Wireless growth? According to Wireless Intelligence, as shown in 3G Today, there are 486 million reported 3G CDMA customers. This is counting CDMA2000 1xRTT customers, which in my mind is not 3G, but perhaps 2.5G.
Counting “real 3G” customers, there are 68 million CDMA2000 1xEV-DO customers and 127 million W-CDMA (UMTS) customers worldwide, for a total of 195 million. That’s still a small penetration rate, when you consider the overall cellular landscape. However, the 3G numbers are growing at an annual rate of 70%, which points to a very rosy picture for wireless carriers.