Next generation wireless looks to get rolling

Ericsson is doing its best to keep 3G front-of-mind for me. First, there was the invite to tour the “”Drive to 3G”” trailer – 18 wheels of high-tech wireless gimmickry and gadgetry – ensconced in a downtown Toronto parking lot. The invitation was followed by a die-cast and plastic scale model

of the vehicle. The trailer will be at the Telus Skins Game in Haliburton, Ont. this week, obviously because I’ll be there too. A guy can get to feel he’s being stalked.

The company has a vested interest in constantly reminding us of the promise of the wonderful wireless world 3G will bring. In conjunction with partners, it’s going to provide the infrastructure, the mobile devices, the applications and the services that will make us wonder how we ever lived without digital wireless broadband access.

Third-generation wireless technology – offering 2 Mbps of bandwidth to a fixed wireless device, 384 kbps when you’re going walkabout and 144 kbps when you’re zooming around in your Mazda and should have your eyes on the road – is “”a wave from the East,”” Ericsson Canada president and CEO Mark Henderson acknowledges.

Indeed, 3G is nicely settled in Japan and making inroads in Europe. North America is “”spectrally challenged,”” Henderson says – in the U.S., licensing is fragmented, and some holders are in precarious financial straits. It’s cleaner in Canada, he says, but a power user won’t settle for a service he can’t get roaming in New York.

But 3G in North America is inevitable, and the conversion of the customer base “”just a matter of time,”” says Henderson. He compares it to computing with an old XT and a green screen – sure, you can do it, “”but you won’t be talking to anyone.””

It may indeed be inevitable, but I don’t think a customer rush to 3G is imminent.

Yes, 3G is entrenched in Japan. But I recall a conversation with mobile consultant Andrew Seybold some three-and-a-half years ago, when the first 3G networks were being rolled out. Everyone, he said, was missing the point. Japan needed 3G because there were too many cell phones in too small a geographic area. “”The reason they’re putting in that system has nothing to do with data,”” he argued. “”They’re going to the new generation to get voice, and they’re essentially getting data for free.””

We aren’t running out of voice overhead in North America any time soon.

Some of the 3G apps Ericsson demoed in the trailer were actually running on the 2.5 G GPRS network. And running quite well, thank you very much. Bell Mobility’s new 1X service occasionally approaches the low end of 3G’s spectrum of promise. Available applications don’t demand more than that.

Then there’s the cost issue. How much are users willing to pay for the services? How much will they cost to roll out and provide? And how do we bridge the inevitable difference? Given that a certain amount of volume is going to be critical to paying the capital costs, 3G will likely remain an urban phenomenon. That dream of sitting on the dock at your cottage in the Muskokas wirelessly accessing your desktop? Not soon.

Of course, circumstances might conspire to prove me wrong. As a hedge, I should point out that Japanese wireless company NTT DoCoMo projects that the average revenue per user will rise from 2000’s low of about 9,000 yen to a little over 12,000 yen by 2008. About half of that will come from data services. So 3G data services are apparently useful and marketable.

There simply isn’t a compelling enough story to roll them out here. Just yet.

dwebb@itbusiness.ca

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