Although the wireless data/Internet market has had to bear the brunt of some tough public criticism, it is steadily progressing, according to In-Stat/MDR). The high-tech market research firm reports that there are some very bright spots in the wireless data market. The availability of the proper infrastructure

and colour handsets, and the rollout of next generation services such as CDMA 1xRTT and General Packet Radio Service (GPRS), is aiding the market’s growth.

Overall, the messaging market (thanks to the advances in Enhanced Messaging Service (EMS) and Multimedia Messaging Services (MMS) that support graphics and video) will continue to outstrip the wireless Internet market in several areas. Through 2006, for example, it will outstrip wireless Internet in terms of subscribers growing from an estimated 305 million at the end of 2001 to more than one billion by the end of 2006 worldwide. While smaller than the messaging market, the wireless Internet market is growing at the same pace.

Going forward, the wireless Internet market’s future rests largely on service pricing. In most regions, service pricing is completely inconsistent and far too expensive for the average consumer. However, Orange’s announcement of bargain basement GPRS pricing in Europe and Nextel and Verizon Wireless’ flat pricing in the U.S. are definitely steps in the right direction. Sprint PCS launched a challenge to other U.S. providers with extremely aggressive pricing for PCS Vision. Beyond service pricing, more compelling applications need to come to market and carriers need to do a better job of tying applications to services for the market to really take off. Thus far, the CDMA-based carriers are experiencing more success tying applications to services than are the GPRS carriers.

In-Stat/MDR also found that:

  • The wireless Internet market will grow from 74 million wireless Internet subscribers, at the end of 2001, to more than 320 million subscribers by the end of 2006.
  • Japan is the obvious early leader in the wireless Internet market, primarily due to the innovations of NTT DoCoMo, based on Personal Digital Cellular (PDC) technology. However, competition is growing in Japan, and DoCoMo’s next hope, its Wideband Code Division Multiple Access (W-CDMA)-based Freedom of Mobile Access (FOMA) service, is largely failing due to minimal coverage, high device and service pricing, and a lack of applications that set that technology apart from the earlier generation’s service.
  • The Korean market is now coming on strong in the Wireless Internet space, largely fueled by CDMA technologies, and the United States is not performing as badly as some might expect.
  • The Wireless Internet market is receiving a further caffeine jolt from Sun’s J2ME and even Qualcomm’s Binary Runtime Environment for Wireless (BREW) technologies. Even WAP is performing satisfactorily, when integrated with these technologies, in certain markets.
  • Europe is largely failing with GPRS technology and, not including SMS and other messaging services, is falling behind the rest of the world in terms of wireless data adoption.
  • W-CDMA technology will likely not be its savior.

The report, Worldwide Wireless Data/Internet Market: Bright Spots in a Dark Industry, forecasts the worldwide wireless messaging and Internet market. Forecasts are broken down by region (Americas, Europe, Japan, ROW). Subscriber forecasts for all of the primary air-interface technologies (circuit-switched CDMA, CDMA 1xRTT, CDMA 1xEVDO, CDMA 1xEVDV, circuit-switched TDMA and GSM, EDGE, W-CDMA/UMTS, PHS and PDC) are provided.

Becky Diercks is a director with In-Stat/MDR. InStat/MDR can be visited on the Web at www.instat.com.

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