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Mobile Service Providers are Video Hopefuls

Competition has become more cutthroat among next generation mobile and wireless broadband service providers, according to an Infonetics Research study about North American, European, and Asia Pacific operators.

The study shows 65 percent of providers rating competition and customer retention as the most challenging of their business concerns. As competition increases, the contest becomes focused on the range of services offered rather than price, so creating new services is key to driving revenue, says Infonetics.

"Beyond basic voice and access services, mobile and wireless operators are focusing on mobile TV and interactive video services like chat and blogging. Video based services represent a opportunity for operators to diversify their offerings and boost ARPU, but new media services present business model issues as well as technical challenges like streaming and download capabilities," said Richard Webb, directing analyst at Infonetics Research.

Service providers indicate confidence in the new services they plan to offer, with participants in the study saying they expect revenue from next gen mobile services to increase 121 percent on average. I wish that Infonetics elaborated on why the mobile carriers are upbeat, relative to their past experience with VAS, but unfortunately they didn't.

Capex among respondents jumps 21 percent between 2006 and 2008, from an average of $2.8 billion to $3.4 billion, a sign that providers are investing heavily to continue upgrading mobile infrastructure to 3G and on toward 4G.

The Infonetics study found the following:

- Fixed mobile convergence and integrating new wireless technologies were the top-rated technical challenges to offering wireless broadband and next gen mobile services.

- 75 percent of respondents plan to offer mobile video and mobile TV services by 2008-more than double the number offering them now.

- 43 percent use a content aggregator for mobile video services now; this grows to 56 percent by 2008.

- IMS is far and away the lead reference architecture for packet control planes, with 54 percent already having deployed it and 92 percent planning to by 2008.

- Fixed WiMAX, mobile WiMAX, and HSDPA, HSUPA deployments by respondents all grow over the next year.

- 70 percent currently include Wi-Fi as part of their infrastructure, declining to 45 percent by 2008.

- Ericsson, Nokia-Siemens, and Alcatel-Lucent are the top-rated vendors of infrastructure for mobile networks, followed by Nortel and Cisco.

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