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South Korea Still Leads Mobile Data Growth

Global mobile phone data revenues from services other than SMS exceeded $10 billion in 1Q07 according to Informa's World Cellular Data Metrics (WCDM). The total of $11.3 billion compares with $8.1 billion in 1Q06.

The figure means that nearly one third of mobile data revenues now come from non-SMS services, suggesting operator's investments in advanced technologies are finally reaping rewards. Again, this is a global metric, and doesn't reflect typical results here in the U.S. -- although Verizon Wireless has made some noteworthy progress.

Moreover, this does not mean the end of the road for short message services (SMS). Worldwide SMS traffic was up year-on-year by around 50 percent to more than 620 billion messages in 1Q07, according the WCDM report. The SMS phenomenon is truly amazing -- especially when you consider that its application, adoption and continued marketing is typically driven by subscriber word-of-mouth.

SMS revenues were up 23 percent over the same period, helping total data revenues to reach $34.3 billion in the quarter, the highest ever. The higher increase in SMS traffic compared to revenue reflects lower SMS tariffs and the greater availability of bundled packages.

Out of 70 operators tracked in WCDM, the proportion of value-added data data revenues coming from non-SMS ranged vastly, from just 1 percent (Vodafone Egypt) to over 70 percent (KTF, Korea). The Informa report follows the trend of other positive analyst assessments, and further validates the bullish outlook for continued growth.

Furthermore, given the recent debates regarding the potential for progressive "open access" policy to change the dynamics within the U.S. market, I remain upbeat that the incumbent mobile service providers will evolve their business practices to further stimulate mobile data growth. New competition is coming, and there's no point in denying this reality.

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