Digital Lifescapes

In February 2009, ABI Research found that dual-mode cellular/Wi-Fi mobile handset shipments were set to double between 2008 and 2010. ABI analysts have now confirmed that a similar pattern will hold true for the period 2009-2011. This year is on track to see 144 million handsets shipped, with forecasts for 2011 at just over 300 million. "Wi-Fi's penetration into handsets has more momentum than the bad economy," says industry analyst Michael Morgan. "It has become a must-have item much as Bluetooth did earlier. But just having Wi-Fi in the handset isn't enough. You have to have a reason for customers to use it. Until now it has been predominantly for data use, with voice struggling to find its niche." However mobile operator attitudes to Wi-Fi have been changing. At first many feared that Wi-Fi would take (voice/data) traffic off their networks, resulting in lost revenue. Now they're starting to realize that it may instead mean an increase in available ne...

The fixed-mobile convergence (FMC) outlook is now suspect, as most telecom operators have failed to deliver the mass of subscribers they promised. Despite this fact, Informa Telecoms and Media forecasts that over 190 million subscribers could be FMC users by 2013. The propensity to hype new FMC services is an unfortunate characteristic of the mobile phone service industry, which leads to the services themselves being downplayed when they do not live up to expectations. FMC subscribers are expected to increase by 2013 -- but these subscribers are only forecast to equate to around 5 percent of the global market, states Paul Merry author of Informa Telecoms and Media's report. More seriously, mobile operators have failed to monetize FMC, continues Merry, "Within such an environment the justification for starting along the path to FMC becomes a real issue." Of the subscribers forecast the majority will be device-based users, FMC subscribers who use a dual-mode capable device ...

A new market study by Parks Associates finds worldwide growth in the number of 3G subscribers will motivate service providers, under pressure to maintain customer satisfaction and build revenues, to expand on traditional voice offerings to include converged fixed-mobile services. Their report predicts that the number of 3G subscribers will exceed 2.5 billion worldwide by 2013, with over one billion in Asia alone. The tremendous expansion of this large service population will catalyze the development of fixed-mobile convergence (FMC), creating new service options where users can access video, audio, and community offerings via mobile devices once limited to traditional voice applications. "Service providers have to offer personalized services that fit individual needs, instead of uniform sets of services," said Jayant Dasari, Research Analyst, Parks Associates. "Consumers rely on their mobile phones for communications and for entertainment and social networking." Dem...

The femtocell has the potential to improve indoor cellular coverage. But an older technology, the picocell, has existed for about a decade. Picocells provide larger coverage and capacity than femtocells, which should make them well suited to small and medium businesses. Yet global shipments of picocells will total only about 18,000 this year. Why haven't picocells gained greater market share, and what can vendors do about it? According to ABI Research senior analyst Aditya Kaul, "One major reason for picocell's low penetration has been their high total cost of ownership. Picocells are mostly operated and maintained by mobile operators, and every installation and service call costs them money. Many operators underestimated these costs when they initially opted for picocells." The market has also focused on femtocells, with their minimal ownership costs. Mobile phone operators have avoided picocells because they've been waiting for femtocells to be thoroughly tested...

High speed packet access (HSPA) will be a key driver behind future wireless femtocell adoption, according to the latest market study by Infonetics Research. Once users adopt high speed mobile data services, their report contends, subscribing to a femtocell service could follow to ensure coverage and capacity consistency for services delivered to the home or office. "When HSPA becomes more widely available, mobile broadband adoption will get an extra push. Femtocells, in turn, should see an uptick in adoption, as they provide consistent indoor wireless coverage and give mobile operators a stronger positioning in the home broadband network," said Richard Webb, directing analyst at Infonetics Research. Once launched, femtocells offered with home-zone tariffs could be seen as a recession-buster deal for consumers seeking to reduce mobile voice call charges, and the early market could see decent growth, despite the prevailing economic climate. Highlights from the Infonetics study ...

According to a new market study by Informa Telecoms & Media, mobile phone traffic generated in the home environment was estimated at 40 percent in 2007. By 2013 it is expected to reach an overwhelming 58 percent. Informa expects Femtocells deployment to help operators offload up to 8 percent of total mobile traffic to fixed networks via end-user broadband lines. Their report finds that mobile voice minutes of use (MoU) in the home environment will approach 42 percent of total mobile voice traffic by the end of 2008. As the price gap between fixed and mobile calls narrows mobile voice usage at home will gradually increase to reach 49 percent by 2013. The office environment will come in second position with a 30 percent market share, while only 9 percent of calls will be initiated on the move -- when walking, driving, or on the train or bus -- and the remaining 21 percent of calls will be generated from other public environments. Mobile data usage is also expected to increase over th...

Informa Telecoms & Media expects the number of femtocells deployed by the end of 2013 to exceed the 40 million mark, with 22 million net additions in 2013 alone. This installed base could help mobile operators to offload up to 8 percent of total mobile traffic to fixed networks via the customer's wireline connection. This could enable service providers to attain significant savings by reducing the need to create additional macro-cell capacity to cope with this traffic. However, whether these savings materialize depends on a number of factors -- the nature of the operator, the mobile access technology involved, the value proposition to the end-user, the region targeted, and the level of investments the operator has already made in upgrading its mobile network. According to Informa, to handle the same amount of traffic carried by the 22 million femtocell deployments in 2013 would in theory require a $13.8 billion investment in macrocell capacity. This is the potential sum if one ...

The benefits of seamless roaming between wireline and wireless networks is gaining some momentum, but many challenges remain before Fixed Mobile Convergence (FMC) is widely deployed, according to the latest market study by In-Stat. Chief among these challenges is finding a compelling business case for most wireless carriers, who view FMC as a contra-revenue threat, the high-tech market research firm says. "This is clearly the case in the U.S., with the exception of T-Mobile, which has primarily been focused on the consumer market," says David Lemelin, In-Stat analyst. "In-Stat believes communications industry leaders will not be dissuaded by lagging felt need for FMC solutions by businesses, and will aim to develop compelling solutions that, once experienced, will lead to viral adoption over the next several years." The research analyzes current and planned adoption of various FMC solutions and discusses how industry market leaders will not be dissuaded by lagging f...

Mobile service providers have a growing customer base. However, one of the biggest challenges facing wireless subscribers is a lack of indoor coverage, according to the latest market study by In-Stat. The timing of 3G service rollouts is making this problem more relevant, as carriers realize that 3G services will have limited success without addressing the indoor coverage issue, the high-tech market research firm says. The cost to address these shortcomings with traditional macro base station solutions is too high and not possible for most mobile operators. "Microcells, picocells, and femtocells address these challenges in a much more cost-effective manner," says Allen Nogee, In-Stat analyst. "By providing smaller and less powerful base stations in smaller areas, like public spaces, offices, and even homes, carriers can provide better coverage in more specific areas without a huge capital investment." The research covers the worldwide market for microcells, picocell...

Use of cell phones is increasing and traditional landline telephone coverage is decreasing. In fact, one in five U.S. adults do not have a landline -- only 79 percent currently do. One in seven adults now uses only their mobile phone. Furthermore, while the use of wireless phones among younger segments of the population has been widely reported, the technology is becoming increasingly popular among older populations as well. Remarkably, about half of U.S. adults who only use a cell phone are 30 or over. One-third of 18 to 29 year olds only use a cell phone or the Internet for making phone calls. The implication: young consumers may never embrace a traditional telco business model. These are some of the results of a special analysis of four surveys conducted online by Harris Interactive. In total 9,132 adults were surveyed in this comprehensive market study. This data was then weighted where necessary to bring it into line with the total population. The Harris market study found the fo...

What's really holding back fixed-mobile convergence (FMC) service deployment? Some analysts believe that it's technology and CPE cost issues, but I'm not convinced. I believe that it's service provider fear of current revenue stream cannibalization causing these delays. U.S. mobile network operators are just now starting to investigate the use of femtocell technology as a way to keep a lid on both backhaul costs and customer churn rates, but first-generation equipment prices are still too high for wide-scale deployment, according to the latest market assessment from Unstrung Insider. "If there's one safe bet regarding femtocells, it's that success or bust, they're guaranteed to go down in telecom history as one of the most-watched and most-hyped wireless technologies ever," notes Tim Kridel, research analyst with Unstrung Insider and author of their report. "Most U.S. service providers and equipment vendors are still trying to figure out where...

According to In-Stat's latest market study, successful growth within mobile broadband services requires three components -- users, infrastructure, and devices. The device sits in the middle of the relationship between the user and the network -- shaping how those two interact. For example wireless femtocells will create new service opportunities for carriers that will help them win new subscribers. What is going on at the device level for 3G and WiMAX plays a major role in the type of services consumers will see in the future, reports the high-tech market research firm. "Two of the biggest device trends in the cellular industry are dual-mode cellular/Wi-Fi phones and femtocells," says Daryl Schoolar, In-Stat analyst. "This trend can change how operators sell both voice and data services." The In-Stat research covers the worldwide market for mobile services. It provides analysis of forecasts for mobile devices across 3G, WiMAX, and Wi-Fi. The ways in which device...

ABI Research forecasts worldwide deployment revenues from in-building wireless systems to grow from $3.8 billion in 2007 to more than $15 billion in 2013. Drivers for this tremendous growth include consumer's growing dependence on wireless voice and messaging communications, as well as an increasingly competitive mobile operator environment. But underlying all demand drivers is a fundamental connectivity issue. According to principal analyst Dan Shey, "The higher frequencies used by 3G technologies impose limits on wireless coverage inside buildings based on current cell site distributions. The business case is made for deployment of in-building wireless systems because mobile data services are capturing a greater share of subscriber's mobile phone services spend." But every region and operator has a different set of network technologies, competitive conditions and cell phone usage. Fortunately for the owners of in-building systems, which include businesses, operators...

Wireless carriers may still be focused on the wrong customer need. Consumers often do not care about which particular technology provides them with service -- but consumers always care about quality and the consequent benefits of those services. ABI Research believes femtocell solution providers must recognize this fact and then direct attention toward the development of potential services that can be enabled by an intelligent femtocell solution, especially with the majority of technical hurdles already overcome. Not only is this critical in differentiating from competitive solutions such as Dual-Mode Wi-Fi solutions, but also it will be critical in ensuring profitability for carriers. ABI Research vice president Stuart Carlaw states that "with a very conservative uptake of new innovative services enabled by femtocell solutions, it could take as much as five years before carriers go into the black following the trials on femtocell solutions." "It is important to put this...

Operators are now rolling out converged services on fixed and mobile networks, converting trials to commercial deployments. 2008 will see another spate of trials, as femtocell technology begins to become available. The move to FMC infrastructure is a natural evolution for the mobile network as broadband services, including Voice over IP and other Session Initiation Protocol (SIP) services, begin to be deployed. Both Unlicensed Mobile Access (UMA) and SIP infrastructures are being deployed and dual use Wi-Fi and cellular devices will be joined by femtocells in 2008. According to a new ABI Research report, operators are fully aware of the increasing threat from mobile VoIP services and FMC will allow them to offer similar services and tariff packages. "As we move to the end of the decade, mobile networks will emerge with a flat all-IP architecture using 3GPP standards to deliver multimedia services and VoIP," says principal analyst Ian Cox. In the meantime operators want to off...

The hype surrounding fixed-mobile convergence (FMC) and femtocells continues to grow, but it is likely that neither technology will live up to expectations, according to the latest study by In-Stat. There is much interest in fixed-mobile service (FMS) enabled by femtocells and FMC among consumers, with the promise of more convenience and lower costs, the high-tech market research firm says. Femtocells are micro-base stations designed for home use that support mobile connectivity over the broadband facility. FMC uses Wi-Fi-enabled routers and handsets to carry mobile calls over a broadband connection. "In-Stat believes that by 2010 the FMC and femtocell market segments will evolve to form a new fully-converged services market segment," says Keith Nissen, In-Stat analyst. Current unlicensed mobile access (UMA) and IMS-based FMC services, which emphasize cheap phone calling, will be marginalized. Likewise, operators that deploy femtocell-based services using the same cut-rate ca...

Pressure on companies to provide work-life balance programs for their employees -- combined with advances in communication technologies -- is increasing the number of mobile workers in the U.S. and around the world. By year-end 2011, IDC expects nearly 75 percent of the U.S. workforce will be mobile. The current generation of workers is demanding more flexibility and mobility in their schedules. They also have a higher comfort level with technology in general, including remote access technologies and mobile devices. The proliferation of high speed networks, widespread public wireless broadband Wi-Fi hotspots, and fixed-mobile convergence (FMC) technology now allows employees to work effectively from almost anywhere. In addition to meeting the demands of today's workforce, enterprises are deploying mobile solutions to meet both horizontal and vertical industry needs driven by increasing business response time as well as to help reduce corporate space (and leasing) requirements. Orga...

Market research firm Infonetics Research says worldwide sales of GSM/GPRS and 3G femtocell access points will heat up quickly once femtocell services become more widely available, with unit shipments expected to grow 10-fold from 2007 to 2008, and revenue reaching more than $630 million in 2010. Femtocells are small, low-power, indoor cellular base stations that can achieve higher-quality local-area coverage and allow mobile operators to extend their cellular footprint in the home and office environment. The Infonetics report entitled "Femtocell Access Points Market Outlook," explains that the femtocell concept can be applied to a variety of wireless technologies, such as GSM, W­CDMA (including HSPA), CDMA2000 (including EV-DO), 4G LTE, WiMAX, and WiBro, but not all of these applications will be necessarily commercially justified. The greatest opportunity, the report indicates, will be presented by 3G femtocells that are deployed in households, where they can be used to provi...

IP Networks deployed by fixed and mobile operators will lead to mainstream Voice over IP and SIP (Session Initiation Protocol) services, driven by the increasing popularity of smart devices such as PDAs and smartphones. ABI Research principal analyst Ian Cox explains, "New affordable price points and ease of use will allow consumers to benefit from SIP services such as instant messaging, video sharing, and conferencing, which will join VoIP as it takes over from circuit-switched voice." Cox adds, "We have seen the start of a revolution, as mobile handsets become the product of choice not just for voice and simple text messaging, but also for any task that one can perform on a personal computer. And as networks are replaced by flat architecture all-IP with SIP application servers in the core, all forms of communications become possible. SIP services will develop into the norm after 2010 and rapidly begin to dominate the world's telecom markets. By 2012, almost half of...

Global telecommunications industry services revenue will reach $1.7 trillion by the close of 2008, with continued strong growth in wireless leading the way, according to a market analysis report from Insight Research Corporation. According to the new industry market study, overall telecommunications services revenues are expected to grow at a compounded rate of nearly 10.3 percent over the next few years, reaching $2.7 trillion by 2013. Wireless makes the strongest showing across all sectors while wireline follows a distant second. Nearly all of the growth in both sectors is expected to occur in broadband services, with wireless broadband service revenues expected to grow at a compounded rate of more than 70 percent over the forecast period, while wireline broadband services grow at under 10 percent over the same forecast horizon. The "2008 Industry Review, an Anthology of Market Facts and Forecasts" states that in the growth environment set off by the rush to meet subscriber...