What’s the real scoop on new wireless applications—including wireless Internet—and how fast will they be getting to us? According to one researcher, that’s the million-dollar question. But most experts agree that the wireless Internet is still a few years away from being a commercial success.
The wireless Internet market, currently in its infancy, is experiencing lackluster sales, in part because it has been slow, unreliable, and expensive. Even so, Cahners In-Stat Group predicts that the wireless Internet market will grow rapidly, and new devices as well as new applications and services will drive that demand. Internet access is the main application for what is called 3G—third-generation wireless.
What are the new apps?
New wireless applications for 3G will be determined by how essential they are to business productivity, according to Cahners In-Stat Group’s wireless service. For instance, respondents to an In-Stat study rated e-mail, Web browsing, and “pull” content as important to productivity; these features are the most likely 3G applications. Alternatively, video conferencing, rated important to productivity by only 39 percent of respondents, won’t be an essential part of 3G wireless applications, according to In-Stat. Study results found that:
- 90 percent of senior executives want wireless e-mail, with two-thirds of these wanting the ability to receive attachments
- Almost 80 percent want Web browsing, with 88 percent of these wanting both text and graphics.
- Nearly 70 percent want pull content (news, stocks, weather, web-clipping services).
Another In-Stat study showed that 85 percent of In-Stat survey respondents want high-speed access, and 65 percent want news delivery (including e-mail). In addition, Forrester Research identified that mobile customers want personalized applications that are simple and relevant.
State of wireless globally
Approximately 300 million mobile phones are in use worldwide, according to Interactive Week (Oct. 18, 1999). Finland (population about 5.5 million) leads the world in per capita use of wireless technology and Internet connections, with 3.1 million cellular phones in use and more than half a million Internet connections. Mobile phones are widely used by Finnish teenagers to communicate; Finnish adults use mobile phones for banking as well as approximately 200 other services. Wireless Internet subscribers get sports results, museum and theatre schedules, top music charts, and more on their mobile phones. Why does Finland lead the world in wireless technology use? Two possible reasons are that Nokia—the world’s largest vendor of mobile phones—is headquartered in Finland, and the cost of using telephones is lower in Finland than in many countries.
Acknowledging that Finland’s wireless penetration is 63.2 percent, Ray Jodoin, senior analyst in the Global Wireless Division of Cahners In-Stat Group, says that “Italy and Israel are hot on Finland’s heels. The penetration in Italy is 46.8 percent. By contrast, the United States is down about 30 percent,” he said.
In-Stat also predicts that, by 2002, businesses with more than 100 employees will spend in excess of $117 billion on wireless services. No wonder, since 37.3 percent of business employees will be mobile, according to Wireless Integration’sDave Whalen report of a Dataquest prediction. Whalen also says, “More than 231 million data-capable phones will be shipped in the year 2002, outpacing for the first time sales of personal computers.”
Why are we lagging?
The United States is moving slower than the rest of the world. Will the world’s technology leader in many areas close this technology gap soon? According to Jodoin, “That is the million-dollar question. We have a different situation in this country. We have too many mobile wireless telephone standards. Therefore, you can’t take one phone—unless it’s an old-fashioned analog phone—and travel all over the country and use it. Whereas, in Europe and a good percentage of countries in the world, you can take one phone and go all over the world with it.” Jodoin says that will change, eventually, “But, no, it’s not going to change as quickly as some people think. There are so many influencing factors on that, not the least of which is the U.S. pride relative to ‘not invented here.’”
Nevertheless, In-Stat has declared 2000 the year of wireless data, according to Jesse Berst, AnchorDesk editor, quoting In-Stat research. Berst cites several reasons for the research group’s optimism:
- Carrier prices are going down; At least one carrier offers flat rates of $39.95 for wireless e-mail and Internet.
- Wireless modem costs are declining (from $700 to $300 currently).
- Carriers are expanding their geographic coverage.
- Security has been enhanced.
In-Stat estimates that 50 million Americans spend 20 percent or more of their time away from their desks and are, therefore, mobile. In addition, 95 percent of U.S. households will own computers by 2003, and 69 percent of these will own at least one wireless device. According to Wireless Week , at the end of 1999, Americans were spending a third more time on their mobile phones than a year earlier. More than 15 million Americans subscribed to wireless service between June 1998 and June 1999. At that time, 76.3 million Americans used mobile telephones. The vendors and pundits are expecting that these folks soon will be hungry for wireless Internet.
Kent Lanum, director of product development at UniDial Communications, a Sprint PCS agent, says UniDial sells a lot of wireless Internet phones to business users rather than consumers. Lanum predicts that in the next two years the “early adaptors who already have Palm Pilots” will be using wireless Internet phones regularly. Wireless Internet will likely become more commonplace in the next two to three years, he predicts. He also believes “we’re going to see convergence of the products [mobile phone and Palm Pilots, for instance]. Qualcomm, for example, has partnered with 3Com to make a phone with a Palm Pilot built into it.”
Forrester Research agrees with Lanum’s assessment of early adopters, predicting that business travelers will be the first to adopt new wireless technology.
What must be overcome?
Several barriers to the widespread implementation of wireless applications in the U.S. exist, including:
- Vendor concentration on wireless voice services, thus overshadowing data services
- Slow transmission speeds
- Limited graphics; text-based information from the Internet
- Small screen sizes of palmtop computers, pagers, and other handheld devices
- Competing technologies
- Lack of standards
- Lack of understanding of what potential users want and are willing to pay for
The future is wireless
Today, wireless Internet traffic accounts for less than 2 percent of mobile traffic. Sprint and MCIworldcom predict that by 2003, however, data traffic will be as much as 45 percent of wireless traffic. And Datacomm predicts that, also by 2003, use of wireless will equal use of wireline in the United States. (See TechRepublic’s StatCenter for this and other statistics on wireless use.)
Will wireless technology change people’s lives a few years from now? Lanum says, “I don’t think so. It’ll be simple information like driving instructions, text-based type messages, buying tickets, checking stock quotes, buying stocks. I think you’re going to see that first.” Will it change our lives dramatically? “Not yet,” Lanum says. Not yet. But look out for 2003.
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