Year of Wireless Data

This is finally the “year of wireless data!” As an attendee of every major CTIA show for the past 12 years, I heard that announcement from the podium at every keynote speech since 1999. Eight years later, it has finally come to fruition. But why the seven years of false claims by the sages who supposedly knew the industry inside and out?

Some of it was self-promotion, some it was a true lack of reality, and most of it was wishful thinking. However in all cases, the vision was dead on. The actual turning point was in late 2005 when wireless convergence occurred after 6 year incubation. The availability of: High speed wireless data networks (WWAN’s), Devices (Smartphones, data cards & music phones) capable of operating on such networks that could be provisioned and updated over the air (OTA), and lastly, user friendly and robust applications for consumer and enterprise users. It has taken another two years for most of the network operators to deploy their upgraded 3G networks. In most of the top North American cities (with pops over 250,000) the roll-outs are complete.

In a recent CTIA study, for the first 6 months of 2007, US Wireless Data Revenues grew by 63% to $10.5B over the same period a year earlier. That represents 15.5% of ARPU and nearly double from a year earlier. These numbers are just the “the carrier take” of the pie. When you factor in all the related businesses that also produced revenue off of this evolutionary step (Device Manufacturers, Software, Applications, Infrastructure, Tower and Content), I would estimate that the total ancillary revenue doubles that number just in the US alone for the period.

Is there a “gold rush” to this sector? Absolutely! Have the investments been justified? Most have! Is it too late to get into this game? No. We are only seeing the tip of the iceberg in terms of “the relationship people will develop with their phones.”

Author: Gary Cohen