Who Leads In The Mobile Race?
4/3/2002 Author: Andrew Darling, Editorial Director,
I have seen European mobile technology executives smirk and laugh as they told stories of how their American counterparts, when given mobile telephones for their visits to Helsinki, had failed to turn them on and only used them for outgoing calls. The reason was fairly simple – in the US a user is charged for both receiving and making calls. However, the anecdotes also went a long way towards explaining some of the reasons why Europe considered itself technologically ahead of the US in the development of a mobile society. However, this is no longer the case….
It was the case once. For a while Europe did lead the world in wireless technology. However, network operators borrowed heavily on short-term debt to stump up more than $150bn to pay for third-generation licenses and the debacle of WAP arrived to poor consumer response.
The result was that operators, strapped for cash, put the brakes on further investment in new software and network technologies. The hundreds of new wireless start-ups, initially feted by network operators, found themselves starved of much needed revenues as they failed to find customers, often finding the door of operators slammed in their faces. With next to no new wireless services emerging, the traditional saviour of new technologies – corporate IT departments – shelved new wireless projects.
Where Europe has been playing the first to market game plan, over the pond the US has been a fast follower and the gap in market development has decreased steadily over the past two years. While the European wireless industry was taking some rough knocks, the US was rolling out and developing its own technologies. Going far beyond the basic email-type applications, the most innovative, richer new wireless applications are now coming out of North America. In 2001, venture capitalists invested $12bn into US wireless start-ups compared to $4bn into European firms.
Forrester reported that in 2001 50 percent of large US corporations had rolled out wireless data applications, and 16 percent of consumers owned a mobile data device such as a Blackberry or PDA.
Both these devices run on pager networks, which although running at similar speeds to GSM, have one major advantage – a packet-based network delivering and always-on connection.
It’s clear that the US has caught up fast in wireless technology while Europe has been trying to get over the worst of its own excesses. However, who will win in the end is still up in the air. Realistically, both continents will probably develop along similar lines as 3G comes on line and greater convergence of other wireless technologies, such as Bluetooth and Wi-Fi occurs.
