Still a long way to go

Implications: The market is still fragmented. In the big five we still see a wide spread of take up as consumers are yet to be won over. The mobile networks are still to discover a range of products that make the investment pay off. This talks about terminals rather than handsets and so a slowing of sales of phones is offset by a boom in USB Mobile Broadband Devices.

Analysis: When I look at the take up of 3G in the major countries of Europe what I see is Italy out in front with over 40%, then you have Spain with 34%, the UK with 25%, Germany with 20% and France with 16%. The development of the market in Austria, Finland and Sweden present a risk in that they are very small and two of them are leaders in Mobile Technology. When I travel around Europe I look at what people are using and if I have time ask them about what they do with their phones. Too many times I hear that all they do is voice and text. The third most important feature seams to be the clock which is disappointing for someone who works in teh industry. The investmenst made by the mobile networks in high speed data networks required that they find a customers base. Whilst Sony Ericsson has droped the price of its popular K800i device to a point that it can take market share in the Pay As You Go market the devices are still generally to expensive. Therefore what you have seen is a boom in Mobile Broadband with Huawei and ZTE selling high volumes of USB devices that allow consumers to connect computers to the mobile web. The problem is that in Sweden 500K Mobile Broadband users have generated 2X the level of Data of 10M phones. The service is priced such that the networks will need to look at traffic shaping if they are not to drop quality of service. Sony Ericsson has said that this year thay have had difficulty with supply of compenents for 3G devices. Nokia have been focusing on lower end handsets for Emerging markets rather than get the handsets that were show in Barcelona to the market because of software issues. RIM have spoken about finally launching a 3G devices but it looks like this will be delayed in terms of launch, the credit crunch means that Financial Services have not been upgrading. HTC has managed to grow the Enterprise market with its Windows Mobile devices running UMTS. The Autumn will be critical in Markets such as Germany and the UK as a wide range of 3G handsets enter the market. In France, Orange will need to invest in a National 3G Network before the consumer can take up devices. As an Orange customers all to oftan I discover that my 3G device does not work in France. The current financial situation could mean that the Spanish and Italian cool on 3G handsets.