Technology | Media | Telecommunications

Thursday, September 25, 2008

Mobile Broadband Connectivity Evolution

Sprint, the U.S. wireless operator, lowered its mobile broadband prices for using a phone as a modem, but the price for using PC Cards and USB modems are unchanged. Given this change, cellular modem sales are still set to top $22 billion by 2013.

ABI Research principal analyst Dan Shey notes, "Customers want mobile broadband experiences like those provided by their PCs, meaning they want the fastest devices. Phones with at least 3G radios threaten cellular modem sales; however shipments of these modems will not exceed 30 percent of cellular handset shipments by 2011."


However convenience is important to business customers -- PC Cards and USB modems are far more convenient than phones for broadband connectivity. Adding complexity to the analysis is the growing penetration of embedded cellular connectivity in laptops and notebooks, which will reduce the need for external devices.

How does this apply to consumers and to developing world regions? Any operator can drop the price for mobile broadband using the phone as the modem, which is more amenable to a broad customer base regardless of world region.

But the questions remain -- how will this pricing change detract from use of the phone for other revenue-generating services? And, does it perpetuate the perception of the wireless operator as the dumb pipe provider?

The ABI Research study provides a comprehensive overview of the market for cellular modems. The report analyzes the factors both driving and inhibiting growth and examines how changes in the market are creating both opportunity and complexity for the value-chain participants.