4G Adoption Might Take a While
If an analysis conducted by NERA Economic Consulting of 3G adoption has any relevance for 4G, it might well take longer than most now believe for 4G services to be adopted. The reason is the industry’s experience with 3G. The networks will be built; that isn’t the problem. The issue is that consumer adoption might be slower than most seem to forecast.
Vice President Christian Dippon notes that only two countries–Japan and South Korea–currently have more 3G than 2G subscribers. Furthermore, leading nations such as the United States, the United Kingdom and Germany have 3G penetration rates of less than 30 percent, about seven to 10 years after the services first were made available.
Dippon speculates that mobile subscribers do not view 3G services as being sufficiently different from 2G services. Right now, that might be the case for many potential 4G customers as well.
Faster is better, no doubt. But users are going to weigh the additional speed boost with the additional cost. And many likely will conclude that 3G is good enough.
See more at http://www.nera.com/67_6802.htm.
The average 3G penetration rate in the European Union 15 countries for year-end 2009 was 25.7 percent, far short of the predicted 60 plus percentage range or the stated 30 to 80 percent rates some experts originally had foreseen.
Similarly, contrary to the forecasts, the leading countries were Spain with a 43 percent 3G penetration rate followed by Sweden with a 40 percent penetration rate. The United Kingdom and Italy had 3G penetration rates of 32 and 30 percent, respectively, which was less than half of the predicted rate, Dippon says.
The apparent slow diffusion of 3G technology is not limited to the EU 15 nations. Rather, it seems to be a worldwide phenomenon. The December 2009 U.S. 3G penetration rate was 26.1 percent, which is less than one-third of the number forecasted for the U.S. by various analysts for 2010.
4G is not going to sell itself, and so far the only message users seem to be getting is that 4G is faster. That it is. But whether the user experience is commensurately better, given the higher cost, is not yet clear.
That doesn’t mean 4G networks will come on line any slower. But revenue remains the issue.
If an analysis conducted by NERA Economic Consulting of 3G adoption has any relevance for 4G, it might well take longer than most now believe for 4G services to be adopted. The reason is the industry’s experience with 3G. The networks will be built; that isn’t the problem. The issue is that consumer adoption might be slower than most seem to forecast.
Vice President Christian Dippon notes that only two countries–Japan and South Korea–currently have more 3G than 2G subscribers. Furthermore, leading nations such as the United States, the United Kingdom and Germany have 3G penetration rates of less than 30 percent, about seven to 10 years after the services first were made available.
Dippon speculates that mobile subscribers do not view 3G services as being sufficiently different from 2G services. Right now, that might be the case for many potential 4G customers as well.
Faster is better, no doubt. But users are going to weigh the additional speed boost with the additional cost. And many likely will conclude that 3G is good enough.
See more at http://www.nera.com/67_6802.htm.
The average 3G penetration rate in the European Union 15 countries for year-end 2009 was 25.7 percent, far short of the predicted 60 plus percentage range or the stated 30 to 80 percent rates some experts originally had foreseen.
Similarly, contrary to the forecasts, the leading countries were Spain with a 43 percent 3G penetration rate followed by Sweden with a 40 percent penetration rate. The United Kingdom and Italy had 3G penetration rates of 32 and 30 percent, respectively, which was less than half of the predicted rate, Dippon says.
The apparent slow diffusion of 3G technology is not limited to the EU 15 nations. Rather, it seems to be a worldwide phenomenon. The December 2009 U.S. 3G penetration rate was 26.1 percent, which is less than one-third of the number forecasted for the U.S. by various analysts for 2010.
4G is not going to sell itself, and so far the only message users seem to be getting is that 4G is faster. That it is. But whether the user experience is commensurately better, given the higher cost, is not yet clear.
That doesn’t mean 4G networks will come on line any slower. But revenue remains the issue.
