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But there will also be people who have four, five or even six, especially if the pricing model changes to a per-person subscription basis.
 
Commentary

Wireless Penetration: 300% and Growing

Tuesday, August 07, 2007
 

That could well be a headline within the next five years. In the past few months, a number of companies have been making similar statements and I believe them to be true and correct. In the United States, we are nearing the 90% mark for wireless penetration and it won’t stop at 100%, it will keep climbing. Why?

 

Because today, the numbers are based on one device per person, but in reality there are already a number of us who carry two or even three wireless devices with us most of the time. In my case, I carry my BlackBerry, cell phone and notebook computer equipped with both wide-area broadband and Wi-Fi. I am not alone, nor will these be the only wirelessly-enabled devices we will carry in the future.

 

Intel and Sprint have stated for a long time that they believe many of us will carry a variety of wirelessly-enabled devices and Sprint has made a good case for a person, rather than per-device, subscription model going forward. These statements are related to its upcoming WiMAX network, but I believe the same will apply to all networks in the future.

 

A few weeks ago, I spent a few days at the Qualcomm Industry Analyst conference in San Diego. It was attended not only by U.S.-based analysts but analysts from Europe, Asia and South America as well. At this event, we heard definitive proof of the future growth of wireless technologies being embedded in many different consumer and business products. The chip division of Qualcomm (QCT) showed a roadmap going forward only a few years but moving from multiple chips to single-chip architecture, and moving from today’s processing power to processors with many times today’s capabilities. But of most interest for this discussion is that Qualcomm’s low-end chipsets will include more technology and sell for less money. It won’t be long before we have entry-level chips that include wireless broadband data capabilities, either EV-DO or UMTS/HSDPA.

 

Having lower-end chips will make it easier and cost effective to build them into many other devices. Already there are phones, or plans for phones, that will include heart rate monitoring, glucose monitoring capacities and other medical functions. Some cameras and dashboard navigation systems already come with Bluetooth embedded in them and it won’t take long for wide-area-capable chipsets to find their way into these products.

 

In the past month, Apple introduced the iPhone and rumors are rampant that it will soon offer an 80-GB version of that phone and that it is working on a Nano iPod that will also be a phone. Several companies are already building wireless devices that include GPS receivers that can be worn to track a person with Alzheimer’s, or a young child (I’m not sure any of us really want to know where our teenagers are) and I assume at some point we will have a GPS/wireless system built into our dogs’ collars so we can find them when they run off.

 

Wireless is no longer limited to extending our voice capabilities beyond our home and office nor is it simply a way we can take our email with us or gain access to our corporate data or the Internet when we are out and about. It is about empowering an entirely new set of devices.

 

If we want to take a video we can do so with our camera phone with built-in video, which is not of great quality, but gets the job done. How long will it be before we see HDD digital video cameras on the market with built-in wide-area wireless embedded in them? Some still digital cameras already have Bluetooth in them, and I think wireless USB 2.0, which is coming on strong, will provide even greater flexibility for devices with higher speeds and better resolution. The costs of single-chip wide-area solutions are coming down quickly and it won’t be long before they start showing up in these devices as well as in many others.

 

Reaching 300% penetration is not that farfetched. It means some of us will have three or more wirelessly-enabled devices, some will stick with one and, of course, there will always be those who don’t have any. But there will also be people who have four, five or even six, especially if the pricing model changes to a per-person subscription basis.

 

At some point, there will be a chipset capable of all of the various wireless technologies at a low price―GSM/GPS/UMTS/CDMA/EVDO, Wi-Fi, perhaps Bluetooth or wireless USB 2.0 and maybe even WiMAX if there is sufficient demand. When we reach that point, a consumer device vendor can build in a single chipset and build a zillion units that can be shipped virtually anywhere in the world and activated on any network. Perhaps that would meet Chairman Martin’s requirement for “Open Access.”

 

It will be even more interesting once we reach the next phase in our wireless evolution, which in GSM/UMTS speak is LTE (Long-Term Evolution), while the CDMA community is working on UMB (Ultra-Mobile Broadband) and WiMAX is in the early stages of developing WiMAX-M. All of these technologies, when they are commercially available, will provide higher data speeds, more network capacity and the ability to more closely integrate voice and data services. It will be a number of years after these technologies are deployed before the chipsets become inexpensive enough to be embedded into low-end devices, but in the meantime, these technologies will be rolled out in existing networks to cover areas where more capacity and greater data speeds warrant them.

 

Think of a consumer device you take with you and how it could be enhanced with a wireless connection built into it. My navigation system could be updated more often than once a year using a DVD (which is still more than a year old by the time my auto dealer sends it to me), real-time traffic alerts would appear in my navigation system (coming sooner than you think) and there would be interactive games with multiple players from around the world.

 

For any of you who thought the wireless industry would move into a mature, dull industry, I, for one, think we are a long way from being there. It will become more exciting than ever. As we approach the 90% penetration mark in the United States, many of the European and Asian countries are already over the 100% mark and climbing. If you believe, as I do, that we will reach 300% penetration, that means we have a long way to go and there will be many changes along the way.

 

Andrew M. Seybold

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