Mobile Broadband Central to Future Operator Embedded Mobile Strategy

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HONG KONG, Nov. 16, 2010 /PRNewswire/ -- The GSMA today unveiled research that reveals 3G embedded modules have a lower total cost of ownership (TCO) than modules based on 2G technology. The report, conducted by Analysys Mason, specifically compels operators to deploy 3G embedded technology so that they can reap the benefits of Mobile Broadband, such as higher data throughput, enhanced capacity and richer mobile services. The report, commissioned by the GSMA, is the result of 23 in-depth interviews with key players in the embedded mobile industry such as AT&T, Deutsche Telekom, Qualcomm, Telenor Connexion and Vodafone. It reveals that 3G delivers lower on-going network costs than 2G, while also offsetting potentially high 2G replacement costs.

"Embedded mobile technology is set to enrich the lives of billions of consumers over the next few years, presenting an enormous opportunity to operators. Mobile can enable a wealth of services including vehicle accident recovery applications, remote health monitoring, smart utility meters and in-car entertainment systems," said Michael O'Hara, chief marketing officer, GSMA. "Through Mobile Broadband, operators will be able to deliver embedded services cost-effectively, allowing them to fully capitalise on the opportunity at hand. This report underscores that deploying 3G modules will give operators the flexibility to leverage Mobile Broadband enabled technologies now and in the future."

"Module costs are just one part of the equation when bringing the next range of connected devices and services to market. Other factors, including unique requirements by vertical segments, certification process, provisioning, and support also share in the costs for a complete embedded solution," said Glenn Lurie, president, emerging devices, resale and partnerships, AT&T. "The good news is that as 3G multi-mode modules reach economies of scale, they are closing the cost gap with 2G modules and will help further reduce the total cost of ownership."

Embedded mobile technology is being deployed across a range of key vertical industries including healthcare, automotive, utilities and consumer electronics. The value that these embedded services and devices deliver will be vastly enhanced through the superior data processing capabilities and bandwidth offered by 3G Mobile Broadband mobile network infrastructure.

While approximately 90% of wireless modules being deployed today use 2G technology, this research demonstrates the benefits to operators of replacing 2G modules with 3G technology. These include the ability to maximise flexibility when it comes to longer-term network strategy; minimise the costs associated with replacing legacy 2G embedded devices; and ensuring they are better equipped to meet future embedded mobile demand. When taking into consideration enforced 2G module replacement costs, the report concludes that the TCO for 3G modules is lower than 2G for almost all applications in almost all scenarios.

Any decisions taken by mobile operators on the deployment of embedded mobile modules could also affect how they use their spectrum. Should operators delay the decision to deploy 3G modules, choose to decommission their 2G networks and re-farm their spectrum, the long life cycles (potentially up to 20 years) of new embedded devices such as smart meters could have important implications for the future. If the majority of embedded mobile modules sold continue to be 2G, and if an operator chooses to decommission its 2G network, this could result in high costs to replace legacy equipment. For example, the report found that the typical replacement cost facing an Indian operator with 10 million subscribers in 2020 could be as high as US$400 million.

"Leveraging the full capabilities of Mobile Broadband is crucial in fulfilling the true potential of embedded mobile technology," concluded O'Hara. "Today's report clearly demonstrates the significant value to mobile operators of deploying 3G modules as soon as possible to reduce network costs, maximise existing spectrum and enhance the quality and variety of embedded services they offer to their customers."

About the GSMA

The GSMA represents the interests of the worldwide mobile communications industry. Spanning 219 countries, the GSMA unites nearly 800 of the world's mobile operators, as well as more than 200 companies in the broader mobile ecosystem, including handset makers, software companies, equipment providers, Internet companies, and media and entertainment organisations. The GSMA is focused on innovating, incubating and creating new opportunities for its membership, all with the end goal of driving the growth of the mobile communications industry.

For more information, please visit Mobile World Live, the new online portal for the mobile communications industry, at www.mobileworldlive.com or the GSMA corporate website at www.gsmworld.com.

SOURCE GSMA