America's 3rd Generation (3g) Wireless Race

Introduction

America's race to achieve 3rd generation (3G) wireless capabilities will redefine the way telecommunications companies operate, and determine how Americans communicate with one another. Wireless communication is slowly moving away from the world of limited bandwidth 2nd generation (2G) wireless technology to the next generation of wireless infrastructure that enables significantly higher bandwidth. This higher bandwidth will lead to the convergence of devices. Consumers will begin to utilize devices that combine cell phones, PDAs, video cameras, pagers, and other various gadgets. Increases in bandwidth will also enable users to download rich multimedia and access up-to-the-minute data from the Internet.

3G is a global wireless communication technology that makes packet-based transmission of digitized voice, data, and video a possibility. Packet-based networks provide an "always on" capability, which is not available through circuit based 2G networks. This evolution in technology also makes networks more bandwidth efficient and lowers carrier's costs. With the emergence of 3G the traditional billing model of charging by airtime no longer applies. The "always on" concept of packet-switching means that charging for long distance and the duration of a call are not appropriate, because they don't accurately reflect the amount of resources being used. New pricing models will likely be based on a combination of the amount of data transmission and charges for various services and content. The bill received from a 3G service provider will likely resemble a credit card statement rather than a typical telephone bill. Third party applications and services, such as a subscription to a wireless based MP3 download site, will be billed through the service provider.

The United States has traditionally trailed the leading wireless networks in Europe and Asia (Japan in particular), but large investments and initiatives on the part of American telecommunications giants have started to narrow the gap. America's early testing and deployments of scaled down 3G networks have typically trailed their European and Asian counterparts by about a year and a half. 3G is poised to make a significant breakthrough into the mainstream U.S. markets relatively soon. Exactly how long is the subject of much debate. This paper will take an in-depth look at the scheduled 3G deployments of U.S. carriers.

Most experts agree that 3G represents the future of telephony. However, what they don't agree upon is exactly what the future will be like or how quickly it will roll out. How will the mobile Internet be used? What kinds of services will be offered? Who will be the leading providers of 3G technologies? At this point 3G is all 'potential' and no 'promise'. This paper explores some likely answers to these questions.

The Current State of Wireless

Over 400 million mobile phones were sold worldwide in 2000. Improved service capabilities and the enhancement of phone capabilities should push total mobile phone sales to over one billion by 2002. There are a number of factors driving the evolution toward broadband wireless capabilities; including the following:

Societal trends
· The emergence of a computer literate society
· Increasing travel and mobility
· Desire for entertainment
· The need for increased productivity
· Telecommuting

Technology Enablers
· High speed, cost effective mobile systems
· Integrated multimedia applications
· Small, powerful application intensive devices

Market Trends
· Rapid growth in mobile
· Rapid growth in Internet usage
· Accelerating pace of eCommerce and mCommerce (mobile)
· Rapid growth in usage of laptops, PDAs

The large majority of mobile phones sold to date have lacked the data capabilities that will be apparent with the emergence of 2.5G and 3G wireless technologies. Today's 2nd generation (2G) wireless technology, which currently makes up most of America's wireless market share, is based on circuit-switching technology. Second Generation circuit-switching is accomplished using GSM (Global System for Mobile Communications), CDMA (Code Division Multiple Access), or TDMA (Time Division Multiple Access). GSM was launched as a worldwide standard in 1992 and is still the basis for much of the wireless services offered today. CDMA is another widely used 2G wireless standard. TDMA on the other hand has begun to lose market share from companies that are now shifting their networks to GSM. 2G's low bandwidth is capable of an average 9.6 Kbps, which is well suited for voice transmission but inadequate for data transmission.

2G has only been able to handle simplistic data services, such as email and text messaging. These basic services have been slow to catch on in America, due in part to both the unattractiveness of the capabilities, and the awkward navigation and input requirements of the current wireless devices. Yet another obstacle seems to be the failure for WAP (Wireless Application Protocol) to receive the universal support it expected, in part due to its lack of an "always on" feature. American standards organizations were hoping WAP would be the savior in terms of wireless protocols, while other countries abandoned it for arguably more promising technology. Japan's NTT DoCoMo is a prime example. They have been successful in signing up 20 million subscribers for their second-generation "always on" i-mode service.

NTT DoCoMo's global success in developing and launching wireless services makes them perhaps the leader in the global race for 3G. They will be the first carrier to achieve widespread 3G services. However, an in-depth discussion of NTT DoCoMo's global presence and their services is beyond the scope of this paper. Their alliance with AT&T Wireless will be discussed.

Figure 2.1 shows the recent evolution of wireless networks. Figure 2.2 displays the projected amount of mobile data users in the United States.

Figure 2.1

Figure 2.2

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