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WIRELESS DATA - IS IT ALL TALK?
by Nicki Hayes, April 12, 2001
Seen by many industry commentators as a sign of things to come, ‘wireless data’, ‘SMS’, ‘texting” -
whatever you choose to call it, has been driving the wireless industry forward for some time now. But
statistics from wireless organizations and carriers in the last month reveal an industry that's still talking
the talk but neglecting the walk. Nicki Hayes reports:
In the UK, wireless data has been poised to revolutionize the wireless industry for some time. But statistics
released by the Mobile Data Association (MDA), which compiles data from the UK's four wireless
operators, show that the volume of SMS text messages sent in the UK slumped from 929 million in January
to 808 million in February - and that includes the 20 million messages sent on Valentine's Day!
This decline in monthly messages - the first ever in the UK industry - follows hot on the heals of the UK
wireless networks' decision to implement a three pence (4.5 Cents) per message internetwork text message
charge starting February 1. The reason for this unified strike was to check the volume of traffic from web
sites offering free SMS text messaging. These sites were routing their messages via a non-UK wireless
operator at discounted rates. Imagine - handling all that data but generating no income!
Another reason for the sharp decline may be the ocean of greetings sent on New Year’s Eve - a staggering
30 million plus - included in January’s figures. The linking up of the four disparate UK GSM networks in
the second quarter of 1999 also corresponded with a tremendous upsurge in the use of SMS. It could also
be argued that February is a short month - even if it is the month of Valentine’s Day. Oh yes, then there’s
the point about wireless devices still being clumsy and the networks still circuit-switched - not ideal for
data transmission. Although, in Europe packet-based networks in the shape of GPRS are starting to be
introduced, promising an 'always-on' data connection and improved speed.
In the US, the proliferation of data across wireless is even more chaotic. Regulatory spectrum issues,
network technology fragmentation, lack of national coverage, poor quality of voice service and the
operators' refusal to adopt a 'calling party pays' policy look set to constrain wireless data penetration to
business users.
So, the role of data in wireless communications remains questionable. Up until now wireless operators and
service providers had planned on data halting the decline in average revenue per user (ARPU), adding up to
$20 a month to the average bill. That was the ideal world but in the real world competition between the
operators and service providers, as well as the still clumsy, low data transmission rates, mean that data will
not contribute as much to ARPU as was originally hoped.
So, it seems that once again the industry has over-hyped itself. We’re very good at talking the talk, but
when will we learn to walk the walk?
About the author:
Nicki Hayes is a freelance writer and corporate communications consultant specialising in business to business internet issues. She has contributed editorial to a number of publications including Unstrung.com, Guardian Online, Financial Times, Banking & Financial Training, eAI Journal and Secure Computing. Nicki is also the European correspondent for The Wireless Developer Network. Nicki is based in Dublin, Ireland and also has a base in Cambridge, UK. Through her consultancy, Hayes-Singh Associates, she has access to a number of technical writers and PR consultants throughout Ireland and the UK.
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