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What’s Driving LTE Services?

Mobile industry leaders say the main reasons operators are launching LTE are improved data speeds for customers and new IP-based services (which will drive new revenue for operators).

LTE, or long-term evolution, is the next big thing in mobile networks. Following on my Mobile World Congress survey results post earlier this week , I wanted to share some additional insights about the state of LTE.

To recap, this was the third annual SAP survey of the operators , fixed telecommunication providers, over-the-top players and other industry execs at the GSMA Mobile World Congress in Barcelona at the end of last month.

When asked what they see as the main driver for operators launching 4G/LTE services, respondents chose improved data speeds for customers (36 percent) and the ability to launch new services (30 percent) such as broadcast video and on-demand movies.

Operators see these new, IP-based services as big potential revenue-generators in the next few years. Of the industry insiders at the conference who responded, 58 percent said that rich communication services (RCS) and increased data usage, among other new offerings, will drive operator revenue. Sources of revenue differed across regions, as you might imagine. Streaming video topped the list for Europe and North America, while respondents based in Asia cited increased data usage by the region’s huge number of of new smartphone users as most significant.

The lack of LTE-compatible devices continues to be a stumbling block, however. This year, 26 percent of respondents said this was a major obstacle, compared to 29 percent last year. Lack of support for roaming LTE service, or spectrum fragmentation, is also holding back widespread adoption, according to 20 percent of respondents.

LTE is really a win-win. I’ll be delving into all the reasons why in a three-part series starting next week, covering what LTE will deliver for consumers (part 1) and for operators (part 2), as well as why it’s not yet more widespread. Stay tuned.

If LTE is your thing, mark your calendar for a free, hour-long webinar hosted by my colleague, Bill Dudley. (See his blog here.) It’s called LTE Roaming: Making it Work. Making it Reality. March 27th, 4pm Central Europe, 11am Eastern, 8am Pacific. Read more about it here.