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Watch out for mobile broadband

Analyst firm predicts mobile broadband to explode this year, but expects tepid performance from U.S. mobile players.
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Written by Victoria Ho, Contributor on

Keep your eye on the mobile broadband space, says Danish consultancy firm Strand Consult, which predicts this market will see significant growth in 2008.

In a statement released Friday, Strand said "mobile broadband is the thing to look out for", and expects 30 to 50 percent of all new broadband connections globally to be made via 3G this year.

As a result, Strand said many traditional broadband service providers will begin offering mobile products, including telephony and mobile broadband, to take advantage of the upswing in the market.

However, market directions will still be determined by consumers, where changes in consumer behavior will drive the types of services provided. And the typical consumer is becoming the "educated customer", one who better understands how to obtain value for money from the various service offerings in the market.

" It would have been wise for [the American firms] to open their eyes a lot earlier…instead of believing that the entire world can be made to behave the way the Americans want."

"Consumers themselves will evolve in 2008 as it becomes possible to tailor devices to individuals... In the coming period, the power will lie with the customer," Strand said in the statement.

U.S. stands alone
The analyst highlighted the U.S. mobile market as "one of the most isolated", where just 15 percent of the world's mobile users will originate from the country, according to Strand's figures.

"American mobile technology providers have, one by one, succumbed to competition from European and Asian players, and very few American players are successful outside the United States," said the research firm.

By comparison, Strand said, Asia's mobile subscriber base has seen explosive growth, and this is expected to continue to be fueled by the region's emerging markets.

Furthermore, the consultancy firm casts doubt on new American entrants to the mobile space, such as Google's Android OS and Apple's iPhone, which Strand summarily dismissed as "beautiful, but ultimately little more than media hype".

"Apple had a lot of success with its hype in the United States but when its devices hit Europe, the results were mixed--reminiscent of RIM's attempt to conquer Europe," noted Strand.

BlackBerry-maker RIM (Research In Motion) had experienced lukewarm subscription levels in Europe in mid-2005, and saw its share price drop around that period.

"It would have been wise for [the American firms] to open their eyes a lot earlier to what's been taking place outside their home market, instead of believing that the entire world can be made to behave the way the Americans want," said Strand.


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