Evolution of Wireless in the United States and Globally
Cell-phone owners around the world do not limit their cell phone applications to voice service
as Americans tend to do. This section explores some technological, economic, political
and cultural differences between the United States and other countries. We examine how
the differences effect market penetration and uses. This section also discusses specific applications
gaining popularity around the world.
e-Fact 9.2
According to The Industry Standard, only 5 percent of Americans who own a cell phone use
the phone for sending e-mail. Fewer still use the phone for browsing the Internet (3 percent)
and shopping (2 percent). [***G. Jones, “Wireless: What to Do?” The Industry Standard
<www.thestandard.com/research/metrics/display/
0,2799,20262.00.html> 20 November 2000.***] 9.2
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9.3.1 Technological and Cultural Factors Effecting Wireless Adoption
The United States has an extensive wireline telecommunications infrastructure that delivers
relatively inexpensive telephone service and Internet access. Many other parts of the world
do not have the same level of infrastructure, making telephone and Internet service expensive
and far less accessible. Underdeveloped regions are turning to wireless infrastructure
solutions by implementing wireless local access as well as wireline infrastructure. [***
“Wireless Facts,” CWTA, <www.cwta.ca/industry_guide/facts.php3>***] It is
cheaper to erect a base station tower to service an area for wireless local access than it is to
dig trenches and bury cables to provide point-to-point service (see Chapter 10, Wireless
Communications Technologies).
e-Fact 9.3
A recent study forecasts 200 million wireless local access subscribers worldwide by 2005.
[*** “Wireless Facts,” <www.cwta.ca/industry_guide/facts.php3>***] 9.3
American wireless service includes a host of standards, many of which are incompatible.
Incompatibilities result in poor or dropped phone connections or no phone service at
all. [***L. Rogak, “The Sky is Falling Redux,” m-Commerce Times <www.mcommercetimes.
com/Industry/13> 17 May 2000.***] Some countries, such as Brazil,
also suffer from multiple standards but are making efforts to improve the situation. Telefonica
Moviles and Portugal Telecom are merging their Brazilian mobile subscriber operations
and are adopting the same standard. [***L. Crawford, “Moviles Looks to South
America for Most Growth,” Financial Times 27 February 2001: 20.***] Europe widely
supports GSM for current cell phone service, and WCDMA for 3G networks. Overall, Asia
supports compatible standards. [***D. Sims, “The Whole World in Your Hand,” The
Industry Standard November 2000: 19***] We discuss standards in Chapter 10, Wireless
Communications Technologies.
Cell phone adoption is popular in some countries because of the cultural importance of
the family coupled with expensive wireline service. For example, Morocco’s cell phone
subscriber population grew by 3 million people over an 18-month period (between 1999
and 2001) and 200,000 new customers are joining each month. One reason for this growth
is that more than two million Moroccans live in Europe. The Moroccans in Europe purchase
handsets and calling cards in Europe and use the service during vacations to see their
families in Morocco. The person leaves the handset in Morocco when they return to
Europe. This way, they can call their family regularly on that cell number rather than the
expensive wireline system. [***J. Drummond, “North Africa’s Mobile Connections,”
Financial Times 1 February 2001: 20.***]
Politics cannot be separated from economics. State-owned, monopolistic mobile operators
still exist in parts of the world, but they are disappearing. For example, Brazil recently
opened its cellular market and Indonesia plans to open its telecommunications market to
outside competition by 2003. [***E. Brown, “Brazil Takes to Wireless,” m-Business
January 2001: 34-35.***] [***T. McCawley, “Telekom, Indosat Cut Cross-Holding
Ties” Financial Times 16 February 2001: 18***] At times, contracting with non-democratic
countries can be difficult. Qualcomm believed it had a contract agreement with China
in February 2000, but the Chinese Premier decided to (temporarily) disregard the agreement
one week later. [***A. Hamilton, “The China Syndrome” Red Herring 13 February
2001: 50***]
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Chapter 9 International Wireless Communications 158
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e-Fact 9.4
According to The Industry Standard, 40 percent of Americans have a cell phone, but only one
in one-hundred use their cell phone as a wireless Internet connection. [***G. Jones,
“Wireless: What to Do?” The Industry Standard <www.thestandard.com/research/
metrics/display/0,2799,20262.00.html> 20 November
2000.***] 9.4
9.3.2 Applications
The wireless applications market for cell phones is growing rapidly. Messaging, Internet
access, wireless-specific content, financial trading and grocery ordering are examples of
the wide range of available applications used by cell phone subscribers outside the United
States.
Messaging is the most popular cell-phone application, next to voice service. Messaging
is the ability to send brief text messages to the display of another cell phone.
According to the GSM Association, fifteen billion Short Message Service (SMS) text messages
were sent over GSM wireless networks during December 2000. SMS is used for short
messages as well as to alert subscribers of new e-mails, faxes or voice messages.
e-Fact 9.5
According to the GSM Association, over 200 billion SMS messages will be sent during 2001.
[***M. Smith, “More Than 200 Billion GSM Text Messages Forecast for Full Year 2001,”
GSM World <www.gsmworld.com/news/press_2001/
press_releases_4.html> 12 February 2001***] 9.5
SMS Web portals offering m-commerce applications, corporate services, sports, financial
news and weather-based information services are being launched. Televised award ceremonies
use SMS to poll audiences. Some Muslims use SMS to notify users of prayer-time.
[***M. Smith, “More Than 200 Billion GSM Text Messages Forecast for Full Year
2001,” GSM World <www.gsmworld.com/news/press_2001/
press_releases_4.html> 12 February 2001***]
e-Fact 9.6
Ovum forecasts that the market for wireless device Internet access is reported to reach 484
million people by 2005, up from six million in 2000. [D. Lake, “Wireless Net: Not Yet,” The
Standard <www.thestandard.com/research/metrics/display/
0,2799,15258,00.html> 22 May 2000***] 9.6
Internet access is offered increasingly by wireless operators. In Japan and other parts
of the world, NTT DoCoMo offers i-Mode as a wireless Web service. Other wireless Web
services are KDDI (Japan), Sprint PCS (U.S.) and British Telecommunications’ Genie.
Mobile operators also use Wireless Application Protocol (WAP) for subscriber Internet
access. WAP gateways enable wireless devices to access remote Web servers on which
wireless-specific content resides. Brazil’s Telesp Celular offers WAP-enabled Web access
services in São Paolo. We discuss WAP technologies in detail in Chapter 10, Wireless
Communications Technologies. Telefonica Celular offers MoviStar Internet service in
northern Brazil. [***E. Brown, “Brazil Takes to Wireless,” m-Business January 2001:
35-36.***] Columbia’s Comunicaciones Celulares SA (Comcel), is partnering with U.S.
software maker Brience, Inc. to provide Internet access to the one million Comcel cell
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phone subscribers. [*** “Columbia Connects to Wireless Web,” Computerworld 5 February
2001: 54.***] Almost six million people in Asia-Pacific accessed the Internet
through a wireless device in 2000. [D. Lake, “Wireless Net: Not Yet,” The Standard
<www.thestandard.com/research/metrics/display/0,2799,15258,00.html> 22 May
2000***] Analysts predict that more Asians will access the Internet through mobile devices
than with computers. [***A. Hamilton, “The China Syndrome” Red Herring 13 February
2001: 48***] This will probably be the trend for other countries as well, particularly
as Internet-enabled cell phones become cheaper and more widely available.
Japan’s NTT DoCoMo is also targeting the wireless content market. NTT DoCoMo
and KPN Mobile of the Netherlands announced they would create an Internet portal for
mobile phone users. A wireless Internet portal is a site on the Internet that offers services
such as e-mail, discussion forums, news alerts and concise content that is specifically
designed for a wireless interface and mobile users’ needs. The service is expected to be
available in Germany, Belgium and the Netherlands, and offers access to news, entertainment
and financial services information. [*** “World Business Briefing, Asia,” New
York Times 30 September 2000: B2***]
The British Safeway grocery store chain is experimenting with wireless technology to
increase customers’ convenience. Customers order groceries via their PDAs by accessing
a store database containing close to 200 items. The customers then go to the store to pick
up and pay for the groceries and any additional items. In the future, the store plans to create
a database that will be downloadable to a wireless device rather than the device accessing
the store’s network. Safeway plans support for access through additional wireless devices
and allowing consumers to customize their shopping lists for a more personalized experience.
[***D. Cassell and M. Marshall, “Safeway U.K. Trials Mobile Shopping” m-
Business, January 2001: 38***]
New Zealand tapped into wireless trading in 2000. Investors can make trades on the
New Zealand Stock Exchange (NZSE) using a mobile phone and the NZSE’s electronic
trading system eFASTER. A user can place buy and sell orders from a WAP-enabled
mobile phone. [***B. Foster, “Stock Trading Goes Mobile,” Communications News
September 2000: 92.***] WAP is discussed in detail in Chapter 10, Wireless Communications
Technology.
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