HONG KONG-The future of cdmaOne technology was the theme of this year’s CDMA World Congress in Hong Kong, and while data services are the future, wireless executives are struggling with how to price and package services.
“Everyone uses the lack of a killer application as a reason mobile data isn’t here already,” said David Murashige, vice president of CDMA marketing and product management with Nortel Networks. “But it’s a matter of how to package and price this.”
Industry experts point toward Canadian cdmaOne operator Bell Mobility as an example of how to price data services to gain widespread acceptance in the market. Bell Mobility last month launched Digital Data to Go, pricing the Internet-access service at 15 cents per minute, 5 cents lower than its voice service. The company doesn’t charge a monthly or activation fee, and the services don’t count toward voice minutes.
“The key is driving acceptance in the marketplace,” said Brian O’Shaughnessy, vice president of technology development with Bell Mobility. “Using information is foreign to people. It’s the wrong time to go after certain parts of the market.”
O’Shaughnessy said financial firm Schwab Canada, on its own initiative, is looking at subsidizing Bell Mobility’s handsets to sell to its key customers.
AirTouch Communications Inc. is testing Internet access in some of its Central region markets, also pricing the service below voice service.
“Once packet-based services become available, you won’t be able to charge per minute,” said Mohammed Ali, executive director of strategic technology and industry relations with AirTouch. “It doesn’t make sense to charge it at a premium.”
Ali said services AirTouch has been working and experimenting with include, Web-based information using short messaging service, electronic commerce and corporate intranet access.
“We’ve observed nonvoice traffic is increasing in our networks month over month,” said Ali. “It won’t replace voice but the revenue potential is huge, and we’ve only scratched the surface.”
Sprint PCS, however, has a different strategy. The nationwide U.S. personal communications services carrier recently teamed with Yahoo! to offer Internet access by the end of the year.
“We expect to see data more from the business user as an extension of the enterprise network,” said Al Kurtz, senior vice president of One Sprint strategic development. One Sprint is an initiative to seamlessly offer all Sprint products and services by leveraging the different back-office support structure of each division so they seems as one. “We favor that because the value and pricing starts better at the business level and works its way down. We don’t want to be in flat-rate access in the near future.”
U S West Wireless Inc. recently announced plans to launch commercial wireless Internet access by the fourth quarter. It too will target business users, pricing the service at a premium.
Korea Telecom Freetel, a PCS operator in South Korea, said 6 percent of its revenues account for wireless data services that include short messaging services delivering information such as weather and financial news. The carrier plans to offer Web-browsing services next month. It wants to target the business and the general consumer, saying it can offer Internet access at the same price as landline access.
