NEW DELHI, India-Several leading GSM operators in the Asian region have announced plans for migration to 2.5-generation (2.5G) services during 2001. Many of them hope to roll out commercial General Packet Radio Service (GPRS) services during the year, but mass expansion of the new services is not expected until 2002.
“As many as 25 of the region’s top 40 cellular operators have disclosed plans for commercial rollouts of GPRS services before the end of 2001. A further nine operators in the region plan CDMA 1XRTT commercial rollouts before the end of 2002,” said Nick Ingelbrecht, Singapore-based principal analyst at Gartner Dataquest. “2.5G rollouts are uppermost in operators’ minds, but 2.5G services may not really become widely available to the mass market before 2002 to 2003.”
The most preferred platform for migration will be GPRS. High Speed Circuit Switched Data (HSCSD) and Enhanced Data Rates for Global Evolution (EDGE) have not been widely adopted, and this is not expected to change.
“We think operators in this region at least will tend to invest in GPRS, 1X and 3G rather than EDGE as the mainstream wireless Web platform. Cellcos are unlikely to abandon
cdmaOne to go to GPRS. There is a strong possibility they will move from cdmaOne to go to wideband CDMA, like in Korea and New Zealand,” the Gartner analyst predicted.
There are wide regional variations in how these GPRS rollouts will take place. For instance, migration to 2.5G will be slower in some Southeast Asian countries like Thailand, Indonesia and Vietnam due to economic conditions there. In other developing markets like India, the migration will be slower, although leading operators have announced plans to launch commercial GPRS services in 2001.
Ingelbrecht said the level of preparation for the migration to GPRS and finally to third-generation (3G) varies greatly. Most of the big cellular operators have arrangements well in hand. Some of the smaller carriers are finding the going tougher, and consolidation is likely in some markets like Hong Kong and Taiwan.
More than 17 million customers signed up for mobile-phone service in the Asia-Pacific region during the second quarter of 2000, despite signs of a slowdown in some key markets, according to a study by Gartner Dataquest. At the end of June 2000, the total number of cellular users in Asia Pacific had grown to 188 million subscribers.
“We project that 30.2 percent of the region’s cellular subscriber base will be connected to 2.5G and 3G services by 2004. The total base by then will be 390 million,” noted Ingelbrecht.
In Malaysia, leading operators Celcom and Digi have announced GPRS plans. Celcom has launched GPRS trials with Lucent. “This development is encouraging, and it is a right step toward our implementation of GPRS in 2001. Notwithstanding any major issues, such as availability of terminals and system constraints, we will definitely be the first operator in Malaysia to offer GPRS,” said Bistamam Ramli, Celcom group executive vice president.
However, response to the new services may be affected by the fact that GPRS terminals are still not readily available in the country. The demand for such services may pick up by 2003, depending on how the handsets are priced and if there is enough mobile Internet content to satisfy consumers.
The situation is similar in the Philippines where potential of wireless technology had mobile-phone providers projecting that most of their subscribers would be using Wireless Application Protocol (WAP)-enabled phones by the third quarter of 2000. But a combination of the lingering effects of the mid-1997 financial crisis, current economic crisis caused by the political scandals besieging the country’s presidency, a general hesitancy of ordinary Filipinos to use the Internet, and high cost of WAP phones have resulted in a slow take off for WAP technology.
“The exact timing of these service rollouts will depend on the availability of sufficiently large volumes of 2.5G handsets, starting from the second quarter of next year,” said Ingelbrecht.
Several factors could fuel GSM migration in the region. The migration depends on demand for new mobile data applications and services, faster access speeds, competition between operators, lower costs of entry and proliferation of types of wireless devices.
“Mobile Internet is changing the business model for operators from a carrier of voice services to one of hosting a mix of applications and information or m-commerce. GPRS accelerates the revenue potential from individualized m-commerce transactions, m-advertising and revenue sharing with information providers,” observed Phil Pryke, managing director, Lucent Australia and New Zealand, after signing a GPRS infrastructure deal with Australian cellular provider One.Tel.
