3G Communications System - Essay Example

Introduction According to Encarta World English Dictionary (North American Edition), 3G is defined as "a wireless communications technology designedto provide high-speed internet access and transmission of text, digitized voice, video and multimedia. ZD net defines 3G as "the current generation of data transmission capabilities over a cellular network in order to provide Internet access via smart cellphones. EV-DO, WCDMA, HSDPA, GPRS and EDGE are the major technologies in use, allthough GPRS and EDGE are often called 2.5G because of their lower speeds. 3G systems were introduced in Europe in March 2003 and later moved to the UK and Italian markets. According to a study by strategy analytics published on their website, by the end of 2006, approximately 167 million people worldwide will be customers of 3G networks. This implies that there is vast potential for growth. With the invention of the 3G network, users have been provided with an opportunity to upgrade their existing services and avail of superior services and high transfers in voice and data. Size of the 3G market The 3G communications system was developed in the Asian region with Japan in the forefront of innovation. The Japanese introduced this system in their country and is vey popular. The upgrading of systems began in 1999 and is expected to continue till 2010. As of reports published in June 2007, 6.7 per cent of the total worldwide users are 3G users. Predominant countries that have a large share among their users are Japan and Korea. Fifty per cent of the users in these countries subscribers in Italy are 3G users and UK, Austria and Singapore's 3G market base is made up of 20 per cent of it's consumers. Cellular mobile telecommunications networks are being upgraded to use 3G systems. Research Objectives The objective of this research is to elucidate the problems and opportunities in the 3G Global market. Upon identification of these problems and opportunities, we can suggest necessary or adequate measures to solve the problems. The data involved in the research will be secondary, collected from publications and papers of various independent market research agencies. After studying the data and interpretations, the research will bring out answers on what can be done to solve the problems and make avail of the opportunities. Opportunities and threats to the 3G market. The 3G service has gone through various stages of migration passing through various stages of service integration and unification. These stages have revealed various opportunities and threats faced by the 3G market. Threats faced by the 3G operators: 1. Lack of robust service strategies - Early 3G launches lack robust service strategies, diverse approaches had been applied but failed to capture the attention of the consumers due to the arising problems. 2. High Cost of Licenses - Governments around the world charged expensive license fees to 3G operators. Not only were the fees exhorbitant, but also subject to Government bids and auctions. 3. High Installation and Operating Costs - The technology costs for running a 3G network is very high. 3G operates on a different frequency from 2G and mobile operators must build new networks for 3G. This setup involves heavy capital expenditure and thus overheads of operating a 3G system are very high. 4. Lack of Coverage in many areas - 3G being a new service is still in the developmental stages, therefore there is a lack of coverage in many areas. 5. Burden on the Customer - 3G involves a higher cost of operating and maintenance, the handsets are relatively expensive to purchase thereby burdening the consumer and affecting sales ultimately. This is the main reason that led to the shutdown of Vodafone KK (the Japanese subsidiary of Vodafone). Consumers in Japan were used to using smaller handsets and the consumers in Europe demanded bigger handsets to meet their requirements. So Vodafone started to market bigger handsets to the Japanese which led to decline in sales and ultimately it had to be shut down. Opportunities in the 3G market 1. Large worldwide market - The future of 3G seems bright as the mobile subscriber base all over the world amounts upto 3 billion in numbers. Most of these users are willing to try new products that are technologically advanced. A research conducted by Strategy Analytics published on their website, by the end of 2006 approximately 167 million people worldwide will be customers of 3G networks. These users are mainly from Japan, Korea and the European region. The 3G operators can also take advantage of arising opportunities in countries like China, India, Pakistan and Latin America where customers are demanding better products. 2. Flexible Bandwidth - 3G systems are built to deliver flexible bandwidth. The operator can extend the capacity of his bandwidth if he chooses thereby leaving room for growth and value add to customers. 3. Concept - The 3G concept is a novel concept for consumers and can serve as an excellent opportunity to the consumers who want to try new products that are technologically advanced. The above indicates that there is a vast potential for the 3G market. Recommendations based on the study of Opportunities and Threats 1. Reduce Capital and Operational Expenditure - By reducing these overhead costs, operators are better able to price their products and services in order to gain a competitive edge over their rivals and capture broader market base. Reducing costs will also enable the carriers to invest in newer technology and upgrades. 2. Improve the Quality of Service - A high quality of service is important for the operator who targets enterprises and individual business users. The Quality of service affects overhead costs. If the quality of service is lower, the operator has to incur costs to attract and retain its customers. 3. Developing a wider range of products and services - Including innovative offerings that rivals cannot match positions an operator to compete on other offerings. A benefit of this service is that, the more ways customers have to communicate, the more they are likely to spend-ultimately benefitting the carriers. 4. Packaging of the 3G offering to consumers - A package that includes a rich user interface, flashy graphics and photos, streaming audio and video and a small and light power efficient device will help in capturing the consumers attention. References http://dictionary.zdnet.com/definition/3G.html http://encarta.msn.com/dictionary_701710471/3G.html http://inspirethenewlife.com/videogallery/index.cfmid54E51C5A-E0CB-91F4-255EEF865A7BEB74 Tellabs - Foreward by Steve McCarthy, Senior Vice President. http://www.tellabs.com/solutions/integratedmobile/tlab_integratedmobile_primer.pdf www.heavyreading.com/details.aspmod=ReportAbstractViewer&a0=3055 Read More