Revenues for cellular data and small business DSL should grow to $2.5 billion and $9.1 billion, respectively, by 2011, according to a new report from Research and Markets.
Meanwhile, small business spending on Internet access will grow to $8.2 billion by 2009, the research firm calculates, up from $4.4 billion in 2005, largely due to adoption of DSL and higher bandwidth services.
Spending on wireless data services will outpace all other categories in the SOHO segment, growing to nearly $2.2 billion in 2009, up from $0.47 billion in 2005.
Cellular phone network operators recently invested $13.7 billion simply for the rights to spectrum that will eventually be used in conjunction with 4G technology to deliver voice and data services, Research and Markets noted.
But at the same time, competitors have been developing and deploying Wi-Fi and WiMAX technology, which should be less expensive to implement (for starters because access to the spectrum is free).
Cellular companies will need to recoup the investment, probably through fees charged to the public. Today’s cost for cellular service with an average data communications service of 130 Kbps is about $80 a month. To be competitive with the advances in WiMAX and Wi-Fi, the fee for 4G services will need to be lower than the cellular companies expect, however, Research and Markets believes.
A better strategy for 4G operators would be to offer lower speeds with more capacity to handle more users as a bargain, thereby fully loading the networks with subscribers. Usage-based offerings with specific services, offering niche services at moderate speeds, may turn out to be the most effective and profitable method to roll-out 4G, the research firm recommended.
