Twitter, Facebook & The Coming Global 3G Boom

In less than 48 hours, Verizon Wireless, one of world’s largest carriers will turn on its next generation network powered by the Long Term Evolution (LTE) set of technologies. And as we enter a bold new wireless era of superfast wireless broadband, it is important to take stock of the third generation (3G) wireless technologies.

At present only 14 percent of world’s total mobile subscribers are using 3G wireless technologies. With majority of growth expected from young telecom markets such as China, India, and Brazil, the world needs to brace for mobile tsunami. Cheap smartphones with web browsers and 3G data would bring attention to apps and web-based services such as Facebook and Twitter.

How Big is Planet 3G?

According to Telegeography, a telecom research firm, there were about 694 million 3G subscribers at the end of third quarter of 2010, 14 percent of the total 5.12 billion mobile subscribers.

New research from TeleGeography shows that of the wireless total 48.6% of subscribers were located in the Asia-Pacific region, with Latin America accounting for the next largest share, at 10.7%, and Western Europe at 10.1%. The Middle East is the smallest in terms of subscribers, accounting for 279 million subscribers at the end of the third quarter, equivalent to 5.4% of the total.

At the end of second quarter of 2010, there were 4.43 billion total mobile subscribers of which a total of 535 million, or 12 percent of the total, were using 3G technologies, according to data collected by Informa Telecoms & Global Mobile Suppliers Association.

Nearly 160 million new 3G subscribers signed up during July, August and September 2010 — a shade over 50 million a month, a pretty impressive number. Much of the recent 3G growth is coming from places like China. According to GSMA, there are about 136 networks committed to using HSPA+ technologies and 81 HSPA+ networks have been launched.

Who Needs LTE, When We Got HSPA+

LTE is the next step up from HSPA+ although many carriers argue that HSPA+ in many cases will be as fast, if not faster than LTE networks, especially those are constrained by spectrum. In an interview, T-Mobile USA CTO Neville Ray gave me his reasons as to why LTE will have a slow start:

Our competitors are launching LTE in fairly limited bandwidths of spectrum,” he pointed out. “So, 10 to 20 megahertz of LTE spectrum doesn’t give you a significant benefit in any manner, or form, from a performance perspective over and above HSPA+.” In comparison, European carriers are being more generous with the spectrum devoted to LTE.

Another big challenge, he said, is that there will be a lack of early LTE devices, and most of them are going to be either data sticks or embedded modules in tablets and portable computers. “You’re not going to see much from an LTE perspective in smart phones,” he said.

“That’s in direct contrast to what we seen from HSPA+, where we’re working off of a more mature and developed device ecosystem in HSPA,” Ray said. “It’s going to take some time before LTE will offer anything approaching the device choice that’s available in HSPA+.” That is one of the main reasons why T-Mobile USA is backing HSPA+ as its next generation wireless broadband technology.

“Subscriptions to third generation networks increased by over 40 percent in the twelve months ended 30 September 2010,” Tig Harvey, Research Director at TeleGeography, noted in a press statement. With India and rest of the emerging telecom markets looking to switch on their 3G networks in 2011, one should expect to see a big jump in the number of 3G subscribers in 2011.

Smartphones+3G+Apps=Mobile Nirvana

The 3G availability and the sales of smartphones are closely tied together. As more folks have access to low-cost smartphones, such as those powered by Google’s Android OS that are likely to come to the market in 2011. Cheaper smartphones, means many more millions will now be able to access web through their mobiles and start using services that they were unable to because of lack of personal computers. Facebook, Google (s GOOG) and Twitter are three likely beneficiaries, at the very least. In a report, research firm, comScore wrote:

An analysis of Twitter usage via mobile for the six mobile markets currently reported by comScore (U.S., U.K., France, Germany, Spain and Italy) revealed that Twitter is gaining adoption among smartphone users. In the U.S., 8.3 percent of smartphone users (4.2 million people) accessed in a month via the browser on their mobile devices, outpacing each of the European markets. In Europe, 2.8 percent of smartphone users overall accessed (1.7 million users), with the U.K. experiencing the strongest penetration in the region at 5.8 percent, followed by Germany with 3.1 percent and France with 2.1 percent.

Facebook, too has seen the number of mobile users explode to over 200 million, thanks in part to availability of faster wireless broadband. But beyond these two web majors, one should expect a sharp increase in demand for mobile apps — an opportunity in itself for folks like Google who want to push mobile advertising. So, it might seem cool for us to get excited about LTE, one can’t forget the long term impact of 3G technologies is yet to be felt.
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