Data deluge forcing carriers' hands

Keith Willetts, TM Forum
24 Mar 2010

When Steve Jobs proudly took the wraps off the highly anticipated iPad at the end of January in San Francisco, the reaction wasn't quite what he'd experienced almost three years before at the launch of the original iPhone.

Sure, a tablet computer based on the Mac with a huge screen for watching video, the ability to run anything from the App Store and present books in many more colors than you currently get on Amazon's Kindle or the Sony Reader sounds really cool, but it's actually just the other shoe dropping for beleaguered service providers gearing up to finance upgrades to wireless broadband networks designed to handle mobile data traffic.

The first shoe was the original iPhone. It may have been the most anticipated electronic device ever -- and certainly, with millions of users, it's perhaps the most widely adopted -- but the consequence of so many of the phones (and other smartphones from Nokia, Samsung, Google and others) is a strain on the world's mobile data networks.

People in San Francisco, New York, London and other cities complain about slow data service to their smartphones -- or, in some cases, a lack of coverage -- but this is just a drop in the bucket. Until very recently, the iPhone has been the exclusive property of a few lucky providers. But that luck has been a double-edged sword. With today's unlimited, all-you-can-eat data packages, customers aren't afraid to leave their phones on and burn through as much bandwidth as they can manage.

So while the likes of AT&T in the US and pan-European wireless provider O2 have enjoyed exclusivity with the popular iPhone, they have also had to frantically upgrade their networks to accommodate the huge swell in data traffic.

The iPad will only exacerbate the problem because it will put further pressure on 3G networks. And over the next year, as the iPhone and most likely the iPad, become available to more service providers, this will really up the ante.


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