Making money from 3G services

Zhu Jinyun, ZTE
12 Jun 2008
00:00

Following the advent of services like Skype, consumers are beginning to expect free voice on their mobiles, threatening operator revenue. 3G provides the antidote to this, enabling multimedia data applications and features such as video clips, mobile TV and video-calling, opening up a new revenue stream for operators and providers.

Lucrative opportunities are emerging for manufacturers, operators and content and service providers as networks migrate to 3G. Whether or not 3G services actually generate a strong return on investment will prove to be crucial in the establishment of 3G networks.

New 3G services

3G services refer to all kinds of mobile communication services running over 3G networks; both existing 2G voice services, supplementary services and data services, and new 3G-specific services like streaming media.

The range of 3G services is growing rapidly, with applications such as multimedia message service (MMS), color ring back tone (CRBT), mobile TV, mobile music and mobile game are already integrated into the consumer lifestyle.

The WCDMA radio system operates within the existing GSM/GPRS network. It features high bit rates, low latency, seamless mobility for packet data services, QoS differentiation for high efficiency of service delivery, simultaneous voice and data communication. These advanced capabilities lay a good foundation for the flexible delivery of any type of cellular service.

CRBT

As operator's ARPU decreases, the whole telecommunication industry is turning to value-added services to increase ARPU and reduce churn. CRBT is one such service that offered this opportunity, as a voice value-added service which could enhance users' communication experience. CRBT replaces the monotonous ring tones of the past with music, greetings and popular songs.

CRBT services are mainly popular in Asia. It was initially introduced by SKT in South Korea, followed shortly by Korea's two mobile operators LGT and KTF. Operators like China Mobile and China Unicom are now also offering CRBT services in China.

Operators anticipate that as 3G takes off, CRBT will sustain, if not increase, its popularity with more innovative applications. Because CRBT is not a data value-added service, it has mainly become popular with the consumer as it meets users' communication and entertainment requirements. Countries such as South Korea have already begun to provide this service over 3G networks.

Additionally, the new CRBT system provides enhanced features like corporate ring tone and music station, where a collection of tones that change monthly is offered by content providers at a special price. An additional feature is the 'Copy' function where users can copy tones from another mobile phone without having to know their titles.

Multimedia Messaging Service

MMS is a technology that allows users to send messages that contain multimedia (images, audio, video, rich text) and not just text as in short message service (SMS).

MMS is similarly considered to be a new revenue-generating service, although not to the extent of CRBT as its development is limited by network, compatibility, mobility and interoperability issues. The MMS development will progress in two phases: the first phase will focus on end-to-end multimedia messaging; the second phase, MMS application development.

Users currently compose MMS with uploaded images or photos, which allow little interactivity. The MMS usage scope will be extended when it evolves into a channel for the delivery of multimedia entertainment and news, and as MMS brings more interactive applications into mobile messaging, users will feel as if they are browsing the internet.

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