3G has arrived: Official
Oh no it hasn't...
Comment The Authority of Reuters has announced that 3G is here, and that next week's 3GSM show will be devoted to it. Reuters is a wonderful news service, but even a casual look at the article reveals that the headlines are not saying what the story under them reveals. No, 3G is still a mess.
And one reason it's a mess, is the focus on downlink and "content delivery" by the big operators.
Reuters last Fridaypublished a story saying that "Third generation mobile telephony has arrived at last, and while one part of the wireless industry is busy building multimedia services to make the most of those fast connections, others are working to boost speeds even more."
Which is true, in the sense that the networks are building out HSDPA (High Speed Downlink Packet Access) - which improves the download speed of wideband CDMA (WCDMA) networks - which are typical of those in Europe.
But (as the story admits a couple of paragraphs lower down) nobody can use them. There are no HSDPA data cards on the market yet, and phones using the technology won't be on the market for another year, or maybe two years. And the days when they'll be the majority of handsets could be even further off.
So, what does "here" mean? It means that the networks have found new ways to chase the wild goose of data. They still don't get it: the content that people want from their phones is the content other users provide, not the sort of stuff you get from the download menus. Disney clips, frog ringtones, and adult content are an illusion, despite the huge business traffic in them.
Take ringtones. It's estimated that the amount of money spent on ringtones is roughly a quarter of NASA's budget - very roughly, $5bn compared to NASA's $20bn. A lot of money! - but what the statistics don't show is something every network operator knows: that even the big operators are losing money on every download. The smaller ones are losing a lot of money on every download.
It probably costs a winner, in this market, about ten to twenty cents (US $) to send the data for a ringtone to you. Small networks spend probably between $1 and $2 for the privilege of sending it. The price to you, isn't negotiable! if they charge more, you'll just switch networks and download from someone else.
What about downloading video? Well "3" talks a brave fight and, perhaps in Australia, they're really making money - profitably - out of video phone calls and video clips. But it's an illusion, because they can only do this while the network is under-subscribed.
For example: if you try doing data downloads in Europe, you'll find it costs. In America, by contrast, you can have "all you can eat" data packages for $16 a month. That's why companies like Danger can take every picture you take, and transmit it back to their headquarters and back it up as soon as you take it.
Why doesn't that work in Europe? Simple: if they sold a deal like that in Europe, at that sort of price, the traffic would look like London's M25 orbital motorway at 5pm: it would be jammed solid with eager users trying to send photos to friends.
Now, look at HSDPA - and look at the letter "D" - it stands for "download" and it is exactly that. Download. Look at a video phone. I'm staring into my screen, and looking at the video coming from your phone, and I can now get it three (or maybe five, if you believe the hype) times as fast as before HSDPA.
Well, no, duh! I can't download the stuff any faster than you can upload it!
And faster uploads require different technologies. Ignore the issue of latency, something we've discussed elsewhere; just look at raw speed. A 3G handset cannot upload faster than the 40K average speed you get today, if you're standing under the wireless mast with a fully charged battery on a day when all the other 3G phone owners are watching Coronation Street or the Superbowl on TV.
Oh, technically, sure it can. It's just that if they upped the speed to 128 kilobits, the thing would get too hot to hold, and the battery would run down in ten minutes.
Phone batteries are small. When you're transmitting and receiving speech, on GSM, there are ways of saving battery power by switching the transmitter off for a lot of the time. When you're transmitting video on CDMA and WCDMA, those dodges don't work, and you're actually sending a powerful signal, continuously, a long distance.
Long distance? Well, yes. Here in North London, I have three 3G data cards. Even with the power of my PC's battery, only two of them will get a 3G signal at all; there simply aren't enough masts within range. To do a video call, I'd need to stand outside in the rain. And I'd get three frames a second.
No, 3G isn't here. It will improve, but there's plenty of time for other technologies to take over. The operators who blew their budget bidding for WCDMA franchises may complain that the new technologies are "too expensive" - but they aren't too expensive for startups, or Eastern European operators, or people doing data only.
The arithmetic isn't hard. Every phone owner generates "content" every time they make a call. Just count up the number of times you use the phone to call someone, and then count up the number of downloads you do, in a day.
If the operators want to make money from data, they have to find ways of increasing the amount of data you use in making calls. They have to find ways of letting you and me *upload* video so that others can download it. Selling ringtones and ringback services and dodgy durty pix at a profit of minus 20c a download, is simply a dead end.
And until 3G technology enables uploads that won't jam the network, that can't happen.
Sponsored: What next after Netezza?