Trends in mobile communications

A joint ITU/Republic of Korea workshop examines social and human implications for a more mobile world

Aworkshop on “Shaping the Future Mobile Information Society” was held in Seoul (Republic of Korea) from 4 to 5 March 2004. The workshop was part of the ITU “New Initiatives” programme run by the Strategy and Policy Unit (SPU), and was preceded by a one-day Symposium on “Shaping the Future Broadband Convergence Network”. The event benefited from the generous support and collaboration of the Korean Ministry of Information and Communication (MIC) and the International Cooperation Agency for Korea IT. Some 60 experts participated, representing regulatory and policy-making agencies, mobile operators, service providers, academia, private firms, and others. Svend Kraemer, Head of Sector within the European Commission’s Information Society Directorate, chaired the meeting. For documents and information see: www.itu.int/futuremobile.

Where is mobile at?

At the end of 2003, there were over 1.35 billion mobile subscribers worldwide, compared with only 1.2 billion fixed-line users (see Figure 1). Mobile phones had overtaken the number of fixed lines globally by the end of 2002 and the number of subscribers continues to grow, albeit more slowly now that many economies are approaching universal coverage. The rise of mobile telephony to overtake fixed has numerous implications, but perhaps the most significant relates to access to basic telecommunication services and information and communication technologies (ICT). It is noteworthy that this explosion in the use of mobile telephony has occurred largely irrespective of geographic, socio-demographic or economic criteria.

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• In the Republic of Korea, mobile is continuing to grow by around 160 000 subscribers per month, but fixed-line subscriptions have started to decline. Korea is a market leader in 3G use, based on CDMA-1x technologies. As of June 2003, just over 36 per cent of all Korean mobile subscribers were mobile Internet users, with usage levels peaking at over 80 per cent among school pupils. Favourite applications in Korea include karaoke songs and soap operas delivered to mobile phones.
• In Morocco, mobile overtook fixed in August 2000. Critical factors in its growth included the introduction of prepaid cards in late 1999 and the market entry of a second GSM operator in April 2000. As at the end of 2003, there are more than five times more mobile than fixed-line users (around a quarter of the population). But fixed-line subscribers still account for two-thirds of total revenue.
• In Norway, a head start in the 1980s (with analogue mobile service NMT) was followed up with aggressive rollout of GSM in the 1990s. By the time mobile overtook fixed, in mid-2000, penetration of both was over 70 per 100 inhabitants. The volume of voice traffic has actually fallen since 2000, but shifts in usage — from fixed to mobile, and from voice to data — have helped to sustain revenue. Use of SMS (short message service) tripled between 1999 and 2002 and now stands at an average of over 600 per user per year.
• In Japan, fixed-lines overtook mobile around the end of 2000. Japan’s major contribution to a “more mobile world” is possibly its early leadership in mobile data services, initially through i-mode, and latterly through the adoption of 3G mobile (IMT-2000). As at December 2003, there were some 13.8 million 3G users of whom over 90 per cent were using CDMA 1x systems and the remainder using wideband CDMA. Japan’s leadership in this field has given it an early insight into the use of video-telephony (real-time) and video-messaging (store and forward) over mobile phones.
• Despite a late start, India has recently started to add new mobile subscribers at a rate of around 2.5 million per month. Key factors in triggering this turnaround have been the introduction of increased competition, a move from receiving party pays (RPP) to calling party pays (CPP) and the introduction of a unified licensing system. The combination of these factors has helped to reduce calling rates to below 2 US cents per minute, among the lowest rates worldwide.

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Mobile market drivers and inhibitors

Probably the biggest market driver for mobile phones is “convenience”, but there is a cluster of other factors that drive take-up, including security, fashion, social contacts and work requirements. Among mobile data users, the main applications include ring tones, logos and games. Over time, new services are being developed that benefit from the higher capabilities of 3G networks, such as downloading of songs, m-commerce or location-based services (LBS). Wireless LANs, too, are extending the usefulness of spectrum-based services.

Market inhibitors include costs and the ability to control them, health fears and loss of privacy. The North American market and others that have persisted in the use of receiving party pays (RPP) continue to lag behind other economies that use calling party pays (CPP) or, like India, that have shifted to CPP.

In the developing world, the cost of ownership has come down considerably but continues to be a deterrent to wider mobile use in some economies. In Morocco, operators enable contract users to set a voluntary limit on their monthly usage, but this does not apply to prepaid users. To extend mobile usage to lower-income users, Médi Télécom, the new market entrant, offers prepaid cards for DAM 20 (USD 2.30).

How will our lives change in the mobile information society?

Social changes are highly differentiated by age, gender and culture. In the future, we will communicate not only with each other but increasingly with machines. Early manifestations of this trend can be found in the development of radio frequency identification tags (RFID) (see Box 1), ubiquitous networking, and various trials on human to machine interaction.

Cultural adaptation

How have culture and etiquette and mobile usage affected each other? It seems that users experience a liberating and unrestrained tendency to experiment, as mobile phones increasingly become central part of daily life. One consequence of this is the rise of a new casualness about space and time constraints, and about use in public and private spaces and contexts. For example:

• A 2003 Nokia survey attributes to the use of cell phones the fact that 71 per cent of respondents tended to arrive late at social events.
• In the Republic of Korea, self-restraint is now counter-acting intrusively loud ring tones and voices.
• In Japan, people often cover their mouth with their hand out of discretion when using a mobile in public. There is also some limitation on mobile phone use in restaurants and public transport.

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Wireless and the “portable Internet”

Of course, the future of wireless communications is not limited to the small mobile devices of today. One promising concept to help accelerate the narrowing of the digital divide is being promoted in the Republic Korea, where some 100 MHz have been set aside in the 2.3 GHz band in order to bridge the gap between short-range wireless LAN technologies and longer-range 3G technologies. This type of “portable Internet” solution could offer up to 1-2 Mbit/s of bandwidth per user for an estimated USD 15 per month. Future mobile handsets would work seamlessly with existing wireless infrastructures. This could prove popular in developing markets where new networks are planned and where there is a requirement to cover low-density rural populations. The “Portable Internet” will be the subject of a new ITU Internet Report, due to be released in the latter half of 2004.