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Mobile broadband takes off

Roland Tellzen | April 01, 2008

HALF a decade after mobile broadband appeared in Australia, it is really only now that technology and competition have combined to make it one of the fastest growing areas of technology uptake.

Mobile broadband takes off

Technology first used by 3G phone networks is opening up broadband options

Local users are jumping in to make the most of mobile broadband and are starting to reap the benefits of competitive and widespread network coverage.

The winning ingredient seems to be the piggybacking of mobile broadband services on 3G technology first used by phone networks. After earlier and less than spectacular adoption of mobile services using Edge or GPRS technology, 3G-based broadband services are finally tempting mobile consumers.

Indeed, mobile data is now widely being accredited as the killer app of 3G.

The move was spearheaded in late 2006 by the launch of Telstra's HSDPA Next G service, but the carrier's rivals, such as Optus, Vodafone and Hutchison, have all now joined the fray to get users on board.

With Telstra's CDMA network due to be shut off by the end of this month, the race is on to build market share with a range of offers from all the providers.

For users this inevitably means the luxury of choice and the benefits of price competition, not to mention speed.

The original Telstra CDMA network offered mobile data speeds up to about 400Kbps, which was sufficient for applications such as mobile email.

It provided a solid foundation for services from the likes of such companies as Research in Motion, developer of the popular BlackBerry push-email device, and helped spawn a generation of business and personal applications based on being in touch by email at all times.

By the time 3G came into its own, initially with novelty offerings such as video and music downloads, and more recently with mobile television services and broadband internet access, the hunger for speed and capacity had increased. The Telstra Next G network (marketed as 3.5G rather than 3G), upped the ante to about 3Mbps, and challenged others to match such data rates.

The carriers are also planning much further ahead. Telstra is promising, for example, the first deployment of next-generation mobile broadband, and speeds of up to 40Mbps from next year.

Such claims, however, must be treated with caution.

Just about all carriers will claim theoretical maximum speeds for their offerings, but weather, interference and physical obstacles, as well as the complexity of the applications being used, all combine to make such maximum speeds fairly rare.

In reality, speeds of between 1Mbps and 1.5Mbps are most common.

As for claims of super-fast speeds exceeding current limits within a few years, technology may limit such achievements for the time being.

The type of devices that will hook up to these services will, at least initially, slow down the achievement of such results.

Equipment manufacturers are widely acknowledged to be a year or two behind the theoretical technology curve.

Anyway, as in most areas of telecommunications, it is never as simple as a straight comparison.

For users, choosing the best network can be a complex equation affected by factors such as coverage and usage patterns.

Adopting mobile broadband also means weighing up the compromises involved in greater mobility at the cost of the advantages of being hooked up to a fixed broadband offering such as ADSL or cable internet.

There are concerns, for example, that mobile broadband is not yet robust enough for data-intensive applications such as online games or internet telephony.

Nevertheless, for many people, mobile broadband is the only option for fast broadband access in areas where ADSL or cable services are not available.

When it comes to coverage, Telstra is in the lead, due partly to the fact that it must satisfy the Government that rural users won't be disadvantaged when the CDMA network is turned off.

The carrier claims its Next G service covers 98 per cent of the population.

In May, Optus upgraded its Sydney and Melbourne networks to HSDPA.

Its Turbo G service offers 3G/HSDPA coverage in the metropolitan areas of Canberra, Melbourne, Brisbane, Perth, Sydney and Adelaide.

Optus says it will extend the network to 96 per cent of the population by the end of this year under a deal with Hauwei and Nokia for a $500 million mobile network expansion. Initially, it expected to achieve 96 per cent coverage by the end of next year, but it brought forward its deadline in response to rival plans.

Vodafone offers a network that covers the metropolitan areas in Sydney, NSW Central Coast, Melbourne, Canberra, Brisbane, the Gold and Sunshine coasts, Adelaide and Perth. It also covers all of Australia's main international airports, and is constantly expanding.

Vodafone says it expects to be able to extend mobile 3G broadband coverage to 95 per cent of the population in the next 10 months under a deal with Sweden's Ericsson to build a $500 million national mobile network. Vodafone says the upgrade will enable the network to provide a theoretical downlink speed of a sizzling 14.4Mbps.

Hutchison's Three network offers coverage across Sydney, Adelaide, Melbourne-Geelong, Canberra, Brisbane-Gold Coast and Perth. Outside these areas it offers seamless roaming to the Telstra network, albeit at increased rates.

This explosion of offerings has fed a surge of new users itching to make use of it.

In the three months to September, for example, Optus's 3G subscriber numbers rose 27 per cent to 868,000, while Vodafone reported a doubling of its subscriber base in the same period and now claims to be adding between 12,000 and 15,000 mobile subscribers monthly.

Hutchison Three reports that its mobile subscribers increased from 82,000 to 195,000 in the year to June 30.

According to figures from telecommunications analyst Market Clarity, the number of 3G connections in Australia grew by about 2 million to 4.7 million in the first six months of last year, mostly on the back of Telstra's Next G launch.

Market analyst IDC recently predicted mobile data services would grow at a rate of more than 50 per cent in 2008, and that by midway through next year 3G customers would exceed 2G customers by 9 per cent.

Telstra's mobile broadband growth has been so phenomenal that the carrier's mobile data revenue overtook its SMS revenues for the first time in the six months to the end of last year.

Mobile data accounted for 30 per cent of Telstra's mobile services revenue in the six months to December, rising to 31.5 per cent in the month of December alone, Telstra said earlier this year.

Telstra recently boasted a mobile broadband user base of 735,000, representing a threefold increase in the past year.

While Telstra has been able to hang on to its lead in mobile data, it has faced strong pricing competition, particularly since Christmas.

Hutchison Telecommunications' Three network, for example, just yesterday announced a fast mobile broadband package at $15 a month for 1GB of data.

Vodafone, for its part, began offering 5GB for a monthly $39 in November.

Both deals include a free USB broadband modem.

Telstra's cheapest mobile high-speed broadband deal, in comparison, offers 1GB a month for $79.95 and a modem costs an additional $249.

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