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Some might say that the figures don’t add up! In 2003, we forecast very few 3G connections in Western Europe, but are already forecasting 3G connections in regions such as Asia-Pacific and North America in 2002. This can be explained by the fact that cdma2000 1X is being defined as a 3G technology.

Our forecasts show that this will technically gain increasing traction against W-CDMA, which is currently experiencing a bumpy ride. Marta Munoz Mendez-Villamil highlights our main findings from Mobile@Ovum ( www.Ovum.com ).

W-CDMA versus cdma2000
By 1 January 2003, the total number of 3G connections will reach 11.4 million, increasing to 66.4 million by 2005 and more than 251 million by 1 January 2007.
Until 2005, the number of 3G connections in Western Europe will be insignificant compared to the total number of 3G connections worldwide.
By 2005, the majority of 3G connections will be located in Asia-Pacific and North America.
1 shows the regional distribution of total 3G connections.

The forecasts for Western Europe come across as being rather pessimistic for an industry that has invested large amounts of money and time in 3G. However, in regions where the 3G standard in place is not W-CDMA, the picture is rather different. cdma2000 is already operative in some countries in Asia-Pacific and North America via its 1xRTT version (we define cdma2000 1xRTT as a 3G technology). We therefore believe that:

the early years of 3G will be dominated by cdma2000
W-CDMA adoption will only become significant in 2006, particularly in Western Europe
W-CDMA will catch up with cdma2000 and overtake it, but not within the forecast timescale.
Figure 2 shows the split in 3G connections worldwide between W-CDMA and cdma2000.

Figure 2 3G connections worldwide, 2003–2007

cdma2000 has already been deployed successful in Asia-Pacific and the Americas. Some Eastern European operators (in Romania and Russia, for example) have also implemented cdma2000 1xRTT, and we expect other operators in the Middle East and South & East Asia to eventually implement cdma2000 networks.

Figure 3 indicates the geographical distribution of cdma2000.

Figure 3 Distribution of cdma2000 connections

W-CDMA will mainly be implemented in Asia-Pacific (Japan’s NTT DoCoMo has already launched its FOMA services, which are W-CDMA based) and Western Europe, as Figure 4 shows.

Figure 4 Worldwide W-CDMA presence

There are several reasons for the slow take-up in Europe compared to other regions:

countries where GSM is already implemented are expected to migrate to W-CDMA, and Europe is so far dominated by GSM
there have been few announcements on when W-CDMA devices will become commercially available
a number of European operators have announced postponements in their 3G launch – Telefonica Moviles is one example – until both the supply side (handsets, networks and reliable technology) and demand side (consumers) have been proved to be stable
GPRS has so far proved to be a disappointment to operators in Europe, with fewer active GPRS connections than expected.