Europe : With operators faced by major uncertainties over services and technology choices, scenario planning and 'market-making' strategies are now critical to the future of the mobile industry, according to a new report, Scenarios for the Evolution of the Wireless Industry, from Analysys Research, the global advisers on telecoms, IT and media.

To date, the cost and capability of cellular systems have led to mobile operators focusing on services such as premium-priced voice, messaging and WAP browsing, which deliver high revenue per megabyte and do not overstretch the technology. Developments in cellular, WLAN and broadband wireless access (BWA) technologies now promise substantial improvements in cost and capability that could enable radical new service propositions.

"Three major uncertainties will shape the future of the wireless industry over the next five years," according to report co-author, Mark Heath. "First is the extent to which mobile operators attack the market for fixed voice services. Second is their appetite for low revenue per megabyte data services, such as broadband Internet access. Third is the extent to which they deploy W-CDMA, or else prefer to implement alternative cellular, WLAN or BWA technologies."

The report defines three diverse, yet highly plausible, scenarios for the evolution of the wireless industry. In 'Premium for Mobility', mobile
operators continue to pursue their current strategy of high revenue per megabyte services, such as messaging and 'small screen' browsing, which requires little investment in W-CDMA. In 'Voice and Broadband Data Go Cellular', mobile operators invest heavily in W-CDMA and its enhancements, to achieve substantial fixed voice substitution and deliver true broadband wireless access. In 'Alternative Technologies Thrive', public WLAN and alternative BWA technologies are implemented by a variety of different players to deliver broadband data services, at the expense of W-CDMA.

"The wireless industry is on the brink of decisions which will have a profound impact on the businesses of network operators and equipment vendors," says report co-author, Alastair Brydon. "These scenarios demonstrate the possibility of very different business outcomes in terms of ARPU, infrastructure investment and handset take-up over the next five years. It is critical for industry players to take their futures into their own hands by understanding the impact of industry uncertainty and taking firm action to drive the market in the direction that suits them".

Scenarios for the Evolution of the Wireless Industry defines three diverse scenarios for the future, using extensive case studies to demonstrate the real prospects of each these scenarios occurring. Each scenario is quantified in terms of service revenues and usage (split by service type), network infrastructure revenues (split by technology type) and handset revenues. The report identifies the clear winners and losers in each scenario and the strategies that are needed to secure success.