3G adoption quickens its pace

After a slow start, 3G mobile services uptake in Australia is beginning show a quickening pace.

Mobile telco 3 reported this week that it had hit the one million 3G subscriber mark - four years after launching its service.

In announcing the milestone, 3 CEO Kevin Russell said with its size and scale, 3G services were now a credible mobility platform.

Vodafone Australia spokesperson Greg Spears, said subscribers for its 3G service had also grown rapidly since being launched in October.

“Anecdotally, we’ve seen very healthy demand for 3G handsets and data cards in key markets even prior the launch of our local 3G network,” he said.

As at March 31, 2006, the telco had more than 100,000 Vodafone live! 3G and Vodafone Mobile Connect (mobile broadband data card) customers, he said.

This figure was expected to double by September, Spears said, thanks in part to anticipated 3G roll-outs in the Adelaide and Perth metro areas mid-year.

While declining to provide specific numbers, an Optus spokesperson said 3G subscribers made up a significant part of its 6.4 million mobile subscribers as at March 31.

“Our [3G subscriber] numbers were inline with expectations and we have seen a very positive uptake of the Optus Wireless Connect card [since launching in November],” she said.

IDC research director, telecommunications and consumer Landry Fevre, said as at March 31, Optus had about 160,000 subscribers and Telstra 250,000.

With the combined 3G market expected to double from about 1.4 million now to 2.8 million by year's end, 3G services were approaching a 'tipping point', he said.

“It’s the hockey stick effect in action,” he said. “Initially it’s a scramble for the first customers and then it rolls upwards as more and more people take it up.”

With 3G coverage continuing to lag behind current 2G services, the growth in the breadth of available content, capped pricing, service speeds and the drop in handset prices had been responsible for the accelerated take-up of 3G, Fevre said.

However, with the overall mobile phone market hovering at 95 percent saturation, 3G providers would soon need to focus on new ways to interest consumers.

“Companies are be playing the handset replacement game, but the market will hit 100 percent saturation by 2008,” he said. “Then, it’s all about customer retention.”

Telstra declined to comment for this story.