WCDMA promises success says report

February 14, 2004

Although off to a slower start than originally expected WCDMA is showing regained promise, according to a new study from Visant Strategies. Although current WCDMA deployments have no more than small parts of nations covered, albeit some very atypical rollouts exist, the need for voice capacity and a data niche offering will allow WCDMA to do well.

According to findings in "WCDMA: Promise of Success 2004," close to 80,000 WCDMA base stations are live as of 1Q 2004 and shipments of WCDMA infrastructure will continue to rise, driven by coverage requirements in Europe and market developments in Japan.

"WCDMA is expected to enjoy greater than sixty percent penetration in both Japan and Western Europe in 2009," said report author Andy Fuertes, a Visant senior analyst. "WCDMA will play a lesser role outside of these areas, although it will do well in North America, due to increasing competition from other air interfaces and a limited demand for enhancements in voice capacity in the short-term and the mid-term."

One critical assumption made in the study is the ability for the wireless industry to produce a capable and cheap WCDMA phone during the 2005 to 2007 timeframe, allowing unknowing 2G and 2.5G users to be ported over to WCDMA seamlessly. Cost-effective improvements in content, applications, input/output, and screen technology must be satisfied in order to drive broad interest in mobile Internet services.

Also, although currently ARPU to WCDMA services is 30% higher than that of 2G services, such increases are unsustainable within mass-market acceptance. Today the WCDMA user is defined by price conscious, prepaid consumers in most of the markets it has been deployed.

The study provides global and regional annual WCDMA infrastructure shipments, deployments and revenues as well as WCDMA chipset shipments and revenues for the years 2002-2009. It also details global and regional annual WCDMA subscribers and WCDMA handset shipments, average price and BOM for 2003-2009. Also detailed are the impact of competitors to WCDMA, such as 802.20, CDMA2000, EDGE, and TD-SCDMA.