CDMA2000 1xEV-DO enabling higher revenues for operators

May 8, 2006

The CDMA Development Group (CDG) reported that operators in Asia and the U.S. have seen a significant uptake of CDMA2000 1xEV-DO broadband wireless services and, as result, higher revenues and growth.

A first-to-market advantage, new marketing opportunities and a wide selection of devices have enabled operators to attract high-end users, reduce churn and drive data revenue. In some markets, operators report that their 1xEV-DO subscriptions are growing at a rate of 230% per year and that wireless broadband subscribers spend 2 times more on data and 40-60% more overall than average users. Their experiences are highlighted in a paper titled, "The Role of CDMA2000 in the Success of Wireless Broadband," which is now available on the CDG's website.

"CDMA2000 has had a 3-year lead in wireless broadband and is now deployed in 55 countries, serving close to 30 million users worldwide," said Perry LaForge, executive director of the CDG. "What is most important is that 1xEV-DO provides the services that wireless customers want, which is reflected by the growing number of users and rising minutes of use, and delivers results for operators in higher revenues and improved overall performance."

When CDMA2000 1xEV-DO was commercially introduced in 2002, it was the first wide-area network, wireless broadband technology deployed worldwide. Today, there are 35 live networks and 37 more are in deployment across 6 continents, making 1xEV-DO the most widely deployed high-speed data technology.

With speeds compatible to landline broadband -- average speeds of 400 to 800 kbps up to 2.4 Mbps -- 1xEV-DO enables faster access to information and customized applications for enterprises, as well as new services such as mobile TV, access to radio programs, music downloads, video distribution and 3G interactive video gaming for the consumer. These services and over 217 1xEV-DO devices have generated enthusiasm in the market, with 12% of CDMA2000 subscribers already using broadband, and the number of users is growing at 4 million per quarter. For SK Telecom in Korea, 1xEV-DO already accounts for over 40% of the operator's subscriber base.

The first-to-market advantage with broadband has allowed CDMA2000 operators to attract and retain high-end users. KDDI in Japan, for example, reports that more than half of new subscriptions to its WIN 1xEV-DO services are new customers.

With the strong demand for 1xEV-DO services, operators have seen data usage and revenues grow rapidly. In the United States, Verizon Wireless' data revenues in the 1st quarter more than doubled year-over-year, contributing $872 million or 11.5% of all service revenues, up from 6.3 percent the previous year. Data ARPU reached $5.58 for the quarter, up 79% from one year ago; data customers totaled 26.1 million, a 47 % increase over one year ago. Sprint Nextel's data revenue topped $800 million in 1st quarter 2006, with data ARPU growing 21%, accounting for 11% of total ARPU. In the 3 years since the introduction of 1xEV-DO, SK Telecom has signed 8.2 million users and data contributed 27.6% of its total revenue in 3rd quarter 2005.

"The commercial success of 1xEV-DO demonstrates that there is tremendous opportunity for advanced wireless data; being first-to-market provides operators a significant competitive advantage," continued LaForge. "With the next generation CDMA2000 technologies scheduled to be deployed over the next two years, operators will be able to maintain their lead in delivering an enhanced multimedia experience."