VoIP and video services are most attractive 3G services

November 1, 2006

According to primary market research by Lucent Technologies, businesses and consumers are willing to pay a premium for next-generation mobile high speed data services such as voice over IP (VoIP), interactive video and video sharing.

Lucent surveyed U. S. consumer mobile phone users and enterprise communications technology decision makers to determine which applications and services would be of most interest on emerging advanced mobile high-speed broadband networks such as those based on 3G technologies such as CDMA2000 1xEV-DO Revision A and HSPA (high-speed packet access).

The research, part of Lucents ongoing primary market research program, will help service providers identify new opportunities to grow revenue and reduce subscriber churn.

"Our mobile high speed data research identified consumer and enterprise services and applications that will enable service providers to monetize -- or obtain a return on -- their investment in advanced mobile broadband infrastructure," said John Marinho, Lucent Technologies corporate strategic marketing vice president. "This research is an example of marketing tools that Lucent makes available to its customers through the Market Advantage Program."

"Clearly identifying the most attractive next generation voice and data services is critical for service providers as their traditional businesses saturate and become increasingly competitive," said Phil Marshall, vice president of Enabling Technologies at Yankee Group. "High performance network technologies like UMTS/HSPA and CDMA2000 are critical for the reliable delivery of these services."

As part of the enterprise research, Lucent gauged interest in five applications VoIP, video conferencing, communicate and collaborate, multicasting and business continuity. VoIP, consisting of basic VoIP and IP PBX features, generated the greatest willingness to buy amongst enterprise communications technology decision makers and was the top driver for switching carriers. Lucent research also found that enterprises would be willing to pay a monthly premium for "a new cellular broadband service that offers higher speed, simultaneous voice and data along with reduced latency performance." The willingness to pay the premium is much higher for companies that use an existing mobile high-speed data service such as EV-DO Revision 0 (Rev. 0) or HSPA as compared to enterprises that dont. The research indicated that:

* 76 percent of companies currently using EV-DO Rev. 0 are willing to pay a premium over current spending for premium mobile broadband.

* 34 percent of the companies that are not currently using EV-DO Rev. 0 are willing to pay $60 or more per user per month for premium mobile broadband.

Among the topics covered with consumers, Lucent evaluated interest in video calling, video sharing, multimedia ring-back, content sharing, and "share and discuss." Video calling and video sharing were the two most popular applications.

The research also indicated that nearly half of all consumer survey respondents are willing to pay extra for "a cellular broadband service with DSL-like speed and simultaneous voice and data." As with businesses, the willingness to pay for premium mobile broadband data service is much greater for those who already spend money on services beyond basic voice (SMS text messaging, video/TV, ringtones, games, Internet access, etc).

* More than 60 percent of respondents who currently spend money for such services are willing to pay extra for premium mobile broadband.

* 40 percent of respondents who currently do not spend any money on such services are willing to pay extra.

The comprehensive consumer and enterprise research represented a cross-section of U.S. cellular subscribers and business technology decision makers.