Mobile working Toolkit

Who is 3G for, anyway?

Peter Judge Special to ZDNet.co.uk

Published: 29 Jul 2003 17:50 BST

We have now had four months of commercial 3G service in the UK, since Hutchison launched 3 in March. And gosh, hasn’t it made a difference to all our lives?

Pioneers always end up with arrows in their backs, and by the end of the year, Hutchison will look like a pincushion. While it has pushed ahead with 3, its consumer 3G service, rival Orange has delayed its launch till 2004 (though there is supposed to be a trial running in the UK now), and O2 will probably wait till 2005. There is serious doubt whether some of the original buyers of UK 3G licences will ever actually deliver a service.

We all know the big problem with 3G. It’s got fast data and it’s always on, but no one knows what users will pay to do on the 3G network. Until that question is answered, it’s a matter of going for market share in the hope that you’ll stumble on a real consumer need; or else waiting on the sidelines and criticising those already on the field.

3 is nothing more or less than a massive heuristic experiment, on behalf of all the other operators, to try and figure out who will buy 3G and why. The network has set itself an increasingly ambitious-looking target of a million users by the end of the year.

Only 3 knows for sure how many subscribers it actually has at this point, but estimates put it at about 100,000. So how to get more? The network is playing with the uncharted market of offering content to users. It is also juggling different handsets, some of which will surely be given away free in the latter part of this year -- a big change from the £400 handsets it started out with.

However, the only way to get more subscribers on a consumer service is to cut prices. Last month’s new prices were as low as £25 per month.

This seems to be making some difference. The Daily Telegraph reports that the new rate produced weekly sales of 4,000 at Carphone Warehouse. At this rate, the Warehouse might have singlehandedly taken 3 to its million users (albeit in five years). Unfortunately, Carphone Warehouse admitted the mini-boom has already begun to “flatten out a bit”.