"I want to make one thing perfectly clear: Nobody will pay for these [wireless data networks] with laptop users," said Seybold, head of mobile computing consulting company Andrew Seybold Group LLC. It will be PDA users "who will pay the freight" to keep these networks in business, he said Monday at the CTIA Wireless show here.
Furthermore, the wireless voice service providers also will dominate the field of wireless data communications "because there is not a terrestrial data network in the world that has ever made money," Seybold said.
Wireless data will be an added revenue stream for the voice carriers, he said, but data-only networks by themselves cant generate enough revenue to stay in business.
But that hardly matters because "we are heading for a 3G [third-generation] world," in which all of the major wireless phone services are rapidly moving to various flavors of 3G high-speed data transmission, he said.
This includes CDMA2000 1X, which supported 144 Kbps in 2002; and CDMA2000 1xEV-DO, which supports 2.4 to 4.8 Mbps packet data with currently available throughput set at 3.1 Mbps, according to Seybold.
EDGE (Enhanced Data Rates for Global Evolutions) is also starting to be widely deployed in the United States and offers available data rates of 400 to 800 Kbps with a theoretical peak of 2.4 Mbps. AT&T Wireless says it is providing EDGE technology everywhere that it has GSM (Global System for Mobile Communications) technology, and Cingular Wireless has deployed EDGE in Indianapolis and plans to expand from there.
AT&T Wireless is also offering WCDMS UMTS (Universal Mobile Telecommunications Service) in Dallas, Detroit, Phoenix, San Diego, San Francisco and Seattle. Verizon Wireless plans to deploy CDMA2000 EV-DO in 14 major U.S. cities and 20 U.S. airports.
"We now have three cities that say they are going to build [free public Wi-Fi services]: San Francisco, Philadelphia and New York," Seybold said. "They are going to take a local-area technology and turn it into a Wi-Fi, wide-area technology and offer it for free," he said.
This means "anybody in the business solely as a hot-spot provider is going to be in a lot of trouble and will probably not be in business" in a year or two, Seybold said.