March 22, 2004, 10:30 AM — For about 72 hours this week, the U.S. cell phone industry will stop talking about minutes.
Though fierce competition over plain voice calls will form a backdrop to CTIA Wireless festivities in Atlanta that kicked off with pre-show events on Sunday and will end Wednesday afternoon, many discussions and product unveilings will involve multimedia and other advanced services. That's where mobile operators see the potential for greater revenue and more loyal subscribers.
The annual show, sponsored by the Cellular Telecommunications & Internet Association, is taking place at the Georgia World Congress Center.
Many product and partnership announcements at the show will involve premium offerings such as multimedia messaging, streaming music and video as well as push-to-talk, the "walkie-talkie" feature that has proved popular with some U.S. mobile phone users. These services can take advantage of the growing capacity of North American mobile data networks, which are set to evolve over the coming months from dial-up-like speeds to performance close to that of DSL (digital subscriber line).
With those kinds of speeds available or on the way, mobile operators are looking for services to complement "commodity" voice calls, said Roger Entner, an analyst at The Yankee Group, in Boston.
"This is the big hope," Entner said. He predicts U.S. subscribers will eventually watch music videos and check clips of ongoing baseball games during the workday. He compared mobile success to a three-legged stool, where operators need not just the right network and the right client device but the right applications.
"They want to be the venue for something other than just vanilla voice," said Seamus McAteer, an analyst at Zelos Group Inc., in San Francisco. One thing operators hope to do is draw customers into a network of users, as Nextel Communications Inc. has done with its push-to-talk service, which has become the venue for collaboration among workers in enterprises, he said.
"If they become the venue for mobile interactive gaming ... every self-respecting 15-year-old gamer will want to belong to that network," McAteer said.
However, sexy new services won't change the fact that the market for regular voice calls still makes up the bulk of operators' business. "They can't forget their knitting as they go after these potentially higher margin opportunities," McAteer said.
Announcements at the show will cover a broad range of products and partnerships.