Explosive Growth in Mobile Video Shifts Advantage to WiMAX Providers Until 2012

New DIGDIA report finds that wireless operators who are first to deploy higher capacity 4G networks will gain from increasing consumer demand for mobile digital media. An analysis of ecosystem development for 3G migration shows that the lag in LTE rollout will alter the competitive landscape in the U.S. wireless industry over the next three years.

San Jose, CA , July 6, 2009 -- A new report by DIGDIA finds that congestion in 3G networks, caused by a massive increase in demand for mobile digital media, will accelerate adoption of higher capacity 4G technology. Mobile WiMAX is first out of the gate in the U.S., and will establish itself as more than just a niche player, while operators who plan deployment of LTE technology race to catch up.

While partisan wars have been raging between proponents of WiMAX and LTE, over whose technology was faster and who would "win", something more serious was happening. The capacity of 3G networks was already running out. Wireless data traffic is doubling every year and video traffic is growing faster than that. With millions of subscribers trading up to smartphones, many equipped with video cameras, mobile uploads to YouTube have spiked 1,700% in the first 6 months of 2009.

As a result, operators are imposing caps and policy control mechanisms while completely prohibiting some of the most popular place-shifting mobile video applications from their 3G networks. The imposition of disincentives on consumers will prove to be counter-productive. Voice ARPU for wireless operators has flattened or declined in recent years. Operators seeking revenue growth increasingly depend on new subscribers for data ARPU, which has increased an average of 25% from 2008 to 2009.

The solution, for operators and consumers alike, is more rapid deployment of 4G networks optimized for internet protocol traffic, with higher capacity WiMAX and LTE air interfaces. Mobile WiMAX service is now commercially available in several U.S. cities, while LTE only saw its first field test in Europe in June 2009 and will not be available in the U.S. until 2010.

For some leading U.S. wireless operators, LTE deployment is more than two years away. Chipsets and consumer electronics for LTE also lag WiMAX developments by two to three years. These challenges present opportunities for companies throughout the wireless value chain to develop devices, services and applications to meet consumer demand for mobile digital media.

DIGDIA has thoroughly studied the developing 4G ecosystem, through interviews with industry leaders, extensive research, case studies, and analysis.

Topics covered in the report:

• Mobile WiMAX and LTE technologies are compared and explained in terms of the advantages that each will provide over 3G.
• Operator strategies for migration to 4G are explored, with a competitive analysis that identifies the strengths, weaknesses, opportunities and threats in each carrier's plans.
• The report includes a review of the leading chip set providers that are developing the 4G SoCs that will enable next-generation mobile internet devices.
• Examples of new 4G-enabled consumer electronics are shown, from laptops with embedded transceivers to 4G handsets, MIDs and personal hotspot modems.

The report is titled The Emerging 4G Wireless Landscape in the U.S. - Operators, Chip Sets, and Consumer Electronics. A free excerpt can be downloaded at www.digdia.com.

About DIGDIA

Digdia helps companies find growth opportunities, create winning strategies & business plans in the digital entertainment value chain. Services include strategic consulting and market analysis with a balanced business & technical perspective.