The Deployment of Third-Generation Mobile Services: A Multinational Analysis of Contributing Factors

Successful diffusion of 3G mobile is necessary for the provision of many advanced applications via the mobile platform such as mobile broadband Internet and video. The current deployment of 3G services is significantly more developed in some countries than others. Through a regression analysis of 106 observations, this study examines the factors affecting such differences. It was found that multiple standardization policy, lower level of 1G and 2G penetration, and a higher level of income contribute to the diffusion of 3G mobile. The Deployment of Third-Generation Mobile Services 2 The world of telecommunications has changed rapidly as we enter the era of convergence between wireless networks, broadband communication, and the content sector. Demands for advanced services such as mobile broadband Internet and mobile video have increased tremendously in recent years and been touted as the driver for the continuous growth of the telecommunications industry (Tellabs, 2009). In fact, such bandwidth consuming mobile ventures are often regarded as a means of paying off the hefty license fees for many third generation (3G) mobile service providers (Ponsford, 2006). In essence, as the mobile voice services become commoditized with increasing price competition, new data services made possible by the 3G networks are critical in generating profit and growth. Mobile network or service based on the International Mobile Telecommunication-2000 (IMT-2000) family of global standards is commonly referred to as “3G mobile” (ITU, 2003b). These mobile systems provide higher transmission rates than possible in second generation wireless technologies, supporting data transport rates of at least 144 kbit/s for all radio environments and 2 Mbit/s in lowmobility and indoor environments (ITU, 2003b; Shelanski, 2003). The 3G mobile systems enable many advanced applications such as mobile videoconferencing, video phone/mail, mobile TV/Video player, and digital audio/video delivery (Xavier, 2001; ITU, 2001). Thus, the true provision of video communication, information, and entertainment via the mobile platform will be impossible without the successful diffusion of 3G services. In addition, industry analysts have increasingly concluded that mobile broadband will soon become the standard of accessing the Internet in most countries (3g.co.uk, 2008). Nevertheless, without established 3G networks, the anticipated growth in mobile broadband data services would be unattainable. The Deployment of Third-Generation Mobile Services 3 From a global perspective, the deployment of 3G mobile services is significantly more advanced in some countries than others. At the end of 2007, there were 3.35 billion mobile subscribers throughout the world (ITU, 2008). It was estimated that mobile broadband handset users will grow from 158 million in 2008 to over 1.8 billion in 2014, with most increase coming from emerging countries such as China and India (CellularNews, 2009). In spite of the rapid growth of 3G and even 4G services in a select number of countries, many countries are still in the early stages of 3G mobile deployment. According to the latest International Telecommunication Union (ITU) penetration data (December 2006), Korea, Italy, and Japan are the leading 3G mobile economies among ITU member countries (ITU, 2006). What factors contribute to the differential deployment rates of 3G mobile services among countries? As important as these factors are in affecting the next phase of mobile technology development, consumer access to advanced mobile broadband and video services, and the eventual convergence between the mobile platform and other mass media content distribution systems, little empirical studies have addressed the political, economic, market, and consumer issues that might play a role in the diffusion of 3G mobile services. Through a statistical analysis of approximately 106 observations, this study attempts to explore the influential factors of global 3G mobile deployment, examining various policy, industry, consumer, and technology issues for their contribution to 3G mobile deployment.