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3G's future looks a little rosier

Peer-to-peer services will be crucial to rollout

The future of 3G (third generation) technologies still remains uncertain, with many unsure what its killer application will be or even when we can expect wide rollout of such services, but despite this most Europeans are still positive about its launch according to a new report.

The report, released today by analysts at research group The Thinking Box, predicts that peer-to-peer services will drive initial demand for 3G, including applications such as MMS (multimedia messaging) and video calls.

"Applications built on self-generating content will meet instant success," says the report.

Such services will, however, rely on paid-for content, something which users have, up until now, been reluctant to purchase, an attitude which operators will have to work hard to change.

But back in August, a report from analysts at Datamonitor urged mobile operators to abandon their plans for 3G networks.

"Within the next 12 months some licence holders may shelve 3G aspirations, possibly having to treat the cost of licences as a write-down," said the report's author, analyst Nick Greenway.

"Give it away now — there's more sense in abandoning the market altogether than rolling out a service on top of giant sunk costs," added Greenway. In other words, don't throw away good money after bad.

Today's report is more positive, estimating that 3G will reach 50 percent of European mobile users by 2007 and within five years average revenue per user will have increased by 50 percent.

According to Thinking Box, text messaging will be a thing of the past making way for MIM (mobile instant messaging. This is similar to PC-based messaging systems such as AOL's and Microsoft's instant messagers but on mobile phones.

This is certainly the way operators and Microsoft see the market going, as the launch of the Orange SPV smart phone (pictured) last week illustrates.

Mobile phone operator Nokia will release its first 3G handset in the UK at the beginning of next year.

A full copy of the report can be purchased here.

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