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Mobiles to get smarter

Feature-rich phones will replace vanilla handsets by 2007

There's good news for mobile operators hoping to cash in by selling customers data services dependent on next-generation smartphones and technology. A report by PC Analysys says that in the next five years there could be as many as 278mn 'feature' phones in circulation in western Europe.

The Analysys report predicts that even by the end of 2003 millions of us will have ditched our vanilla mobiles in favour of smartphones capable of accessing data services over GPRS (general packet radio service) networks.

This is just what UK operators want to hear, as all are investing heavily in tempting customers to spend on data services. Orange has recently launched the Microsoft Smartphone-powered SPV; Vodafone, has its Live service, which relies on feature-packed phones to download the games and images on offer and T-Mobile has signed a deal with Sony Pictures to offer movies to mobile users.

The report says operators are backing a winner by pushing such services. "Sales of these new devices could stimulate demand in the mobile industry by reversing declining average revenue per user, renewing sales growth for operators and encouraging new equipment sales for vendors".

It goes on to say that many of the features found on smartphones today, such as Java gaming, picture messaging, digital cameras, digital music and polyphonic ringtones will become standard by 2007. The aim is undoubtedly to encourage users to mimic their use of text messages in more expensive pictures and, eventually, video messaging.

But ,i>PC Advisor can think of a couple of barriers that may stand in their way. Firstly, the cost of the handsets. Smartphones cost an average of £200, which is a lot to pay when you consider it’s possible to pick up a phone for free with some contracts. Secondly, text messages are around 10 or 12p, while picture messages on the Vodafone Live service cost from 36p.

The report claims the introduction of new devices will make data services more attractive, weaning users off voice services and on to more profitable data-based ones. "We are finally seeing the kinds of devices that really enhance the desirability of non-voice services", says Julie Robson, the report's author.

If the anticipated revenues are to be believed it seems the operators’ faith in our desire to swap text for images is well-founded. The report forecasts that mobile data revenues in western Europe will increase from €14bn in 2002 to €45bn by 2007, making up 33 percent of total mobile data revenue. They currently represent just 14 percent.

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