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3G has reached 1 billion subscribers. What can we expect going forward?

2010 will be remembered as the tipping point for 3G. According to Wireless Intelligence, global 3G connections crossed the 1 billion mark in mid-March. 3G subscriptions grew more than 30% year over year (YoY) in 2009, largely due to rising demand for smartphones and uptake of mobile broadband. By 2014, Wireless Intelligence, estimates that the number of 3G connections will grow to approximately 2.8B or nearly 42% of the total subscribers in the world.

Moving forward, 3G will contribute more net additions and data revenues to operators than 2G. In 2010 alone, analysts estimate that 3G will make up more than 55% of net additions. In terms of revenues, carriers in developed markets have already started to reap the rewards from their 3G network investments as data revenues have consistently shown strong growth. Three of the world’s largest operators, AT&T, Vodafone and Verizon Wireless have all reported greater than 25% YoY growth in data revenues.

It is expected that emerging countries will play an increasing role in the growth of 3G moving through this decade, with China, India and Brazil leading the way. In 2009, shortly after obtaining 3G spectrum licenses from China’s Ministry of Industry and Information Technology (MIIT), China Mobile, China Telecom and China Unicom invested a total of US$23.6B to build out 3G networks in China. According to MIIT, Chinese 3G users are expected to grow from 15M to 60M in 2010.

India is the next hot bed as a 3G license auction is set to start shortly. In Latin America, the number of 3G networks has grown significantly over the last few years with approximately 65 offering 3G services today. And in Brazil, TIM Brasil is targeting to expand its 3G network to 60% of the population by 2012 from 30% at end of 2009 (source: Telegeography database).

3G is here in a big way. As impressive as the 1B 3G subscribers milestone is, all signs indicate that there will be a tremendous amount of growth in the years to come, with continued innovations throughout the thriving ecosytem. The mobile phone, and 3G in particular, is set to change the way we live, learn, work and play. Stay tuned as we will explore some of the key trends and innovations in the coming months.

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