December 24, 2010

Deloitte released its forecast of top themes and trends for the telecommunications sector in 2011, and predicted that third-generation (3G) networks will continue to be the dominant wireless networking platform of choice throughout 2011 even as fourth-generation (4G) networks begin to proliferate in the market and demand for faster mobile data upload and download speeds continues to increase.

“While 4G networks will offer customers a substantially enhanced data experience, the reality is that 3G network technologies will continue to serve as the backbone for the majority of mobile data traffic for the next few years to come,” said Phil Asmundson, vice chairman and technology, media and telecommunications industry leader, Deloitte LLP. “As carriers look to leverage their current investments in 3G networks and still unutilized 3G spectrum, Deloitte believes the adoption of next-generation Long Term Evolution (LTE) wireless networks will be deployed in coordination with existing 3G networks to maximize overall return on investment and customer experience.”

Among Deloitte’s top telecommunications trends for 2011, highlights include:

Getting to 4G cheaply: will many carriers opt for 3.5G instead?

In 2011, the deployment of next generation Long Term Evolution (LTE) wireless networks will fall short of industry expectations due to the continuing viability of the latest third generation (3G) wireless technologies. Fewer than 30 LTE carriers in six countries are likely to offer commercial service by the end of 2011. The adoption of 4G might be slower than expected because some mobile providers have not fully utilized their existing 3G spectrum. Also, LTE, as it exists today, does not offer the quantum leap in speeds and features over 3G as experienced in previous generational upgrades.

Wi-Fi complements cellular broadband for “data on the move”

In 2011, the volume of data uploaded or downloaded from portable devices via public Wi-Fi networks will grow at a much faster rate (25 to 50 percent) than the volume carried over cellular broadband networks. Wi-Fi’s increasing share of the mobile device data load will likely have a ripple effect by slowing the growth rate of cellular broadband traffic, potentially helping improve margins for mobile providers’ data services. Cellular broadband will increasingly revolve around specific applications for users that can justify the cost premium by taking full advantage of the technology’s wide-area coverage, mobility, and integrated security.

What is “in store” for Wi-Fi: online comparison shopping on aisle 3

In 2011, 25 percent of North American big box and anchor tenant retailers are likely to begin offering free in-store Wi-Fi access to shoppers. In the past, retailers have resisted offering Wi-Fi access, fearing it would allow consumers to comparison shop using their smartphones or tablets. However, this fear may have been misguided. When shoppers do in-store online comparison shopping, preliminary and anecdotal evidence suggests they are more likely to purchase at that store, especially when an online search reveals that competitors’ prices are similar. In-store Wi-Fi can become a way to enhance the customer’s in-store experience and allow store employees to spend more time on service and sales, instead of responding to routine inquiries.

Video calling: the base goes mainstream, but usage remains niche

In 2011, video calling will be cheaper, better, and more widely available than ever; a boom in demand, however, is unlikely. While video calling continues to grow, the vast majority of business and consumer calls will remain purely voice-based; most callers do not yet perceive a need for video. Despite many recent innovations, video calls still cannot compete with the richness and depth of face-to-face meetings.

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