Wednesday, December 7, 2011

Is There a Killer App for LTE?

It has become the conventional wisdom that there is no "killer app" for fourth-generation mobile networks. Orange's LTE/EPC Program Director RĂ©mi Thomas says "LTE is not driven by a killer application, but it will essentially be driven by capacity needs," said Thomas. No Killer App for LTE

It might be more accurate to say there is, at present, no stand-out killer app for 4G networks. Some think if such an app is possible, it will emerge, rather than being "planned for." Killer app is a myth

But it would be odd, perhaps almost unprecedented, for 4G mobile networks to succeed wildly, which is what virtually everybody expects, without the emergence of some new qualitatively different experience or value driver. 

It might be more important to say that "nobody knows" what such qualitatively-new experiences will emerge. But some find say it is unlikely 4G will remain "3G but faster." Some might suspect that 4G will lead to new apps that we originally believed would happen on 3G networks. 

About a decade ago, when the first commercial 3G networks were introduced, there was much talk about innovation and new applications the networks would enable, and the list looked remarkably similar to what people claim will happen with 4G. 3G history

E-commerce apps, for example, were thought to be an important 3G innovation. That is claimed for 4G as well, with more conviction, perhaps. “The availability of 3G services is going to have a profound effect on electronic commerce,” it was said. 

That also is said of 4G. It was said that “3G works better” than 2G, and that was true. It also is said of 4G, and also is true. 

3G wireless was sometimes characterized as a wireless version of the Internet, encompassing Web browsing, e-mail and media downloads. That sounds like 4G as well.

Over time, though, a distinctive lead application does tend to develop, though it might take some time. Voice and texting were the lead apps for 2G, while Internet access and email have emerged as the "killer app" for 3G, it can be argued. 

Exactly how 4G products and services evolve is highly uncertain at this time and very similar to when wireless operators first deployed 3G networks, Fitch Ratings has argued. 

For 3G networks, the industry did not offer a good view of this until smart phones, in particular the iPhone and other similarly oriented devices, drove significant consumer uptake for broadband data, as opposed to the earlier growth provided by 2G email services.

Longer term, Fitch expects the majority of operators should achieve data device penetration rates of at least 70 percent to 80 percent. If so, mobile broadband will collectively represent the killer app for 3G. But what about 4G? Is it just "3G with more speed," or something else?

Fitch expects that 4G services will likewise be defined by innovative devices, perhaps tablet oriented, with new content applications, including video that will drive significantly increased demand for data. If so, 4G might ultimately be different from 3G in providing a platform for different types of end user experiences.

There is a line of thinking that the value of 4G might initially accrue in large part from significantly-lower the cost per-bit costs to provide mobile broadband. Verizon Wireless, for example, believes the cost to deliver a megabyte of data on 4G with LTE will be half to a third of the costs of a 3G network.

But if the 4G experience is anything like what we've seen with 3G, it might take years for the answer to be found. 

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