Interview with CDG executive director: CDMA global market has huge growth potential
Earlier this month, the Korean telecommunications market showed an interesting sign of development. According to the CDMA Development Group (CDG) report, LG Telecom's latest CDMA2000 1x EV-DO version A data service is booming in the Korean wireless service market, and its 3G data service "OZ" ("Opening Zone") adds new data users every month About 100,000. Compared with the previous quarter, the data ARPU value of OZ services increased by about 14%. As of the end of July, the total number of OZ users has reached 287,000. Since its launch in April 2008, OZ has developed a strong momentum by providing Korean consumers with full-featured mobile phones that have the advantages of a powerful wireless broadband data service. OZ services include open Internet browsing and unlimited high-speed data downloads, all at a fixed rate. Before the end of this year, LG Telecom will launch more than 10 mobile phones supporting OZ service, further expanding its OZ service content.
A reporter from the Indian CIOL website recently interviewed CDG executive director Perry Lafarge to learn about the success of version A, the current status of CDMA development in the world, the level of ARPU in various places, etc. Market views. The following is an excerpt from this interview:
CIOL: Can you give a brief overview of the global market for CDMA?
Perry Lafarge (Lafarge): From a global perspective, CDMA is developing rapidly, and the industrial ecosystem is stable and strong. We are still updating the latest statistics. But as of the end of the second quarter of this year, CDMA users worldwide have exceeded 451 million, including 438 million CDMA2000 users.
In the past year, the user base of EV-DO has increased from 65 million to 91 million, with a compound annual growth rate of 40%. Since the beginning of 2007, the number of commercial EV-DO version A networks has also increased from 3 to 43, and another 35 networks are also being deployed.
CDMA is still the dominant technology in North America. Among them, India, Indonesia and other Asian countries have the fastest growth in the number of CDMA users. In addition, the recent reorganization of China's telecommunications industry has also provided huge development opportunities through China Telecom's CDMA network.
CIOL: What services will version A provide for the Korean and global markets?
Lafarge: LG Telecom has launched a fixed rate "OZ" mobile broadband service supported by version A. This service became very popular once it was launched. Since April 2008, more than 100,000 new users have been added every month.
The connectivity supported by version A opens a new wireless service platform for global operators, including user-generated content / social networks, broadcast TV / multicast, mobile commerce, push-to-X, mobile advertising, and enterprise productivity applications And public safety systems.
CIOL: What do you think of the prospects for CDMA development in India?
Lafarge: We see that CDMA development opportunities in India are very good, especially when mobile broadband EV-DO services are widely used. The new 3G band policy allows CDMA operators to use the 2 × 1.25 MHz 3G band in the 800 MHz band. This policy is a welcome first step in the development of CDMA to achieve its goals.
CIOL: What is CDG's comment on India's 3G frequency band policy?
Lafarge: We welcome the Ministry of Telecommunications India ’s announcement of the introduction of the 3G service band guidance and congratulate the Ministry of Telecommunications of India for opening the 450 MHz and 1900 MHz IMT-2000 bands for 3G services after the 2100 MHz band.
Although 450 MHz and 1900 MHz bands currently do not have available frequency bands, we believe that in order to ensure an equal competitive environment with GSM operators, such bands will soon be auctioned.
Just as the competitiveness of CDMA2000 1x has driven the rapid popularity of phones in India, we believe EV-DO will continue to play its role in pushing the country's Internet penetration rate to a new level.
CDG agrees with the recommended principle of effective use of frequency bands, which guarantees the neutrality of technology and services, and allocates 3G frequency bands by bidding at a reserve price to establish a fair competitive environment.
CIOL: What do you think of the development prospects of CDMA in China?
Lafarge: We saw that CDMA has huge development opportunities in China, and began to work closely with CDG member China Telecom, because China Telecom acquired the CDMA assets of China Unicom.
China's largest fixed-line operator is committed to expanding CDMA2000 services and bundling these services with its telecom portfolio products, which will certainly increase the chances of CDMA's success in China. We also look forward to seeing China Telecom introduce more new mobile broadband services supported by version A into China.
CIOL: Do you think global operators can really solve the problem of ARPU?
Lafarge: Judging from the recently released data for the second quarter, the ARPU value of most leading CDMA2000 operators shows a comprehensive growth trend, and the main factor driving this growth is the ARPU value of wireless data.
* In the US, Verizon Wireless and Sprint Nextel have just announced that their wireless data ARPU value has increased in the second quarter of 2008. Verizon's total data ARPU value reached $ 12.58, accounting for 24.41% of the total ARPU value, with a compound annual growth rate of 31.3%. The ARPU value created by Sprint's CDMA2000 users increased by 21% compared with the same period last year at US $ 14, accounting for 21.43% of the total ARPU value.
* In Japan, the wireless data ARPU value of KDDI continues to remain above $ 20. Since LG Telecom launched version A, its ARPU has increased by 18%.
* In Europe and Russia, the ARPU value of CDMA450 operators exceeds US $ 50. For example, the current ARPU value of Telefonica O2 non-SMS data accounts for 43% of the total ARPU value in the Czech Republic.
Since the launch of EV-DO, Russian operator Skylink's profits from high-speed broadband data services have increased from 7% to 35%. In less than two years, version A helped Nordisk Mobiltelefon, a Norwegian operator, to obtain a 100% return on investment, although its number of users was only 100,000.
* In Latin America, in Puerto Rico, Centennial's version A network has an ARPU of US $ 65, which is one of the highest values ​​in the region's market. The average ARPU of other competitors is about US $ 50. Data revenue is a key factor driving Centennial's competitive advantage. The current data revenue is about $ 7.50 per user per month, and this number is still growing.
* In Africa, Starcomm ’s version A users have created an ARPU value of over US $ 80 in Nigeria, which is more than three times the average voice and data revenue of US $ 24.25 created by ordinary users.
Obviously, technologies such as EV-DO version A and HSPA are helping operators achieve their expectations for 3G, including the increase in wireless data ARPU. CDMA2000 has broken through the challenges brought by the ARPU value and is gradually realizing the industry's expectations for 3G.
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