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Mobile services trend

Posted on: Thursday, 25 March 2004, 06:00 CST

SIEMENS Information and Communication Mobile (Siemens mobile) expects a mass market shift from voice-driven service to mobile services this year.

Rudi Lamprecht, member of the managing board of Siemens AG and president of the board of Siemens mobile, foresees multimedia messaging service (MMS) taking off by the second half of the year, with 20 per cent of the short messaging service (SMS) volume to be replaced by MMS.

The percentage of MMS-enabled phones of the total phone sales will double from 25 per cent to 50 per cent this year, he says.

As of this year, all new Siemens mobile phones will be MMS- enabled, including its entry-level phones. In the last four to five weeks, five MMS phones were introduced into the market.

MARKET SHARE

Siemens will be introducing 30 new mobile phones this year. The company plans to address pricing pressure by introducing new phones and covering more market segments.

The mobile communication arm currently has 9.8 per cent of the global market share (as of fourth quarter 2003), climbing from 8.2 per cent the previous year. It is still in fourth position behind Nokia, Motorola and Samsung, though it is gaining on the latter which has 10 per cent share of the market. Lamprecht claims it is not too concerned about what competitors are doing.

"The consumers determine the market share and therefore, we need to have the best products," Lamprecht says.

There are questions whether handset markets are becoming more commoditised and whether high-end or low-end phones are driving the market.

Lamprecht says the different market segments have to be approached accordingly.

He adds that the low-end phones in emerging markets have a higher volume potential and Siemens is addressing it.

Concerning the Asian market, Lamprecht says almost 20 per cent of the company's total business is done in Asia. It is increasing its research and development (R&D), and manufacturing capacity in Asia, with most of its phones designed in China.

GROWTH DRIVER

The introduction of new mobile services such as Push-to-Talk is expected to be a major growth driver.

"These services are made possible by the convergence of mobile and fixed-line networks, new devices supporting new services and new powerful infrastructure based on Edge (enhanced data rates for global evolution) or 3G (third-generation) technology," Lamprecht told Business Computing at CeBIT in Hanover, Germany, last week.

Predicting that mobile phone users will go from 1.3 billion today to two billion in 2010, Siemens mobile certainly intends to grow its business above the market average.

The German company sees the network market growing by up to five per cent this year, and global handset sales to increase by 10 per cent.

"We are gaining market share in the network market because to a large extent, this growth stems from investments in 3G networks," Lamprecht says. "Out of the 15 3G networks worldwide, nine were built by Siemens in co-operation with NEC."

He also notes that Edge is a very interesting technological development, and that Siemens is well positioned in this area with many network rollouts in place.

PUSH-TO-TALK

Siemens mobile is particularly excited about its new Push-to- Talk service, which allows mobile phones to be used like walkie- talkies.

With a push of a button, a user can talk to a particular person or group without having to dial numbers.

Lamprecht informs that Siemens has eight Push-to-Talk trial networks running and its first enabled handset, the CX65 was shown at CeBIT. "There is great development in this area as it basically opens up new revenue streams for providers," he says.

Siemens, Motorola and Ericsson recently announced the first joint interoperability tests for Push-to-Talk over Cellular (PoC) technology.

The three parties, along with Sony Ericsson, have interoperable products and solutions on the cards for the second quarter of this year.

LATEST SIEMENS OFFERINGS

* The C65: A new mobile that offers MMS, an integrated camera, a 65,536- colour screen and an attachable flash.

* The CF62: New clamshell phone from Siemens. Equipped with two screens, including a 65,536-colour display, MMS and an attachable QuickPic camera.

* The M65: A tri-band GSM handset. Offers an integrated VGA video and photo camera, a large high-resolution colour display, and full MMS functionality. The phone also comes with improved resistance to water splashes, shock and dust.

* The CX65: Equipped with MMS and an integrated SVGA camera. Comes with an extra large screen with a high-quality 65,536-colour display.

* The S65: Comes with a full suite of business software, integrated 1.3- megapixel camera, extra large colour screen, and a beautiful silver finish.

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