Communications and Technology Industry Research

ABI Research (News - Alert) forecasts that cellular modems sales may top $22 billion by 2013.

 

The reduction in the price of mobile broadband connectivity poses a threat to cellular modem sales. This threat apparently hasn’t been fully realized yet, though; according to forecasts from ABI Research, cellular modem sales are on track to top $22 billion by 2013.

 

Cellular network connectivity is achieved using either a cellular modem or an embedded modem, also called a Mini Card, that’s internal to a computing device. PC Cards and Express Cards provide access for laptop computers. External, USB-connected modems can also be used for connectivity on both portable devices and on desktop computers.

 

Third-generation (3G) cellular network coverage, combined with lower mobile broadband costs, helped the cellular modem market expand more than 300 percent in 2007 compared with 2006, ABI reported.

 

The market environment for cellular modem providers has changed dramatically, ABI added — the result of an expanding and increasingly competitive mobile ecosystem that is increasingly inter-connected. New mobile technologies, applications and services are expanding the market. This, combined with the mobilization of desktop applications and services is creating more competition and providing more choice for the mobile customer.

 

ABI Research's study, "Cellular Modems and Mobile Broadband Connectivity" provides a comprehensive overview of the market for cellular modems.

 

The report examined how changes in the market are creating both opportunities and challenges for value chain participants, chipset manufacturers, wireless operators and products of modems, laptops and client software.

 

ABI Research analyst Dan Shey (News - Alert) said customers want the fastest and most convenient devices. PC Cards and USB modems are far more convenient and faster than phones for broadband connectivity.

 

“Any operator can drop the price for mobile broadband using the phone as the modem, which is more amenable to a broad customer base regardless of world region,” Shey said.  “But the questions remain: how will this pricing change detract from use of the phone for other revenue-generating services? Does it perpetuate the perception of the operator as the 'dumb pipe'?”