Northstream's trends & challenges for a wireless 2003

Northstream's trends & challenges for a wireless 2003: A grown up industry - now it's time to make a living! STOCKHOLM - February 12, 2003 - After years of success, followed by a roller-coaster style hype and gloom, the wireless industry seems now to be adapting to the life of a regular industry with average margins. In its 2003 issue of the annual lookout "Wireless Top Trends & Challenges" leading wireless advisor Northstream, points out crucial trends and challenges on the road to sustainable wireless business. - After a number of dramatic years we now see a maturing mobile operator industry with lower margins facing the same challenges as any everyday industry, says Bengt Nordström, CEO of leading Wireless advisor Northstream. - The industry suffers from stagnation after a dramatic growth period over the last 10 years. But with a healthy base of users that generates $30 billion revenue in a global market with only 20 percent penetration, the future for the hardworking and clever service providers with carefully crafted strategies looks quite bright. The industry now has to act as a mature industry. The Northstream "to- do" list for the Wireless CEO includes: · Prepare for normal margins · Look inwards - improve logistics and organisation efficiency · Clean up portfolios and partnerships - consolidate further · Be bold - create new services and kill the unprofitable ones, all at a faster pace · Assure delivery of end-to-end solutions, that's how to keep customers Going forward, Northstream's list of trends and challenges include: Early lessons from MMS The market is still handset driven. So far the new terminals with colour screens, polyphonic sound and games have shown consumers that something new is being offered on the market. But while MMS terminals are certainly being promoted, there is a lack of attractive MMS services in a broad enough variety. With the right approach, reasonable efforts can very quickly make dramatic changes for the better. Changes to 3G markets The entry of 3G challengers with plenty of capacity will most likely lead to a price and marketing war. Northstream expects prices to come down faster and more drastically for 3G than it did when GSM was introduced. This change in the competitive situation is the most important factor for wireless operators during 2003 and could be the start of a bandwidth demand-spiral from consumers. 3G as a technology is less interesting than the answer to question; 'How can we make increased spending an enjoyable and useful exercise?' Gateway to 3G in distress GPRS has the potential to become the gateway to 3G and future growth for the wireless industry as it will expand end-user behavior to also include data. But the present embarrassing shortage of GPRS roaming unfortunately gives end-users a clear message that they cannot depend on wireless data services to be available when needed. Without efficient and broad scale roaming wireless data have a long way to success, so this must - and can - be changed. Outsourcing on a whole new level - terminal ODM players With the outsourcing of development as well as manufacturing to Original Design Manufacturing companies (ODM), the old value chain of the mobile terminal market goes up in smoke. - Operators are finding themselves in a position where they have easier access to customised and self-branded handsets, given that the cost and logistics challenges can be managed. We also see that traditional vendors will be challenged not only in the low cost range, but also in the high quality and high-end segments, says Bengt Nordström. Meet us in Cannes at the 3GSM World Congress, 17th-21st February 2003, Hall 2 stand F57 and Hospitality suite 301 or follow the event through live updates at www.northstream.se. About Northstream: Northstream provides strategic technology and business advice to the global wireless industry. Northstream has assembled a multinational team with some of the world's best experts and analysts on wireless communication business and technology. Northstream's list of clients include several of the world's leading operators and system suppliers, e.g. Vodafone, AT&T, NTT DoCoMo, Orange, Sonera, Telia, Mitsubishi, Ericsson, Nokia and Microsoft, as well as some of the leading investment banks and financial institutions. Northstream is established in Stockholm (Sweden), Sophia Antipolis (France) and Tokyo (Japan). For more information please visit us at: www.northstream.se For more information please contact: Tommy Ljunggren, Public Relations Manager Tel: + 46 705 91 00 64 press@northstream.se ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.waymaker.net/bitonline/2003/02/12/20030211BIT01220/wkr0001.doc http://www.waymaker.net/bitonline/2003/02/12/20030211BIT01220/wkr0002.pdf