Worldwide Wireless Penetration to Hit 24 Percent in '05 According to In-Stat; China Rises to Top.

Business Editors/High-Tech Writers

SCOTTSDALE, Ariz.--(BUSINESS WIRE)--June 4, 2001

The next five years will see dramatic wireless subscriber growth, with the worldwide penetration rate reaching 24 percent in 2005, according to Cahners In-Stat Group (http://www.instat.com).

The high-tech market research firm anticipates that this continued growth will be marked by the long awaited surge by China into first place, with the country passing the United States in wireless subscribers during the third quarter of this year.

"This five-year forecast period will harbor a number of changes for the industry. The most significant is the roll that will be played by 3G. Today's massive investments that are required to deploy 3G infrastructure will not yield significant subscriber revenue to offset the short-term expenditures," said Ray Jodoin, principal analyst for In-Stat's Wireless Technology and Infrastructure Group.

According to In-Stat, virtually all 3G service providers will not see a return to profitability until well after 2005, leading to serious conflicts between the need to maintain profitable 2.5G service, and the desire to rapidly add to the 3G subscriber base. Despite this, subscriber growth continues at an unabated rate, and services, not specific technology, will continue to drive the growth.

In-Stat has also found that:

-- GSM will leap into second place among air link technologies in the Americas.


-- ROW (Rest of World) will achieve rapid dominance in the mobile marketplace.
This may lead to large shifts in the manufacturing "balance-of-power" for
infrastructure as well as handsets.

-- The Americas will have a combined CAGR (Compound Annual Growth Rate) over
the forecast period of 14.5 percentage points. Canada will lead the growth,
followed by CALA (Caribbean and Latin America) and the United States.

-- Europe will have a combined CAGR over the forecast period of 5.8 percentage
points. Russia will lead the growth, followed by Eastern Europe and Western
Europe.

The report, "China. The sleeping dragon arises. '01-'05 Worldwide Wireless Subscriber Forecast" (No. GW0107SU), provides worldwide, regional and country-specific forecasts for cellular subscribers.

To purchase this report, or for more information, please visit http://www.instat.com/catalog/cat-cw.htm#gw0107su or contact Matt Woods at 617/630-2139; [e-mail]. The report price is $3,695 USD.

Cahners In-Stat Group (http://www.instat.com/) covers the full spectrum of digital communications research from vendor to end-user, providing the analysis and perspective that allows technology vendors and service providers worldwide to make more informed business decisions.

In-Stat is a unit of Cahners Business Information (www.cahners.com), a leading provider of critical information and marketing solutions to business professionals and a member of the Reed Elsevier plc group.