Costly handsets stall Europe's 3G takeup

While the picture is looking bleak for 3G take-up across Europe, the UK is forging ahead with adoption.

A new report from analyst house Forrester predicts that 3G take-up will languish in the doldrums in Europe until around 2010, when some 60 per cent of the continent's citizens will be using third-generation phones.

Until then, GPRS will remain the dominant technology. According to Niek van Veen, the report's author, the extra cost needed to subsidise 3G phones in place of 2G will put operators off converting their entire portfolio to third-generation mobiles.

Van Veen said that natural churn will help to boost the spread of 3G, however. "The average European changes their handset every two years. A person who bought a phone this Christmas probably bought a GPRS phone. That same person buying a phone in two years' time is more likely to buy one that's UMTS [one flavour of 3G]."

The UK, alongside Italy, has got the drop on other European countries when it comes to 3G take-up. Europe is set to reach around 61 per cent 3G take-up in 2010, while the UK will notch up 68 per cent.

Forrester puts the UK and Italy's higher adoption down to the presence of the operator 3 -- the first to offer 3G services -- in the market and to the fact older operators were forced to react to 3's appearance with their own 3G offerings.

However, the UK also has a taste for using phones as status symbols, helping to boost the spread of 3G. Van Veen said: "In the UK, people like fancy phones and they like having the latest stuff. The UK leads in adopting advanced services."

Mobile Internet services, however, are not expected to feel the benefit of faster-speed mobile connections. Forrester believes just 21 per cent of Europeans now use mobile Internet services on a regular basis -- and that figure will plateau at around 50 per cent by the end of the decade.