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iPhone Data Booms at T-Mobile

Dan Jones
LR Mobile News Analysis
Dan Jones, Mobile Editor
1/30/2008
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European carriers may not sell quite as many Apple Inc. (Nasdaq: AAPL) iPhones as AT&T Inc. (NYSE: T), but there's still a good reason to have them on the books, according to René Obermann, CEO of Deutsche Telekom AG (NYSE: DT). He says the device is driving up average wireless data usage as much as 30 times higher than on other phones.

The CEO revealed the data figures this week as the German carrier revealed key metrics around its T-Mobile International AG cellular operations in Europe and the U.S. In Germany, T-Mobile has sold 70,000 iPhones with contracts. (See T-Mobile Boasts Subscriber Growth.)

These phones are helping to drive up mobile data use for the operator, Obermann says. "iPhone customers retrieve weather reports, stock prices, and YouTube videos from the Internet on the go -- all as a matter of course.

"The average Internet usage for an iPhone customer is more than 100 MBytes. This is 30 times the use for our average contract-based consumer customers."

Note that Obermann doesn't specify if that is per month. Carriers, however, do generally measure users' data consumption on a monthly basis.

The ability to watch TV and download video and music on a phone can dramatically increase the volume of data that a mobile user burns through anyway, notes Unstrung Insider senior analyst Gabriel Brown with a personal example: "I used 100 MBytes in an hour and a half listening to Internet radio on my phone the other day."

Ramping up data usage rates is extremely important to Western European carriers since they need to replace voice revenues and find alternatives to text messaging, which is expected to reach saturation point over the next few years. (See Analysys Reports on Voice ARPU.)

Heavy Reading senior analyst Patrick Donegan suggests that such potential data increases may also be a reason for wireless carriers to re-examine their backhaul capabilities in the near future. (See T- Mobile Busts Backhaul Bottleneck.)

"Datapoints like this suggest that many operators are still underestimating the impact that data is going to have on their backhaul networks," says Donegan. "The ability to support these data volumes flexibly and cost effectively in the backhaul network is going to differentiate mobile carrier performance just as much as their ability to win over the end user market at the front end."

— Dan Jones, Site Editor, Unstrung

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