U.S. Catches Up with Western Europe in 3G Mobile

By Gary Kim

One of the salient themes in U.S. communications policy is “the United States is falling behind” or the “the United States is far behind” arguments about service usage and adoption.

This refrain has been heard in the broadband access area, where it is access speed, access penetration or access price where the United States lags other nations. It once was said of U.S. mobile penetration as well as of mobile user propensity to communicate using text messaging.

One of the salient themes also is that, after a slow start, U.S. consumers “catch up” to usage patterns and service penetration typical of other nations in Western Europe, for example.

The latest example is use of third-generation broadband services, where U.S. usage has lagged that of Western Europe for some time. But comScore now reports that, after an 80-percent increase in 3G subscribers over the past year, U.S. 3G penetration now is on a par with Western Europe.

At the moment, at least 28.4 percent of American mobile subscribers have 3G devices compared to 28.3 percent in the largest countries in Europe. 

The change came only recently, as the number of U.S. subscribers with 3G-enabled devices has grown 80 percent to 64.2 million during the past year.

In part, that increase is due to better 3G network availability as well as marketing efforts to get 3G devices propagated into the user base.

The only individual major European countries exceeding the United States in 3G penetration rates now are Italy and Spain.

One might point to any number of reasons why some services (not all) take longer to reach mass acceptance in the U.S. market, compared to Western Europe, for example. In some cases, it is high tariffs that drive behavior, and U.S. rates for domestic calling are far lower than rates in Europe, given the higher percentage of European calls that are international.

Under such conditions, rational consumers will send text messages rather than place more-expensive phone calls. Where calls are inexpensive, there isn’t the same pressure to substitute texting for talking.

Transportation issues appear to make a difference as well. Western Europeans spend more time taking public transportation than many U.S. users do, leaving more “hands free” and “eyes free” time to communicate and interact with mobile handsets. U.S. commuters tend to spend more time driving, which obviously makes some forms of device interaction impossible, others merely difficult or unsafe.

At some level, there are network coverage issues as well. It simply takes longer to build out a continental-sized network than a network spanning a small country. Signal propagation also is easier in dense urban areas compared to less-dense areas more characteristic of most of North America, so in-building coverage issues are less an inhibitor of adoption.

There also are social factors at work as well. Consumers in Japan, Korea and parts of Europe spend more time out of the home than U.S. users do. That increases the value of a mobile phone.

Still, despite those differences, one wouldn’t notice huge differences in mobile penetration, text messaging or 3G device use at the moment. The point simply is that U.S. consumers sometimes do take longer to adopt innovations first seen elsewhere. That is not a predictor of permanent “disadvantage,” though.

There also are many cases of consumer electronics adoption that happen faster in the U.S. market, compared to others. PC ownership, at-home Internet use and cable TV are some examples where U.S. consumers adopted new services at a higher rate than users in other regions and
countries. IP