Mobile World Congress: Yawn, Says ThinkEquity

They came, they saw, they launched solar-powered handsets, but by and large Mobile World Congress 2009 was a bit ... underwhelming. Especially when it came to smartphone and 3G developments. And LTE? Don’t even start. Well, so says research firm ThinkEquity on the last day of the world’s largest communications event.

“GSMA's Mobile World Congress has largely paralleled the economy: uninspiring developments across the industry, with a few rays of sunshine around advanced messaging and femtocells,” reads a ThinkEquity brief circulated on Thursday. “We expect advanced messaging and femtocells to start making some impact on the industry value chain in second half, with a much bigger impact in 2010. Meanwhile, the smartphone market and 3G sales specifically are off to a very slow start for 2009.”

The biggest news from the show was probably Verizon Wireless’ award of big infrastructure contracts to major OEMs for LTE, which left ThinkEquity analysts yawning: “[These awards are for] products [that are] far from proven technology, for an LTE [standard that is] far from complete, although we are intrigued by the selection of Starent Networks as a leading vendor.”

In fact, the firm doubts whether Verizon’s stated mass deployment plans even hold water: “With a mere 20-some-odd megahertz of spectrum to serve an 80+ million subscriber base, we view the ultimate 700MHz LTE deployment as either very dense (and hard to deploy and manage), or hopelessly insufficient for the subscriber base. Alternately, the service could be priced extravagantly to limit subscriber uptake. We suspect that a workable deployment model for limited spectrum in the robustly propagating 700MHz range will be long in development.”

Meanwhile, roaming revenue will decline this year as consumers and businesses make do with less travel, pushing carriers to look to new revenue streams, like advanced messaging.

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