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Operators banking on MMS takeoff
By Pia Heikkila
LONDON, England (CNN) -- Mobile service providers in Europe are beefing up their packages to phone subscribers in an attempt to secure returns on multi-million dollar investments. The popularity of text messaging has given operators the confidence to tout multimedia messaging services (MMS) as the next killer application for wireless. But more than two years after a mad rush to secure "third-generation" operating licences, marketing departments are trying to convince customers that they need to upgrade their phones. Mobile networks and handset manufacturers want consumers to use the new services, including taking and sending pictures, games, chat and improved Internet access. They have invested heavily in new technology and as markets for mobile phones become saturated, they hope MMS will open some wallets. John Delaney, analyst at IT and telecommunication consultant Ovum, says the market is making significant steps towards the always-on wireless Internet. But he warns that consumers remain wary of the hype created by WAP (Wireless application protocol) two years ago. "People had over-inflated expectations about the wireless Internet because of the intense marketing of WAP, which never quite fulfilled its promise. The operators have to be careful this time in their attempts to restore the consumers' faith in mobile technologies." Delaney says customers may be frustrated by limitations on MMS working across different networks. "Consumers don't really care who provides the service as long as the technology they are using works." Operators are looking on the bright side. T-Mobile in Germany says more than 20,000 MMS subscribers have signed up in six months, while the UK's Vodafone says it has more than 30,000 subscribers for MMS alone. Vodafone, Europe's largest mobile operator, hopes its new service, Vodafone live!, will make access to Internet and wireless content easier for its customers via one colour icon-based menu. Vodafone has signed up about 30 content partners and expects more to join next year. The service, launched simultaneously in Germany, the Republic of Ireland, Italy, The Netherlands, Portugal, Spain, Sweden and the UK, can be accessed via handsets costing from about 350 euros. Existing customers hoping to access the service will need to upgrade their phones. In the UK, where most handset sales are heavily subsidised by mobile operators, new phone sales could mean a sharp increase in line rental contracts, either from renewals or new customers. Meanwhile Vodafone's main rival, Orange, has collaborated with Microsoft to make a wireless data access device for the UK called an SPV phone, which stands for sound, pictures and voice. Orange says it will provide fast Internet access to users anywhere, anytime. But customers wanting to buy the telephone must also take out an Orange line rental subscription. Change in the way we use phones is a slow process. Most models on the market today cannot handle multimedia. Orange is releasing just 70,000 of its new handsets to the market, but the company hopes sales will take off once the third generation network reaches its full coverage across Europe, said to be early next year. Nokia says demand for its 7650 multimedia phone, released earlier this year, is strong, but has not announced official sales figures.
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