3G laptops are overrated

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Laptop makers are rushing new models to market with integrated 3G broadband modems, despite analyst suggestions that the market neither wants or needs them.

The Disruptive Analysis report, Mobile Broadband Computing: Device Market Forecasts & Business Model Scenarios, predicted that while embedded mobile broadband will indeed overtake separate modems in the long term, short term demand will remain significantly below vendor expectations.

The report states that by 2014, there will be 150 million active users worldwide of notebooks and netbooks with embedded 3G broadband modems. In addition, around 100 million devices with built-in 3G modems will be shipped annually by 2014, though many will not be actively used with a 3G connection.

“Mobile-embedded notebooks are very elegant in concept, but suffer from practical and business-model limitations that will restrict their near-term growth, especially during a period of economic uncertainty when buyers will be especially conservative,” said Dean Bubley, the founder of Disruptive Analysis and the report’s author.

Bubley’s report stated that 2009 will be a difficult year for mobile broadband compared to the success the networks have enjoyed in 2008. Economic pressures combined with tougher credit checking will curtail sales of contract 3G dongle services, laptops and combined bundles as consumers reclassify broadband on the move as a nice-to-have rather than a necessity.

Long-term, monthly contracts will account for only 40 per cent of worldwide mobile broadband subscribers by the end of 2011.

A by-product of this will likely be that prices and service plans will change, reflecting growth in pay-as-you-go 3G data services. Bubley argues that so-called ‘free’ mobile broadband services, funded by advertising or co-branding, will emerge, mirroring what has happened in the Wi-Fi hotspot market.

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