A MOBILE MARKET

Gibraltar has become a community of mobile phone-users anci with sales doubling annually since the first handsets were introduced almost a decade ago, the market must be close to reaching saturation point. Walk down Main Street and count the number of locals either talking into or listening to the gadgets. The figure will surprise you. My own spot check earlier this month showed that — di.sregarding gawping tourists and grannies pushing prams — one in three were using their mobiles, while among a group of school children to whom I spoke,four out of five had their own handsets.

Since the first generation of bulky and rather clumsy affairs went on sale, mobiles have proved a phe nomenal success story, while the ancillary text-messaging has cre ated a "new" written language some of whose abbreviations and usage has already found its way into the latest edition of the Oxford dictionary - the "bible" of serious lexicographers. And public famili arity with second generation mo biles and the hype surrounding the sale of third generation (3G) li cences contributed significantly to the telecoms/ dot.com boom which peaked in 1999 — and whose col lapse led to massive falls in share prices on the world'sstock markets.

Though the first of Britain's 3G mobiles went on sale at the begin ning of March,they will not be com ing to Gibraltar, Lucio Randall of Gibtele.com tells me.And this is not only because the price of handsets is probably too steep for the aver age Gibraltarian but because the system has yet to prove itself. How ever, the latest second generation phones have become so sophisti cated that they already provide many of the services which were promised for the 3G models!

When Britain's 3G mobiles hit the market they confirmed earlier speculation about their likely cost£399 for each hand-set... and that's before tlie cost of calls! And so far sales have been minimal, with all signs pointing to a repetition of Ja pan's woeful 3G experience. When the new "hear-it-all, see-it-all" mo bile phones went on sale in Tokyo 18 months ago they generally were welcomed with all the enthusiasm of an injured gazelle for an ap proaching lion or hyena.

Bought mainly by Japanese gadget freaks and wannabe corpo rate executives, only slightly more than a third of manufacturers'fore cast sales of handsets have been achieved, according to a recent news report from Tokyo.

T-Mobile the mobile arm of Hutchinsons, one of the four Brit ish licence holders who lashed out a whopping £22 billion in the eu phoria thatsurrounded the dotcom boom, has been the first to test the UK market—forced to do so by the need to recoup some of the massive investment the company has al ready made not only on its licence but in research and setting up the network of new transmission masts and other infrastructure the 3G phone system needs.

The three other players Vodafone, Orange and mm02 have punted these in major sales and marketing drives. And this seems to have worked.

In January British mobile users downloaded 524 million Internet pages to their phones, an increase of more than a quarter on the pre vious month as sales of new hand sets and marketing of services in-

In January British mobile users downloaded 524 million Internet pages to their phones are not yet ready to launch and are waiting for the initial glitches to be sorted out before they take the plunge which will be towards the end of this year or "some time in 2004", according to sources at Or ange.

Other than the cost of the new handsets, the progress which has been made in second generation mobiles seems likely to curb sales.

Anxious to increa.se their earn ings from non-voice services. Or ange and Vodafone particularly creased interest in cell-phone surf ing. The rise also boosted the sale over Christmas of hundreds of thousands of new phones geared to make mobile gaming and Internet access simpler.

With so much trivia available from the existing, comparatively cheaper systems, it is unlikely that the punters will be queuing up to splash out£400 for 3G handsets. In fact, the sanity that has gradually returned to the stockmarkets in the wake of the dot.com high-tech col lapse, has hit the mobile phone sec tor hard — with Vodafone a major casualty.

"It is less than three years since Vodafone - then the darling of in vestment advisors and fund man agers — announced its $183 billion bid for the German giant Mannesmann in its drive to capture pan-European coverage and thus dominance of the mobile phone market.

Mannesmann owned D2 and Omnitel, mobile franchises which offered a leading position in Ger many and a substantial proportion of the Italian market," according to a recent reportin the Spanish press.

But any investor who bought Vodafone shares, carried along by the hype surrounding the deal, will have taken a hammering.Today the whole Vodafone group is valued at only £75 billion, only two-thirds of the value of shares offered for Mamiesmarm in November 1999.

However, on the credit side if Vodafone paid for the deal in shares, not cash, and proceeded to sell a raft of Mannesmann assets for cash — improving its balance sheet at a time when other telecoms com panies were burdening themselves with debt to pay for their 3G li cences. It also disposed of Orange to France Telecom for around £20 billion, and although Orange con tinues to expand its UK market share, the Vodafone deal has brought the French company dan gerously close to bankruptcy... While,locally,Gibtele.com continues to prosper and we continue to use our mobiles, second generation though they may be!