2012 is the year of 4G

4G LTE devices are apparently so hot this year, Sprint is selling LTE phones without a network to support them. Sales of 4G-equipped smartphones, tablets, portable hotspots and other devices are set to explode in 2012 as carriers continue to expand 4G coverage and roll out new networks. In a recent report, market research firm ABI Research said that 4G device sales will balloon nearly 300% to 87 million units in 2012. ABI notes that higher prices are still a barrier to 4G devices in some regions, however, and consumer confusion is an issue as well. “As evidenced by the Australian iPad 3 promotion fiasco, when iPad 3s were being promoted as being ‘LTE-ready,’ even though the modem is unable to access the Australian LTE spectrum band, the number of LTE spectrum bands will hamper initial pricing and product roll-out,” ABI analyst Philip Solis said. “Nevertheless, in addition to 61 million 4G handsets being shipped in 2012, we estimate 26 million 4G non-handset products will be shipped. In the short-term, most of that will reflect customers purchasing USB dongles for legacy laptops and netbooks, followed by customer premise equipment, or home modem, purchases.” ABI’s press release follows below.

87 Million 4G Devices to Ship in 2012

SINGAPORE – April 19, 2012

4G subscriber adoption is primed to take off in 2012 as a range of 4G-enabled mobile devices, from USB dongles, smartphones, tablets, 4G portable hotspots, and wireless broadband CPE modems, are shipping from assembly line to retail stores. “4G devices are expected to generate 87 million in unit sales in 2012, up 294% year-on-year,” states Jake Saunders, vice president of forecasting. “The lion’s share of the market is now backing LTE as service provider and vendor support has fallen away from WiMAX.” Observing the success of 3G cellular services, it is clear there is a natural evolutionary demand from end-users, both business and consumer, to jump onto the 4G data bandwagon. However, there are still some teething issues that will need to be worked through.

Some operators in Western Europe have stated that while customers do recognize 4G offers higher speeds, they are not necessarily signing up in droves, as many of them are not prepared to pay the premium for 4G handsets and 4G tariffs. “High definition,” from video streaming to richer, more interactive/immersive social networking and gaming experiences, should coax 3G customers to migrate to 4G. Furthermore, mobile device vendors are experiencing intense competitive pressure, which is expected to bring down LTE handset prices, estimated at 10 to 20 percent over the next two years.

“As evidenced by the Australian iPad 3 promotion fiasco, when iPad 3s were being promoted as being ‘LTE-ready,’ even though the modem is unable to access the Australian LTE spectrum band, the number of LTE spectrum bands will hamper initial pricing and product roll-out,” comments Philip Solis, research director, mobile devices. “Nevertheless, in addition to 61 million 4G handsets being shipped in 2012, we estimate 26 million 4G non-handset products will be shipped. In the short-term, most of that will reflect customers purchasing USB dongles for legacy laptops and netbooks, followed by customer premise equipment, or home modem, purchases.”

ABI Research’s “4G Subscriber, Device, and Networks Market Data” contains regional and selected country-level segmentation for the 4G market.

It is part of the firm’s 4G Research Service.

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