There are some early signs that mobile operators are changing their business models. This would, after ten years of hype, finally produce a breakthrough in the use of mobile services.

Over the last decade the vendors and mobile operators have continually bombarded the market with announcements about their fabulous mobile data products and services. But the reality is that, apart from Japan and Korea, no mass markets have been developed for mobile data, beyond SMS. Only ringtones and wallpaper can claim some victories, with music following at a distance. In the business market we have seen a recent spurt in the uptake of mobile email, and this is set to continue, independently of the mass market business models.

Looking at Japan, last year I reported that most people there are using mobile email – including Instant Messaging - outstripping voice calls and SMS. Although the difference in culture most certainly plays a role in this there is no doubt in my mind that a change in business model, introducing flat rate mobile data, will produce a cannibalisation of the very lucrative voice call and SMS markets in other countries.

The mobile services market is driven by cost. In markets where prepaid is significantly cheaper than postpaid, more than 80% of the market moves to prepaid; where mobile calls in bucket prices are cheaper than fixed calls we see the same trend. SMS is cheaper than mobile calls, and this speaks for itself. So if mobile email were to become cheaper than voice and SMS, one can guess what would happen – perhaps not in the overall market, but most certainly in the all-important ‘youth’ market.

I am sure that this makes many mobile operators very nervous. I believe this is the reason only a few operators have developed mass market wireless broadband products and, to be honest, despite the messages from some of the leading HSPA suppliers, I can’t see a rapid turnaround.

Eventually of course, operators will have to embrace enhanced mobile messaging services that will replace SMS. In a converged world, SMS is clearly a legacy telco-only service, and true integration into social community sites and other messaging services is only possible if other messaging alternatives are considered. Mobile operators will simply be left behind if they don’t embrace non-SMS messaging.

In Japan it was ultimately the competition that forced the market in the direction of mobile email, and that is where I believe we will see the initial development of HSPA as well. Only in countries where there is a robust level of mobile competition will we see operators positioning themselves in this wireless broadband market. And if they are successful, then, over time, the other operators will have to follow.