Over the years, thanks to developments in the electronic communications market, Malta has experienced a revolutionary change. Technology convergence has not only changed and improved the way in which a business can operate, but has also improved the quality of life of every one of us through such added values.

While it is generally accepted that the mobile phone sector is experiencing a healthy and seemingly sustainable rate of growth, it may be difficult to predict precisely what shape and form the 3G landscape will eventually take. Mobile telephone operators know that the opportunities are there, and they have to make sure that they make the best of them.

Over the past three years, my ministry, together with the Malta Communications Authority, has been plotting what we feel is the best possible course for the country’s migration to third generation mobile. Over this period, through both market research and from learning via the experiences of other countries, we have worked hard to draft an appropriate policy and strategy that, hope-fully, will soon bear fruit in the local market. It is always hard to choose between the attraction of being up there with the trail-blazers or holding back in order to have enough manoeuvrability to avoid the pitfalls.

In July 2004, the Competitiveness and Communications Ministry issued a consultation paper outlining a proposed strategy leading to the eventual adoption of new third generation (3G) mobile telephony services in Malta. After taking into consideration the feedback received, a stra-tegy and policy document outlining the processes that would be applied in the assignments of rights of use of spectrum for various wireless technologies, including 3G, was published jointly with the MCA in February.

Here it was explained that the optimum number of frequency bands for 3G mobile in Malta would to be three, giving an ideal combination of increased competitive potential and adequate spectrum to permit rapid network rollouts and network capacity.

In doing so, we always had to keep the following essential principles in mind:

• spectrum is a precious national resource that has to be valued correctly, assigned appropriately and used efficiently;

• operators only have rights of use and not ownership;

• spectrum must be allocated where available, and if demand exceeds supply, a fair, transparent, non-discriminatory, competitive or comparative allocation process is necessary.

Things have moved very swiftly since then, with a call for expressions of interest in obtaining access to rights of use for frequencies in the IMT-2000 band for the purpose of implementing 3G networks in Malta being published by the MCA in March. Three companies have since responded to that call and the resulting assignment process is currently underway.

The local mobile telephone sector is one of considerable success, with the country now having over 315,000 subscriptions – which translates into 78.5 per cent of the population having a mobile subscription. This rapid rate of growth is a phenomenal achievement, compared with the 20,000 subscriptions that existed in January 2000. However, compared with a number of other countries that are now hitting penetration rates of over 100 per cent, it becomes clear that there is still a lot of room left for further market development. But looking at raw statistics does not convey the full picture. Growth can occur both vertically, in terms of increasing the number of subscriptions, and also horizontally, where each subscriber renders more in terms of revenue.

Here the government’s forward-looking policies will play a key role. Increasing competition in a sustainable manner will favour investment and market entry, in turn improving consumer choice and value. However, to ensure a balanced market it is vital that a fair and level competitive playing field is maintained for all operators.

All operators need a long-term investment strategy, with the right technical and operational expertise allied to a reasoned and sensible marketing and business plan. If this is not ensured the market could possibly have to face undesirable market instability.

There are significant challenges ahead and carriers will have to evolve to 3G. The drive behind 3G technology is very strong, and it could result in a situation where it is going to happen, whether there is a strong business case behind it or not. The challenge now for network operators is to work out the appropriate ways of exploiting the new technology in order to maximise returns on their investment.

Policy-makers are insisting on its development, while manufacturers are putting a lot of money into it. So the market push is certainly there. What remains to be seen is whether this is matched by a similar pull from consumers.

3G technology is the convergence of mobility and broadband. This signifies that soon we will have access to high-speed data services wherever we are. This “anytime, anywhere” access to information means that ways of working, communicating, playing and even thinking will be radically changed.

The potential for innovative, value added services is clear. Using the more efficient 3G systems first to continue to deliver only voice and SMS services, even if more cheaply, will not be an economic use of resources. Software and application developers should be poised to begin thinking of how best to integrate their products with the service provider networks.

During the 3G mobile evolution, it is possible that consumers will begin accessing 3G services through a plethora of consumer devices and not just their mobile phones, including personal digital assistants, in-car systems and laptop computers, which could all potentially reduce an operator’s customer acquisition cost.

The new 3G networks will certainly create new opportunities for consumer electronics players to develop new wireless access devices. Due to this, the industry could be at the peak of what will become a radical development of applications and usage patterns.

Does the user care or even know what technologies they are using? I believe not. People want services that are good value, reliable, easy to use and make their lives interesting, simple and fun.

Any technology is only a means to that end. This will be the case with 3G as with anything else. 3G technologies will be with us shortly. Having a massive success story will mean that sizeable challenges are converted into opportunities.

I believe that, given the right atmosphere, 3G will also be a success story. Yet much depends on how we will handle the issue. Local realities can never be forgotten.

Censu Galea is Competitiveness and Communications Minister