Will 2009 be the year of the Dongle?

With the global market for 3G dongles set to grow from 20 million units in 2008 to 26 million units in 2009, the dongle is set to become a standard accessory for the “mobility”.  Fuelled by subsidized access from the major mobile networks such as Vodafone and 3, the dongle is grabbing an increasing share of the internet access market.   Nokia was reported in December to be launching a new Nokia dongle which has been unofficially christened the “donkle”.

This is all very bad news for traditional fixed line ISPs and Cable operators who with one or two notable exceptions have failed to capture any significant numbers from the IPTV developments.  Now plain utility broadband (PUB) is about to be squeezed by the major mobile companies aggressively moving on to their turf.

With 3G Broadband dongle service costing as little as £10 a month and you get a free laptop offers, ISP’s PUB service is going to find it hard to compete.  As we have seen with the growth of the mobile telephony market, the market has seen the entry of all manner of players from telcos to supermarkets, all seeking to tie their users in with some very low offer just to retain customers for a broad range of services.  ISPs look like a threatened species and will need to evolve very quickly if they are to survive.

Whilst Europe is seeing double digit growth for the major mobile players, the US market which is traditionally slow to adopt mobile developments is just beginning to see the dongle develop a small market share.  The entry of Nokia and the proof of success in Europe will undoubtedly see the likes of Vodafone and T-Mobile seeking to capitalise on their European experience in the US.   This will undoubtedly drive some of the middle rank ISPs to the wall.  2009 will be a very interesting year.