Michael Lazaridis, the co-founder of RIM who isn't preoccupied with buying a hockey team spoke at a wireless communications conference in Toronto this week. As reported in The Globe and Mailhttp://www.theglobeandmail.com/report-on-business/telecom-firms-face-capacity-conundrum/article1185127/ His position is that the ever increasing stream of data to wireless devices is a challenge to service providers that isn't easy, or cheap, to meet.

My reading of the story is that we shouldn't expect wireless companies to make big price cuts to data services in the near future. When one average data user consumes the same bandwidth as 40 voice users, we can surmise that providers will use prices to manage the volume of data being transmitted as well as the number of users. It doesn't bode well for those who are waiting for low-cost, unlimited data.

I don't believe Mr. Lazaridis.

Just like internet service and cable telephony was a boon to cable company's because they could sell services over essentially the same infrastructure, the addition of data to wireless company's is a massive margin enhancing add-on.

Rogers, Bell and Telus are making out like bandits with their data add-ons. I've heard margins can be as high as 90%.

Will the big three cut data costs anytime soon? No of course not, they have an oligopoly.

Is data services extremely profitable? For sure!

The move by Rogers to LTE (4G) will resolve any pipe filling as Voice calls will all be VoIP and will just be data bits so conventional circuit switched phone calls will disappear. Achievable fixed data rates will be in the 50mb area while expected 120km mobile dl speeds will be in the 15mb range. All this using 20% of the bandwidth and infrastructure of today. And this is just the 1st evelution of LTE. Exciting times ahead as Rogers rolls this out in BC for the 2010 Olympics.