3G: Promises video clips and fast net access

The sums invested in 3G are staggering - $100bn worldwide so far, just to get licences.

The figure does not include the cost of developing and building networks and there is a continuing air of uncertainty in the telecommunications world as to whether all that money will be worth it.

So far 25 countries worldwide have issued 3G licences. But as with every new technology, the manufacturers are hoping that one function - a killer application - will encourage uptake.

Cellphone companies are pinning their hopes on games to drive the next generation of 3G handsets.

In a saturated, flat marketplace they need something new to boost revenues.

Wireless devices

"One of the things we're looking for is mass adoption of our high-speed data capabilities, and we are the only provider in the US that has this on our nationwide network," said Len Lauer, president of SprintPCS.

The interesting thing with a wireless device is that it has a much larger install base because everybody has a cellphone Jennifer Walters, Sega

"As a result we are going to look more in terms of having multi-users that are gaming that are SprintPCS customers so they can start battling against each other. So that's a good opportunity for us in the future."

A combination of new 3G networks, updated colour screens and faster chips provide the foundation for small screen gaming not just for cellphones but for palmtop devices too.

PDAs have better screens and faster processors and many are being sold as wireless devices out of the box.

Despite numerous challenges, like differing screen sizes and resolutions, game manufacturers such as Sega are rushing to miniaturise their most popular titles from the 1980s onwards across as many platforms as possible, for obvious reasons.

"The interesting thing with a wireless device is that it has a much larger install base because everybody has a cellphone," said Jennifer Walters, director of marketing communications for Sega.

"To have the access to Sega content on that phone that's in your pocket or in your purse all the time is just a really exciting prospect for us."

Better games

The gaming industry and cellphone manufacturers were both quick to realise the potential crossover market for their respective products, which is why this trend is growing so fast.

Games on mobiles are getting better

In Japan there is already a game which requires cellphone users to train a warrior for fighting before it can be downloaded to a more conventional game-playing platform.

It is just one way of convincing today's hard core gamers, spoilt by super fast action and breathtaking graphics, to embrace the pixel-challenged devices.

The mobile industry is doing its best to play catch up with the likes of the PlayStation and Xbox, but until 3G networks are commonplace, the downloadable mini-games will have limitations.

"Right now most games are still single-player, just because the networks and devices are still being rolled out so they aren't very commonplace yet," said Victor Brilon, java application manager for Nokia.

"But we're starting to see a very slow trickle of multi-player games such as multi-player card or chess games. I think as network speeds increase and devices get more complicated we'll see things like first-person shooters."

Out of place?

Later this year Nokia will start selling the N-Gage, a phone and game unit in one that is capable of linking up with other players on high speed networks or via Bluetooth.

Games will be sold on electronic cards that slot into the device, enabling higher quality graphics and gameplay.

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Even so, many serious gamers are simply not impressed with anything in the handheld category right now.

"There's just really no place for it right now," said Jeff Gerstmann, senior editor of the games site Gamespot.com.

"I think they're really trying to reach out to the businessman, someone who is going to have time to kill in an airport and already has the cellphone on him and thinks 'why not just spend the $4.99 to download this game and check it out'."

It may take a couple of years for cellphone and PDA games to catch on.