Mobile broadband $137 billion by 2014, but access prices to drop

Peter Dinham
Thursday, 26 March 2009 14:29

IT Industry - Deals

“For example, 40% of total mobile broadband laptop users will come from Asia Pacific in 2014. The advent of 3G in markets such as China and India, the sheer number of mobile users and poor fixed line penetration in these markets means that broadband access to a very large number of people will be purely ‘mobile’,” predicts Mackenzie.

“For many though, Internet access will be through the handset. In China, there will be 52.5 million laptop users versus 325 million handset users, a ratio of 6:1.
 
However, Hartley says that even in mature markets such as Western Europe, the slowest growing region between 2008 and 2014, user growth in laptop access over the next five years is set to reach 747%, and 918% in handset access.
 
“Such recession-busting growth will be music to the ears of operators. The ubiquity of the Internet and the desire to be connected on the move are key drivers for this, as will the increasing adoption of prepaid tariffs, which support the complementary nature of mobile broadband in such regions with high fixed broadband penetration,” says Hartley.

On a global level, Hartley and Mackenzie report that revenues grow at just 44% of the rate of users, and they say, a signpost as to the reason can be seen in the fact that, as with most mobile services the vast growth in mobile broadband user numbers in emerging markets does not provide corresponding revenue growth. Therefore, their report says, the contribution of each region remains broadly the same across the forecast period.

The two analysts report that the rate of growth between 2008 and 2014 for mobile broadband laptop and handset revenues is consistently below that of users, and on a global level this is a factor of the ARPU erosion they assume will take place.

Hartley and Mackenzie say several factors help explain this erosion:
• The adoption of mobile broadband laptop access into increasingly less wealthy segments of emerging markets
• The introduction of prepaid tariffs driving adoption in mature mobile and fixed broadband markets, which boosts users but dilutes ARPU and,
• Increasing competition for mobile broadband access driving prices lower.
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