Massive growth for mobile services

Peter Dinham
Thursday, 02 July 2009 09:54

IT Industry - Market

According to Burley, by the end of 2014 there will be 6.42 billion connections, up 59% from 2008, and a CAGR of 8%. Asia-Pacific will grow at 10% CAGR, with penetration reaching 78%, highlighting potential for further growth.

Ovum says that in developed markets - and some emerging markets- mobile penetration will well exceed 100%, but further growth will still be possible from multiple SIM ownership and through uptake of data-centric devices, with population penetration ceasing to be a useful indicator.

Senior Analyst at Ovum, Steven Hartley, says that in the Asia Pacific region, China and India will dominate connections and will account for 30% of total worldwide connections by 2014.

“However, the countries’ penetration rates will be just 76% and 69% respectively by 2014. Massive population growth will continue to fuel mobile demand as new, unconnected users join the market.”

Hartley cautions that the enormous growth in connections has financial implications for Asia-Pacific mobile operators as they are expected to grow by 80% from 2008 to 2014, while revenues grow by 40%.

“Furthermore, Asia-Pacific mobile outgoing minutes of usage are set to rise 155% between 2008 and 2014, but voice revenues will rise just 26%.

“Both comparisons highlight the influx of ever-lower ARPU customers from emerging markets and price erosion in mature markets, even for data services.

“Therefore, efficient networks, enabling competitive pricing, will be critical in both highly saturated mature markets and low-ARPU emerging markets,” suggests Hartley.