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Wednesday, February 10, 2010

Mobile data revenue might not compensate for voice decline

A new study by the Economist Intelligence Unit (sponsored by InnoPath) has found that only a minority of telecoms executives believe growth in revenue from mobile data services will make up for a decline in voice revenue over the next five years. Almost 200 senior execs in the mobile telecommunications industry were interviewed but only 44% thought data growth would compensate for the voice decline.

The survey also noted that:

  • Mobile operators plan to focus on developing content and applications for phone users, but their strategies for doing so are still unclear. Almost half of respondents say that in the next five years their company will develop revenue-generating content and applications to reduce its reliance on traffic revenues. Yet more than two-thirds prefer to partner with third-parties in offering applications through online shops – and this means sharing revenue.
  • Operators believe that open networks, which allow their customers to visit third-party sites, will help them to make profits. A large majority of respondents say that operators adopting an open-network policy will be more successful than those that do not. And less than a third say that legislation supporting the principle of “net neutrality” (which would lead to open networks) would hamper their ability to invest in advanced networks. Openness poses a risk, however: a mobile operator’s presence in the content and application market is likely to be even smaller than it is now.
  • Operators may be over-reliant on next-generation networks to ensure profitability. Companies will focus on boosting efficiency over the next five years, and are counting on next-generation networks to help them achieve this, the survey shows. These will provide new capacity for the high-bandwidth services operators plan to develop. And although the networks will help alleviate the burden of high traffic volumes engendered by flat-rate pricing, operators may also revisit the issue of pricing in their search for profits. 58% of survey respondents think usage schemes are more likely to ensure profitability.
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Author: The Fonecast
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