Technology | Media | Telecommunications

Tuesday, June 30, 2009

Recession-Proof Mobile Phone Services

Due to the global economic crisis, there's been a recalibration of consumer purchasing and usage behaviors which will affect all industries -- including the normally recession-proof mobile phone services industry.

Yet despite these market uncertainties, a new ABI Research study shows that even under the worst recovery scenarios, mobile services revenues will continue to grow at nearly 1.2 percent through 2014 -- a 0.5 percent loss over pre-crisis conditions.

According to ABI practice director Dan Shey, "A long economic recovery places pressures on mobile operators to compete on price, particularly with undifferentiated voice services. Mobile data services allow operators to counter that pressure. However each region is different."

Operators should create strategies that lead customers to maintain nice-to-have data services or encourage addition of more utilitarian ones.

Economically, North America has been hit hardest. But mobile data services growth will exceed 8 percent through 2014 even in the worst recovery scenario and will shield mobile services revenues against growing voice pricing pressures.

While stimulus packages are helping power the Asia-Pacific region through the financial crisis and limiting unemployment loss, regional operators derive a large portion of their data revenues from content downloads.

These products would be the first casualties of an extended recession, particularly with APAC's substantial prepay base. But operators can mitigate the impacts of the depressed conditions through appropriate messaging and offer management.

According to Shey, "Mobile operators need to stress the utility of mobile services and pursue appropriate services personalization initiatives that allow customers to buy and use services in ways that best suit their needs."

Business customers should also be a target segment as businesses consider mobile a way to lower communications cost and increase competitiveness.