Mobile penetration and rapid adoption of broadband access continue to boost total service revenue for wireless operators, but the dilution of Average Revenue Per User (ARPU) -- due to multi-SIMs -- is a cause for concern, according to the latest market study by ABI Research.
Market data shows that 4Q-2010 has seen an increase of $1.4 billion quarter-on-quarter or 2.2 percent growth for Asia-Pacific total mobile service revenue. However, 4Q-2010 ARPU showed a decrease of 2.1 percent from 3Q.
"The overall contraction of ARPU is largely caused by the continued expansion of the subscription base, where remarkably one in five is a newly-added subscription that was not around a year ago," said ABI Research practice director Neil Strother.
More mobile network operators are looking for new ways to generate revenue, which include adding new interactive value-added service (VAS) applications such as mobile TV, mobile payments, mobile wallet, airtime transfer or even free music downloads which encourage more data usage.
With the launch of India's 3G networks, BSNL has also recently introduced VAS such as video SMS and video calls, in an attempt to capture more market share and encourage 3G service adoption.
Mobile phone service providers believe these new offerings will also be likely to improve customer retention -- due to their familiarity and commitment to the services.
The urgency in seeking improved loyalty could not come at a better time, as Mobile Number Portability (MNP) came into effect in January 2010 in India, and country-wide MNP requests crossed 3.8 million at end of February.