While mobile service subscriber growth rates are slowing, operator-billed ARPU (Average Revenue per User) levels continue to shrink. The decline in certain regions is exaggerated because of the depreciation of local currency bundles against the dollar (e.g. in Latin America and Europe), but the implications are clear.
Juniper Research believes that the key trends of recent years are likely to continue. In pluralistic markets typically inhabited by at least three network operators and MVNO providers, competitive pricing will continue to impact service provider revenue growth.
Mobile Services Market Development
Juniper Research has found that annual global mobile network operator-billed revenues from voice and data services are expected to fall by over $50 billion during the next 5 years -- that's from $837 billion last year to $785 billion in 2022.
Their latest global research findings attributed the anticipated decline to further consumer migration toward Over-the-Top (OTT) messaging and social media services, with data bundle pricing erosion also expected to significantly impact revenues.
However, Juniper Research has identified a series of new revenue opportunities and costs savings which collectively could potentially enable mobile network service providers to sustain, or even increase, their profit margins.
The telecom industry analyst now claims that the opportunities afforded by the Internet of Things (IoT) related technologies and associated services should enable mobile network operators to increase their revenues from that sector by over $8 billion by 2022.
They also argued that mobile Application-to-Person (A2P) messaging adoption across a number of key industry verticals -- including marketing, banking and healthcare -- should result in a similar uplift in revenues.
Meanwhile, the worldwide market study findings highlighted a series of measures by which costs could be reduced, including network virtualization, the implementation of next-generation firewalls and improving Customer Relationship Management (CRM).
Outlook for Mobile Reinvention Investment
The research also assessed the extent to which 15 leading network operators across Europe and North America were in a position to invest in meaningful new innovation strategies. As a result, Juniper analysts have identified two network operators, AT&T and BT, as likely leaders in the mobile communication sector.
"AT&T is a market leader in terms of IoT implementations and adoptions, while both AT&T and BT are at the forefront of research into (and deployment of) virtualization of the network," said Dr Windsor Holden, head of forecasting & consultancy at Juniper Research.