Skip to main content

Mobile Content Providers are Unlikely Saviour

At the 3GSM Congress in Barcelona, it was possible to hear a whistling noise as the mobile operators scrambled past each other to reach mobile content providers, and it is not hard to find out why. Data-heavy mobile content services will be key to their future success.

ABI Research is releasing two Research Briefs, "Mobile Operator Performance Benchmarks, 4Q-2006" and "Global Wireless Subscriber Dynamics, 4Q-2006" that track the latest developments in the global mobile marketplace. "As of the end of 4Q-2006, there were over 100 million WCDMA subscribers around the world," said Asia-Pacific research director Jake Saunders. "The WCDMA subscriber sector is moving particularly fast, growing 102 percent YoY and 16.6 percent QoQ."

3G subscribers are providing a much-needed shot in the arm for mobile operators, because they deliver an average revenue per user (ARPU) that is 5 to 20 percent greater than the average. For many operators, the period 2Q-2004 to 2Q-2006 proved challenging, as competition pushed down on ARPU but the additional revenue streams from non-voice applications failed to compensate.

"Operators are now looking to YouTube Mobile, Jamster and Warner Music for content to excite and entertain consumers," Saunders added. "Messaging platforms such as Research In Motion's BlackBerry devices and enterprise solutions are driving up data traffic and non-voice revenue contributions." Non-voice now represents between 15 and 29 percent of operator service revenue, depending on the market.

Of that, mobile Internet downloads and data now contribute a very respectable 3 to 17 percent of total service revenue. Operators are striving to lock down entertainment content, including not only broadcast network syndicated shows, but also user-created material that enables an operator to differentiate itself and reduce churn.

Fixed mobile convergence (FMC) and substitution are also giving mobile operators a lift. Minutes of use (MoU) are growing across all markets, with the exception of Japan, where the high dependency on messaging applications has been absorbing some of those minutes. Overall, average MoU grew 1.8 percent YoY.

The amount of traffic an operator carries is about to explode, and within seven years the majority of the traffic carried will be data-orientated (music, video streaming, messages, enterprise applications and more). Handling that traffic efficiently will then become the new challenge for operators.

I have to wonder, however, can the mobile content providers really save the carriers from their own marketing practices? After the combination of high-prices and limited content choice pushed through poorly designed walled gardens -- consumers seem to have gotten the message, they really don't want to sell value added services (VAS) to the mainstream user.

Popular posts from this blog

Rise of Software-Defined LEO Satellites

From my vantage point, few areas are evolving as rapidly and with such profound implications as the space sector. For decades, satellites were essentially fixed hardware – powerful, expensive, but ultimately immutable once launched. That paradigm is undergoing a transition driven by Software-Defined Satellites (SDS). A recent market study by ABI Research underscores this transition, painting a picture of technological advancement and a fundamental reshaping of global connectivity, security, and national interests. LEO SDS Market Development The core concept behind SDS is deceptively simple yet revolutionary: decouple the satellite's capabilities from its physical hardware. Instead of launching a satellite designed for a single, fixed purpose (like broadcasting specific frequencies to a specific region), SDS allows operators to modify, upgrade, and reconfigure a satellite's functions after it's in orbit, primarily through software updates. The ABI Research report highlights ...