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Why Mobile Broadband Revenue will Double by 2016

Infonetics Research released excerpts from its latest market study, which tracks global mobile services revenue, mobile voice and data average revenue per user (ARPU), and mobile voice and broadband subscribers.

"As we approach mobile phone market saturation, the mobile industry is undeniably shifting from voice to data, and over-the-top voice revenue is shifting away from mobile operators," notes Stephane Teral, principal analyst for mobile infrastructure and carrier economics at Infonetics Research.

Infonetics reports that SMS use is now fading in places like Japan, the U.S., the Netherlands, and the UK market. It's being replaced by free applications over mobile broadband that enable internet browsing, email and -- more importantly -- video.

Those services may be free to the smartphone app users, but carrying the associated data traffic is not free to the mobile network operators.

Mobile service providers are investing a significant amount of their profits to upgrade their networks to handle the skyrocketing data traffic -- if they don't, they could encounter network outages and subscriber turnover.

All mobile network operators are therefore seeking cost savings and efficiencies that would help them to minimize the burden of the data traffic from these over-the-top (OTT) apps.

But, when all is said and done, it comes down to their subscribers either being willing to pay a fair price for the app-related service transport and delivery, or not.


Highlights from the latest market study include:
  • Mobile service revenue is increasing year-over-year but the growth rate is decreasing and in some cases not keeping pace with network operator capital expenditures (capex).
  • Despite the rise of revenue from mobile data services, blended ARPU continues to fall or stay flat due to fierce competition, declining voice ARPU, and regulatory tariffs.
  • Mobile broadband services are growing fastest, with global revenue on track to nearly double between 2012 and 2016.
  • Revenue from services carried on W-CDMA/HSPA networks will exceed revenue from CDMA2000/EV-DO-based services by more than 6-fold by 2016.
  • Thanks to its aggressive LTE strategy, Verizon Wireless now accounts for just over one third of the world's 44 million LTE subscribers.
  • Asia Pacific is home to around 45 percent of the world's 1.1 billion mobile broadband service subscribers.
  • Mobile broadband subscribers are expected to surpass post-paid contract voice subscribers by 2015.

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