Global mobile revenues to top $1tn in 2013

Annual revenues from the global mobile market will top $1.03tn by 2013, when the number of subscriptions worldwide will have risen to more than 5.3 billion.

From the end of 2007 to the end of 2013, the global mobile market will see huge growth, increasing in size by over half (56 per cent), according to analyst house and telecoms.com parent, Informa Telecoms & Media.

It took over 20 years to reach 3 billion subscriptions, but another 1.9 billion net additions are forecast in just six years, with the global total nudging past the 5 billion milestone in 2011.

As a result of this extraordinary growth, total annual revenues derived from mobile operators will grow by over a third, jumping from $769bn in 2007 to $1.03tn six years later.

Informa forecasts more than three quarters (78 per cent) of global net additions between 2007 and 2013 will come from markets in Asia Pacific, Africa and Latin America, which will be the powerhouses of organic growth over the next five years. And nearly half of the forecast 1.9 billion global net adds will come from just five markets – India, China, Indonesia, Brazil and Russia. By contrast, the mature markets of North America and Western Europe will in total contribute just 8 per cent of global net adds, reflecting the high level of saturation in these markets.

Globally, subscription penetration will approach the 75 per cent mark in 2013, while some countries, including Romania, Russia, Italy, Ukraine and Greece, will push past the 150 per cent barrier. Growth in subscriptions (SIMs) will outstrip growth in the number of unique users, pointing to greater multi-SIM ownership. The global ratio of subscriptions to subscribers will increase from 1.29 in 2007 to 1.32 in 2013. In Western Europe, the ratio will reach 1.55 in 2013, and even higher at 1.75 in Eastern Europe, the analyst said.

The high growth potential of developing markets reflects the entrance of new operators, as well as improvements in regional network roll-out and rising competition, which is expected to lower the barrier for new subscribers. “Reductions in voice tariffs, the option of very low-denomination prepaid top-ups and the greater availability of cheap 2G and 2.5G handsets will open out mobile services to low-income, low-ARPU subscribers who have never previously owned a mobile phone,” said Chris Stamatakis, research analyst at Informa.

Voice revenues will continue to make up the lion’s share of total revenues, but will see slowing growth, and even a decline from 2010 onwards, resulting in a challenge for operators to generate sustainable revenues as average revenue per user (ARPU) continues to drop. This will lead to increased promotion of data services, which are predicted to more than double from $148bn in 2007 to $347bn in 2013. As a result, the proportion of total revenues generated by data services will increase from 19.2 per cent in 2007 to over a third 33.7 per cent at the end of 2013.

While 2G will remain the dominant technology generation by subscription numbers until 2013, its market share will fall from over two thirds in 2007 to less than one third in 2013, as 3G+ technologies continue to gain ground. 3.5G technologies accounted for just 1.2 per cent of total subscriptions in 2007, but will represent nearly a quarter (22.9 per cent) of the global subscription base by 2013 and exceed the number of 3G subscriptions.

“As more next-generation networks roll out, 3G and 3.5G traffic will grow vigorously and the number of global HSDPA subscriptions will increase exponentially in the short term,” said Stamatakis. “Furthermore, with migration to next-generation technologies already under way, with operators increasingly favouring HSDPA as they jump on the LTE bandwagon, Informa Telecoms & Media expects operators to focus increasingly on fulfilling consumers’ growing demand for mobile broadband – which is becoming the long-sought killer app for mobile operators.”