European ARPU boost

Mobile data, specifically mobile internet take-up, is starting to have the desired effect on declining operator ARPU in Western Europe, according to research firm Analysys.

Most European operators will struggle to halt the decline in voice ARPU, says the firm. However, progress in mobile internet should ensure total ARPU for the whole region grows by 10.2 pre cent over the next five years.

Combined with a growth in active subscriptions, mobile service revenue will increase at a compound annual growth rate of 5.4 per cent per year reaching Euro195bn in 2012.

“In the majority of Western European countries, total ARPU has been on the decline, due primarily to decreasing voice ARPU,” said Analysys’ Yanli Suo-Saunders. “Operators are facing increasing challenges in halting the decline of voice ARPU, which is likely to decrease further over the next three years, due primarily to ongoing downward pressure on mobile termination rates from regulators and intensifying price-based market competition.”

“However, voice ARPU could stabilise or even recover slightly from 2011 onwards if operators can be more aggressive in migrating voice minutes from fixed to mobile via the help of femtocell solutions,” explained colleague Emma Buckland.

Suo-Saunders reckons that, in general, mobile servcie revenue will increase steadily over the next five years, thanks to the growth in non-voice ARPU and active subscription base.

“Mobile data will take up rapidly in the next few years, fuelled by an increasing adoption of open approach to the mobile internet, flat-rate data pricing and ongoing deployment of HSPA ,” said Suo-Saunders.

“Furthermore, active subscription penetration is forecast to rise from 101.6 per cent in 2006 to 120.1 per cent in 2012, maintaining the trends towards multiple SIMs. This will provide the added stimulus to mobile service revenue,” added Buckland.