Annual mobile revenues to hit USD 1 trillion by 2013 as global subs top 5

12th December 2008
Annual revenues from the global mobile market will top USD 1.03 trillion by2013, when the number of subscriptions worldwide will have risen to morethan 5.3 billion, according to Informa Telecoms & Media. From end-2007 toend-2013, the global mobile market will see huge growth, increasing in sizeby over half (56%), according to the latest edition of Informa Telecoms &Media’s Global Mobile Forecasts to 2013.

It took over 20 years to reach 3 billion subscriptions, but another 1.9billion net additions are forecast in just six years, with the global totalnudging past the 5-billion milestone in 2011. With this extraordinarygrowth, total annual revenues derived from mobile operators will grow byover a third (33.9%), jumping from USD 769 billion in 2007 to USD 1.03trillion six years later.

Informa Telecoms & Media forecasts more than three quarters (78%) of globalnet additions between 2007 and 2013 to come from markets in Asia Pacific,Africa and Latin America, which will be the powerhouses of organic growthover the next five years. Astonishingly, nearly half (47%) of the 1.9billion global net adds will come from just five markets – India, China,Indonesia, Brazil and Russia. By contrast, the mature markets of NorthAmerica and Western Europe will in total contribute just 8% of global netadds, reflecting the high level of saturation in these markets.

Globally, subscription penetration will approach the 75% mark in 2013, whilesome countries will push past the 150% barrier – Romania (152%), Russia(153%), Italy (168%), Ukraine (173%) and Greece (183%). Growth insubscriptions (the number of SIMs) will outstrip growth in subscribers (thenumber of unique users), pointing to greater multi-SIM ownership. The globalratio of subscriptions to subscribers will increase from 1.29 in 2007 to1.32 in 2013. In Western Europe, the ratio will reach 1.55 in 2013, and evenhigher (1.75) in Eastern Europe.

The high growth potential of developing markets reflects the entrance of newoperators, as well as improvements in regional network roll-out and risingcompetition, which is expected to lower the barrier for new subscribers.“Reductions in voice tariffs, the option of very low-denomination prepaidtop-ups and the greater availability of cheap 2G and 2.5G handsets will openout mobile services to low-income, low-ARPU subscribers who have neverpreviously owned a mobile phone,” said Chris Stamatakis, research analystat Informa Telecoms & Media and author of Global Mobile Forecasts to 2013.

As the global subscription base expands, total annual revenues will increaseto over USD 1 trillion in 2012. Voice revenues will continue to make up thelion’s share of total revenues, but will see slowing growth, and even adecline from 2010 onwards. With regulators worldwide looking to promotecompetition, forcing operators to push down voice tariffs, Informa Telecoms& Media expects voice revenues to peak as soon as 2009 in Western Europe,and even by end-2008 in North America. In more developing markets such asthe Middle East and Asia Pacific, voice revenues will not peak until 2011,and 2012 in Latin America and the Caribbean.

Operators globally will be challenged to generate sustainable revenues asaverage revenue per user (ARPU) continues to drop. To keep annual revenueson the up, operators will need to promote usage of data services. Annualdata revenues, unlike voice revenues, will go from strength to strength, andwill more than double from USD 148 billion in 2007 to USD 347 billion in2013. As a result, the proportion of total revenues generated by dataservices will increase from less than a fifth (19.2%) in 2007 to over athird (33.7%) at the end of the forecast period.

With voice revenue streams diminishing, industry players will encourage dataspend among subscribers by innovating in non-voice services anddifferentiating their data service offerings from those of theircompetitors. While 2G will remain the dominant technology generation bysubscription numbers until 2013, its market share will fall from over twothirds (66.9%) in 2007 to less than one third (32.7%) in 2013, as 3G+technologies continue to gain ground. 3.5G technologies accounted for just1.2% of total subscriptions in 2007, but will represent nearly a quarter(22.9%) of the global subscription base by 2013 and exceed the number of 3Gsubscriptions.

“As more next-generation networks roll out, 3G and 3.5G traffic will growvigorously and the number of global HSDPA subscriptions will increaseexponentially in the short term,” said Stamatakis. “Furthermore, withmigration to next-generation technologies already under way, with operatorsincreasingly favouring HSDPA as they jump on the LTE bandwagon, InformaTelecoms & Media expects operators to focus increasingly on fulfillingconsumers’ growing demand for mobile broadband – which is becoming thelong-sought killer app for mobile operators.”