European mobile phone operators are hoping to grow the share of their revenues derived from data services from the current 12% to 30% by 2008. However, according to a survey conducted by Forrester Research, they are facing a number obstacles, with one key problem being the current limitations of billing technology.
Real-time billing systems are particularly difficult for pre-paid customers, as compared to contract customers. Forrester found that 71% of European mobile companies are delaying launching new services, such as video, multimedia messaging (MMS) and video, to pre-paid customers because of these billing technology restrictions.
Another problem deterring growth amongst pre-paid customers (which in some countries is the majority segment) is the high price of the handsets which can provide these services, says the report.
“Our policy is not to favour contract customers over pre-paid in new product introductions. We can’t because pre-paid represents more than 75% of our customer base in markets like Italy. The problem is that, due to technical complexity, real-time billing is just not always immediately available,” says one pan-European mobile company.
The report also shows that GPRS, the system that allows the faster transfer of data needed for these new data services (MMS, instant messaging, streaming and so on), is displaying a slow rate of adoption. Operators report that 8% of customers have a GPRS-enabled phone, but one German company claimed that only 1.6% of customers are actively using the facility.
Forrester forecasts that 13% of European mobiles will be GPRS-enabled by the end of this year, rising to 70% in just five years’ time.
A separate report from IDC forecasts that mobile messaging will generate revenues of $14.5 billion in western Europe by the end of 2007 (see Western European Mobile Messaging To Hit $14.5bn In 2007).
