Mobile services will generate E97 billion in revenue across Western Europe in 2002, just 4% more than in 2001, according to new research by Analysys. Mobile services revenue rose 12% in 2001 but the growth rate has now decreased thanks to fewer new subscribers and a drop in average revenue per user (ARPU).
The report,
Western European Mobile Forecasts and Analysis 2002–2007, reveals that 70% of Western Europe’s population now has a mobile phone, significantly reducing the potential for new subscribers.
“Operators have been trying to increase ARPU to counter the effects on revenue of slowing subscriber growth, but it will be some years before ARPU returns to the levels seen in 2000 or even 2001,” said Analysys analyst Katrina Bond.
Mobile operators, says Analysys, have been sustaining reduced revenue from diminishing ARPU for voice services over the past few years and have attempted to boost usage of other mobile service in order to boost revenues. Non-voice services such as messaging, downloadable ringtones and mobile internet access have been pushed in order to boost subscriber numbers to such services with some success. Analysys estimates that non-voice services accounted for 8% of mobile ARPU across Western Europe in 2001.
The short term outlook for mobile operators is not brilliant, further declines in ARPU are forecast leading to slow growth for revenue. In the long term, however, the outlook is more positive. Analysys forecasts that mobile services revenue will be E135 billion in 2007, of which 37% will be generated by non-voice services. Messaging and ‘infotainment’ services will be the greatest driver of revenue growth leaping from E7.6 billion in 2001 to E44 billion in 2007.
“For consumers, the operators will build on the current popularity of text messaging and start to provide multimedia messaging from the second half of 2002,” added Bond, “while for businesses mobile email will be their most important messaging service.”
