Market Insight

Updated Mobile Operator Forecasts - Diverse Impact from Weakening Economies

November 05, 2012

Jack Kent Jack Kent Director, Media and Advertising

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We have published updated mobile operator data including the latest forecasts for mobile subscriptions, revenues / ARPU, and 3G connections by operator for all the countries covered by the service. Also, the service now includes historical operator data up to and including Q2 2012.

Of particular note are the market dynamics in three countries:

  • In France new mobile operator Free continues to transform the market. Free totalled 3.6m subscribers by the end of Q2 2012 -- just six months after launch -- which is placing huge pressure on the established French mobile operators Orange, SFR and Bouygues. These existing operators have shed a combined 1.9m subscribers since Q4 2011 and we forecast that Free will continue to gain share in the years ahead. IHS Screen Digest expects Free to make further gains with around 4.3m total subscribers by the end of 2012. Free is providing a tremendous case study of how to enter a mature mobile market.
  • Spanish mobile operators have faced sustained pressure because of the shift of business model as lead operators have withdrawn handset subsidies. Plus Spain's economic struggles have hit the performance of mobile operators. Overall mobile ARPU (average revenue per user) has dropped almost 10% since Q2 2011, falling from €22.98 to €20.94 in Q2 2012. A clean-up of inactive lines has resulted in a big decline in total subscribers numbers for leading Spanish operator Telefonica -- which counted 21.3m subscribers in Q2 2012 compared with 24.4m in Q2 2011. The Spanish experience indicates mobile operators in other markets must be careful what they wish for when they consider ceasing to offer handset subsidies.
  • In the US, operators have bucked the global trend of declining ARPU. While European operators are facing pressure on ARPU, North American operators have driven an improvement. The three biggest US operators (AT&T, Sprint and Verizon) all saw quarter on quarter improvement in ARPU driven by the growth of 4G services and increased smartphone adoption. The US model of shared data plans is one that operators in other markets must evaluate urgently, but because of the high degree of market concentration of the US market, it will not automatically lead to a similar jump in ARPU.


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