Parks Associates Blog

Thursday, November 04, 2010

Mobile carriers must focus on data services as smartphone sales exceed 215 million units in 2010

Mobile operators have to diversify their business plans, according to a new Parks Associates report, which finds voice ARPU declining by as much as 30% in some areas, while annual smartphone sales will exceed 215 million units in 2010, creating new opportunities for data services.

Mobile operators are looking to their data-based services for revenue generation and to offset losses in voice revenues. In North America, AT&T, Verizon, Sprint, and Rogers Wireless have started data-based initiatives including subsidization of smartphone handsets, branded mobile-app storefronts, wholesale connectivity to connected CE, and network upgrades. In Western Europe, Vodafone continues to push its mobile broadband offerings and recently launched a new suite of Internet services for mobile devices. These are all key monetization strategies as the market shifts away from voice services.

Mobile Services: Global Outlook (Second Edition), the new report finds voice ARPU in North America will decline by almost 30% from 2009 to 2014. Over the same timeframe, it will decline by 27% in Western Europe and 25% in Asia-Pacific.

Regulatory changes, increasing competition, and the struggle to attract and retain high-value subscribers conspired to drive down voice ARPU and revenues. In contrast, global smartphone shipments experienced a 32% year-over-year increase from 2008 to 2009, and they account for 16% of worldwide mobile phone shipments, compared with 11% in 2008.

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