Mobile internet spending up, overall revenue down

Economic conditions reduce mobile user spending up to 15 percent

While one of the fastest growing revenue segments for mobile operators is mobile internet, driven by access fees and data traffic, mobile user ARPUs (average revenue per user) dropped between 5 percent and 15 percent year-over-year in the fourth quarter of 2008 compared to the same period in 2007.

Mobile internet revenues grew between 15 percent and 25 percent YoY for 4Q-2008, according to the ABI Research Mobile Subscriber ARPU, Voice, Messaging and Data Traffic Market Data report.

ABI expects absolute mobile internet revenues to continue growing robustly in spite of the economic downturn in 2009, particularly with the rise of smartphones such as the Apple iPhone and RIM BlackBerry. Improvements in work, personal productivity, and organisation are proving to be strong draws to mobile data applications.

End-user voice traffic did grow between 2 percent and 10 percent depending on the market, but revenue/minute continues to decline. End-users are embracing mobile data applications such as messaging, web browsing and game downloads.

China, India, and a number of other Asian markets dropped more than 10 percent. In Europe the ARPU contraction was in the range of -5 to -8 percent. In North America, YoY ARPU did not nosedive, as ARPUs were buoyed by mobile data. In South America, markets were more mixed with some markets deflating inline and others, like Brazil, managing to hold up ARPUs.Mobile data (messaging + mobile Internet) contributes 38 percent of Japanese ARPUs, and many European operators depend on mobile data for over 25 percent to 30 percent of their ARPU."The evolution to LTE, along with 3.5G technologies, is not just about offering end-users faster download speeds. It is also about capacity," says ABI Research vice president Jake Saunders.

"Our research into mobile network traffic shows that the ramp-up in traffic is effectively exponential. Global terabits transferred per month are expected to grow 155 percent between 2008 and 2009, from to 81,670 terabits to 31,720."

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