Mobile Broadband Growth Results June 2010

Mobile Broadband Growth Reports from HSPA Operators Worldwide June 11, 2010 www.gsacom.com Global mobile Suppliers Association (GSA) www.linkedin.com/groups?gid=2313721 www.gsacom.com/rss/gsanews.php4 www.twitter.com/gsacom info@gsacom.com www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 1/41

How mobile broadband is contributing to growth and profitability Source: Company reports, websites, announcements www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 2/41

Mobile Broadband Growth Success (1) Celcom, Malaysia – after moderated growth in Q4 09, mobile broadband surged again with the highest ever net additions of 124,000, a strong 24% increase QoQ. Strong growth was seen overall in non voice services, with data now contributing 30% to revenue, from 25% a year ago XL Indonesia in Q1 10 reported data service revenue growth which now contributes 7% of service revenue – an increase of 58% QoQ Singapore’s M1 non-voice services continued to grow, contributing 29.8% of service revenue, up from 25.1% a year ago. This was primarily driven by an increased focus on data usage In Sweden, according to the Swedish Post and Telecom Agency (PTS) the number of mobile subscriptions, including voice and data, increased 7% to 11.6 million at end 2009. Subscriptions for mobile broadband represented the largest share of the increase, up 50% YoY to 1.31 million. Traffic for mobile data services increased in 2009 by 103% compared to 2008, According to the Communications and Information Regulatory Commission, mobile broadband in Saudi Arabia grew 488% to 1.41 million subscriptions, representing 51% of all broadband connections in the country, compared to a 47% share for ADSL www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 3/41

Mobile Broadband Growth Success (2)  Tele2 Group has reported a 50% year on year increase for Q1 2010 in the number of mobile broadband subscriptions  SFR’s data revenues represented 26.5% of mobile revenues at the end of March 2010, compared to 21.9% for the same period in 2009, due to the popularity of "smartphones“  TeliaSonera stated that for the first time in several quarters, Finland and Denmark reported positive revenue growth in local currencies as a result of strong growth in data usage and higher equipment sales  In Taiwan, Chunghwa Telecom reported for its mobile business an annual increase in total revenue of 2.1%, mainly due to growth in mobile data revenue and increased handset and datacard sales  In Bangladesh, Grameenphone has highlighted how data revenues are contributing to consistent revenue growth. In Q1 2010 data revenues increased 65% and 13% from Q1 09 and Q4 09 respectively www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 4/41

Mobile Broadband Growth Success (3) Smartphones  Growth of the worldwide smartphones more than doubled that of the overall mobile phone market in Q1 2010, confirming the segment is exhibiting high-growth. According to the International Data Corporation (IDC) Worldwide Quarterly Mobile Phone Tracker, vendors shipped 54.7 million units in Q1 10, up 56.7% year on year. By contrast, the overall mobile phone market grew 21.7%. Smartphones accounted for 18.8% of all mobile phones shipped in Q1 10, up slightly from 14.4% in Q1 09  The Android operating system (OS) is increasing its smartphones market position, at least in the U.S. in Q1 2010. According to NPD Group, based on smartphone unit sales to consumers last quarter, the Android operating system moved into second position at 28% behind RIM's OS (36%) and ahead of Apple's OS (21%)  Since January 2010, the Smartphone share in Ireland has doubled from 8% to 16%, driven by key handsets.  MAVAM's has revealed that Smartphone users are the most likely to use handsets for Internet access (14%),against 4% for other devices.  In Honk Kong, almost half (48%) of respondents own a smartphone, more than double the global rate of 23%. www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 5/41

Mobile Broadband Growth Success (4)  Mobile broadband customer base grows by 130.6%, data accounts for approximately 18% of revenues www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 6/41

Mobile Broadband Growth Success (5)  Remarkable push in data/service revenues: +5.3% YoY Q1 2010 Venezuela  Service revenues (+21.1% YoY)boosted by data services Q1 2010 www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 7/41

Mobile Broadband Growth Success (6) South Africa Mobile data revenue market share of 58% Data revenue1 growth of 32.8% – Active data users up 29.1% – Data connect cards up 34.1% to 728k Data usage up strongly – Data traffic up 58.4% Increasing penetration of smartphones – Up 44.6% to 2.0 million Increasing penetration of data cards - Up 34.1% YoY www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 8/41

Mobile Broadband Growth Success (7) Vodafone Group Plc announces revenue from mobile data services reached £4 billion (US$5.8 billion) in 2010  Group data revenue increased by 19.3 percent to £4 billion ($5.8 billion) from a total of 50 million active data users across the group Smartphone use is currently the key driver of data growth, and Vodafone said it plans to increase the proportion of smartphones from 30% of its total sales mix to 70% by the end of 2013  CEO Vittorio Colao, said traffic on the group's networks in Europe increased 100% during the last 12 months, of which 85% was from data cards and 15% from smartphones. But the mix is shifting to smartphones: in the fourth quarter last year, total data revenues in Europe increased by 19%, with mobile Internet traffic increasing by 37% and PC (dongles) traffic by 17% www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 9/41

Mobile Broadband Growth Success (8) Mobile revenue Mobile non-voice services  Post‐paid mobile revenue increased 10%  Pre‐paid customer base expanded 10% & crossed 1,000,000  StarHub has announced that total post-paid mobile data traffic on its network grew to 7.4 petabytes in 2009 from 1.7 petabytes in 2008. www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 10/41

Mobile Broadband Growth Success (9) Revenues (NOKm) and EBITDA% Telenor Norway Telenor Group  10k net mobile subscriber growth driven by mobile  Added 5 million new mobile broadband subscribers Q1 10  9% mobile revenue growth  Solid mobile revenue growth, driven by mobile data and handsets Revenues (NOKm) and EBITDA% Telenor Sweden  8k net mobile subscriber growth  10% mobile revenue growth in local currency www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 11/41

Mobile Broadband Growth Success (10)  Data revenues up 46% YoY to €947 million in FY 09  1.5 million iPhones dispatched since market launch, 1 million during 2009  Growth of non voice revenue share of service revenues by 4% T-Mobile USA YoY to 26% Deutsche Telekom CEO René Obermann is expected to double revenues by 2015 with €10 billion coming from mobile data traffic. Obermann said it would double the number of 3G smartphones in the network to around 8 million by the end of 2010 www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 12/41

Mobile Broadband Growth Success (12) Mobistar SA  The use of mobile Internet and SMS continues to expand in 2010. At the end of March, the share of mobile data service revenues amounted to 31 % compared with 27.4 % a year earlier  Non-SMS mobile data represent 6.4% of total mobile service revenues (4.9% in 2008) www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 14/41

Mobile Broadband Growth Success (14)  Continued Strong Wireless Growth – driven by mobile broadband, substantial wireless margin expansion www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 16/41

Mobile Broadband Growth Success (15) Nation’s fastest 3G network getting faster  HSPA 7 2 Mbps performing well with 32%-47% increase in data download speeds where fiber backhaul is in place  Text messaging grew 50% YoY and picture messaging grew 130% Q4 2009  Wireless Service Revenue 2009 = $41.3 billion, +2.8 billion YoY, 29% of ARPU www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 17/41

Mobile Broadband Growth Success (16) Belgacom (Proximus) FY 09 revenue up 9.1% to € 303 million  Driven by increased SMS revenue (+8.1% YoY) and advanced data revenue (+12.2% YoY)  Net data ARPU YoY +6.3% to € 6.7 million KPN - Netherlands www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 18/41

Mobile Broadband Growth Success (17) Q1 2010 operating highlights:  Mobile customers: 1.8m (Net increase: 38,000 QoQ)  Mobile data as % of service revenue increased to 15.3%  Increasing take-up of smartphones will continue to drive data growth  M1 CEO Karen Kooi said: "mobile data revenues increased as a result of a larger mobile broadband customer base. Non-voice revenues made up 26% of services revenues, up from 23.4% a year ago”. www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 19/41

Mobile Broadband Growth Success (18) Wireless data revenue growth of 40% Q1 10  Higher smartphone penetration  Data device subscribers up 70% YoY  Data now represents ~21% of service revenues www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 20/41

Mobile Broadband Growth Success (19) According to a report from AdMob, smartphone data traffic grew in February 2010 was up 193% YoY which AdMob attributed primarily to iPhone™ and Android device usage  Telecom NZ reported data ARPU at December 2009 was up 19% YoY  A report by Chetan Sharma revealed that messaging still accounts for the bulk of data business, but media services such as mobile music, TV and video streaming, voice navigation, games, and location-based services, are gradually gaining ground. The explosion of apps and app storefronts last year contributed to the mobile data boom. The total of app downloads hit 7 billion, generating $4.1 billion in revenue - 12% of which came from in-app advertising www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 21/41

Mobile Broadband Growth Success (20) Etihad Etisalat (Mobily) Saudi Arabia Etihad Etisalat passed the one million mobile broadband subscribers landmark 2009  Mobily passed 1 million mobile broadband 1,200,000 subscribers in December 2009 1,000,000 800,000  HSPA is the enabling technology 600,000 400,000  Since December 2007, data traffic grew 200,000 tenfold reaching 50 terabytes in December 2009 0 2007 2008 2009 www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 22/41

Mobile Broadband Growth Success (21) HSPA+ entering the mainstream GSA – June 9, 2010: 114 HSPA operators i.e. more than one third have committed to deploy HSPA Evolution (HSPA+) Almost 1 in 5 commercial HSPA operators have commercially launched HSPA+ Source: GSA report: Global HSPA+ Network Commitments and Deployments – June 9, 2010 www.gsacom.com/downloads/pdf/Global_eHSPA_network_commitments.php4 www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 23/41

Mobile Broadband Growth Success (23) NTT DoCoMo Revenues from Wireless Services Year ended March 31 *’’PHS services revenue’’ for the years ended March 31,2007 and 2008 has been reclassified into ‘’Other revenues’’  No. of data plan subscriptions grew to 670.000  Smartphone sales recorded steadfast growth www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 25/41

Mobile Broadband Growth Success (25) Vivo SmarTone  Continuing growth • ↑23% YoY • Accounts for 33% of service revenue  Growth from • Wider adoption of smartphones • Mobile & wireless fixed broadband Vivo reported a sustained growth in data and VAS revenues, up 51.8% and 7.3% respectively in Q1 2010 compared to Q1 2009, and representing 17.5% of net service revenues in the quarter www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 27/41

Mobile Broadband Growth Success (26) Rogers Wireless  Continued strong smartphone activations helped drive Q1 10 wireless data revenue up 40% to $416 M or 26% of network revenue  Activated nearly 1.5 million smartphone customers bringing smartphone penetration to 31% of postpaid subscriber base Turkcell  > 1 million smartphone users  Number of monthly average mobile data users increased to approx. 7 million through handsets and PCs www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 28/41

Some industry forecasts (1) According to a study by Cisco “Visual Networking Index (VNI) Forecast and Methodology, 2009-2014 “, mobile data traffic is estimated to surge by as much as 39 times during the five year period from 2009 to 2014. By 2014, the annual global mobile data traffic is expected to reach 3.5 exabytes per month i.e. a run rate of over 42 exabytes on a yearly basis. Mobile data traffic will be the strongest in the Middle East and Africa (MEA) followed by the Asia-Pacific and North America as revenue from voice gets saturated and operators focus on alternate sources of revenue A new report published by Chetan Sharma Consulting, “Managing Growth and Profits in the Yottabyte Era,” predicts that in 2010, mobile data traffic in the U.S. will exceed 1 exabytes (or 1 million terabytes) - a mobile data traffic milestone that the global industry as a whole reached in 2009. www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 31/41

Some industry forecasts (2)  Ericsson has estimated that, by 2015, there will be 3.5 billion mobile broadband users around the world, compared to the 500+ million that use it at present  According to a recent Analysys Mason report, the total data traffic volume in 2015 will be more than 30 times that of 2010. Operators will need to make capital investments to increase capacity in order to meet this demand  According to In-Stat, “WCDMA-HSPA base stations will be the workhorses of wireless data networks”. 2009 saw overall deployments of newly deployed macro base stations up 10% on 2008, driven by the rising demand for smartphones and mobile broadband, meaning that most of the increase will have come from WCDMA-HSPA. WCDMA-HSPA base stations will account for at least 50% of total revenue in this segment in 2009. By 2013 WCDMA-HSPA will contribute 70% of revenues in the sector  ABI Research announced that shipments of mobile broadband-enabled consumer products, which includes e- book readers, mobile digital cameras, camcorders, personal media players, personal navigation devices and mobile gaming devices will increase 55-fold between 2008 and 2014 with total shipments reaching 58 million units per year in 2014 www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 32/41

Some industry forecasts (3) Smartphones According to a report by ABI Research on US mobile operator network traffic, smartphones and connected computing devices will be the primary drivers of data traffic over the next five years. By 2014, these device categories will generate more than 87% of total mobile network data traffic for US operators. The report also states that growth of Android, iPhone and similar smartphones will cause average smartphone traffic levels to grow by 48% over the forecast period. Led by the success of Android, Linux-enabled smartphones are expected to make up 33% of the total worldwide smartphone market by 2015, according to a new report from ABI Research. More than 60,000 smartphones are now shipping per day, with Android OS leading the pack, notes the market researcher. Up to 127 million Linux-based smartphones may be shipping by 2012. www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 33/41

Some industry forecasts (5) Leading the Mobile Broadband Revolution Ralph de la Vega, Chairman of the Board, CTIA  Mobile broadband growth outpaces every other platform**  Pew estimates that by 2020, mobile devices will be the primary Internet devices for most people in the world***  The average smartphone user generates 10 times the amount of traffic generated by the average non-smartphone user* *Source: Cisco, VNI Mobile, 2010 ** Source: CTIA, Written Ex Parte to FCC, Sept. 29, 2009 *** Source: Pew Internet & American Life Project, Dec. 2008  Worldwide Machine-to-Machine devices rise to 412 million by 2014* * Source: Juniper Research, Embedded Mobile and M2M Strategies 2009-2014, Jan. 2010 www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 35/41

Some industry forecasts (6) Total mobile traffic worldwide forecast Total Mobile Traffic Worldwide Forecast 20 18 Exabyte 1,000,000,000,000,000,000 CS Voice 16 Petabyte 1,000,000,000,000,000 (c) GSA – Global mobile Suppliers Association 14 Terabyte 1,000,000,000,000 Exabytes 12 Gigabyte 1,000,000,000 10 Megabyte 1,000,000 Mobile Broadband 8 Kilobyte 1,000 6 4 2 0 2008 2010E 2014E Source of data: Informa Telecoms and Media – March 2010 www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 36/41

Some industry forecasts (7)  UK consultancy firm, Coda Research Consultancy, has predicted that mobile data consumption in the US is set to reach 327,000 terabytes a month by 2015, indicating a 40-fold rise in mobile data consumption over 5 years  Mobile data traffic from PC modems and routers is forecast to increase 4-fold between 2010 and 2014, according to a report by ABI Research. 2,000 petabytes of data will be sent and received in 2010, a figure that will rise to about 8,000 petabytes in 2014  Semiannual US wireless industry survey was released at CTIA in March 2010 revealing that wireless service revenues totaled $77 billion for the last half of the year. The real growth is coming from wireless data services - mobile Web, text messages, and other non-voice services. In the latter half of last year, revenue for wireless data service totaled > $22 billion, nearly a third of overall wireless services revenue and up 26% YoY. Steve Largent, President and CEO of CTIA, said in a statement. "Mobile broadband will increasingly play a vital role in people’s lives."  A study by Juniper Research has forecast that more than 1 in 10 mobile subs will either have a ticket delivered to their mobile phone or buy a ticket with their phone by 2014, representing a five-fold growth over the next five years. www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 37/41

Some industry forecasts (8) A Report Predicts Explosive European Growth for Mobile Broadband - According to a CCS Insight report, Mobile Broadband in Europe, 4Q09 - the total Mobile Broadband subscribers in key European markets will rise from 22m at the end of 2009 to over 43m in 2011. In addition, total revenue from Mobile Broadband access in the major markets will rise from less than €6 billion in 2009 to more than €11 billion in 2011 www.ccsinsight.com/reports/491/ Cisco Systems predicts in its Visual Networking Index that mobile-ready devices and mobile video will fuel enormous global growth in mobile data traffic over the next four years - The Pentagon and broadcast networks can expect continuing pressure to turn over some of their spectrum to make more airwaves available to the private sector. According to Cisco Systems, global mobile data traffic increased 160% in 2009 to 90 petabytes per month. Cisco predicted that "annual global mobile data traffic will reach 3.6 exabytes per month globally or an annual run rate of 40 exabytes by 2014," (39 fold increase from 2009 to 2014, or a CAGR of 108%) and noted that such traffic "is growing today 2.4 times faster than global fixed broadband data traffic.“ Cisco says that, by that date, there will be more than five billion personal devices connecting to mobile networks, as well as billions of machine-to-machine devices. Video will represent 66% of all mobile data traffic by 2014, up 66-fold from 2009. www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 38/41

Some industry forecasts (9) Global mobile Suppliers Association (GSA) The results from an industry survey organized last year by GSA provided an expectation that HSPA+ mobile broadband technology would enter the mainstream during 2010. GSA confirms this is now becoming reality as HSPA+ is now commercially launched on almost 1 in 5 of HSPA networks. Several more HSPA+ networks are scheduled to launch in the coming weeks and months. The eco-system includes 42 HSPA+ devices which have been announced by 11 suppliers. 61 HSPA+ systems have now entered commercial service in 34 countries, of which 52 support a peak downlink data speed of 21 Mbps and 5 systems support 28 Mbps and the remaining 4 support 42 Mbps. By the end of 2010 GSA expects that around 95 HSPA+ systems will be in commercial service Source: GSA report: Global HSPA+ Network Commitments and Deployments – June 9, 2010 www.gsacom.com/downloads/pdf/Global_eHSPA_network_commitments.php4 www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 39/41

Mobile Broadband resources from GSA - recent surveys, reports and papers Evolution to LTE: Information Paper - June 7, 2010 WCDMA operators (347 in 144 countries) – April 16, 2010 All these resources – and more – are 114 HSPA+ network commitments – June 9, 2010 available via the links on the GSA HSPA operators survey (341 networks launched) – April 16, 2010 home page 2,349 HSPA Devices survey – April 22, 2010 www.gsacom.com Digital Dividend update – June 2, 2010 Join the discussion on the GSA LinkedIN Group www.linkedin.com/groups?gid=2313721 www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 40/41

Register for updates/press releases/downloads www.gsacom.com/php/register_form.php4 website: www.gsacom.com www.gsacom.com/rss/gsanews.php4 www.twitter.com/gsacom http://gsacom.mobi Download this chart and others and maps etc. at http://www.gsacom.com/news/statistics.php4 www.gsacom.com Global mobile Suppliers Association © 2010 Mobile Broadband Growth – June, 2010 Slide no. 41/41

Mobile Broadband Growth Results June 2010

by Global mobile Suppliers Association (GSA) on Jun 15, 2010

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Mobile Broadband Growth Results June 2010 — Presentation Transcript

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