Global Perspectives to Mobile Access and Data

Global Perspectives to
Mobile Access and Data
By ALI Saghaeian
Chief Analyst & Consultant
Telecoms, IT, and Media
Saghaeian [at] gmail.com

Objectives
• How Data access is compensating
for the decline in voice
• Will LTE users pay more for quality
• How can 4G Grow the Revenues
• Learning Industry Growth Drivers
(i.e. Mobile Data and OTTs)
• Discussing
Operators’ plans
and their success
keys in the
Competition
Exercise

Agenda
• Mobile Access Revenue Growth Curves
• New Evolving ECO System
• Mobile Infrastructure Evolution
• 4G-LTE Global Service Status
• How can 4G Grow the Revenues
• Case Studies of Growth in Data revenues
• Core Revenue Trends – Mobile Data
• Industry Growth Drivers: Mobile Data and OTTs

Mobile Access Revenue Growth Curves
With each cycle, the length of the curve shrinks, so the access
revenue curve will peak earlier than the previous two curves

Data access is compensating for the decline in voice

communications is core business…
being challenged by digital communication
 Communication is (will be) feature of
any web-based service and web-
connected “thing”.
 Operators’ existing communication
services have failed to address costumers’
digital communication needs and will be
increasingly challenged new technologies
& new players.

 Mobile operators must look at ways to move beyond just providing access
services and position themselves from being service providers to becoming
service innovators.
Mobile Access
 In addition, the migrations from 2G to 3G to 4G have been step functions to
deliver more capacity at a lower cost/bit.
 For the access curve, where most operators are still going to be riding the growth
for the next several years, strategies will be driven by technologies and business
models that help manage the cost per bit to enhance the margins per bit.
 The growth of the access curve helped compensate for the declines in voice and
messaging revenues. For example, in the US, the voice revenues declined $12B
from 2007 to 2011. During the same time, the data revenues increased by
$41B, easily compensating for the decline. In Japan, the voice revenues
declined by $3B but the data revenues increased by $25B from 2007 to 2011.

Mobile Services Revenue Growth has been Declining

As We Grow from 2G to 3G to 4G and to 5G

New Evolving ECO System

Mobile Infrastructure Evolution

Network evolution is dedicated to meeting business
development

4G-LTE Global Service Status

LTE users – what’s important?
New opportunities, new challenges

Will LTE users pay more for quality?

How can 4G Grow the Revenues

Mobile Data
 WE are living in a data-driven mobile era.
 Many operators started from unlimited to boost demand but soon realized
the folly of their judgment and moved back to the metering model. While
unlimited voice and messaging can be sustained, unlimited data cannot
 Smartphone penetration is a proxy for high-data usage. The advent of the
iPhone coincided with and to some extent accelerated the deployment of
the fast 3G networks. Android started to show the same data consumption
characteristics as the iPhone by 2010.
 AT&T’s data revenue grew from $689M in 2004 to $22,000M in 2011, a
30x increase. Other operators have seen similar hockey stick curves.
 AT&T gave up on the unlimited plans 3 years after the launch. During this
time period, the operator sustained the most incredible wave of data
growth witnessed in human history. From 1 PB/month traffic in 2007, the
data traffic grew 25000% to 35 PB/month by Q1 2012.

US Mobile Operators Revenue Microtrends

US Mobile Revenue Growth 1995-2011

Growth in Data revenues in India
• Data revenues were insignificant pre 2010. During 2010-11 there was some traction.
• In 2012 it increased by 50%. In 2013 it doubled form 2012 levels and became
significant contributor to non voice revenues
• Airtel’s mobile Internet revenues grew around 90 per cent year-on-year
• Idea Cellular that reported 92.2 per cent mobile data traffic volume growth.
• The company’s average 3G data revenue per user has also increased by Rs 20 in
the last one year to Rs 109.

China Mobile – Mobile data segment trends

Core Revenue Trends – Mobile Data
Telco revenue decline is expected to slow a little going forwards, also due to
increasing data revenues from higher penetration and traffic from smartphones &
connected devices

Industry Growth Drivers 2014 - Mobile Data and OTTs
Also industry executives are highlighting mobile data monetization and
OTTs/content services as key industry growth drivers

Any Questions?
24
ALI Saghaeian | saghaeian@gmail.com

Global Perspectives to Mobile Access and Data

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