Global Mobile Revenue Decline Predicted, Except In Africa

Global Mobile Revenue Decline Predicted, Except In Africa

While a global decline in mobile revenue is predicted after 2018, only Africa is forecast to be exempt, leaving lots of room there for investment, according to HumanIPO.

International connection growth will not reach a compound annual growth rate higher than 4 percent between 2012 and 2018, according to a study by Ovum, a London-based consultancy specializing in global coverage of IT and telecommunications.

If universal revenues in the field increase by less than a 2 percent per year, the average revenue per user will continue to decline, HumanIPO reports.

However, Africa’s compound annual growth rate is forecast to increase by 4.2 percent between 2012 and 2018.

“Innovation in services, tariffs, business models, network operations, and partnerships will be key revenue-generating strategies,” the report said.

Sara Kaufman, industry analyst at Ovum said, “When you compare connection and revenue compound annual growth rates, it is clear that mobile operators are facing a new reality: they must do much more with much less.”

An expected one billion connections by 2018 has been calculated for the continent, with a compound annual growth rate of 5.6 billion.

By comparison, global connections will rise from 6.5 billion to 8.1 billion between 2012 and 2018 with annual mobile service revenue increasing from $968 billion to $1.1 trillion.

A 1 percent decline is expected from 2017, translating to $7.8 billion, with the decline expected to continue for five years.

While growth is anticipated to slow down for the majority of markets worldwide, consolidation is viewed as a relief for market pressures.

“The need for revenue stabilisation is becoming paramount for a sustainable future,” Kaufman said.

Developing markets such as Africa are facing the severest challenge with steadily growing markets reaching maturity.

However, Africa is believed to still carry large potential for development, as well as the South America, Central America and Asia-Pacific regions.