Sorry, you need to enable JavaScript to visit this website.

Broadband strategy imperative for APAC mobile operators: IDC

  • Voice growth at 2.5% CAGR till 2017, data connectivity or mobile broadband at 19.3%
  • Factors driving trend: Cheap smartphones, 3G and LTE rollouts, and OTT popularity

Broadband strategy imperative for APAC mobile operators: IDCMANY mobile operators in the Asia Pacific region have been struggling to maintain revenue growth, especially for their voice services.
 
International Data Corporation (IDC) projects that the growth rate for voice services revenue in what it calls the APeJ (Asia Pacific excluding Japan) region will slow down to a compound annual growth rate (CAGR) of 2.5% from 2012 to 2017.
 
However, data connectivity or mobile broadband revenue will grow at a CAGR of 19.3% in that same time period, the analyst firm said in a statement.
 
IDC attributes the growth of data revenue in APeJ to three key factors: Smartphone penetration with affordable prices; rollout of 3G (Third Generation) and LTE (Long-Term Evolution) licences; and mobile user behaviour towards over-the-top (OTT) services.
 
OTT refers to instant messaging, video, audio and other media delivered over an open Internet / broadband connection directly to the user, without the need for carriage negotiations and without any infrastructure investment on the part of the provider, IDC noted.
 
The provider may be aware of the contents of the Internet Protocol packets but is not responsible for, nor able to control, the viewing abilities, copyright and/ or other redistribution conditions of the content.
 
“Growth for data connectivity in 2014 will continue to be strong and we expect the market to reach US$141.2 billion by 2017,” said Ashadi Cahyadi, senior research manager at IDC Asia/Pacific’s Telecommunications Group.
 
“LTE subs (subscriptions) will hold the highest five-year CAGR of 44.3% compared with other mobile technologies, and Singapore will lead the growth in the region and achieve a CAGR of 103% in 2017.
 
“With this trend, mobile broadband has already become an imperative strategy for operators, considering the high investments, and to offset revenue losses from OTT players,” he added.
 
According to the IDC Asia/Pacific Semiannual Telecom Services Tracker for the first half of 2013, the total mobile services market revenue in APeJ will reach US$271.4 billion by 2014.
 
Asia's most populated countries like China and India will continue to make up the largest shares in the market. Meanwhile, emerging countries like Indonesia, Thailand and Philippines will be the top three countries leading revenue growth in 2014.
 
“Like other mature markets in Europe or North America, the hype of mobile broadband services will lead into the same classic problem, which is bandwidth as a resource,” said Ashadi.
 
“Having a better understanding on what customers want and their behaviours in terms of data usage will help the operators not fall into the trap of unlimited broadband plans,” he added.
 
IDC also sees the impact of heavy deployment of 3G and 4G infrastructure on traditional messaging services like SMS and MMS (short and multimedia messaging services).
 
Revenue from these kinds of services is expected to decline at a CAGR of around -7%, from US$27.8 billion in 2012 to US$19.5 billion in 2017.
 
Therefore, it’s also important for the operators to start looking for opportunities to partner with OTT players to cover this potential revenue loss, IDC said.
 
Related Stories:
 
Celcos beware: Voice-over-data players gunning for you
 
No 1 risk for telcos is failure to adapt to new technologies: EY study
 
Mobile players must evolve to stay relevant: Frost                      
 
Social messaging apps will cost operators US$32.6bil: Ovum
 
 
For more technology news and the latest updates, follow us on TwitterLinkedIn or Like us on Facebook.

 
Keyword(s) :
 
Author Name :
 
Download Digerati50 2020-2021 PDF

Digerati50 2020-2021

Get and download a digital copy of Digerati50 2020-2021