News
23/08/2010
Global market worth 1,348.9 billion USD in 2009
The World Telecom Services Market
In the latest edition of its half-yearly report “The World Telecom Services Market” IDATE’s experts are analysing the global recovery and impacts on the telecom services market. Yet the recession did not leave telecom services untouched. In many cases it exacerbated the decline of fixed phone service in advanced countries. Mobile services were unable to sustain growth and even recorded a drop in several advanced markets.
“We continue to expect a gradual recovery in 2010, fueled by growth in emerging economies, and a return to growth in 2011 ” comments Carole Manero, project manager and senior consultant at IDATE.
Trends by market
The value of the global telecom services market grew just 0.6% in 2009, which was lower than what we anticipated in our previous publication. After the slowdown that began in 2008 (growth was just +3.5%, down 2 points compared to the 2007 rate), the telecommunications services market again stumbled in 2009 with a rate of less than 1%. This was as much the result of a difficult economic situation as of structural adjustments related to the maturity of the sector in a number of segments and regions. It is
easy to see in this positive growth a sort of resistance to the economic outlook, given that other industries experienced major setbacks. Though they were not spared by the crisis, telecom services were still able to capitalize on the subscription concept underlying their business model.
The global market was worth 1,340.3 billion USD in 2008 and 1,348.9 billion USD in 2009 (.0.6% growth). The global market is increasingly dominated by mobile services (55%), whereas in fixed services, there is a strong shift from phone to Internet, and especially broadband.
Growth of revenue from mobile services continues to drop. Down from 11% in 2007, the worldwide growth of the mobile services market fell by two-thirds over two years to just 3% in 2009. This may seem reasonable given that more than half the planet owns a mobile phone and penetration exceeds 80% in most industrialized markets. Yet a comparison with the dynamic growth in devices (+15.5% in 2009) provides a glimpse into the pressure on revenue per subscriber. This is a natural consequence of the massive influx of low-revenue customers from emerging markets. But the pressure is also noticeable in advanced markets, especially in Europe. The number of mobile customers worldwide has reached 4.6 billion (for monthly growth of some 51 million customers!).
With total sales estimated at 737.5 billion USD in 2009, mobile services remain the main driver of overall growth. They have represented more than half of total global revenue from telecom services for four consecutive years (in 2009 their share was 55%) and have accounted for more than twice that of fixed telephony since 2009.
The decline of fixed telephony began in 2002 and again picked up speed in 2009, plummeting 7%, with revenues falling to 348.6 billion USD. This left its share of the total telecommunications services market at just over one-quarter (26%), compared to one-third in 2006 (33%). In three years, fixed telephony lost 14% of its value. The substitution of landlines with mobile phones, coupled with a shift toward IP, is responsible for the drop in the number of fixed lines in use and the sharp decline in average revenue per line.
With revenues of 262.9 billion USD for 2009, other services (Internet and data) continue to gain ground, driven by Internet services in particular. Their share of total telecom services has slowly but steadily grown, by 0.4 to 0.8 points per year since 2006. It reached 19.5% in 2009 compared to 17.5% in 2006 and less than 15% in 2001. In 2009, for the first time, their contribution to growth was unable to offset the loss incurred by fixed telephony with a whopping 26.7 billion USD loss for fixed voice versus a 12.1 billion USD gain for fixed data. Nonetheless, the surge in Internet services, especially broadband, is remarkable. In terms of volume, the number of fixed broadband customers again jumped by some 58.4 million (+14%) in 2009, amounting to 4.9 million new customers per month worldwide. At this pace, we expect the 500 million customer mark to be passed during 2010. At the end of 2009, high-speed accounted for more than three-quarters (77%) of the world’s Internet connections.
Carole Manero
Project Manager
c.manero@idate.org
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