[official wire] The effects of the slowing US economy become ever more apparent with all operators reporting a decline in ARPU in the final quarter of 2008. Nonetheless overall operators saw marginal improvements in comparison to end of 2007 ARPUs as data and mobile content continue to increase in popularity. Data ARPUs rose for AT&T, T-Mobile and Verizon with the former reporting a boost in Q408. The prevalence of more sophisticated handsets has helped drive this growth and increased reliance on mobile content will be one of the defining trends of the US mobile market moving forward. BMI has included a new section devoted to the mobile content market in the US given the growing importance of this area of the market.
The range of services on offer depend on the different operators but the overarching trend seems to be towards mobile handsets being able to access data in the same way as a PC.
Although the operators themselves do not provide much indication of 3G subscribers the market leaders AT&T and Verizon's data show that growth was strong. T-Mobile launched its first 3G network in May 2008 in New York and has rapidly expanded its coverage. BMI has included 3G forecasts for the US market for the first time with an estimated 30% of the mobile market believed to be 3G users. Again it is the presence of popular data-enabled handsets that has helped to drive this area of the market. BMI forecasts that there will be over 190mn 3G subscribers int he US market by the end of 2013 accounting for around 60% of the total mobile subscribers in the country. Total mobile subscribers by this time will still not have reached 100% penetration as annual growth rates look set to remain slow.
The economic crisis will certainly impact the mobile market with lower ARPUs being one of the most visible sings. There is also increasing evidence that prepay services have grown in popularity as this enables subscribers to have more control over their spending during a period when unemployment is high and causing consumer confidence to drop. BMI beleives this will be a temporary move on the part of US subscribers as they face difficult times but overall the mobile market looks set to weather the storm.
The area of the market likely to be most affected is the fixed-line market with many subscribers expected to choose mobility over a wireline service. The fixed-line makret has been in decline for some time and this may yet accelerate as the econonic downturn goes on. Broadband on the other hand has been identified as a key area for boosting economic growth with the January stimulus package reserving US$7.2bn to develop broadband services in underdeveloped areas.At the time of writing no company had been awarded funding.
We have left broadband and fixed-line data mostly untouched in this report owing to the added data for the mobile sector. In our next quarterly update BMI will provide a full update of these two sectors including the impact of the economic downturn and the parties expected to participate in the broadband stimulus package.
An Estimated 30% Of The Mobile Market Believed To Be 3G Users
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