Thursday, December 9, 2010

Usage Up, Users Up, Revenue Down: Primary Reason Service Providers Seek New Revenue from App Providers

While the number of mobile data connections in western Europe will rise by an average of 15 percent a year to 270 million in 2014, overall end-user revenue will fall about one percent a year, IDC estimates. That is the primary reason European and U.S. mobile operators insist they will have to move to two-sided revenue models that generate income both from end users and business partners using the mobile and fixed networks.

The alternative is raising access fees for most, if not all, users, in an environment where such moves face tough consumer opposition.

The greater usage, and greater number of users is propelling capital investments that will grow 28 percent from last year to about $3.7 billion, according to researcher Canalys.

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