These two charts explain, in a nutshell, the business model problem faced by mobile service providers. In the U.S. market, for example, data consumption--and therefore capacity--grows exponentially. That means ever-growing investment in facilities.
Service revenue, on the other hand, does not grow much, if at all. On an inflation-adjusted basis, U.S. mobile subscription prices have generally been flat for the past decade or more.
Access provider revenue sources are multiple: business and consumer; flat-ate and usage-based products; base and value-added components. But revenue growth is driven by data usage. And relatively little of that usage is directly usage based.
To be sure, “buckets of data” are somewhat related to usage, at least in the mobile segment of the business. But in the fixed networks business, charging tends to be usage insensitive, with pricing variability based on downstream speed, not consumption.
And that, in a nutshell, illustrates the core problem for access providers: flat revenue and ever-growing capacity requirements.
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