Chetan Sharma predicts that in less than five years, the connected devices category will generate more revenue for the operators than the entire prepaid segment in the United States. If you assume the prepaid market generates about 18 percent of all mobile subscriptions, that will give you some idea of the magnitude of revenue.
Yankee Group researchers estimate 50 million prepaid customers at the moment. If you assume average monthly revenue of about $40 for each of those accounts, or $480 a year, you could estimate a market worth $24 billion or so. Since most connected devices these days use Wi-Fi rather than data plans, connected device revenue as big as prepaid assumes robust uptake both of tablets and a switch to mobile broadband connections in place of Wi-Fi as well.
Today, connected devices represent about three percent of the quarterly data revenues.
By the end of 2010, Sharma expects the average U.S. data consumption to be approximately 325 MBytes per month, up 112 percent from 2009. This puts United States right behind Sweden in the top two nations, ranked by per capita mobile data consumption, says Sharma.
While the United States lags Japan and Korea in 3G penetration, most of the cutting edge research in the areas of data management and experimentation with policy, regulations, strategy, and business models is taking place in the networks of the U.S. operators and keenly watched by players across the global ecosystem, Sharma says.
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