Study: Mobile Services Market Will Grow Despite Economy

June 22, 2009

While the normally recession-proof mobile services industry has been impacted by the economy, a new study projects that revenues from mobile services will continue to grow during the next five years.

Josh Cable

According to a study by ABI Research, even under the worst recovery scenarios, mobile services revenues will continue to grow at a nearly 1.2% annual clip through 2014, a 0.5% loss over pre-crisis conditions.

"A long economic recovery places pressures on mobile operators to compete on price, particularly with undifferentiated voice services," ABI Research Practice Director Dan Shey said. "Mobile data services allow operators to counter that pressure. However, each region is different. Operators should create strategies that lead customers to maintain 'nice-to-have' data services or encourage addition of more utilitarian ones."

Economically, North America has been hit hardest. But mobile data services growth will exceed 8% through 2014 even in the worst recovery scenario and will shield mobile services revenues against growing voice pricing pressures, according to ABI Research.

While stimulus packages are helping power the Asia Pacific region through the financial crisis and limiting unemployment loss, regional operators derive a large portion of their data revenues from content downloads. These products would be the first casualties of an extended recession, particularly with APAC's substantial prepay base, the ABI study notes. However, operators can mitigate the impacts of the depressed conditions through appropriate messaging and offer management.

"Mobile operators need to stress the utility of mobile services and pursue appropriate services personalization initiatives that allow customers to buy and use services in ways that best suit their needs," Shey said. "Business customers also should be a target segment as businesses consider mobile a way to lower costs and increase competitiveness."

ABI Research provides in-depth analysis and quantitative forecasting of emerging trends in global connectivity.

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About the Author

Josh Cable | Former Senior Editor

Former Senior Editor Josh Cable covered innovation issues -- including trends and best practices in R&D, process improvement and product development. He also reported on the best practices of the most successful companies and executives in the world of transportation manufacturing, which encompasses the aerospace, automotive, rail and shipbuilding sectors.

Josh also led the IndustryWeek Manufacturing Hall of Fame, IW’s annual tribute to the most influential executives and thought leaders in U.S. manufacturing history.

Before joining IndustryWeek, Josh was the editor-in-chief of Penton Media’s Government Product News and Government Procurement. He also was an award-winning beat reporter for several small newspapers in Northeast Ohio.

Josh received his BFA in creative writing from Bowling Green University, and continued his professional development through course-work at Ohio University and Cuyahoga Community College.

A lifelong resident of the Buckeye State, Josh currently lives in the Tremont neighborhood of Cleveland. When the weather cooperates, you’ll find him riding his bike to work, exercising his green thumb in the backyard or playing ultimate Frisbee.