Mobile broadband revenues to grow 19.2% annually to 2016: Ovum

Mobile broadband revenues are forecast to grow at an annual rate of 19.2% and generate $122.9 billion in incremental revenue between 2013 and 2016 in new research from Ovum.

Despite these impressive gains, overall operator revenues are forecast to increase little over the next five years from a 2012 estimate of about $2 trillion.

“The recovery from the 2009 recession has been weak, and the ongoing global fiscal crisis continues to present a risk to the telecoms industry,” said John Lively, chief forecaster at Ovum. “Over the next three to four years, both fixed and mobile operators will face the same fundamental challenge: to increase new sources of revenue fast enough to offset the decline in mature services.”

While revenues from public cloud, enterprise Ethernet, IPTV and managed/hosted IP voice services will also grow at double-digit rates over the next five years, operators will face tough competition from over-the-top players and traditional rivals, says Ovum.

The market-research company recommends that operators adopt “consumer-services marketing approaches” to meet the challenge.

Nevertheless, low, single-digit gains in service-provider revenues will crimp capital expenditure over the forecast period, creating a difficult environment for equipment suppliers.

Vendors that position themselves in high-potential product segments – such as converged packet optical, ROADMs, 40G/100G networking gear, carrier Wi-Fi and network-related services – will have the most to gain.

Ovum also warns component makers to expect continued volatility in terms of market demand. “This can be mitigated to some degree by forming close relationships with infrastructure vendors and jointly understanding the end customers’ needs and plans,” said Lively. “Plus, winning a share of 40G and 100G business will be essential to avoid being left behind by competitors.”

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