Mobile Internet Driving Service Revenues, Contributes 31% Globally in 1Q 2014

In ABI Research’s profitability analysis, Verizon Wireless beat China Mobile for the first time

ABI Research

SINGAPORE - ​In 1Q 2014, the worldwide mobile service revenue increased 0.58% year-on-year (YoY) to US$264 billion according to ABI Research, and the aggregate service revenue for 2014 will grow 2.9% YoY to US$1.01 trillion, mainly driven by the robust growth of the mobile Internet market. Proliferating mobile data subscriptions and enhanced network capacity will drive global mobile Internet service revenue to US$456.7 billion by 2019—44.7% of total mobile service revenue. Despite global service revenue growth, the Western European market is declining: 1Q 2014 service revenue declined 5.2% YoY.

“Facing continued price pressure driven by the competitive mobile market, mobile carriers have had to take on higher subscriber retention and acquisition costs to support their market positions. This has affected profitability,” commented Marina Lu, research analyst at ABI Research. According to ABI Research’s Market Data, the major European carriers such as Vodafone, Telefónica, T-Mobile, and Orange all suffered from gross profit decreases in 1Q 2014, whereas in North America mobile carriers are still demonstrating a positive outlook for gross profit.

In ABI Research’s profitability analysis, Verizon Wireless beat China Mobile for the first time, carrying the top position for most profitable mobile carrier in aggregate for 1Q 2014, followed by China Mobile and AT&T respectively. Strong growth in retail postpaid subscribers, increased smartphone customer base, enhanced 4G LTE smartphone line-up, and attractive pricing plans have contributed to Verizon’s profitability. In addition, Verizon also moved up one position to second in the ranking for quarterly gross profit per subscriber, at US$77.1.

There is no doubt that fast-growing mobile data consumption has helped to mitigate the declining voice and messaging ARPU trend. “Japan and South Korea mobile operators have spared no effort to boost mobile data usage, expecting monthly data traffic per wireless subscriber will reach 12 Gigabytes in 2019,” noted Jake Saunders, VP and practice director, core forecasting. “Global mobile data traffic will reach 260.8 Exabytes by 2019, nearly a six-fold increase on 2014.”

The “Mobile Carrier and Revenue” and “Mobile Data Traffic & Usage” Market Data provide a robust source of financial and operational benchmarks for regional and mobile carrier analysis. These findings are part of ABI Research’s Mobile Deployments, CAPEX, and Traffic Market Research.

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