2010 European Mobile Data Market

The market for mobile data in both Eastern and Western Europe is potentially enormous, given the region’s population, the rapid development of mobile technologies and the growing number of content providers. Application stores, initiated by Apple and Nokia and increasingly adopted by pan-European network operators such as Orange, have extended the reach and potential revenue to be derived from gaming, video, music and thousands of additional applications.

The promotion of flat-rate data plans has also become a significant business strategy among MNOs as they endeavour to retain and attract customers, while encouraging customer use of high-end mobile data services. Flat-rate plans have also served to overcome consumer reticence to make use of some services which have hitherto been dismissed as frivolous, expensive and unnecessary. SMS and to a lesser extent MMS services continue to be the dominant data applications, while services such as mobile TV have yet to prove convincing propositions for many consumers.

Significantly, by the beginning of 2010 data accounted for about 26% of overall mobile revenue, compared to 16% in 2006. Yet fierce competition among MNOs, together with regulated data roaming tariffs, has meant that the tremendous growth in mobile data volume has not translated into higher ARPU and revenue. This is likely to continue during the next few years, while MNOs will secure an increasing proportion of revenue from data services.

Operator investments in technology upgrades, specifically in HSPA+ and LTE, will help secure revenue streams in coming years by making high-end services accessible to a wider number of mobile users. In early 2010 Sweden and Norway could claim to have the world’s only commercial LTE deployments, and by the end of the year several European markets will be exploiting the potential of super-fast data access. In this respect, MNOs will for the first time be able to compete effectively with fixed-line broadband services. In conjunction with improved network capacity, mobile networks by 2015 will have a more profound part to play in the provision of national broadband services as governments and regulators strive to establish broadband as a universal service. For many rural users mobile broadband will be the only effective platform for Internet access, and thus mobile data use will show continued consumer support and growth.

Markets highlights:

Finland

Finland has one of most innovative mobile markets in Europe. The country was a pioneer in developing 3G, and was the first to deploy 3G over 900MHz spectrum. Growth in the sector continues to be strong despite high mobile penetration. The 3G now makes up a quarter of the total subscriber base, while mobile broadband has also grown considerably during the last two years. In addition, the country in 2010 boasted among the lowest mobile call charges of all EU Member States. This report provides statistics and research on the Finnish mobile market in 2010, including key regulatory issues, a snapshot of the consumer market, the growth of mobile data services and the development of emerging technologies and networks such as HSPA.

Germany

The German mobile data market has enormous potential for growth following massive investments by the four network operators to upgrade networks supporting mobile data services. The regulator anticipated future growth in April 2010 by auctioning spectrum in the 1.8GHz and 2.6GHz bands, as well as refarming spectrum below 1GHz for use by mobile broadband. Operators have fast-tracked the development of data-rich applications to improve profit margins as voice ARPU continues to fall in response to competition from resellers and regulatory measures on roaming and termination rates. Mobile TV has not yet caught the public imagination: the national DVB-H licence holder Mobile 3.0 withdrew services soon after launch, partly sabotaged by network operators having introduced handsets allowing users to access free-to-air DVB-T channels. This report provides key statistics and analysis on the mobile data market in Germany in 2010. It focuses on 3G services and assesses the range of advanced mobile data services and technologies such as mobile TV, HSPA, LTE and video over mobile.

Sweden

Mobile data use is set to grow rapidly in 2010 and 2011 in response to MNO investments in upgraded networks using HSPA and LTE technologies. Although much of this infrastructure upgrade was undertaken before consumer need was identified, the commercial launch of LTE has been strengthened by the adoption of business models which encourage consumers to make use of services available. These incorporate popular services such as flat-rate music downloads and low-price mobile broadband offers. As a result, the number of subscribers using mobile data services reached 6.5 million by early 2010, representing some 60% of all mobile subscribers. By the end of 2010 the average mobile data user will download about 2.5GB per month, and mobile data revenue may generate some SEK 3.2 billion for the year.

Data in this report is the latest available at the time of preparation and may not be for the current year.