Last updated: 15 Jun 2009 Update History
Report Status: Archived
Report Pages: 7
Analyst: Paul Budde
Publication Overview
Australia's first newsletter on national and international management and business applications in broadband, voice, data and video communication. Trends and developments in telecommunications, wireless communication, broadband and data services, fibre-to-the-home and satellite-based services. It describes business opportunities and provides updates on deregulation in the Australasian region and around the globe.
Executive Summary
Editorial - Recession-proof mobile investments
Investments in mobile infrastructure might also begin to experience a slowdown, but so far most of these investments have continued at the same pace as before the financial crisis.
This will be partly due to the fact that these investments were committed to before the crisis started. However if the situation had been sufficiently dire that commitment would not have been a good enough reason to continue with them.
So it is possible to (cautiously) conclude that, as work is continuing more or less as normal, mobile infrastructure has to date proved to be fairly recession-proof. It will now depend on how quickly the broader market (for this read ‘financial market’) recovers whether that situation is going to continue, or whether the mobile market will be hit by a delayed impact from the financial crisis.
While this focus on mobile might change, as many infrastructure stimulus packages are aimed at fixed infrastructure, currently more capex is being spent worldwide on mobile networks than on fixed infrastructure.
The mobile developments in the emerging markets are nothing less than spectacular and this market is rapidly showing what else can be done with mobile. Promises made by the mobile operators as long ago as the 1990s – and which in the developed markets were never delivered upon – are actually being fulfilled in the emerging markets – from m-commerce, to m-payments, mobile TV and a range of other interactive services, in particular micro credit.
Even more than in the ‘rich’ developed markets in the emerging markets smart phones are going to quickly replace the current generation of mobile phones. PCs are up to 8x more expensive than mobile phones and are unaffordable for the majority of the population. Furthermore, while mobile penetration in some of these countries is approaching 100%, fixed line penetration is nowhere near that level.
So, in other words, the fixed network with a PC linked to it is simply not an option for most people in those regions. Expect some spectacular, low cost, smart PDAs to come out of these developing markets soon.
Massive investments are taking place in the mobile backbone as these mobile data applications have increased traffic over these networks to an enormous extent. More efficient mobile backbones can create savings to the network operators of between 30%-40%. Hybrid networks, whereby data is transferred over DSL infrastructure, is another option – many mobile sites are now seeing DSLAMs installed at their premises – and here there have been reports of savings as great as 90%.
The challenge for the mobile network operators will be how to move their networks from megabit speeds to gigabit speeds.
Paul Budde
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