3G service revenue of global telecom operators has begun to decline in 2014 as 4G growth accelerates, said Strategy Analytics.
4G LTE connections will account for more than half of the service revenue in 2018 against 9 percent of global service revenue in 2013.
Global mobile service revenue growth will accelerate in 2014, though after passing the $1 trillion mark in 2015, will struggle to grow any further.
Despite the healthy 4G LTE contribution, revenue growth prospects are slim for mobile operators this decade. Mobile connectivity revenue will begin to decline in 2019.
China Mobile’s push on 4G, and the expanding low-cost device ecosystem it is supporting, represents a boost for operators in their attempts to push 4G into more price-sensitive segments.
“While we view 4G LTE as a key part of any mobile operator’s revenue growth strategy, it is not in itself sufficient to significantly improve the situation for many,” said Phil Kendall, executive director, Wireless Operator Strategies.
Europe remains a drag on global mobile service revenue growth, with 2014 revenue forecast at 17 percent below its 2008 peak. The jump in global growth in 2014 is largely down to the slowing rate of decline in Europe.
With limited revenue growth potential, subsidy strategies and consolidation opportunities will remain part of the cost containment picture for mobile operators. At the same time, more operators will follow the example of those in Asia, where the quest for revenue growth has focused on services beyond connectivity, such as finance, content and digital lifestyle services.
