How Apple iPhone 6 to generate extra mobile data revenue for telecoms

Telecom industry analysts are predicting that the launch of iPhone 6 smartphones by Apple CEO Tim Cook is set to assist telecoms to generate additional revenue from mobile data.

Paul Lambert, senior analyst, Operator Strategy, Ovum, said: “Apple announcement is great news for network operators as it raises to new heights public interest in the latest mobile technology, which now includes Apple’s connected watch that will create more buzz around this to-date niche part of the market. Viewed together, the devices represent a step-change in how mobile consumers’ will be connected to the Internet.”

iPhone 6

In March 2014, Juniper Research said telecom operator’s mobile data roaming revenue will reach over $42 billion by 2018.

Data roaming represented an estimated 36 percent of the global mobile roaming revenues in 2013. Total mobile roaming revenue will grow to nearly $90 billion by 2018 from $57 billion this year.

ALSO READ: Telecoms mobile data roaming revenue to reach $42 bn by 2018

These revenues will largely be driven by increasing data usage, primarily from a reduction in roaming charges. Data roaming represented an estimated 36 percent of the global mobile roaming revenues in 2013.

Cisco, one of the telecom equipment vendors, said mobile data traffic will increase nearly 11-fold over the next four years and reach an annual run rate of 190 exabytes by 2018, while 4G traffic will grow 18-fold from 2013 to 2018, at 78 percent CAGR.

iPhone 6 to boost mobile data

Apple’s new devices – though costly — offer telecom operators a great opportunity to increase data usage and data revenues. Each of the new devices will lead to more cellular data use, which is also great news for operators – especially if they can price data services in ways that capture consumers’ imaginations.

The iPhones support more 4G frequencies and also VoLTE, both of which are welcome additions for 4G operators and will boost global 4G uptake. Both iPhone 6 and iPhone 6 Plus are compatible to work for China Mobile, China Unicom and China Telecom.

Indian 4G telecom operators Bharti Airtel, Aircel, Reliance Jio Infocomm will be able to offer Apple devices on their TD-LTE network as well.

Global telecom operators have seen that with each new iPhone consumers are willing to pay a premium to own the latest Apple device.

With the new Apple iPhones operators have fresh impetus to help them increase the amount their subscribers spend with them, and how long they stay with them. At the same time, operators can offer iPhone inventory at lower prices to increase ownership of premium smartphones among a broader range of prepaid and postpaid users, said Ovum.

“Crucially, with the new iPhone 6 devices, operators will need to continue to invest in their networks to ensure they offer robust Internet access that can cope with the increase in mobile data traffic the new devices will bring about,” Lambert of Ovum added.

John Abraham, lead analyst for Analysys Mason’s Revenue Management research program, said: “Apple Pay will not have any direct impact on CSP revenue at present. The greater impact will be the loss of potential customer relationship opportunities by letting Apple become the gatekeeper for all mobile commerce transactions.”

This will be limited at first as Apple Pay is limited to new iPhones, but the impact will expand in scope and coverage over the next few years.

Baburajan K
[email protected]