Mobile revenue growth slowing, seen declining by 2018

Wireless carriers are going to have find new sources of revenue beyond signing up people for cellular service, says Ovum.

CNET

The heady days of wireless growth are near an end.

That's according to research firm Ovum, who warned that global wireless revenue was slowing as more and more people have signed up for cell phones. The industry will likely see its first revenue decline by 2018.

The number of global connections will grow at a compounded annual growth rate of less than 4 percent between 2012 and 2018, while global revenues will grow at less than half that rate, Ovum said. That means the number of global connections will grow from 6.5 billion in 2012 to 8.1 billion in 2018, with revenue rising from $968 billion in 2012 to $1.1 trillion in 2018 -- a 1 percent decline on 2017 revenue and the first time global service revenues will fall.

The slowdown will be most dramatically felt in the developed markets such as Western Europe and the US, where most people already own a cell phone or smartphone.

As a result, Ovum said, carriers need to start thinking beyond selling customers smartphones and wireless services. Indeed, the companies are already looking at hooking up everything from cars to dog collars with a cellular connection, driving additional revenue streams for the industry.

Still, there remains growth opportunities in Africa, which will continue to grow through 2018, and the Asia-Pacific, South and Central America regions, which should drive growth over the next five years.

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About the author

Roger Cheng is the executive editor in charge of breaking news for CNET News. Prior to this, he was on the telecommunications beat and wrote for Dow Jones Newswires and The Wall Street Journal for nearly a decade. He's a devoted Trojan alum and Los Angeles Lakers fan.

 

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