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United States Telecommunications Report Q1 2010
Market |
Telecommunications |
Report Type |
Market Research |
Country |
United States |
Published |
28 January 2010 |
Number of Pages |
102 |
Download |
|
Immediate |
|
Publisher |
Business Monitor International |
In this update of our United States Telecommunications Report, we have extended to 2014 our forecasts for growth in the fixed-line, broadband and mobile telecommunications markets. We have also taken the opportunity to scale back some of our earlier growth forecasts for mobile and broadband due to a marked slowdown in new subscriptions in both the second and third quarters of the year. In the meantime, the decline in fixed-line usage has gathered a little momentum, and the number of lines in service is falling back faster than we had previously anticipated.
With regards to mobile telephony, there were approximately 284mn subscribers at the end of 2009, which would keep the penetration rate under 93%. With around 14mn new subscribers added during the year, it is clear that there is still considerable room for growth in this sector, particularly now that budgetconscious customers are becoming more enthusiastic about low-cost, no-frills prepay services. The emphasis on prepay in 2009 meant that ARPUs suffered, while the larger operators, which rely more on postpay customers, have seen their ARPUs waver as they compete aggressively on price and discount heavily in order to attract new customers. The year also saw a greater emphasis on high-end devices, such as smartphones and netbooks, being used as incentives for customers to switch service providers or even remain with their existing provider. With these conflicting forces still in play, we do not expect dynamic growth for the US mobile sector over the coming five years; there will be 306mn subscribers by 2014, or almost 96 users per 100 inhabitants.
The decline in fixed-line use gathered pace in 2009 as more residential customers replaced their traditional telephone lines with broadband connections from a growing choice of service providers, including cable TV operators. At the same time, fixed-mobile substitution is becoming more affordable, particularly now that the latest phones and wireless broadband enabled devices can deliver to users a broader range of services at a comparable cost. We estimate that there were 128.8mn fixed lines in service at the end of 2009, a figure we now expect to fall to 112.1mn by the end of 2014, or 35 lines per 100 inhabitants. Given that the fixed telephony business will soon only be viable with large-scale operations, perhaps we will soon see the market coalesce around just one or two very large operators. Could a return to the 'Ma Bell' days be in the offing?
Broadband take-up grew robustly during 2009, although Q309 suggested that the principal players were finding it difficult to entice new customers to their networks. There were 77.2mn broadband subscribers by Q309, a figure we believe grew to 78.6mn by the end of the year. AT&T and Comcast are battling it out for dominance of the market, with Comcast having finally overtaken the market leader in Q309. As of September 2009, there were only 46,000 subscribers separating the two companies, and Comcast's slightly faster growth rate means that the gap could widen further as time passes. AT&T is retaliating with improved service offers and marketing efforts, so it could conceivably keep pace with the cable operator.
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