Mobile content is tipped to be the fastest growing revenue segment in the non-voice mobile services sector reaching $2.8 billion by 2013, according to new research from Telsyte.
Compared to SMS and mobile broadband growth, mobile content will outstrip growth at 33% CAGR over the next five years and reap in revenue of $878 million in 2009 to $2.8 billion in 2013. The report "Australian Mobile Services Market, 2008 Year In Review & 2009-2013 Forecast" forecasts that mobile broadband and paid content will blitz SMS growth by four and six times respectively.
Currently the SMS market is worth $2.5 billion, mobile broadband $1.6 billion and paid content $878 million. Telsyte Research Director Warren Chaisatien said that the economic downturn has largely spared Australian mobile carriers and their revenue streams. "With greater network speeds and a myriad of modern smartphones already in place, 2009 will be about content and applications as we see a proliferation of app stores, resurrection of mobile TV and continued push in the still-nascent mobile advertising space. Consumer protection will take centre stage this year," he said.
Cuts on discretionary spending such as travel has had a positive flow on effect for carriers as consumers and businesses rely more heavily on technology as a business tool. Mobile broadband, whose average pricing has dropped by half in the past 12 moths, was the biggest winner, having more than doubled to become a $1 billion market. Overall Australian mobile service revenue grew by 12% and average monthly spend per user by almost 5% with penetration now reaching 110% of the population.
Meanwhile mobile advertising growth is poised to treble with Telsyte forecasting that mobile advertising spend will grow to $20 million during 2009, from the paltry $7 million accrued in 2008. Over the next five years mobile advertising spend is projected to surge to $250 million by 2013.
Despite its impressive growth trajectory, Chaisatien claims that mobile ad revenue will remain a minor component of overall carrier revenues. “Mobile carriers will embrace mobile advertising as an innovation that will enhance their competitiveness in the market place, but they will not be able to count on it as a significant source of revenue generation,” he said.
Mobile usage growth is projected to remain strong in the next five years, with 125% penetration level mainly driven by machine-to-machine use and over 5 million mobile broadband users expected by 2013. Prepaid will make a comeback as wholesale ISPs and MVNOs progressively commoditise 3G offerings.
The merger of Vodafone and Hutchison's local operations will create a strong and credible number 3 player, Chaisatien claims with new entity “leapfrogging Optus in the all- 3G and mobile broadband segments by a wide margin.” He said that while the merger will lead to greater network coverage and better service offerings, “it is difficult to forecast how this will translate into more competitive prices for Australian mobile users."
