Screen Digest the research company has just released their latest review of the European mobile broadband market. The analysis shows the staggering rate of growth in recent years, with mobile broadband connections growing by ten times between 2006 and 2008 from 1 million mobile broadband customers to 10 million.
Growth in mobile broadband usage has been fastest in those markets less well served by home (fixed line) broadband as a result of more limited access to DSL and fibre-optic broadband infrastructure, such as Ireland, Austria, Portugal and Greece.
The research shows that mobile broadband is particularly attractive as an alternative to a fixed line broadband for students living in private accommodation, people who live in more than one place as well as people who live in areas where home broadband is not available.
Screen Digest forecast that the rate of adoption of mobile broadband in the next two years is likely to slow significantly and churn to rise as a result of customers’ disappointment in unreliable mobile broadband connections and limited broadband speeds. De Renesse from Screen Digest says:
“The mobile operators have trapped customers into long-term contracts, whilst failing to deliver the unrealistic networks speed that encouraged them to sign up in the first place. The service can be patchy and users become frustrated – many will switch back to fixed broadband if operators don’t act quickly.”
But the huge growth in the mobile broadband market and intense competition between mobile broadband providers has driven prices down and resulted in some great deals for broadband consumers: 66% of mobile broadband providers now offer prepay packages; 59 per cent have introduced laptop bundles to entice customers to subscribe to their network and they’ve reduced the average subscription price by a third in the past six months.
Overall European mobile broadband market has grown to a value of Euro 1.8bn in 2008 and accounts for 15% of all mobile data revenues.
According to Screen Digest estimates, while European mobile broadband growth is set to reach its lowest in 2010 at only 4.7%, the number of connections will rise again in 2011 and 2012 to reach 22.6m and a total market value of Euro 4.6bn in 2013.
As a result Screen Digest forecast major pressure on the home broadband providers. De Renesse continues: ”While this is potentially good news for stand-alone ISPs, upcoming 4G upgrades in 2010 and further price reduction would put the final nail in the coffin for them.”