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[Arthur D. Little & Exane BNP Paribas] "4G LTE is a must-have but won’t be enough to restore pricing power in European mobile industry"

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According to a joint annual telecoms report by global management consultancy Arthur D. Little (ADL) and equity broker Exane BNP Paribas, the telecoms industry faces revenue decline of 1.8% through to 2016.

"Operators can also expect customers to adopt the higher speed and lower latency of 4G quickly and can count on a good line-up of compatible smartphones and tablets, leading to 54% penetration of 4G-enabled devices by 2016."

 "It models revenue decline of -1.8% compound annual growth rate (CAGR) for European telcos through to 2016. The sector could return to growth if LTE smartphones generated data average revenue per user (ARPU) of EUR17/month by 2016. However, as this is EUR7 higher than today’s figures for 3G smartphones, it represents quite a stretch."

"4G will be a commercial success in Europe but is unlikely to restore pricing power in the industry,” said Didier Levy, Director of Arthur D. Little’s Telecommunication, Information, Media and Electronics (TIME) practice. “To deliver business growth there are a number of innovation areas European operators should focus on, including introducing shared data plans which are already successful in the US."

"Mobile challengers with large spectrum assets and a lean cost structure and integrated fixed-mobile players are well placed,” added Antoine Pradayrol of Exane BNP Paribas”

Source - Arthur D Little (April 16, 2013)

Author

Ray is a news editor at The Fast Mode, bringing with him more than 10 years of experience in the wireless industry.

For tips and feedback, email Ray at ray.sharma(at)thefastmode.com, or reach him on LinkedIn @raysharma10, Facebook @1RaySharma

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