Mobile Network Operators to earn $576B in six years

MOBILE network operators including Nigeria’s four major GSM players, MTN, Globacom, Airtel and Etisalat are among global telecommunications service providers expected to earn about $576 billion as revenues  by 2020.
  These revenues are expected to come from a broader ecosystem, including areas of applications, content and advertising, which is going to be a 16 per cent rise in their revenues.
  The GSM Association, which disclosed this in a report titled: The Mobile Economy 2014, noted that the trans formative effect of mobile has been made possible by significant capital investment by the mobile operators over recent years, totaling over $1 trillion in the last six years.
    It informed that the mobile sector contributed $336 billion to public funding as at 2013, excluding regulatory and spectrum fees and it is projected to hit $465 billion in another six years from now.
   While the mobile sector hoped to have created about 15.4 million jobs by 2020, the report said so far the industry has created 10.5 million jobs across the globe.
   Indeed, in Nigeria, MNOs last year disclosed that they created 20,000 jobs directly and 1.1 million indirectly. They also claimed to have contributed in form of taxes to government coffers within the last 10 years over N160 billion.
    Other global operators to benefit from these earnings include AT&T; Orange; Vodacom; China Mobile; America Movil; Telenor; Vimplecom; China Telecom; Reliance; Ooredo; Megafona; Maxis; T-mobile; Econet; Safaricom among others.
    As such, the body noted that this highlights the role of the mobile networks as enablers in allowing a broad and successful ecosystem to develop, based on high speed, ubiquitous mobile networks.
    It added that a number of new players have already entered the mobile ecosystem, while the power of mobile networks has enabled the launch of new applications and services in a range of adjacent industries including the retail, finance and automotive industries.
    Already, the International telecommunications Union (ITU) has projected that with the proliferation of tablets and smartphones, over 50 per cent of the global population will have Internet access within three years’ time, stressing that both technology gadgets are now the fastest growing technology in human history.  
   Besides, the GSMA, which claimed that the report covered every operator group, network and MVNO in every country worldwide – from Afghanistan to Zimbabwe, said the investment has been focused on both improving network coverage and to facilitate the growth in mobile broadband connections.
   According to it, total investments by the operators are expected to increase going forward in order to accommodate the strong forecast growth in global data traffic, totaling $1.7 trillion out to 2020.
    The GSM body said mobile ecosystem directly contributed around 1.3 per cent of global GDP in 2013, amounting to about $870 billion.
    In specific, the report said MNOs contributed about one per cent; handset manufacturers around 0.1per cent; Infrastructure and support services around 0.1 per cent and Distributors/ retailers around 0.1 per cent. The mobile industry is estimated to contribute around 5.1 per cent of global GDP by 2020
    The GSMA represents the interests of mobile operators worldwide. Spanning more than 220 countries, the association unites nearly 800 of the world’s mobile operators with more than 230 companies in the broader mobile ecosystem, including handset makers, software companies, equipment providers and Internet companies, as well as organizations in industry sectors such as financial services, healthcare, media, transport and utilities.
   While subscriber and connections growth rates are now slowing in developed markets, the GSMA said significant untapped potential remains in developing markets, stressing that these are forecast to add 880 million unique subscribers by 2020.
   It informed that the number of commercially available LTE networks is forecast to increase to more than 500 in 128 countries across the world over the next four years, going from covering around a fifth of the global population today to around half by 2017.
   GSMA disclosed that the number of mobile broadband connections has grown tenfold from just over 200 million in 2008 to well over two billion by 2013. Growth should remain strong, driven by rising smartphone penetration, with almost 4 billion mobile broadband connections expected to be added globally in the period out to 2020.
    Furthermore, the report noted that in developed markets, there is an accelerating technology shift underway in the global connection base, with an increasing proportion of connections now on higher speed 3G and 4G networks (globally this proportion is set rise from a third at the end of 2013 to two thirds by 2020).
    GSMA said mobile has empowered previously disenfranchised communities, bridging the digital divide by bringing voice services and Internet access to the previously unconnected.   
   According to it, access to the mobile Internet and related services has been demonstrated to improve education, health and agriculture productivity, as well as create employment and entrepreneurial opportunities, leading to improved quality of life for individuals and their families.
   Besides, the body said the mobile industry is overcoming cost barriers and developing innovative new solutions to deploy networks in more remote and challenging environments, particularly in developing regions.
   “The industry is already competitive and significant price reductions over recent years have helped to drive strong subscriber growth across the developing world. However, the industry faces a number of challenges if it is to fulfill its growth potential, and regulators and policymakers must be careful not to hinder this with short-term polices that maximize near-term tax revenues over the medium-term potential for growth and development”, it stated.
Source: The Guardian News paper