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February 24, 2009

Report: Mobile Industry to Weather Recession, Reach 4.57 Billion Connections in 2012
By Michael Dinan
TMCnet Editor

The mobile industry will emerge relatively well from this economic recession, according to a new study from a Framingham, Massachusetts-based subsidiary of the International Data Group.

Officials at IDC say that the $700 billion mobile industry – which now serves almost half of the world’s population, with 3.6 billion subscriptions at the end of 2008 – has its fingers in both developed and emerging markets.
According to the firm’s director of mobility research, Shiv Bakhshi, different industry segment likely will enjoy different growth trajectories, and some will enjoy it more than others.
“So, for instance, some industry segments, like mobile infrastructure, are likely to settle to a new, marginally lower, baseline stride,” Bakhshi said.
This year, IDC (News - Alert) predicts, the mobile industry is likely to see softening of sales in many of its constituent segments, from network infrastructure to mobile devices and from chipsets to software. Yet other industry segments, like mobile devices, applications, and services, are likely to only grow over time – taking the current economic downturn in their stride.
TMCnet also has noted spikes in the mobile space, even as the recession took hold in earnest.
As TMCnet reported last month, Waterloo, Ontario-based Research In Motion Limited has announced a 7.9 percent increase in revenues, to $2.78 billion, for the quarter ended Nov. 29. The figure marks a 66.3 percent increase from the year-ago quarter for the BlackBerry (News - Alert) smartphone makers, who say that the company shipped about 6.7 million smartphones during the three-month period.
Another company, Movero Technology, Inc. – an Austin, Texas-based group that offers Web-based mobile management – told TMCnet during an interview this week that its services are growing in demand among businesses as cost-savings in this economy become more vital.
And as TMCnet reported in an interview with Chris Kozup (News - Alert), senior manager of mobility solutions at San Jose, California-based Cisco Systems Inc., even during an economic downturn, businesses should make it a priority to ensure adequate wireless coverage, invest in device management and invest in wireless security.
Now, according to IDC’s $2,500 study, “Worldwide Mobile Outlook: The Global Economic Downturn - Minor Impediment on the Road to Continued Growth?,” the number of mobile connections will continue growing at a substantial pace.
From 3.32 billon at the end of 2008, the firm expects the number of mobile voice connections to reach 4.57 billion by the end of 2012, an average compound growth rate of 8.3 percent per year. The most prolific source of new mobile connections will be India, China, and the other large markets in which mobile penetration is currently below 50 percent of the population.
“However, the industry will be challenged by declining ARPU in all segments, and operators will have to rapidly implement new business models and revenue streams that leverage information services in the emerging markets, and multimedia applications in the developed countries,” IDC says.

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Michael Dinan is a contributing editor for TMCnet, covering news in the IP communications, call center and customer relationship management industries. To read more of Michael's articles, please visit his columnist page.

Edited by Michael Dinan


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