Rating: Brøgger, Bubly, Lewis and McNiece
One of the key benefits of attending MACH Insights 2012 here in Prague was meeting up and speaking to the analysts who attend this event. Best value for money must surely be Dean Bubley from Disruptive Analysis who always came up with incisive questions. Unlike Alun Lewis from Silicon2Synapse, however, Bubly didn’t speak or chair a Panel Discussion. So it was left to Susan McNiece from Software Market Insight to provide us all with some very interesting stats for public consumption. Her major contribution was to introduce ARPA as a term which is apparently the successor to ARPU.In case you are wondering, ARPA stands for Average Revenue Per Account which McNiece reckons will displace ARPU – Average Revenue Per User.
That’s because she believes that an individual person will probably want more than just one single point of access to a cellular network.
The typical person will possess a smartphone plus a tablet, notebook, laptop or other connected device.
So why bill or treat such a person as two or maybe three separate entities? It gets more complicated when you consider that person in question might be the head of a family unit and be billed for a spouse’s or offspring’s cellular communications, too.
Now let’s look at the stats she shared. The communications industry (and these stats are fairly US-centric) is a bit ahead of global GDP which is around three per cent. Compared to that ICT spends about 5.7 per cent of GDP – but growth is flat.
So what’s going up and what’s going down? Well spending on wired voice communications is down 6 per cent per annum. But guess what’s on the rise – mobile advertising which is growing by around 22 per cent.
However, the decline in spending doesn’t equate to ARPU levels. They are all going down apart from wireline voice communications which are actually up by 3per cent (because prices have gone up.)
ARPUs for other areas have gone down because prices have either dropped or remained flat. The worst faller is MMS [– 5.9 per cent] followed by mobile voice [-4.9 per cent].
Even SMS has dropped by 2.6 per cent and – the star of this conference – M2M (machine-to-machine), has seen its ARPUs fall by 3.3 per cent worldwide.
So with all of these revenues decling, where are mobile operators going to make some money? It’s tricky because they’ve already missed to the boat on several potential money spinners such as app stores, for example.
The M2M market is still young so there’s some potential there but McNiece’s gut feeling is that operators can earn a few extra dollars by earning more money from selling mobile data.
There were plenty of figures floating around MACH Insights on this particular subject. Yves Martin, vp group roaming & interconnect, with the Orange Group came up with the best stats.
His group has found that 70 per cent of subscribers turn off data roaming when they go abroad. Mainly because everyone is so scared of bill shock.
As MACH’s CEO, Morten Brøgger, pointed out to GoMobile News, you only have to increase sales from data roaming by a couple of a per cent and you making millions if not billions of extra dollars.
So that’s it, then. Customer service is King. Give subscribers what they want such as Quality of Service (QoS) and talk in terms they can understand – a price per application instead of price per megabyte, and the dollars should start to come rolling back in again.
Tony is currently Editor of GoMobile News. He has taken over this role from Bena Roberts. 
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