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Mobile set to replace fixed broadband in quarter of European homes
|15 октября 2008|
The consumer broadband Internet market could be set to follow the same trends as the voice market when it comes to fixed-mobile substitution – if operators can improve on connection speeds for mobile broadband services.
In a new report published on Tuesday, telecoms consultancy Analysys Mason says that 47% of all broadband subscribers in Europe will access the Internet through mobile networks by 2013.
The report also predicts that in five years' time, nearly a quarter of all broadband-equipped households could be using mobile networks only, foregoing a fixed connection altogether.
"Take-up of broadband via mobile USB modems has surprised many in the fixed broadband space – and, indeed, the mobile business – and the early indications are that consumers in Europe are using mobile broadband as a substitute for fixed," said a statement from Analysys Mason.
Indeed, the GSM Association announced in August that global HSPA mobile broadband subscriptions had hit 50 million, rising from 11 million a year earlier.
The industry body said at the time that the number of HSPA-enabled products available to consumers has reached 740 devices from 116 manufacturers.
The analyst firm said that DSL subscription additions are drying up, and declining prices for mobile broadband packages means they are becoming a more attractive prospect than their fixed-line equivalents.
"Fixed operators are currently underestimating the scale of the threat of mobile broadband," said Rupert Wood, one of the authors of the report, in a statement.
He commented that fixed-line providers could fight back by including higher connection speeds and new features with their broadband packages, but even then, they could stand to lose out to mobile operators.
"[Fixed-line operators] could end up with a product that, although it is better value for money, ultimately loses out to mobile because it is less flexible and involves substantially higher monthly costs for the end user," said Wood.
However, fixed-mobile broadband substitution on the same scale seen with voice services could be delayed unless operators can ensure fast enough connection speeds.
Research firm YouGov published details of a survey in August which found that more than a quarter of U.K. mobile broadband subscribers are unlikely to renew their contracts.
The respondents cited poor connection speeds and high prices as their main complaints.
Analysys Mason said Tuesday that to maintain service quality, mobile network operators (MNOs) not only need to increase network capacity, they also need to dissociate rising network costs from exponential increases in bandwidth demands.
"In the shorter term, MNOs need to manage customer traffic volumes at a retail level, selling to the kind of customers who will not put excessive pressure on the networks," said Matt Hatton, principal analyst at Analysys Mason, in a statement.
He commented that mobile providers can achieve this with usage caps, pay-as-you-go pricing and fixed-mobile bundles.
"In this respect, MNOs can pull many levers," he said.