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China to lead world, mobile market out of recession

17 февраля 2009

By Monday afternoon it was clear that one of the major topics of conversation at this year's Mobile World Congress would be the ongoing economic downturn and its impact on the telecoms space.

But the message from the industry was clear and positive: not only has the mobile telecoms business the wherewithal to withstand the crisis, but it also has the power to drive economic growth. And progress in China will be key to this.

Mobile operators, vendors and industry experts also issued pleas to the governments and regulatory bodies out there to smooth the way to future investment.

“This industry can play a particular role in helping the recovery of the world,” said Jeffrey Sachs, economist, director of the Earth Institute at Colombia University, and advisor to UN secretary general Ban Ki-moon, speaking at a press conference organized by the GSMA on Monday.

“This sector will display resilience in its own growth,” as well as playing “a crucial role… in the economic recovery,” Sachs said.

“[Emerging markets] will likely lead the world out of this recession,” he added, predicting that China will be the first to recover.

People are still using mobile services despite the recession, said Wang Jianzhou, chairman and CEO of China Mobile.

China Mobile added 88 million mobile subscribers last year, Wang said. Customers are using 460 minutes per month and sending 1.6 billion SMS per day.

Furthermore, the rollout of 3G services will provide a “direct stimulus to the economy,” he added, noting that it will provide at least 300,000 new jobs. “The capex will be $450 billion from three operators,” he said.

But operators are reluctant to plough the necessary investment into their networks without certain regulatory assurances.

It is crucial to remove regulatory ambiguity, said Alexander Izosimov, CEO of VimpelCom and chairman of the GSMA.

“We´re pleading to the government,” for clarity, he said, on issues such as taxation, interconnection and spectrum availability and allocation.

This industry is guaranteed to expand, as demand for services is insatiable, but we are running out of capacity, Izosimov said. “Additional spectrum is not a luxury… it will be an absolute necessity for us to advance further,” he insisted.

Izosimov warned governments against the temptation to repeat the excesses of the 3G auctions that took place in 1999-2000, since high prices would further slow investments.

Attendees at Monday´s event called for the harmonisation of spectrum as the industry moves towards LTE, and reiterated their claim to the digital dividend, the spectrum freed up by the switch to digital from analogue TV.

“LTE depends on harmonised digital dividend spectrum,” said Rob Conway, chief executive of the GSMA.

He demanded that the mobile industry be granted 25% of the 400 MHz of spectrum that will become available.

"Broadcasters have plenty of spectrum,” Conway said, noting that there will be a bigger boost to the economy from wireless than from the launch of new television channels.

The operators present agreed that demand for data services, and therefore capacity, is high.

In Italy mobile data traffic grew by almost 210% last year, said Telecom Italia CEO Franco Bernabe.

“We have spent a lot of money to achieve this,” he said. “We are not asking for subsidization… We need a lighter regulation,” he insisted.

Heavy network investments require a “firm and stable regulatory environment,” Bernabe added. “Demand is there. The willingness to invest is there… The industry needs to be given the freedom to act.”

Bernabe was backed by his counterpart at Telenor.

Spectrum refarming will provide operators with a short-term solution for greater mobile data capacity, said Jon-Fredrik Baksaas, president and CEO of the Norwegian incumbent. “[But] LTE development will be the longer-term solution,” he said.

“We´re asking for harmonised developments so investments can happen,” he said.


Источник: Total Telecom

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