Yankee Group wireless projections
by: irv_berlin 10/08/01 02:52 pm
Msg: 306990 of 307007
thedeal.com nse/Apps/Xcelerate/Render&c=TDDArticle&cid=TDDEXB6PFSC&preview=true
Updated 04:18 PM EDT, Oct-5-2001
Wireless Watch - October 8, 2001
Posted 04:18 PM EDT, Oct-5-2001
Prospects for the mobile telephony market
------------------------------------------------------------------------
What changes for wireless?: Taking stock of the industry following the tragedy of Sept. 11
Wireless subscriber growth has been steady throughout the year, despite the economic downturn. The Yankee Group forecast of 128 million U.S. subscribers would easily have been met by the end of this year, especially given the industry's traditional fourth-quarter strength. The visibility wireless communications achieved during the Sept. 11 tragedy will only encourage those contemplating purchasing a wireless phone to commit. Therefore, we expect third- and fourth-quarter net additions to be particularly strong.
We also think consumers generally purchase much more now on "need" than a year ago. This may bode well for fourth-quarter sales, as customers consider utility purchases as opposed to frivolous ones during the holiday season.
We project that recent events will benefit short-term wireless subscriber growth and our forecasted numbers for year 2001. We expect total subscribers at the end of 2001 to be approximately 130 million-2 million above what we had predicted. For next year and beyond, subscriber growth prospects have changed little. We conclude that those who purchase a wireless phone over the next couple of months for safety concerns would have ultimately bought one anyway.
Despite the notion that those who make an impulsive phone purchase for safety purposes will be low average revenue per user (ARPU) who will use their phones for emergencies only, the Yankee Group believes they are already considering purchasing wireless handsets and will therefore keep them even after they feel safe. An increase in safety users should lower the ARPU, but such ARPU declines were anticipated as wireless penetration increased to late-adopting segments.
Wireless subscriber stimulation following the Sept. 11 tragedy will benefit the industry by encouraging those considering purchasing wireless handsets to do so, increasing their overall lifetime value potential.
Number of wireless subscribers in the U.S. (mill.)
2000
2001
2002
2003
2004
2005
2006
109.6
128.2
145.5
160.6
174.6
187.4
199.3
Source: The Yankee Group, Boston |
