FRAMINGHAM, Mass.-Although the wireless industry is showing strong forward momentum this year, an eventual slowdown is expected as subscriber penetration surpasses 75 percent of the U.S. population, according to a new IDC report.
By the end of 2007, IDC expects carriers will focus mainly on subscriber upgrades to third-generation devices and the adoption of 3G services. The company said as the market saturates, there will be increasing voice pricing pressures and a renewed focus on data.
Data services will prompt increases in wireless average revenue per user, reaching $48 by 2009, said the report. Business wireless ARPU is forecasted to reach $74 in the same time frame.
IDC pointed to several key challenges faced by the wireless industry, including quality of service and ease of use for 3G devices, shifting regulatory policies, pressure to differentiate, fast-moving technology trends, uncertain economic conditions and fickle wireless subscriber behavior.
“What this means for wireless carriers is that they need to focus on aggressively diversifying their base of service revenue and creating a ‘brand’ experience to drive data ARPU higher,” said Scott Ellison, program director for Wireless and Mobile Communications at IDC.
