Mobile revenues to top fixed lines

The size of the wireless industry in Europe is approaching that of the entire traditional telephone business, with data playing an increasing role

Revenues from mobile phones in Europe will soon top those of the entire traditional telephone industry, according to analysts the Yankee Group.

In a report released on Monday, "Fixed-to-mobile substitution is inevitable in Europe, but don't rush it", the Boston-based firm said that mobile networks are quickly approaching the levels of the fixed-line market with respect to voice traffic, with 20 to 40 percent of all voice traffic originating from wireless networks.

Revenues from wireless -- which includes revenues from data services such as 3G and GPRS -- will soon overtake the traditional switched-access market in Europe, the firm said.

The predictions underscore the growing importance of mobile networks, including wireless data, compared with the traditional communications infrastructure. In an earlier report, Yankee Group said mobile network operators are relying on emerging data services for an increasing proportion of their revenues, as average voice revenues per user decrease.

While many consumers are replacing their fixed lines with mobile phones, the firm said this trend is already levelling off. "Mobile cannot compete with fixed on price or performance, especially for data," said analyst Farid Yunus in a statement.

The number of mobile-phone subscribers will grow to more than 1.75 billion worldwide by 2007, with data services playing an increasingly important role in the wireless economy, according to the firm.

Globally, subscribers will increase nearly 9 percent from 2002 to 2007, with revenues growing 9 percent on average. The fastest-growth regions will be Asia Pacific and Latin America, with 10 percent projected growth, and nearly 20 percent growth for China, Yankee Group said.