News
21/09/2009
An expected growth rate at 2.6% in 2009
The World Telecom Services Market
The recovery could come from emerging countries such as China which, in addition to its strong potential for economic growth, is already showing positive signs of increased stability overall, thanks to massive stimulus measures. At the end of June, the OECD thus revised its GDP growth forecasts for several emerging countries from March of the previous year. In China, GDP growth is expected to total +7.7% in 2009 and +9.3% in 2010 (up from +6.3% and +8.5%, respectively, in March 2008). OECD forecasts for Brazil indicate a 0.8% decline in economic growth in 2009, followed by a 4% increase in 2010 (March ‘08 forecasts: 0.3% and +3.8%). In Russia, the OECD predicts that economic growth will decrease by 6.8% in 2009 before an upswing to 3.7% growth in 2010 (March ‘08 forecasts: +4.3% and +5.8%). OECD forecasts for India, meanwhile, include a drop to +5.9% growth in 2009, rising in 2010 to +7.2% (March ‘08 forecasts: +4.3% and +5.8%).
In Europe, there could be a slight recovery in 2010, albeit fraught with setbacks. There are no signs as yet of a clear recovery in the Eurozone, according to the latest OECD outlook from June 2009, even if the forecast figures are up and the situation appears less bleak. GDP is forecast to decrease by 4.8% in Europe in 2009, followed by zero growth in 2010. The forecasts from March 2008 were for a 4.1% decrease in 2009 and 0.3% growth in 2010.
Economic growth in the United States is expected to decline by 2.8% in 2009, and not by 4% as forecast in March of last year. The growth forecast for 2010 is now 0.9%, instead of the previous 0%.
Global recession more drastic than initially thought
In terms of value, annual growth for telecom services worldwide totalled 3.7% in 2008, or just under the 4% forecast in our last publication in January 2009. After the recovery which had been ongoing since 2005, 2008 marked a clear drop in telecom services market growth. With revenue totalling 1,404 billion USD, annual growth is estimated at 3.7%: the lowest for the global market since 2002, in other words just after the Internet bubble burst. Growth in 2009 and 2010 is likely to mark the nadir of the past ten years, staying below 4%.
If we continue to believe that the recession, which has worsened since autumn 2008 and whose impact we have reconsidered, is an aggravating but passing factor, this decreased growth is above all the result of more structural pressures weighing on the world telecommunications market, namely the fact that certain markets which have long been driving forces have reached maturity (notably mobile markets in economically advanced countries), the effects of the substitution and/or demonetisation of applications, competitive and/or regulatory pressures, etc.
On the whole, a review of our earlier forecasts reveals the extent to which we concentrated, in some cases too heavily, the effects of the recession in the last part of 2008 and the early months of 2009. Now in mid-2009, we believe that the crisis will be more lasting and have an impact on the results for the entire year.
Trends by Market
In fixed markets, the ongoing development of the Internet and broadband is only just offsetting the inexorable decline of landline telephony, while growth in the mobile services market dropped by four points in 2008 compared to 2007.
With a total turnover estimated at 709.2 billion USD in 2007 and 763 billion USD 2008, mobile services continue to account for all the growth in the telecom services market. Their weight in the total equation continues to rise: since 2006 mobile services have accounted for more than half of telecom services consolidated turnover worldwide – a proportion estimated at 54% in 2008, and which could reach close to 57% by 2012. The mobile market’s growth is sustained chiefly by the expansion of the subscriber base, which increased by another 19% in 2008. At the same time, average revenue per user (ARPU) has been dropping steadily.
Fixed telephony continues its decline which began in 2002, and at an ever increasing pace. In 2008, the market lost another 6% of its total value worldwide, due to the combination of a decrease in the number of fixed lines and a marked drop in average revenue per line. The data and Internet access services markets are playing an increasingly large part in the telecom services market’s growth worldwide. In 2008, they generated over 19 billion USD more in revenue than the year before, for a total turnover of 264 billion USD. Their weight in the equation is increasing steadily, going from 15% of telecom services revenue in 2001 to close to 19% in 2008, but their contribution to overall growth is only just offsetting the losses being reported in fixed telephony services revenue.
We initially forecast a sharper decline for the market for data transmission services in the business segment – and have revised our forecasts slightly for Western Europe and North America. It is the Internet market, and especially broadband, that is enjoying the only remarkable growth trajectory. Broadband subscriber numbers have been revised, however: down to 401 million at the end of 2008, instead of the 415 million estimated in our previous publication – proof of the decreasing rate of growth of the broadband customer base.
