Mobile network spending to slump 10%: Dell'Oro

The worldwide mobile infrastructure market will slump nearly 10% over the next five years, according to the Dell'Oro group.

The decline will be worst in the first two years, with the market shrinking to levels not seen since 2004, the research firm said.

And the road to recovery will be slow, with growth remaining in the low-single digits until at least 2013.

“The market has been experiencing and will continue to experience very steep price erosion,” said Scott Siegler, Dell’Oro’s senior analyst of mobile infrastructure research.

He said intense competition in the fast-growing markets of China and India had squeezed vendor profit margins.

Operators would continue to deploy the necessary capacity to keep up with demand, he said. “However, offsetting our forecast of high double-digit growth in total base station shipments over the next five years is a 40% decline in base station ASPs.”

The road to LTE would provide some relief, with initial LTE rollouts expected in 2010, Dell'Oro said. By 2013, eNode B shipments will make up nearly 10% of the 2 million base station shipments worldwide.