So how is 2014 shaping up for you so far?
At FierceWireless:Europe it's already been an eventful year that has seen FW:E merge with its sister title TelecomsEMEA in order to bring you news on the European mobile market three times a week. Your France-based correspondent (in other words, me) has also finally joined the LTE era – indirectly thanks to Free Mobile. Indeed, on the French mobile market it's a case of plus ça change, plus c'est la même chose as the Iliad-owned enfant terrible causes further pricing disruption and forces incumbent operators to extend LTE to their low-cost brands (in my case, Orange's Sosh).
In the wider market this is also a somewhat strange time of year for the mobile sector, caught between an increasingly mobile technology-focused CES in January and Mobile World Congress in February. Choosing when to launch major services and innovations requires some fine tuning from operators and vendors alike, if they want to make the most of the opportunities these huge events offer.
Both events also provide an opportunity to stick a finger in the air and try to gauge the way the wind is blowing. CES, for example, was dominated by news about wearable technology and John Legere's gate-crashing antics, not to mention autocue failures for leading executives on stage. MWC will probably also see an extension of the wearables debate as well as further innovations such as in connected cars, mobile devices, operating systems and more.
From a European perspective, it will also be interesting to get a sense of the general industry mood following the difficult period in the last few years when operators and vendors have struggled to come to terms with growing competition, regulatory changes and the general economic downturn. This year could in many ways be something of a watershed year for the mobile market in Europe. For example, we might see the approval of the Telefonica plan to buy E-Plus from KPN – a move that some predict will set off a new wave of M&A across the European Union. Plans by the European Commission to abolish roaming charges could also take effect this year, and there are also many regulatory and economic issues at national levels that will influence operators' choices and fortunes.
Looking at some forecasts, the outlook so far looks to be fairly optimistic for sales of telecoms equipment to mobile operators. Gartner forecasts an increase in global carrier network infrastructure spend to $85.4 billion in 2014 from $80.5 billion in 2013, with the highest CAGR predicted for Long Term Evolution (LTE) at 33.4 per cent. No doubt leading European vendors such as Ericsson, Alcatel-Lucent and Nokia Solutions & Networks will profit from this growth, but they also need to compete with the ever present Huawei and ZTE, for example.
The growth in LTE network spend reflects the urgency among operators globally to accelerate their LTE rollouts, and 2014 is seeing a continuation of network launches around the world. Latest figures from the Global mobile Suppliers Association (GSA) show that 263 LTE networks in 97 countries were in service by Jan. 15, 2014.
While this may be good news for vendors, a chill wind is still blowing for Europe's incumbent operators. For example, Gartner has already downgraded its 2014 forecast growth in spending for telecoms services from 1.9 per cent to 1.2 per cent.
"A number of factors are involved, including the faster-than-expected growth of wireless-only households, declining voice rates in China and a more frugal usage pattern among European customers," said Richard Gordon, managing vice president at Gartner, in a statement. "The latter coincides in Western Europe with a breakout of fierce price competition among communications service providers to retain customers and attract new ones," he added.
Comments by Irish billionaire Denis O'Brien have also been pretty damning about the state of Europe's mobile markets: the founder and owner of the Digicel group was quoted in the Financial Times as saying that he plans a "massive" telecoms push this year – but will remain outside of Europe. According to the FT, O'Brien described the region's market as hamstrung by "failed policy" that has seen operators struggle with heavy regulation and pay too much for spectrum.
Many will agree with this perspective. At MWC lets hope we will see some of the innovations and strategies that will help Europe's operators secure a more promising future despite the external factors that have dragged down revenue in the past few years.--Anne