As part of its latest round of service provider benchmarking analysis, TeleGeography has found that 16 leading service providers have grown their revenues by an average of 45% over the last three years, equating to some 13% per annum. As could be expected, those achieving the highest growth have been focused on wireless markets in Africa, Latin America, the Middle East, India and China. Leading the growth charge are MTN, Bharti and Zain which have all more than doubled their revenues in the last three years. Despite being substantially larger companies than the top ranked three, America Movil, China Mobile and Vodafone have all recorded growth in the 45%-70% range. Of the companies covered in this research the only other to achieve similar growth is AT&T, which has achieved this via acquisition and reconsolidation of US service providers, rather than organic growth.
While it is no surprise that four of the bottom ranked five companies are incumbent operators from four of Western Europe’s largest markets, the level of their growth (or more accurately the lack of it) will surprise many: in a nutshell all five have stood still for three years. BT and NTT are locked into their highly competitive and low-growth home markets, and are also primarily dependent on wireline markets. Telefonica, Deutsche Telekom and France Telecom have all taken great strides in the past to build businesses beyond their home countries; collectively they now generate over 55% of their revenues from beyond their home markets. However, over the last three years the trio have been held back by tough competition and diminishing growth in the Western European region, and, in the case of Deutsche Telekom, difficulties growing its US operation. The results of their efforts in Latin America and Eastern Europe have not been sufficiently robust to generate substantial revenue growth for the consolidated groups.
So why does this matter? ‘Absolute scale remains an important metric, but growth often has a more direct impact on profitability and the strength of a business’ said TeleGeography’s John Dinsdale. ’The next five years will see the growth rate of telecoms markets drop to less than half of what has been experienced over the last five years. Those companies which are better equipped to meet and beat market growth rates will be more richly rewarded’ added Dinsdale.
TeleGeography’s service provider benchmarking research includes analysis of revenues, profitability, subscribers, ARPU, growth rates, geographic footprint, market share, competitive positioning and future growth prospects. It is published as part of TeleGeography’s GlobalComms Insight service which is a companion to the GlobalComms Database, a regularly updated online database of wireline, wireless and broadband competition. No other telecoms market research service rivals their collective geographic scope and depth of coverage.
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