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Economic Downturn Halts Wireless Growth in Western Europe

Date: 1/7/2009 11:04:32 AM

Western Europe’s cell phone market stopped growing in the third quarter of 2008 as the global economic downturn affected consumer spending across the board, according to a new report by Strategy Analytics.

As a whole, Western European carriers ran a steady business in Q3 due to continued subscriber growth in the mobile data sector, coupled with stable profit margins. Wireless voice revenues, however, were slower than expected, and are now falling significantly in a number of markets.

“Mobile voice revenues have been falling by around 1% per annum over the last 18 months in Western Europe, and dropped by over 3% in the third quarter,” commented the director of Strategy Analytics’ Global Wireless Practice, Phil Kendall. “Users are still talking more than a year ago, but they are also pocketing some of the savings offered by falling prices. Coupled with weakness in sectors such as international roaming, as companies cut back on business travel, the European mobile voice market is set for a challenging 2009.”

“Mobile data revenues grew by 20% globally in Q3 2008, and these have kept service revenues growing in many mature markets,” added senior analyst, Susan Welsh de Grimaldo. “However, even these could not save the European market last quarter from service revenue growth coming to an abrupt halt.

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