Mobile penetration rates artificially high: analyst

18 Jan 2006

Claims that the western European mobile market now has 100pc penetration are an illusion, a leading research and analysis firm has said.

Informa Telecoms & Media said that many European consumers have two or more mobile subscriptions, a fact which artificially boosts the penetration levels in the marketplace.

From late last year, data began to appear which suggested there were as many phone handsets as there are inhabitants. In other words, every person living in western Europe — including pensioners and newborn babies — owns a mobile phone.

About 11 of the 16 major markets in the region have begun to quote official penetration rates above the 100pc level. By the end of last year Luxembourg was claiming a staggering 160pc ownership, followed by Italy with 119pc, Portugal (114pc) and Sweden (112pc). Others above 100pc include Greece, the UK, Spain, Finland, Austria, the Netherlands and Denmark. Even figures from the Irish telecoms regulator ComReg quoted Ireland as having reached 100pc penetration.

According to Informa, however, there is no information that properly qualifies these statistics. “The trouble is that no one really knows exactly how many double- or multiple-subscribers there are, let alone how many additional subscriptions each possesses,” the company said.

Moreover, Informa pointed to high mobile growth rates as further proof that the market is nowhere near as saturated as the figures would suggest. Data compiled by the firm showed that in every month of last year western Europe added more net subscribers than in the corresponding month of 2004. “If the market were truly saturated, or even nearly so, one would expect the rate of growth to be slowing down considerably now as there would only be a small (and ever-dwindling) number of potential subscribers left to target,” the company said.

“The reality, however, is that the market is continuing to grow strongly because a significant and growing number of mobile users in western Europe possess more than one active SIM card. This creates the impression that many of the region’s markets are saturated. But it’s only an illusion.”

By Gordon Smith