Mobile data services a US$235bn market, says Forfas


1 Apr 2004

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Research commissioned by Forfas indicates that Ireland has the strength to establish a robust wireless cluster that can exploit opportunities in the international mobile data services market, which currently has an estimated market value of US$55bn and is set to grow to US$235bn by 2010.

According to research by telecoms specialists Analysys, commissioned by Forfas, the wireless sector in Ireland comprises over 60 enterprises and employs 4,300 people, split evenly between foreign and indigenous firms. Bolstered by considerable venture capital investment, Irish companies have built a strong knowledge base in key growth areas like messaging and mediation (billing).

Internationally, the report says that Ireland is already recognised as having one of the most dynamic mobile markets in Western Europe, with a penetration rate of 81pc, which is slightly above the European average. Irish consumers are early adopters of new mobile services, while data services already account for 20pc of total average revenue per user (ARPU), double the Western European average.

While this bodes well for Ireland to take advantage of developments in the sector, Analysys recommends that the Irish wireless sector should focus its future development on existing establish strengths in operations support systems (OSS), security and billing and transaction management. There is also potential to expand these core strengths into certification and hosting activities that would enable Ireland to establish itself as a European hub for the emerging mobile application hosting industry.

The report recommends the liberalisation of the spectrum management market in Ireland to allow for the trial and deployment of new wireless technology and calls for greater collaboration between industry and academia in the wireless area to resolve a serious disconnect between wireless research and current market strengths.

The report also calls for the establishment of a wireless community-based network supported by a web interface for the dissemination of information. Work has already commenced on the development of a website to facilitate information sharing in the wireless sector in Ireland.

Development agencies like Enterprise Ireland and the IDA must also show greater support to help indigenous companies identify standards bodies and participate in the standardisation process.

Internationally, the wireless sector continues to show strong growth rates. The report forecasts a cellular subscriber growth rate of 7pc per annum over the next seven years and the emergence of a wider range of data applications. The sector is expected to grow faster than GDP in all regions globally, with cellular revenue remaining the largest contributor to a US$529bn market by 2010.

The chief executive of Forfas, Martin Cronin, said: “The value of the mobile data services market is currently estimated at US$55bn and is set to grow to US$235bn by 2010. Such growth offers a strong opportunity for Ireland to establish a robust wireless cluster based on its existing strengths in the sector.

“I would urge speedy and full implementation of the recommendations in this report, which have the potential to reinforce and maximise the development of the sector in Ireland. Leading edge technology sectors such as wireless communications can provide high value employment and skills which are less vulnerable to relocation to lower costs locations,” Cronin concluded.

By John Kennedy