UK sees mobile forces taking hold

Upon the merger of T-Mobile and Orange in July, the new entity, Everything Everywhere, has become the U.K.’s telecom market leader with an estimated 21 percent of total market revenue, according to a new report from Pyramid Research.

Pyramid’s new report, “U.K.: BT Faces More Market Share Losses as Mobile Services Take Hold,” offers a precise profile of the country's telecommunications, media and technology sectors based on proprietary data from the company’s research in the market. The study provides detailed competitive analysis of the fixed and mobile sectors, tracks the market shares of technologies and ervices, and monitors the introduction and spread of new technologies.

The U.K. telecom market will generate a cumulative revenue opportunity of USD376 billion between 2010 and 2015. The growth is driven by expected sizable investments into new high-speed broadband access infrastructure and 3G+ network upgrades and coverage expansion.

Driven by skyrocketing uptake of iPhones and other smartphones, U.K. mobile data revenue is expected to grow at a CAGR of 12.7 percent between 2010 and 2015, when it will account for 47.5 percent of total mobile revenue, notes Stela Bokun, Senior Analyst at Pyramid.

The incumbent operator, BT, is projected to lose 6 percent share, in line with the expansion of the entire mobile segment at the expense of fixed market over the forecast period. Predominantly mobile operations will, in turn, increase their share of revenue in the same period. This trend will be particularly pronounced in the case of Everything Everywhere.

"The U.K. mobile market, which hosts four mobile operators and a number of MVNOs, has gone through major turmoil with the merger of T-Mobile and Orange in 2010," says Bokun.

"The two operators, which had roughly 21 percent of the market share of subscriptions each in 2009, have formed a new entity, Everything Everywhere, which now controls around 42 percent of the mobile services market," she added.

"As the two operators begin to benefit from economies of scale achieving a number of operational synergies, their share of subscriptions will see a significant rise of roughly 4 percentage points by 2015 and their share of the total U.K. telecom service revenue will grow by 3 percentage points by 2015," Bokun concludes.