Mobile service providers in many emerging nations might be facing an industry-altering problem: high capital investment and regulatory risk that makes the business model unsustainable. In fact, J.P. Morgan equity analyst James Sullivan believes mobile business models are unsustainable across parts of South and Southeast Asia.
Perhaps the problem is not so acute everywhere else, but the basic trend--falling average revenue per user--is clear in many markets.
For example, average monthly retail revenue per mobile subscription fell by £0.40 (2.6 percent) to £14.97 in 2015, according to Ofcom.
To some extent, mobile operators hope next-generation networks create new revenue sources that offset the declines. And, at the very least, they might hope that much-faster speeds lead to much-greater consumption, which can be monetized.
Whether that will happen everywhere, and on a scale sufficient to prevent dire distress for some mobile operators, is an open question at the moment. The unknowable is whether demand is insufficient to support next-generation mobile networks in some countries, at least for a period of time.
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