Archive for May 19th, 2008

The economics of a mature market

Has the wireless market in the U.S. finally hit its saturation point? Have we finally “matured” so much that every subscriber add is a steal from someone else’s network and the few remaining souls without a cellphone are just too plain stubborn to not bother with? Do we have to look elsewhere for growth? There are plenty of signs pointing to just that.

A new report from Bernstein Research points out that Q1 net subscriber adds dropped 23% year-over-year, and overall subscriber numbers have fallen from 11.5% to 7.9% in the same period. Further, the NPD Group found that handsets sales volumes dropped 22% in Q1 compared to the same quarter in 2007. It’s eerie how those two percentages match up. Sure, we’re still growing, but the boom days are long gone.

What’s most interesting about this trend, however, is how it will change the fundamental business of wireless. more

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