Over 500 Million New Mobile Subscribers Expected from Asia's Emerging Economies by...

Over 500 Million New Mobile Subscribers Expected from Asia's Emerging Economies by 2012

SINGAPORE--(Business Wire)--
Asia's emerging markets, comprising eight nations, are expected to
see mobile subscriber net gains of 573 million by end-2012, breaching
the one billion mark to close the year at an estimated 1.06 billion
subscribers.

In 2007, these emerging markets were home to some 487 million
mobile users, accounting for 37.1 percent of Asia-Pacific's total
mobile subscriber base.

New analysis from Frost & Sullivan
(http://www.wireless.frost.com), Asia Pacific's Final Wireless Growth
Frontier, finds that the mobile services sector in eight emerging
Asia-Pac countries (ex-China) earned revenues of US$33.27 billion in
2007. This is forecasted to reach a market size of US$61.35 billion by
end-2013, at a CAGR (compound annual growth rate) of 10.7 percent
(2007-2013).

Growing at a CAGR of 15.1 percent (2007-2013), the mobile
subscriber base is expected to hit 1.13 billion by end-2013 to account
for 46 percent of Asia-Pac's total subscribers.

Emerging markets are defined as countries with low tele-density
and Internet penetration, and a sizeable population that are largely
underserved or completely without telecommunication services.
Countries included in this study are Bangladesh, Cambodia, India,
Indonesia, Laos, Pakistan, Sri Lanka and Vietnam; all with mobile
penetration rates of under 50 percent.

If you are interested in a virtual brochure, which provides
service providers, vendors/manufacturers, end users, and other
industry participants with an overview of Asia-Pacific's emerging
wireless markets, then send an e-mail to Sarah Lourdes at
sarah.lourdes@frost.com, with your full name, company name, title,
telephone number, fax number, and e-mail address. Upon receipt of the
above information, an overview will be sent to you by e-mail.

According to Frost & Sullivan industry analyst Jeff Teh, over half
of the world's mobile networks are believed to exist in emerging
markets. "Most mature markets in Europe, the Americas and even Asia
are fast reaching saturation, adding fewer connections and offering
fewer growth opportunities.

"As mobile operators in Asia scramble to add another staggering
one billion subscribers onto their networks, Asia's emerging nations
offer the most palpable growth prospects, particularly in the rural
sectors," says Teh.

He adds that such opportunities are, however, not without a
gamble. "The inherent characteristics across these emerging markets
are that they are generally lower-income hence low ARPU segments, with
blended ARPU as low as US$3.90 per month in some countries, and
subscribers are largely inclined towards prepaid services.

"In fact, between 86 and 97 percent of mobile users in these
markets are prepaid subscribers," Teh notes.

The challenge for mobile operators and foreign investors as such
is to introduce new business models and flat-rate pricing plans to
appeal to these price-sensitive consumers. "Much of the uptake for
mobile services will be limited to basic services such as voice calls
and text messaging in the near term," he says.

"Apart from having to manage the typical regulatory issues and
service affordability, operators face a further uphill task of
extending network connectivity well into the rural districts while
managing operational and capital expenditure in a cost-effective way
to maintain healthy profit margins," Teh adds.

An upside for mobile operators however is that fixed-mobile
substitution is a distinct phenomenon in these countries, given that
it is more cost-effective to erect cellular towers than to lay
fibre-optic cables to install landlines.

"Competition from fixed-line services therefore is almost
non-existent," Teh says, adding that despite this, competition amongst
mobile operators is rife.

"In most of the emerging nations, there are more than five active
mobile service providers in any given market," observes Teh. "Over
time however, we expect market consolidation as mobile penetration
rates increase and sustaining operations prove tricky for the smaller
operators."

To drive the adoption of mobile services among rural communities,
some countries have rolled-out initiatives such as village phones,
transmission tower-sharing among operators, as well as linking
communities with mobile services to facilitate access and payments.

Teh believes that such innovation is necessary to achieve the
connectivity vision, as wireless technologies will enable Internet
access in these areas. "One of the most compelling features of
wireless networks in emerging markets is the ability to provide a
faster and cheaper alternative to desktop computers for accessing the
world wide web, especially considering the lack of fixed-line
infrastructure and power sources.

"Some tariff plans such as getting paid to receive calls are
risky, although revolutionary, and will only be possible when mobile
advertising takes off in a big way," he says. "But for now it remains
a game of managing risks for potential high returns."

The Asia Pacific's Final Wireless Growth Frontier study is part of
the Mobile & Wireless Growth Partnership Service program, which also
includes research in the following markets: WiMAX, mobile advertising,
location-based services, mobile broadband and mobile content. All
research services included in subscriptions provide detailed market
opportunities and industry trends that have been evaluated following
extensive interviews with market participants. Analyst interviews are
available to the press.

Frost & Sullivan, the Growth Partnership Company, partners with
clients to accelerate their growth. The company's TEAM Research,
Growth Consulting and Growth Team Membership empower clients to create
a growth-focused culture that generates, evaluates and implements
effective growth strategies. Frost & Sullivan employs over 45 years of
experience in partnering with Global 1000 companies, emerging
businesses and the investment community from more than 30 offices on
six continents. For more information about Frost & Sullivan's Growth
Partnerships, visit http://www.frost.com

Frost & Sullivan
Corporate Communications - Asia Pacific:
Sarah Lourdes, +603-6207-1030
sarah.lourdes@frost.com

Copyright Business Wire 2008