Gartner Predicts Global Mobile Connections to Rise 11% as Revenue Leaps 22.5%

Worldwide mobile connections will reach 5.6 billion in 2011, up 11 percent from 5 billion in 2010, according to Gartner, a market researcher. Mobile data services revenue will rocket to $314.7 billion in 2011, up 22.5% from last year.

The forecast reflects the explosion in sales of smartphones like the Apple iPhone and the Samsung Galaxy as well ultra-lightweight appliances like Hewlett-Packard's TouchPad. It may also explain why large U.S. carriers such as Verizon Wireless now support products like Apple iPhones, which were restricted a year ago to the AT&T network..

Mobile data traffic will increase significantly as more people will have access to mobile data network," said Jessica Ekholm, principal research analyst at Gartner. "Mobile data volumes will continue to grow as mobile data networks become faster and more ubiquitous, while at the same time the number of data users and data usage per user is expected to grow."

"Data revenue will continue to grow but at a much slower rate," Ekholm said. "This is causing a decoupling between revenue and data traffic, and it is also creating an increase in network costs for carriers as they try to sustain growing data traffic."

Worldwide mobile connections will experience steady growth through 2015 when mobile connections are forecast to reach 7.4 billion, and mobile data revenue will reach $552 billion.

Gartner expects communications service providers (CSPs) to increasingly start moving toward offering more flexible and more personalized data plans, which should help capture a larger mobile data user base. CSPs have also upgraded their networks by offering faster download and upload speeds to consumers, which have helped improve the general perception of data quality and thus led to increased data uptake.

Gartner analysts said carriers should investigate the pros and the cons of more customized pricing plans, such as tiered pricing, a la carte and usage-based plans, carefully weighing additional costs and future benefits. Additionally, CSPs should look to offer increased flexibility in pricing and introduce add-on pricing models, in which users are able to add data access when they want to. These add-on pricing models could include paying for additional usage and additional speed, and charging a fee for voice over Internet Protocol (VoIP) or for gaming.