Report to Congress Ninth Annual CMRS Competition Report September - - PowerPoint PPT Presentation

Wireless Telecommunications Bureau

Report to Congress Ninth Annual CMRS Competition Report September 9, 2004

Wireless Telecommunications Bureau

Growth in the Mobile Telephone Industry

(YE2002-YE2003)

161 Million Subscribers in 2003 205,629 Jobs in 2003 146 Billion Invested as of 2003 507 Average Monthly MOUs in 2003

UP 13%

From 142 Million Subscribers in 2002

UP 7%

From 192,410 Jobs in 2002

UP 15%

From $127 Billion as

• f

2002

DOWN 13%

From $0.11 per minute in 2002

Price per minute 10¢ in 2003

UP 19%

From 427 MOUs in 2003

Price per minute Minutes of Use Capital Investment Subscribers Jobs

Source: Cellular Telecommunications & Internet Association; FCC.

Wireless Telecommunications Bureau

Total US Mobile Telephone Wireless Subscribers

16 24 34 44 55 69 86 110 128 142 161 25 50 75 100 125 150 175 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003

Millions of Subscribers

Source: Cellular Telecommunications & Internet Association (1992-2000); FCC (2001-2003).

Wireless Telecommunications Bureau

Mobile Data Services

25 percent of all mobile telephone subscribers send text

messages

SMS traffic volume rose to more than 2 billion messages

per month at the end of 2003, double the June 2002 figure

Some users of text messaging services also use their

handsets for leisure/entertainment applications:

Picture messaging – Verizon customers share an average

• f 7 million pictures per month

Ring tones Games – 12.2 million Americans downloaded or

subscribed to wireless games through their cell phones in 2003

Simple web browsing

Sources: Goldman Sachs (text messaging); CTIA (SMS traffic); Verizon Wireless (picture messaging); Roland Jones, Cell Phone Gaming Gathers Momentum, MSNBC, Aug. 17, 2004 (citing market research firm IDC) (mobile gaming figure).

Wireless Telecommunications Bureau

Mobile Telephone Competition

96.8% 93.0% 87.5% 29.5% 75.8% 0% 20% 40% 60% 80% 100% 3 or more 4 or more 5 or more 6 or more 7 or more Number of Competitors in a County* Percent of U.S. Population

1995 2001 2002 2003 2004

*Facilities-based competitors Source: Federal Communications Commission

Wireless Telecommunications Bureau

Structure-Conduct-Performance Framework

• MARKET STRUCTURE
• Horizontal concentration
• Number of competitors per market
• Market shares
• Entry conditions
• CARRIER CONDUCT
• Pricing and service

innovations/rivalry

• Investment in network deployment

& upgrades

• Choice of technological standards

& next-generation migrations paths

• MARKET PERFORMANCE
• Pricing trends
• Subscriber growth
• Usage
• Service variety & quality
• CONSUMER BEHAVIOR
• Access to information
• Ability to switch service providers