Change is in the air: 2009 North American wireless industry survey

2009 North American wireless industry survey
Download Change is in the air: 2009 North American wireless industry survey

Published annually by PwC's Entertainment, Media and Communications practice, the 2009 North American wireless industry survey provides a framework to understand the current and emerging trends in the communications sector and addresses general financial accounting and reporting policies and practices of wireless telecommunications service providers. The results of this survey reflect the participation of the seven largest U.S. wireless operators, plus the two largest Canadian wireless companies.

The economic turmoil over the past year has forced companies to re-examine their current operations to identify areas of cost containment, greater efficiency, and new sources of revenue. In addition to economic considerations, communications companies must also address the industry's changing competitive landscape, due in part to two milestone events: first, the dramatic advance in technology evolution, specifically that of the smart phone, and second, mass-market saturation of mobile penetration. The emphasis is now shifting from customer experience to price. We believe that the convergence of these two events will have management rethinking a key component of their business strategy: The definition of a profitable customer and the resulting implications for their business model and cost structure. Read more about our Point of View on customer profitability.

Highlights from the Survey
  • Large carriers invested more than $160 per subscriber in their networks in the 2009 survey – a more than 30 percent leap over the 2008 survey.
  • U.S. wireless companies reported an increase in customer retention expenses of more than 50 percent in 2008 compared to 2007.
  • On average, use of prepaid minutes increased more than 147 percent in the past four years, from 270 minutes in 2006 to 667 minutes in 2009.
  • As of June 30, 2009, 21 percent of all mobile device sales were smart phones, and an average of 12 percent of overall subscribers use smart phones.
  • The average revenue per user for smart phones is $74 compared with total postpaid average revenue of $54.
  • On average, capital expenditures as a percentage of service revenues increased to 21.5 percent in the 2009 survey from 18 percent in the 2008 survey.
  • Postpaid subscribers receiving paper invoices decreased from 81 percent in the 2008 survey to 72 percent in the 2009 survey, and the average percentage of subscribers that received electronic invoices increased from 6 percent to 14 percent during the 2008 to 2009 survey period.