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    Mobile broadband market in CEE to skyrocket over the next five years, says research

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    New analysis from Frost & Sullivan – Mobile Broadband in Central and Eastern Europe – says that the market earned revenues of €1.1 billion in 2009 and forecasts this to reach €5.2 billion in 2014. The service penetration is expected to grow from 2 per cent to 10 per cent within the forecast period, says F & S..

    "Due to relatively low overall broadband penetration, mobile broadband will be a complementary rather than supplementary service to fixed broadband in CEE countries," says Frost & Sullivan ICT Research Analyst Edyta Kosowska. "Therefore, mobile broadband operators should initially focus on improving the service quality through sufficient network upgrades as customers expect the same download speed and data download limits as from fixed broadband internet. Only when achieved that, the operators should follow Western European players' strategies and concentrate on developing wider range of value-added services (VAS)."

    The Frost & Sullivan study assesses the status of mobile broadband in five CEE key markets: the Czech Republic, Hungary, Poland, Russia and Slovakia. The analysis is based on key performance indicators and looks at the way different mobile broadband technologies are evolving on those markets. The technologies considered are: code division multiple access (CDMA) revision A and revision B; flash orthogonal frequency-division multiplexing (Flash OFDM), high speed downlink packet access (HSDPA), high speed packet access plus (HSPA+), mobile worldwide interoperability for microwave access (Mobile WiMAX) and long-term evolution (LTE).

    "Most of the market participants start mobile broadband service development from large cities' centres, where they can count on relatively quick return on investment," states Edyta Kosowska. This move is still economically justified, as the highest demand comes from people with increased mobility needs such as company workers and students. "However, in the near future, growth potential will be mainly visible within rural areas, where overall broadband penetration remains relatively low. Therefore, focusing on this target group can be a worthwhile consideration," adds Kosowska.

    Targeting population from the rural areas is a very good solution especially in the EU countries. "First of all, companies implementing this strategy can count on market regulators' favour, as it links directly with the ‘preventing digital exclusion' policy. Additionally, part of the investment might be financed by EU funds," concludes Kosowska.