Mobile services revenue set to soar

But SMS still provides the bread and butter.

A new report suggests that the mobile industry will see dramatic growth in mobile services over the next five years.

Research by analyst house Informa Telecoms & Media predicts that the mobile entertainment market will grow from US$18.84bn in 2006 to US$38.12bn in 2011.

While traditional services like SMS will still be the bedrock of operators' non-voice profits, the growth will be helped by new services like mobile internet and user-generated content.

"We are not buying as many games, full-track downloads or multimedia messages as operators would like," said Daniel Winterbottom, senior analyst with Informa Telecoms & Media and author of the report.

"But we are spending a huge amount of time sending and reading text messages, and organising our lives using the phone's address book, clock, alarm and calendar functions.

"Over time users will warm to other data services as well, and the mobile web is a prime example.

"Wap failed to take off when it launched five years ago, but more and more users have become comfortable with accessing news or other information on their mobile phones."

Winterbottom expects the big driver for the market to be mobile internet, and that over half the world's mobile phone users will be accessing the web from their handsets by 2011.

Games, gambling, personalisation and adult content will all grow strongly, as will user-generated content and online forums. Informa believes that these services will be worth US$13.17bn by 2011.

Current services like SMS will not lose their popularity, however. SMS currently generates two-thirds of operators' data revenues, and will only drop to around 50 percent by 2011.

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