17 March 2006
End user spending on fixed line telecom services will decline over the coming years all over Western Europe, a study has suggested.
The report from market research firm Analysis found that fixed line services would continue to decline to under 0.75% of GDP by 2011 – half of its 2001 level.
In some European countries, spending would fall by over 20% over six years, it said.
It is not bad news for consumers, however, as the report identifies that increased competition could lead to falling prices in the industry.
"We are currently seeing the rapid creation of a competitive structure in communications," said Rupert Wood, main author of the report.
The growth of VoIP services will also have an impact on home phone use, it said.
"Historically, fixed line usage has been related to price, but mobile usage tends to take off when it is affordable, whatever the premium over fixed," argued Mr Wood. "Cheaper VoIP makes more and more mobile affordable."
It suggested that television and video services delivered over broadband would be the main boost to fixed telecoms spending in the coming years.
"TV and video services over broadband represent the greatest hope for maintaining spend levels," Mr Wood added.
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