According to a report,“Roaming Tariff Market Size, Share & Trends Analysis Report By Roaming Type (National, International), By Distribution Channel (Retail Roaming, Wholesale Roaming), By Service (Voice, SMS, Data), By Region, And Segment Forecasts, 2019 – 2025”, published by Grand View Research, Inc., The global roaming tariff market size is expected to reach USD 100,750.0 million by 2025, registering a CAGR of 5.5%. The increasing number of internet users coupled with growing international tourism are anticipated to positively impact the market growth.
In recent years, LTE subscriptions have increased at a significant rate owing to broader network coverage. Developing countries such as India and Japan are ranked among countries with the largest internet user base. In addition, the use of high-end mobile devices, such as 4G-enabled smartphones, is also increasing owing to advantages such as low latency and easy access to data & voice services when traveling abroad. For instance, according to International Telecommunication Union (ITU), the number of internet users in developing countries accounted for 2,868 million in 2018. Moreover, according to GSMA, smartphones are expected to emerge as the leading and most popular mobile devices used by individuals across all regions by 2020, which is expected to boost the adoption of smartphones to a total of 80% by 2025.
The rapid growth of international tourism is also expected to contribute to the roaming tariff market growth. The Australian Government revealed that 8.6 million international tourists visited Australia in June 2017. Furthermore, the Australian government updated its Memorandum of Understanding (MoU) with China, India, and Australia in 2016, 2014, and 2017, respectively, for encouraging tourism activities.
The launch of 5G services in 2020 is likely to unfold numerous growth opportunities for the market owing to better coverage and enhanced network capacity. However, regulatory pressures and government intervention in some countries have led to reduced tariff margins for network providers, thereby hampering the market growth. For instance, in 2016, the European Union announced zero roaming charges for European citizens traveling across the region, allowing them to text, call, and browse the internet on their mobile devices at the same price they pay at their home country.
Key Takeaways from the report:
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Based on type, the international segment accounted for a market share exceeding 70% in 2018 owing to the growing international tourism coupled with numerous government initiatives aimed at encouraging tourism
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The wholesale distribution channel segment was valued at approximately USD 50,000.0 million in 2018 and is expected to register a CAGR exceeding 5% from 2019 to 2025, owing to the rise in tourism activities globally
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Based on services, the data segment held the largest market share of over 60% in 2018, which can be attributed to an increase in the number of smartphone users
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The market is expected to witness substantial growth in Asia Pacific owing to factors such as rising disposable income, increased adoption of smartphones, and significant number of internet users in the region
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The roaming tariff market is highly consolidated and characterized by high competition. Major global players operating in the market include America Movil, AT&T Inc., Bharti Airtel Ltd., China Mobile Ltd., and Digicel Group.
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Regional Insights
The European market accounted for more than 40% of the overall share in 2018. The regional market growth can be accredited to the rising disposable income of upper- & middle-class population. Additionally, the European Commission has introduced the ‘Roam like at Home’ policy to prevent additional tariff and reduce bill shock. According to this policy, individuals traveling across Europe can pay domestic tariff for SMS, data, and calling services.
In developing countries, the growing use of mobile services coupled with a rapid increase in LTE subscriptions is driving the overall market growth for roaming tariff. In countries such as India, users are charged a roaming tariff when traveling from one service area to another, even while using the same carrier. The steep roaming charges is a major contributing factor for the growth of the market in India.
Roaming Tariff Market Share Insights
The market is highly consolidated and characterized by high competition. Major global players operating in the market include America Movil, AT&T Inc., Bharti Airtel Ltd., China Mobile Ltd., and Deutsche Telekom AG. Companies are particularly focusing on mergers and acquisitions as part of their growth strategy to hold a competitive position in the market. Reduced tariffs have resulted in increased price competition among key operating players. For instance, in August 2018, Vodafone Group Plc. and Idea Cellular Ltd. merged to form a company called Vodafone Idea Limited. This merger enabled both the companies to utilize their market potential and vast resources as well as expand the subscriber base of the merged company.
Similarly, in January 2019, America Movil announced the acquisition of Telefonica Moviles Guatemala and Telefonica Moviles El Salvador (regulatory approval pending). These companies provide mobile and fixed telecommunication services that include voice, data, and pay TV in Guatemala and El Salvador. The company carried out these acquisitions with an aim to expand its operations in both the locations. Furthermore, in August 2018, Vodafone Group Plc. and Idea Cellular Ltd. merged into one company called Vodafone Idea Limited. This merger enabled both the companies to utilize their market potential and their vast resources as well as to expand the subscriber base of the merged company.
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