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Business intelligence and strategic marketing vendor Informa Telecoms & Media reports the number of mobile subscriptions worldwide should reach 2.14 billion by the end of 2005, having already surpassed the 1.8 billion mark this quarter.

Building on record growth of 354 million in 2004, net additions are expected to exceed 350 million again in 2005. Rapid growth in key developing markets and less extensive declines than previously anticipated in mature markets are Informa's reasons to predict another banner year for the worldwide wireless industry—at least in terms of signing people up service.

For example, reductions in access fees in rapidly expanding areas, such as Nigeria and Mexico, have had an impact on short-term growth. Meanwhile, Informa has also revised its achievable penetration rates upwards for key markets such as China, Russia and Indonesia as a result of network expansion into regional areas and operator schemes to encourage the uptake of subscriptions among lower-income segments of the population.

The Russian mobile market grew by 89 percent in 2004 on the back of four previous years of annual growth in excess of 100 percent and Russia alone is forecast to account for 43 percent of net additions in Central and Eastern Europe between 2005-2010. The Chinese mobile market, which exceeded the 400 million subscriptions in March 2005, is forecast to grow by 65 percent by the end of 2010. Indonesia should exceed 50 million subscriptions in 2007.

In mature markets, operators are successfully targeting new niche groups, such as the under-14 age demographic, while growth in the number of mobile users with multiple subscriptions shows no sign of abating. A number of these markets, such as Italy, the United Kingdom, Sweden and Hong Kong have already exceeded 100 percent penetration. Others that could follow suit before the end of 2005 are Austria, Denmark, Ireland and Portugal.

According to Informa, the global penetration rate for cellular subscriptions is just 28 percent, meaning there's still more than four billion potential new mobile users around the world.

Voice Bubble
Although there's a plenty of room for growth in the worldwide cellular marketplace, carriers catering to mature markets are banking on data rather than voice services as their ticket to ride towards future revenues.

Yes, voice still accounts the lion's share of operator earnings. But that mainstay is increasingly becoming a commodity, earning operators far less money than it did during voice's 1990's heyday.

That's why the wireless industry is turning to data services like entertainment (e.g. handset TV & video) and e-mail to boost revenues and increase ARPU (average revenue per user).

3G networks and increasingly sophisticated handsets like smartphones and feature phones are some of the advancements making this possible. For example, last year U.K. operator Orange reported palmOne's Treo delivered twice the ARPU of other phones it delivers because of the Treo's support for e-mail and other data offerings.

Yet with text messaging accounting for most earnings beyond voice, entertainment and information offerings haven’t turn out to be the boon mobile operators expected, at least not yet.

The reason: Frost & Sullivan analyst Brent Ladarola points the finger at not-ready-for-primetime networks and customer ambivalence; plus incompatible standards, operating systems, browsers, and devices, among other factors.

With better phones and faster and more reliable networks rolling out, and increased cooperation between operators (some would add consolidation), standards organizations, and device manufacturers, there is every reason to expect the initial bumps in the road to pervasive entertainment and information at one’s fingertips will, over time, smooth out.