A demographic take

An tSaoi16/09/2009

An Saoi: Accurate and current information is crucial to giving an up to date view of what is really going on in the Irish economy. The Commission for Communications Regulation (ComReg) have just produced the latest issue of their quarterly statistical review of the communications industry, covering Quarter 2 of 2009 published on 10th September.

A huge amount of relevant current information is available, not just relating to telephones and internet but also to broadcasting. I am glad to see that the number of we refuseniks without cable or satellite connections is increasing. Spending on communications and on television are core parts of household expenditure and substantial cuts in such expenditure suggest major changes in the focus of household budgets.

My own personal interest is in mobile communications. The Report confirms a continued substantial decline in mobile phone numbers with penetration levels falling to 2006 levels. The one area of growth was mobile broadband, which also made up over 50% of the increase in total broadband connections . However there was an overall decline in internet connections because of the reduction in narrowband usage. Internet usage appears to be peaking. The dire state of broadband in Ireland was well covered here on this site by Dr. Dónal Palcic of UL, and for a more sobering view, have a read of this piece by Kathleen Barrington.

I have previously written here suggesting that the decline in the number of active mobile connections was a clear sign of emigration. Local Demographics alone should be providing a substantial increase in the market as there are far more young people reaching the age of their first mobile than customers dying. Michael Taft has produced some interesting figures on the August unemployment figures, which raise similar issues.

The degree of decline in income from mobile calls and texts between Q2 2008 & Q2 2009 is a massive 18% or €75.65M. The moderate increase in Data revenue of €16M hardly makes up for this loss of income, considering the addition costs of hardware etc. The decline has been particularly marked since the start of 2009, however the year on year decline in the first quarter was just 7.5%

The income decline in the Irish mobile market is extraordinary and considerably exceeds that of other mature markets. Indeed it exceeds that of Germany , a country with a seriously declining population. Certainly some of the decline is down to price reductions and economic conditions however the suddenness of the decline suggests the disappearance of a large number of customers.

Between Quarter 2, 2008 and Quarter 2, 2009, the number of mobile phones declined from 4,985,987 to 4,809,857. Natural population increases should have added at least 40,000 customers, leaving a discrepancy of well over 200,000.

The next report is due in the middle of December, and I await its publication with interest.

Posted in: EconomicsLabour market

Tagged with: demographicsemigration


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