Big drop in GSM spending drives mobile infrastructure market to steep on-year decline, says Dell'Oro Group

Worldwide mobile infrastructure market revenues contracted 12% on year in the second quarter of 2009 mainly due to declines in the 2G market, particularly with GSM, despite very strong growth in the 3G markets, according to Dell'Oro Group.

"India and China continued to be the engine of the GSM market, but that engine is beginning to lose steam," stated Scott Siegler, senior analyst of mobile infrastructure research at Dell'Oro Group. "Despite high 2G subscriber growth, spending in both regions significantly declined in the first half of the year. In the second quarter, Chinese operators continued to focus on their 3G rollouts, driving the WCDMA market to another record setting quarter of Node B shipments. In India, operators focused on optimizing their existing infrastructure, rather than expanding their footprint. Nearly 10% fewer GSM base stations were shipped in the second quarter as compared to the same period last year, and GSM's share of the total market fell below 50%," continued Siegler.

Although GSM spending is expected to pick up in the second half of the year, and the WCDMA market is expected to continue to ramp, revenues for the total mobile infrastructure market is forecast to contract 10% in 2009, added the research firm.