WASHINGTON-The cellular and paging industries experienced similar declines in revenue per subscriber and operating expenses this year. But despite jitters on Wall Street, the operating performance of most wireless companies remains strong, said Economic Management Consultant International Inc. in its report, “Financial Benchmarks in the Cellular and Paging Industries.”
EMCI concluded the cellular industry experienced “steadily declining revenues per subscriber as new low-use subscribers were attracted to the service.” In addition, it said cellular will face increasing pressure on revenues per subscriber as personal communications services networks come online.
However, falling operating expenses exceeded falling revenues, EMCI said. It cost only $8 for service per subscriber in 1996, compared with $11 per month in 1993.
The paging industry experienced falling stocks, EMCI said, causing concerns about paging’s role in the future of wireless communications. Like cellular, the paging industry experienced declining revenues per subscriber, which were offset by declines in operating expenses per subscriber. Cost of service per subscriber fell from $3.70 in 1992 to $2.40 this year.
“Further improvements in the paging industry financial performance are likely after narrowband PCS subscribers sign up in significant numbers,” said Elliott Hamilton, vice president, North American Telecommunications at EMCI.
“However, positive results due to new services are not likely to be felt until late 1998.”
