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Mobile telephone retailer revenue expected to decline at a compound annual rate of 1.5 percent

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Krystal
New Update

LONDON, ENGLAND: 92 percent of UK adults own a mobile phone, resulting in the mobile telephone retailers industry facing a challenging period as the market approaches saturation. However, the increased penetration of smartphones is helping to keep the industry growing modestly. For these reasons, industry research firm IBISWorld has updated its report on the mobile telephone retailers industry.

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IBISWorld industry analyst Christopher Edwards said: "Revenue is expected to decline at a compound annual rate of 1.5 percent over the five years through 2013-14 because mounting competition between operators has led to shrinking profit margins and declines in the average price of phones."

Trends in real personal disposable income and consumer sentiment have also played their part in limiting revenue as consumer demand will be held back by the declines in disposable incomes brought by higher inflation and deteriorating consumer sentiment due to uncertainty in the eurozone.

However, increased penetration in the smartphone market has provided some avenues for retailers to generate revenue. Industry sales are also likely to suffer from the continued shift to 24-month contracts, under which customers return for new products less frequently. Despite these difficulties, the revenue of mobile telephone retailers is forecast to rise once more and expand at a modest rate over the five years through 2018-19.