Telecommunication Operators Overview- Europe & US


First, the U.S. market is outperforming the EU market in many important respects:

• EU consumers pay less per month than U.S. consumers for mobile wireless services, but U.S. consumers use five times more voice minutes and twice as much data.

• Growth in investment in the U.S. is translating into faster data connection speeds: U.S. speeds are now 75 percent faster than the EU average, and the gap is expected to grow.

• The U.S. is deploying LTE at a much faster pace than the EU; by YE 2013, 19 percent of U.S. connections will be on LTE networks compared to less than two percent in the EU.



Data on prices and output show that EU consumers incur lower monthly fees than their U.S. counterparts, but that U.S. consumers utilize mobile services more extensively and thus pay lower unit costs. The higher levels of use exhibited by U.S. consumers are broadly consistent with the thesis that, in a differentiated product market, policies that reduce the amount consumers spend do not necessarily enhance consumer welfare.

Thus, while U.S. consumers pay more per month than those in the EU, they pay less per unit of usage. Merrill Lynch reports that average revenue per minute of voice usage in the U.S. is far lower than in any European country, and less than a third of the European average.

Whatever the reasons for usage, European consumers pay less per month than consumers in the United States, but U.S consumers use their devices more intensely than consumers in the EU.

While there clearly are multiple causes for the higher revenues earned by U.S. carriers relative to EU carriers, the divergence between EU and U.S. performance in recent years is likely explained in part by the more rapid expansion of the mobile wireless ecosystem in the U.S., spurred by the more rapid and extensive deployment of LTE.


Europe already has some of the cheapest telecoms services seen in the global developed peer group; the problem is rather that it is falling behind in terms of network capability.… While Americans may pay more for their services, they have access to an increasingly superior platform. U.S. prices might be higher, but this does not necessarily indicate that consumers there receive worse value for money….


One important aspect of mobile wireless quality is the connection speed for mobile data services. While EU and U.S. average connection speeds have been comparable for many years, the more advanced deployment of LTE networks in the U.S. (detailed in the next section) is now beginning to create a gap, which is expected to widen in the immediate future.

Cisco reports that average mobile data connection speeds in North America in 2012 were about 75 percent faster than those in Europe (2.6 Mbps versus 1.5 Mbps), and projects that the gap will expand going forward. By 2017, average mobile connection speeds are projected to exceed 14 Mbps in North America, compared to 7 Mbps in the EU.

Sources:  GSMA