Sylvain Chevallier, an associate at telcoms specialist BearingPoint consultancy, agreed that competition is the issue, but believes the problem is in Europe.
“It’s not that the US market isn’t competitive, but I would say that in fact the European market is way too competitive” which has resulted in plunging prices, he said.
In the United States “you don’t have this constant life or death struggle for a sufficient number of customers” said Chevallier, calling it a “competitive but reasonable market“.
“To survive the operators must get as many clients as possible, but to do so cut prices,” said Chevallier. “It’s a hellish circle that results in the market losing its value.”