Even as AT&T (T) and Verizon (VZ) sail confidently ahead with rising average revenues per user (ARPU) and subscriber levels, several major European mobile carriers continue stumbling badly. Vodafone Spain and Telefonica Spain lost 1.6 million and 3 million mobile subscribers in 2012. Now France Telecom is reporting a stunning 10% decline in mobile ARPU for 4Q12. Markets have been aware of the trend of aggressive challenger operators undermining big behemoths for a long time. Yet it seems that investors are still having trouble wrapping their minds around how bad things are getting. France Telecom’s share price sunk to 2002 levels following its 4Q report. How is it possible that American mega-carriers are doing so well considering that many of their European peers are now on the ropes?

One factor here is obviously the relative health of American consumers. U.S. retail spending is still chugging along even as retail spending in key EU markets has started showing nasty annualized declines, as much as -10% in Spain. But perhaps a more important factor is the naked aggression many spunky challenger operators began showing around 2011 and early 2012. In France, an upstart called Iliad rolled out a monthly package offering unlimited voice and texting with a decent chunk of mobile data for 20 euros per month. That led to substantial subscriber growth and more than 50% annualized revenue growth for Iliad. We now know that the impact on the big incumbent operator in France in Christmas quarter was even worse than expected, even though investors thought they were expecting the worst.

The big question is how Softbank will handle the Sprint (S) acquisition over the next year or two if the deal goes through. After Sprint’s dismal fourth quarter 2012 subscriber decline, Softbank knows that the current value proposition of Sprint is not working against the marketing machines and superior network coverage of AT&T and Verizon. Softbank can now see how effective Iliad’s guerrilla campaign was against the France’s biggest legacy operator. Is it ready to duplicate the same blitzkrieg? If the Softbank acquisition founders on regulatory problems, what the heck is Sprint’s next move going to be? Its Nextel service will shut down soon and the CDMA network is not gaining enough subscribers to even stop AT&T-Verizon market share gains, let alone reverse the trend.

Europe is demonstrating right now that cataclysmic change in mobile market is possible. Is anyone ready to stage an insurgency in America?