Good public policies require the right information. For all digital policy and regulation geeks, this is a cheerful week: Ericsson has just released its 7th Mobility Report, coming up with an exciting array of facts & figures that will shake up talk on today’s telecom markets.
ETNO spoke with Greger Blennerud, who sits on the editorial board for the Mobility Report and is Ericsson’s Head of Marketing – Mobile Broadband, and with Peter Olson, Ericsson’s Vice-president for EU affairs. If we were to summarise the trends they indicated, we would say that the world will soon be fully mobile, hyper-connected and data-hungry.
More mobile subscriptions than humans
Today already, there are 6.9 billion mobile subscriptions globally, compared to a world population that is roughly at 7.2 billion people. Ericsson, which looked at projections and figures for 2020 in this year’s report, predicts that we will hit 9.5 billion subscriptions in the next 5 years. Greger Blennerud describes this as “an exciting trend, which should be good news for human progress: it means that virtually every human on earth will be connected”.
Of course, this trend needs to be put into perspective according to geographical location. While subscription growth in the EU and the US is mostly due to people taking up more than one device per person, in other areas like India or China the trend is due to new users subscribing to mobile services.
Connected how? LTE dominates the market
Being connected, though, is not enough. Ericsson also looked at the type of technology, which determines what citizens will be able to do with their subscriptions. “Telecom operators are rolling out LTE at a very fast pace” Blennerud explained “and we see that 4G growth will overtake 3G growth in numbers as early as 2018”. On top of this, by 2019-20 a firstwave of 5G subscriptions is expected to appear on the chart.
This technological evolution, which will require significant investment, has an incredible transformational potential for society and the economy. “With a new European Commission starting its mandate, it is important to underline the positive contribution of mobile technologies to empowering smarter societies and stronger businesses” said Ericsson’s Peter Olson. Policies which facilitate investment and promote services take-up would clearly bring the promise of significant positive externalities.
Digital citizens are data-hungry
When looking at data traffic growth it is clear that telecom operators will need to invest in capacity and efficient management of the networks. Greger Blennerud told ETNO that an impressive number came up on their screens when preparing this year’s Report. “We saw that data traffic grew by 60% between 2013 and 2014. This means that in the space of a year, there was more growth than in the period 2010-2012 alone”, he added.
If we look even closer, we can see that mobile traffic per active subscriptions is also expected to grow from 900MB in 2014 to 3.5GB in 2020. Today already, in Western Europe, we consume on average 1.2GB per month. Such a trend is supported by technological improvements: Higher speed generates more usage.
Video is king
The most prominent role, in this data-hungry world, is played by video. Blennerud told ETNO that “mobile video traffic, which already reaches 45% of the total today, is expected to grow by a factor of 10 between now and 2020”. Ericsson ConsumerLab took a look at US figures and found that the monthly data consumption in the cellular network for the average YouTube user today is 200MB, while Netflix users are already at 700MB/month.
If we want to maintain a high-quality customer experience and use networks efficiently, telecom operators need to be able to manage networks. “A dumb pipe is less efficient than a smart pipe”, explains Blennerud. “Some refer to network management as a tool to pick winners and losers, but in fact it is an important tool to keep networks working efficiently and to deliver the quality expected by consumers”, he concludes.
On a related note please also check out the Ericsson Networked Society Cities Index 2014 which shows the importance of ICT for cities worldwide.