WIRELESS NETWORK DATA TRAFFIC: WORLDWIDE TRENDS AND FORECASTS

Transcription

1 analysysmason.com RESEARCH FORECAST REPORT WIRELESS NETWORK DATA TRAFFIC: WORLDWIDE TRENDS AND FORECASTS RUPERT WOOD Analysys Mason Limited 2016

2 About this report This report presents 5-year forecasts of wireless data traffic worldwide, in eight regions and selected countries. It analyses the key trends in, and drivers and inhibitors of, data traffic. The forecast dataset underpinning this report covers: mobile data: data delivered over mobile (cellular) networks to: handsets (typically smartphones); mid-screen devices (typically tablets); USB modems, routers and other standalone data devices; M2M devices; median usage per smartphone; and downstream and upstream Wi-Fi data: data delivered over private Wi-Fi connections (at home or work) to handsets and mid-screen devices, and data delivered to all devices using public Wi-Fi connectivity. The report assesses the enablers of future capacity on wireless networks and the cost of supplying that capacity. It also analyses the trends in private and public usage, and their effect on the use of mobile and Wi-Fi connectivity. This report is based on Analysys Mason s: internal research and modelling consumer surveys on smartphone and tablet usage. Our forecasts are informed and sense-checked by on-the-ground regional market experts. Figure 1: Summary of report coverage Geographical coverage Regions modelled: Central and Eastern Europe (CEE) Developed Asia Pacific (DVAP) Emerging Asia Pacific (EMAP) Latin America (LATAM) Middle East and North Africa (MENA) North America (NA) Sub-Saharan Africa (SSA) Western Europe (WE) In addition, 26 countries and the Nordic region are modelled individually 1 For more information, see Analysys Mason s Fixed network data traffic worldwide: forecasts and analysis Major KPIs Mobile data Total volume and average usage for: handsets mid-screen devices USB modems and routers M2M and smart wearables Traffic split by: public and private usage median usage per smartphone downstream and upstream Wi-Fi data Total volume and average usage for: handsets mid-screen devices, split by mobile-connected and Wi-Fi-only devices laptops (public Wi-Fi connectivity only) Traffic split by public and private usage The report serves as a companion to Fixed network data traffic worldwide: forecasts and analysis , which has similar geographical coverage. 1 Analysys Mason Limited

3 Contents [1] 7. Worldwide trends 8. Worldwide: 4G and emerging economies are driving traffic growth, but mobile will remain a sub-10% share of data traffic 9. Worldwide: Traffic growth in advanced LTE markets looks linear not exponential and may even turn into s-curves 10. Worldwide: Investment in FTTx may slow the very rapid growth in emerging markets 11. Worldwide: The value of a gigabyte is falling by about 30% per year, but the gross margin on mobile data remains very high 12. Worldwide: There is now little correlation between traffic growth and revenue growth, especially in advanced markets 13. Worldwide: Within 2 years after launch, 4G smartphones generate at least 3 times more traffic than 3G 14. Worldwide: Wi-Fi is already the default at-home network, and could become the default public indoor network 15. Worldwide: The availability of licensed spectrum will become a less important factor in determining the volume of traffic 16. Western Europe 17. Western Europe: The region is just passing the point of fastest growth 18. Western Europe: The rate of growth in traffic will slow considerably by the end of Central and Eastern Europe 20. Central and Eastern Europe: Deficits in fixed broadband have boosted cellular usage levels 21. Central and Eastern Europe: The region will broadly follow the rates of growth in Western Europe, but with higher MBB usage 22. Middle East and North Africa 23. Middle East and North Africa: Most of the region remains heavily reliant on mobile networks for all broadband 24. Middle East and North Africa: Outside the GCC area, underinvestment may limit traffic growth 25. Sub-Saharan Africa 26. Sub-Saharan Africa: Usage levels are strongly related to income in the region 27. Sub-Saharan Africa: Three main factors will constrain the ability of MNOs to cater for the high demand 28. Emerging Asia Pacific 29. Emerging Asia Pacific: Traffic in the region as a whole is growing by about 80 90% per year 30. Emerging Asia Pacific: Very strong growth is driven largely by China catching up in average usage with comparable markets 31. Developed Asia Pacific 32. Developed Asia Pacific: Pricing discipline and saturation has meant subdued growth in most regional markets 33. Developed Asia Pacific: The pattern of growth in traffic will be linear not exponential Analysys Mason Limited

4 Contents [2] 34. North America 35. North America: US traffic growth has slowed dramatically 36. North America: It is difficult to see cellular data traffic growing more than four-fold between now and the end of the decade 37. Latin America 38. Latin America: South American markets are a little ahead of Mexico in terms of data usage 39. Latin America: Uneven income distribution will shape traffic growth in the region 40. Forecast methodology and assumptions 41. Forecast methodology and assumptions 42. Definition of geographical regions [1] 43. Definition of geographical regions [2] 44. About the authors and Analysys Mason 45. About the author 46. About Analysys Mason 47. Research from Analysys Mason 48. Consulting from Analysys Mason Analysys Mason Limited

5 List of figures [1] Figure 1: Summary of report coverage Figure 2: 4G and higher device share of traffic, worldwide, emerging and developed economies, Figure 3: Cellular data traffic, by region, Figure 4: Mobile share of total worldwide Internet traffic, Figure 5: Annual growth multiples, total mobile data traffic selected advanced LTE markets, 4Q Q 2015 Figure 6: Average usage per data SIM, normalised to 4Q 2011, selected advanced LTE markets, 4Q Q 2015 Figure 7: Cellular data traffic, worldwide, developed economies and emerging economies, , Analysys Mason 2014 and 2015 forecasts Figure 8: Data revenue per used GB, handset-only, by region, Figure 9: Typical range of network and wholesale costs, and revenue sold and consumed, Western Europe, 2015 Figure 10: Mobile data traffic growth, overall retail revenue growth and data revenue growth, worldwide, Figure 11: Year-on-year retail mobile revenue growth, selected advanced LTE markets, 3Q Q 2015 Figure 12: Ratio of average 4G and average 3G smartphone usage, worldwide and selected markets Figure 13: US device penetration and average usage, Figure 14: Smartphone users who connected to Wi-Fi by category of hotspot and the average amount of their total Wi-Fi data usage attributable to that category, Android users (n = 1211) Figure 15: Convergence of fibre access and mobile Figure 16: Annual rate of growth, cellular data traffic, selected Western Europe markets, Figure 17: Cellular data traffic per head of population per month, selected Western Europe markets, 2014 and 2015 Figure 18: Cellular data traffic, Western Europe, by market, Figure 19: Annual rate of growth, cellular data traffic, selected Central and Eastern Europe markets, Figure 20: Cellular data traffic per head of population per month, selected Central and Eastern Europe markets, 2014 and 2015 Figure 21: Cellular data traffic, Central and Eastern Europe, by market, Figure 22: Annual rate of growth, cellular data traffic, selected MENA markets, Figure 23: Cellular data traffic per head of population per month, selected MENA markets, 2014 and 2015 Figure 24: Cellular data traffic, MENA, by market, Figure 25: Annual rate of growth, cellular data traffic, selected SSA markets, Figure 26: Cellular data traffic per head of population per month, selected SSA markets, 2014 and 2015 Figure 27: Cellular data traffic, SSA, by market, Figure 28: Annual rate of growth, cellular data traffic, selected emerging Asia- Pacific markets, Analysys Mason Limited

6 List of figures [2] Figure 29: Cellular data traffic per head of population per month, selected emerging Asia-Pacific markets, 2014 and 2015 Figure 30: Cellular data traffic, emerging Asia-Pacific, by market, Figure 31: Annual rate of growth, cellular data traffic, selected developed Asia- Pacific markets, Figure 32: Cellular data traffic per head of population per month, developed emerging Asia-Pacific markets, 2014 and 2015 Figure 33: Cellular data traffic, developed Asia-Pacific, by market, Figure 34: Annual rate of growth, cellular data traffic, Canada and the USA, Figure 35: Cellular data traffic per head of population per month, Canada and the USA, 2014 and 2015 Figure 36: Cellular data traffic, North America, by market, Figure 37: Annual rate of growth, cellular data traffic, selected Latin American markets, Figure 38: Cellular data traffic per head of population per month, Brazil and Mexico, 2014 and 2015 Figure 39: Cellular data traffic, Latin America, by market, Figure 40a: Regional breakdown used in this report Figure 40b: Regional breakdown used in this report Analysys Mason Limited

7 Cost and revenue (USD per GB) Handset data revenue (USD per GB) Wireless network data traffic: worldwide trends and forecasts Worldwide: The value of a gigabyte is falling by about 30% per year, but the gross margin on mobile data remains very high Mobile data has fallen to a retail value close to USD10 per gigabyte. The average revenue from a consumed gigabyte of data continues to fall. On a worldwide level, it has fallen by an average of about 30% per year between 2012 and 2015, by which time the average value was about USD11 per gigabyte. There are significant variations between regions in terms of revenue per gigabyte. Figure 8 shows the decline in value for handset services only; the inclusion of data-only mobile broadband would show greater disparity. It takes at face value operators own allocation of revenue to data services. Operators in North America (NA) commanded the highest value at about USD16 per gigabyte. This indicates significant room for price erosion. The CEE region has the lowest value; data-only mobile broadband (MBB) services are popular in the region and MBB prices (usually lower than handset data) pull the value of handset services down. Figure 9 shows various cost and revenue metrics for mobile data in Western Europe (WE). The RAN cost per gigabyte depends on local cost and utilisation factors, but we put it in the range of USD0.40 to USD1.10 per gigabyte. Wholesale services for mobile virtual network operators (MVNOs) command about double this figure. Revenue per GB consumed is many times higher, and our estimate of revenue per sold GB indicates that WE consumers consume about two thirds of the data they buy. Figure 8: Data revenue per used GB, handset-only, by region, WE CEE NA DVAP EMAP MENA LATAM SSA World Source: Analysys Mason Figure 9: Typical range of network and wholesale costs, and revenue sold and consumed, Western Europe, Network cost (full loading) Wholesale cost Revenue per GB sold Revenue per GB used Source: Analysys Mason Analysys Mason Limited

8 Australia Hong Kong Japan Singapore South Korea Taiwan MB per capita per month Growth Wireless network data traffic: worldwide trends and forecasts Developed Asia Pacific: Pricing discipline and saturation has meant subdued growth in most regional markets DVAP Traffic growth in DVAP is falling to the underlying rate of Internet traffic growth. Despite high usage levels, there is no strong evidence of fixed broadband line substitution. Therefore, as in other developed markets, fixed and mobile networks seem to be becoming more complementary and less substitutive. There is a homogeneity of tariff structures in some regional markets (such as Hong Kong and Singapore), in which tariffs are kept highly volume-based (for example, no discount for higher volumes). This may be a factor of cross-ownership by industrial groups of more than one network. The hours in the day where the mobile network is used as the default network are already well saturated. There has been little change in the Carrier aggregation has boosted volume growth spasmodically, particularly in South Korea, but it appears to result in little revenue growth. Australian growth is likely to be a little higher than the rest of the region, but comes from a lower base, especially so when LTE fixedwireless is excluded. Figure 31: Annual rate of growth, cellular data traffic, selected developed Asia-Pacific markets, % 80% 60% 40% 20% 0% Figure 32: Cellular data traffic per head of population per month, developed emerging Asia- Pacific markets, 2014 and ,500 3,000 2,500 2,000 1,500 1, Australia Hong Kong Japan Singapore South Korea Taiwan DVAP Source: Analysys Mason Source: Analysys Mason Analysys Mason Limited

9 CONTENTS WORLDWIDE TRENDS REGIONAL TRENDS WESTERN EUROPE CENTRAL AND EASTERN EUROPE MIDDLE EAST AND NORTH AFRICA SUB-SAHARAN AFRICA EMERGING ASIA PACIFIC DEVELOPED ASIA PACIFIC NORTH AMERICA LATIN AMERICA FORECAST METHODOLOGY AND ASSUMPTIONS ABOUT THE AUTHORS AND ANALYSYS MASON Analysys Mason Limited

10 About the author Rupert Wood (Research Director) is head of Analysys Mason s networks practice and leads its Convergence Strategies programme. His primary areas of specialisation include the economics of next-generation networks, long-term industry trends and forecasting the dynamics of convergence and substitution across fixed and mobile platforms. Rupert regularly contributes to the international press on a wide range of telecoms subjects and has been quoted by The Times, The Economist, Business Week, Telecommunications Online and La Tribune. Rupert has a PhD from the University of Cambridge, where he was a Lecturer before joining Analysys Mason.. Analysys Mason Limited

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