Mobile Now Shapes Global Bandwidth Demand

It might still seem a bit unusual to hear an executive at a major company in the undersea bandwidth business argue that his firm, like all others, has to be “in” the mobile business.

“Without mobile, you are in trouble: you have to be part of mobile.” according to Andrew Kwok, Hutchison Global Communications president, international and carrier business.

That doesn’t necessarily mean offering retail mobile services. It does reflect a recognition of what drives global bandwidth.  Mobile connections already outnumber fixed Internet access connections globally.

Of roughly three billion Internet connections in service in 2014, about 2.3 billion used mobile access.  

That said, North American fixed network bandwidth consumption is between two and three orders of magnitude higher than median end user consumption.

But mobile consumption is growing, in part because more smartphones are in use, and in part because video is becoming the dominant driver of mobile bandwidth.

About 75 percent of mobile data traffic in 2019 will be driven by smartphones, according to the latest Cisco Visual Networking Index.

Mobile video traffic exceeded 50 percent of total mobile data traffic by the end of 2012 and grew to 55 percent by the end of 2014.

So mobile data traffic will grow at a compound annual growth rate of 57 percent from 2014 to 2019, reaching 24.3 exabytes per month by 2019, according to Cisco.

In a sense, mobile is growing in importance because it increasingly represents the way most people use the Internet. Mobile networks also are getting faster. For example, 4G traffic will be more than half of the total mobile traffic by 2017.

At the same time, Internet traffic now dominates global bandwidth requirements, and content--especially video content--dominates Internet traffic.

Increasingly, for all those reasons, mobile also drives Internet traffic, growing 45 percent annually.

Global mobile data traffic grew 69 percent in 2014, for example.

Granted, service providers have several tools to increase effective bandwidth. Different network architectures and better air interfaces will help. But almost nobody believes the growth can be accommodated without allocation of additional spectrum.

Still, more traffic will be offloaded from mobile networks--on to Wi-Fi networks--than remains on mobile networks by 2016. Without offload, mobile data traffic would have grown 84 percent rather than 69 percent in 2014.

Still, virtually every trend other than offload drives higher mobile data consumption.

Global mobile devices and connections in 2014 grew to 7.4 billion, up from 6.9 billion in 2013.

Smartphones accounted for 88 percent of that growth, with 439 million net additions in 2014.

Globally, smart devices represented 26 percent of the total mobile devices and connections in 2014; they accounted for 88 percent of the mobile data traffic.

Mobile network (cellular) connection speeds grew 20 percent in 2014. Globally, the average mobile network downstream speed in 2014 was 1,683 kilobits per second (kbps), up from 1,387 kbps in 2013.

In 2014, a fourth-generation (4G) connection generated 10 times more traffic on average than a non‑4G connection. Although 4G connections represent only six percent of mobile connections today, they already account for 40 percent of mobile data traffic.

Average smartphone usage grew 45 percent in 2014. The average amount of traffic per smartphone in 2014 was 819 MB per month, up from 563 MB per month in 2013.

Most bandwidth buyers (mobile or fixed, commercial or non-profit, industrial or media) are fundamentally similar in many ways, in terms of expectations. What is changing is that more of the total demand is coming from content or media companies and mobile service providers.

That underlies Kwok’s argument about the need to be part of the mobile business.

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