Market development for wireless broadband

Numbers of mobile-communication network data-transfer subscriptions have grown significantly since late 2008. According to data collected by FICORA from telecommunications companies, there were almost 3.6 million mobile-communication network data-transfer subscriptions or contracts active in late 2011. Mobile-communication network data-transfer subscriptions are used mostly to complement fixed-network broadband subscriptions. In all likelihood, the number of mobile-communication network data-transfer subscriptions will continue to grow significantly, as current volumes are not

yet anywhere near the limits of potential growth. Mobile-communication network data- transfer subscriptions are personal subscriptions while fixed-network broadband subscriptions are mostly for the use of businesses or households.

Terminal equipment

Large numbers of pieces of evolved equipment utilising mobile broadband, such as smartphones, USB modems, tablets, e-readers, and game consoles, have entered the market in the past four years. The large displays and high resolution of the devices increase the volumes of data transferred. They also encourage the use of applications such as video calls that require high data-transfer capacity. These devices are the primary cause of the fast increase in mobile broadband traffic.

Smartphones

In 2008, traditional mobile phones accounted for 70 per cent of the world’s total traffic. In 2010, smartphones accounted for 13 per cent of all phones globally but already generated over 78 per cent of all traffic. On average, a smartphone generated considerably higher volumes of data traffic (79 MB per month) than did a traditional mobile phone.

Touchscreen smartphones have been a key factor in the growth of wireless data traffic. Growth in data traffic is due both to increasing numbers of users and to increasing use by individual users.

In evolved markets, a smartphone creates roughly 50 times more traffic per month than a traditional mobile phone does. In Western Europe, for example, a smartphone generates 73 MB of traffic per month, while a traditional mobile phone generates, on average, 1.22 MB per month.

In comparison to tablets and laptops, however, the data-traffic volumes generated by smartphones are low in absolute terms.

Other new terminal devices

Tablets, e-readers, and game consoles have proliferated in the past four years, and their impact can already be seen in growing traffic volumes. Compared to a traditional mobile phone, a tablet generates up to 500 times more traffic. In Western Europe, for example, a tablet generates 740 MB of traffic per month, whereas a traditional mobile phone accounts for 1.22 MB monthly.

Growing use of the mobile internet

With mobile devices, consumers expect access to the same services and applications they use with a fixed internet connection. Mobile devices also enable new applications, such as applications utilising location-based services.

Growth in the mobile application supply

Hundreds of thousands of applications, including games, news apps, maps, social networking, and music, are available for the various smartphone platforms. With approximately 11 billion downloads in February 2011, these applications constitute a major new market. It has been estimated that by 2014, the total number of downloads might reach 77 billion globally. Both downloads and application use increase data traffic.

Smartphone video traffic generally refers to real-time video streaming. So far, YouTube and Flash-based videos have generated the majority of mobile video traffic. However, video sharing will be a major feature of social networking in the future. According to estimates, video downloading and sharing will account for 66 per cent of global mobile data traffic in 2014.

Other ways of using mobile broadband that increase data traffic include: Social networking

Machine-to-machine communication

Improved user experience with fast networks Reasonable prices (fixed monthly fees) Proliferation of cloud services

Growing numbers of users from different age groups

The figure below compares the ITU's 2006 market forecast with information published by Cisco on actual traffic volumes in 2007–2010 and Cisco’s forecast for 2010–2015. The blue line indicates the estimated forecast for 2006, which varies depending on the geographic region and the development of wireless broadband networks. The yellow line depicts traffic volumes realised in 2007–2010 according to Cisco, and the red line indicates Cisco’s forecast for traffic volume growth until 2020. The figure clearly illustrates the conclusion that the global traffic growth realised in 2007–2011 has been considerably higher than that forecast in 2006, and that, according to Cisco, traffic growth will continue to be higher than was forecast in the 2006 market research.

Figure 16: Developments in traffic volume (source: ITU-R M.2243).

broadband networks in Finland in 2008–2011. The European Conference of Postal and Telecommunications Administrations (CEPT) has published a report on the development of the mobile broadband market in Europe. The report forecasts that daily data traffic in a typical Western European country will grow 185 TB (terabytes) a day from the traffic volumes of 2010, reaching 12,540 TB, which represents a nearly 70-fold rise, in 2020. From the traffic volumes depicted in the figure, it can be estimated that Finland's daily data traffic volume was approximately 150 TB in late 2011. According to the forecast, the levels of 2020 would equate to 10,500 TB of daily traffic and 3,800 PB (petabytes) annually. This forecast matches the middle of the old and conservative ITU market prognosis. The forecast indicates that more frequency space needs to be allocated to wireless broadband networks.

Figure 17: Development in volumes of data transferred via mobile-communication networks in Finland in 2008– 2011 (source: FICORA, Market Review 3/2011).

According to FICORA's market review of the status in December 2011, volumes of data transferred via mobile-communication networks in Finland grew markedly in the course of the year. The number of broadband subscriptions grew by 12.5 per cent, reaching 3.6 million in late 2011. Mobile-broadband data transfer via mobile-communication networks grew by 82 per cent.