3 June 2016

Internet of Things to overtake mobile phones by 2018: Ericsson

  • Sixteen billion connected devices forecast to join the Internet of Things (IoT) by the end of 2021
  • Smartphone subscriptions to surpass those for basic phones in Q3 this year
  • Teenage use of cellular data for smartphone video grew 127% in 15 months
The latest edition of the Ericsson Mobility Report* reveals that the Internet of Things (IoT) is set to overtake mobile phones as the largest connected device category by 2018.

Between 2015 and 2021, the number of IoT connected devices is expected to grow 23% annually, of which cellular IoT is forecast to have the highest growth rate. Of the 28 billion total devices that will be connected by 2021, close to 16 billion will be IoT devices.

Rima Qureshi, Senior Vice President & Chief Strategy Officer, Ericsson, says: “IoT is now accelerating as device costs fall and innovative applications emerge. From 2020, commercial deployment of 5G networks will provide additional capabilities that are critical for IoT, such as network slicing and the capacity to connect exponentially more devices than is possible today.”

Source: Ericsson. New mobile subscriptions in India equalled the number of new mobile subscriptions in Asia Pacific excluding China and India. China rated a negative number after China Unicom removed  inactive subscriptions.
Source: Ericsson. New mobile subscriptions in India
equalled the number of new mobile subscriptions in
Asia Pacific excluding China and India. China rated
a negative number after China Unicom removed
inactive subscriptions.
Smartphone subscriptions continue to increase and are forecast to surpass those for basic phones in Q3 this year. By 2021, smartphone subscriptions will almost double from 3.4 billion to 6.3 billion. Also revealed in the report, there are now 5 billion mobile subscribers – unique users – in the world today.

Detailed in the report is a dramatic shift in teen viewing habits: use of cellular data for smartphone video grew 127% in just 15 months (2014 to 2015). Over a period of four years (2011 to 2015) there has been a 50% drop in the time teens spend watching TV/video on a TV screen, and in contrast an 85% increase in those viewing TV/video on a smartphone. This, and the fact that the upcoming generation of mobile users are the heaviest consumers of data for smartphone video streaming (Wi-Fi and cellular combined), makes them the most important group for cellular operators to monitor.

In 2016, a long anticipated milestone was reached: commercial LTE networks were measured supporting downlink peak data speeds of 1 Gbps. Devices that support 1 Gbps are expected in the second half of 2016, initially in markets such as Japan, US, South Korea and China, but rapidly spreading to other regions.

Mobile users will enjoy extremely fast time to content thanks to this enhanced technology, which will enable up to two thirds faster download speeds compared with the fastest technology available today.

Further highlights from the Ericsson Mobility Report include:
  • Mobile broadband subscriptions will grow fourfold in the Middle East and Africa between 2015 and 2021; and mobile data traffic in India will grow fifteen times by 2021.
  • Global mobile data traffic grew 60% between Q115 and Q116 due to rising numbers of smartphone subscriptions and increasing data consumption per subscriber. By the end of 2021, around 90% of mobile data traffic will be from smartphones.
  • LTE subscriptions grew quickly during Q116: there were 150 million new subscriptions during the quarter, driven by demand for improved user experience and faster networks for a total of 1.2 billion worldwide.
  • LTE peak data speeds of 1 Gbps are anticipated to be commercially available in 2016.
  • 5G is expected to start more quickly than anticipated, but additional spectrum harmonisation is needed between countries planning early 5G deployment: This is in addition to the current process for WRC-19, which focuses on spectrum for commercial 5G deployments beyond 2020.
  • Singapore leads Southeast Asia in both smartphone and mobile broadband subscriptions penetration, at more than 100% and more than 140% respectively.
  • The Asia Pacific region is set to fuel growth with 1.7 billion new smartphone subscriptions recorded, exceeding the total combined subscriptions from the rest of the world.
  • IoT to overtake mobile phones as the largest category of connected devices by 2018

The Ericsson Mobility Report also highlights Singapore and Asia Pacific’s leadership position in the adoption of smartphones, mobile broadband and IoT growth.

Singapore continues to lead in Southeast Asia in both smartphone and mobile broadband subscriptions population penetration, with more than 100% and more than 140% respectively, ahead of the Southeast Asia penetration levels of around 40% and around 60% respectively for 2015.

Source: Ericsson. India added the most number of  mobile subscriptions in the quarter, followed by  Indonesia and Myanmar.
Source: Ericsson. India added the most number of
mobile subscriptions in the quarter, followed by
Indonesia and Myanmar.
Globally, mobile subscriptions are growing around 3% year-on-year and reached 7.4 billion in Q116. Indonesia and Myanmar are identified as among the key surge markets in Southeast Asia, with an additional 5 million subscribers in each country for Q116.

Across Asia Pacific smartphone subscriptions will reach 1.7 million by 2021. By the end of 2015, only Singapore had a smartphone subscription penetration above 100% percent in Southeast Asia. Singapore also has the top result overall in Southeast Asia for highest cell-edge downlink speed and lowest latency. By 2021, Singapore is expected to reach almost 130% smartphone subscription penetration.

This growth has, in turn, fuelled a huge demand for rich content from subscribers, with YouTube now the second most popular app in Singapore, behind WhatsApp, and the No. 1 app in Indonesia.

Before the smartphone revolution, most of the attention in mobile network operations was focused on managing voice coverage. Voice now constitutes less than 5% of mobile traffic. Users still expect good voice coverage, but they also expect a good user experience when they access the Internet through apps running on their smart devices.

The report also highlights the huge growth expected in IoT connected devices in Asia Pacific, which globally are expected to surpass mobile phone subscriptions by 2018. This will be driven by emerging applications and business models, and supported by falling device costs. Globally, IoT connected devices are expected to increase to close to 16 billion by 2021. Of this, Asia Pacific will be the region with the highest level of adoption, accounting for around five billion IoT connections.

IoT, which is a fundamental part of Singapore’s pioneering Smart Nation vision, will focus on two major segments - massive and critical connections. Massive IoT connections are characterised by high connection volumes, low cost, low energy requirements and small data traffic volumes - examples include smart buildings, transport logistics, smart meters and agriculture. Critical IoT connections are characterised by requirements for ultra-reliability and availability, with very low latency. These include traffic safety, autonomous cars, industrial applications, remote manufacturing and healthcare, including remote surgery.

Martin Wiktorin, Country Head for Singapore & Brunei, Ericsson, said: “This report highlights the exceptional growth of mobile broadband and smartphone technology in Singapore and across the region. It also demonstrates how IoT promises to change society in the next few years. A recent IDC study predicts that by 2019, we will see US$1.3 trillion worth of investment being poured into IoT technology globally which will empower the digital transformation of all our lives, accelerating our progress towards becoming a truly networked society."

Interested?

The Traffic Exploration Tool which accompanies the report can be used to create customised graphs and tables. The information can be filtered by region, subscription, technology, traffic and device type.

Download the Ericsson Mobility Report, Traffic Exploration Tool and regional reports for South East Asia & Oceania, North East Asia, North America and India

*The Ericsson Mobility Report is one of the leading analyses of mobile data traffic available, providing in-depth measurements from live networks spread around the globe. The report uses these measurements and analysis, together with internal forecasts and other relevant studies, to provide insights into current traffic and market trends in the networked society. The report defines a connected device as a physical object that has an IP stack enabling two-way communication over a network interface.

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