LTE set to become the dominant mobile access technology: Ericsson Mobility Report
By Yunnie Marzuki July 11, 2017
- Mobile subscriptions in APAC to hit 1.3 billion by the end of 2022
- Rapid growth in mobile subscriptions in LTE and early stage of 5G will boost IoT offerings
MOBILE subscriptions in the Asia Pacific (APAC) have been steadily growing. From the end of 2016 to 2022, it is forecast that mobile subscriptions in the region will increase at a compound annual growth rate (CAGR) of almost 3%, reaching around 1.3 billion subscriptions, according to the latest Ericsson Mobility Report.
At the end of 2016, around 3.2 billion subscribers out of the world’s total population of 7.4 billion had access to the internet via mobile broadband technology. It is forecast that an additional 2.6 billion subscribers will have mobile broadband internet access by 2022.
This corresponds to an average of more than one million new mobile broadband subscribers being added every day through to the end of 2022.
Key drivers behind this subscriber uptake are a growing young population with increasing digital skills, and decreasing smartphone prices, as well as continued deployment of 3G and 4G mobile broadband technologies in developing markets.
In Q1 2017, China, India, Myanmar, Indonesia and Bangladesh continued to be among the top 10 countries globally for net mobile subscription additions, with net additions in Indonesia reaching ore than 10 million after India (+43 million) and China (+24 million). Behind Indonesia are Pakistan (+5 million) and Nigeria (+3 million).
“Indonesia is growing in a positive way compared to a few years ago. This growth is definitely affected by the Indonesian macroeconomic sector and diverse offerings from mobile service providers,” said Ericsson Indonesia and Timor Leste vice president, head of Network Product Unit Ronni Nurmal (pic) in a media briefing recently.
Smartphone subscriptions lead the growth in data traffic. At the end of 2016, there were 3.9 billion smartphone subscriptions. The majority or 90% were for 3G and 4G. By 2022, the number of smartphone subscriptions is forecast to reach 6.8 billion and almost all of these will be for mobile broadband.
GSM/EDGE still constitutes the largest category of mobile subscriptions. However, LTE is anticipated to become the dominant mobile access technology in 2018, and will likely reach five billion subscriptions by the end of 2022.
In Indonesia, LTE subscriptions will grow significantly with a projected 65% of total mobile subscriptions by 2022.
In 2016, smartphone data traffic reached 2.1GB per month globally, and 1.8GB regionally. The number is predicted to rise to 12GB per month both globally and regionally in 2022.
Total mobile data traffic grew by 70% between Q1 2016 and Q1 2017 dominated by video traffic.
“We also foresee 75% of growth in video traffic by 2022 due to the habit of users now who watch video on their devices for learning purposes,” Ronni said.
Early 5G deployment is anticipated in several markets. In 2022, the number of 5G subscriptions is forecast to surpass 500 million.
A 5G subscription will require a device capable of supporting 5G services and use cases, and that is connected to a 5G-enabled network.
“5G will enable Internet of Things (IoT) to grow. Perhaps by 2020 or 2021, 5G connectivity will come into Indonesia. We have to learn from other countries,” Ronni adds.
App experience and coverage
Ronni also explains that the market in Indonesia remains dominated by overseas mobile applications as only 12% out of the total 100 apps were local or regionally made.
The popular local or regional apps include banking, dictionaries, mobile service providers, transportation, travel, news, and shopping.
“This will give an opportunity for local app developers to create more apps that will be useful by featuring local content to attract the local ecosystem,” he comments.
In mature mobile broadband markets, consumers typically expect a time-to-content of four seconds or less, which requires a minimum downlink speed of roughly 4 Mbps.
In the past few years there have been steady improvements to network performance in most countries in the region, to the point that 70% of the analysed speed test samples in all those countries achieved at least 1 Mbps downlink speeds.
While this speed is not sufficient for a time-to-content of four seconds or less, it is expected that this will improve as networks continue evolving to higher speeds thanks to LTE deployment.
Ericsson conducted an analysis on Ookla Speedtest Intelligence that shows that the probability of a user achieving the minimum required network speed in web browsing, video streaming and loading HD video will be 83%, 51%, and 31%.
“Indonesia is in an average state in terms of app coverage measured by network speed in the region. Mobile broadband operators play a crucial part in optimising the network by applying analytics,” Ronni explains.
Growth in IoT
The rapid growth in mobile subscriptions in LTE and early stage of 5G will boost a variety of IoT offerings according to this report.
Around 29 billion connected devices are forecast by 2022, of which around 18 billion will be related to IoT.
Connected IoT devices include cars, machines, meters, sensors, point-of-sales terminals, consumer electronics and wearables.
Between 2016 and 2022, IoT devices are expected to increase at a CAGR of 21%, driven by new use cases.
“The 30% growth of wide area IoT using cellular devices will standardise the IoT ecosystem. There is a potential for Indonesia to develop the technology if the ecosystem can deliver growing results depending on use cases and business models.
“Regulators on the other hand can implement the technology to increase penetration rate of IoT in Indonesia,” Ronni says.
Mobile service providers addressing IoT opportunities for enterprise segments should thoroughly assess their business opportunities and connectivity requirements in order to deploy the correct network infrastructure, both short range IoT and 5G connectivity.
Implications for Indonesia
According to Ronni, there are three factors for mobile broadband operators to implement digital technology in their businesses.
“Networks need to evolve from time to time in every industry. Along the way, mobile service providers will need to prepare a roadmap and cope with the technology,” he says.
There is also another way for providers to play a part. They can differentiate offerings through IoT.
“Operators can become IoT service providers, service enablers, or service creators to give connections to users,” he adds.
Collaboration between the public and private sector is also needed in order to increase tech development.
“Every sector will complement each other and it also depends on the capability of each industry. The unique points of Indonesian industry will benefit its own ecosystem,” he concludes.