Mobile Data Usage Trends 2011-2015

© 2011, Portio Research. All Rights Reserved

1
Mobile Data Usage Trends 2011-2015

Portio Research Limited.
Published August 2011 by Portio Research Limited © Copyright ...
Mobile Data Usage Trends 2011-2015

Contents
Introduction ...................................................................
Mobile Data Usage Trends 2011-2015

Internet Usage ..........................................................................
Mobile Data Usage Trends 2011-2015

List of Figures
Figure 1:
Figure 2:
Figure 3:
Figure 4:
Figure 5:
Figure 6:
Figure 7:
...
Mobile Data Usage Trends 2011-2015

Figure 48: Total Internet Users and Mobile Internet Users – China (In Million, 2006-20...
Mobile Data Usage Trends 2011-2015

Figure 89: Average Time Spent on Various Activities via Mobile per Day – Chile (In Hou...
Mobile Data Usage Trends 2011-2015

List of Tables
Table 1:
Table 2:
Table 3:
Table 4:
Table 5:
Table 6:
Table 7:
Table 8:...
Mobile Data Usage Trends 2011-2015

Chapter 1
Introduction

© 2011, Portio Research. All Rights Reserved

9
Mobile Data Usage Trends 2011-2015

Introduction
Mobile phones, which were primarily designed to provide simple voice comm...
Mobile Data Usage Trends 2011-2015

Figure 1: Smartphone User Base – Worldwide (In Million, 2008 – 2015F)
1,869.7

Smartph...
Mobile Data Usage Trends 2011-2015

Market, GetJar, Nokia Ovi Store and BlackBerry App World have already become hotspots
...
Mobile Data Usage Trends 2011-2015

Figure 4: Cost per MB of Mobile Data – Worldwide (In USD, 2008 – 2015F)

Cost per MB (...
Mobile Data Usage Trends 2011-2015

This study covers the overview of the mobile data services market, current market size...
Mobile Data Usage Trends 2011-2015

Chapter 2
Worldwide Mobile Market

© 2011, Portio Research. All Rights Reserved

15
Mobile Data Usage Trends 2011-2015

Worldwide Mobile Market
The worldwide mobile industry continues to grow at a significa...
Mobile Data Usage Trends 2011-2015
1

Table 1: Mobile Subscribers – Regional (In Million, 2008 – 2015F)

Mobile Subscriber...
Mobile Data Usage Trends 2011-2015

Asia Pacific‘s subscribers constituted 48.6 percent of the worldwide mobile subscriber...
Mobile Data Usage Trends 2011-2015

Chapter 3
Mobile Data Services Market

© 2011, Portio Research. All Rights Reserved

1...
Mobile Data Usage Trends 2011-2015

Mobile Data Services Market
Mobile data services, including messaging, have added sign...
Mobile Data Usage Trends 2011-2015

Figure 10: Evolution of Mobile Data Services Market (1993-2005)

First P2P SMS was sen...
Mobile Data Usage Trends 2011-2015

Figure 11: Evolution of Mobile Data Services Market (2006-2011)

VOIP services were ma...
Mobile Data Usage Trends 2011-2015

While the history of data services can be traced back to 1993 when the first SMS was
e...
Mobile Data Usage Trends 2011-2015

Types of Mobile Data Services
Messaging services
 Short Messaging Service (SMS)
 Mul...
Mobile Data Usage Trends 2011-2015

Figure 13: Type of Mobile Data Services

Messaging Services

Short Messaging Service (...
Mobile Data Usage Trends 2011-2015

Growth of Data Services Market
The mobile data services market has grown exponentially...
Mobile Data Usage Trends 2011-2015

has proved that the major deterrent was price. Handset manufacturers and operators are...
Mobile Data Usage Trends 2011-2015

Number of Available Applications

Figure 14: App Stores – Number of Available Applicat...
Mobile Data Usage Trends 2011-2015

Expand Perceived Value
It is important to implement a service that adds value to subsc...
Mobile Data Usage Trends 2011-2015

the value chain, it is important for the operator to have control over this value chai...
Mobile Data Usage Trends 2011-2015

Upgrading existing networks appears to be the most obvious solution to network congest...
Mobile Data Usage Trends 2011-2015

Drivers and Inhibitors
Drivers

Figure 16: Drivers of Mobile Data Services

Arrival of...
Mobile Data Usage Trends 2011-2015

Inhibitors

Figure 17: Inhibitors of Mobile Data Services

Pace of Network
Enhancement...
Mobile Data Usage Trends 2011-2015

Chapter 4
Market Size

34

© 2011, Portio Research. All Rights Reserved
Mobile Data Usage Trends 2011-2015

Market Size
Forecast Methodology
In this report, mobile data traffic is defined as the...
Mobile Data Usage Trends 2011-2015

Figure 18: Mobile Data Traffic per Month – Worldwide (In Petabytes, 2008 – 2015F)
5,90...
Mobile Data Usage Trends 2011-2015

Figure 19: Worldwide Mobile Data Traffic – Regional Contribution (In Percent, 2010)

4...
Mobile Data Usage Trends 2011-2015

The figure below highlights the regional share of worldwide mobile data traffic in 201...
Mobile Data Usage Trends 2011-2015

Mobile Data Revenue
With the emergence of mobile data services, a valuable new revenue...
Mobile Data Usage Trends 2011-2015

Table 3:

7

Mobile Data Revenues – Regional (In USD Billion, 2008 – 2015F)

Mobile Da...
Mobile Data Usage Trends 2011-2015

8

Figure 25: Worldwide Mobile Data Revenue – Regional Contribution (In Percent, 2011F...
Mobile Data Usage Trends 2011-2015

CAGR for mobile data revenue in this period, primarily due to their smaller data reven...
Mobile Data Usage Trends 2011-2015

Chapter 5
Case Studies – Regional Trends

© 2011, Portio Research. All Rights Reserved...
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Mobile Data Usage Trends 2011-2015
Upcoming SlideShare
Loading in...5
×

Mobile Data Usage Trends 2011-2015

8,131

Published on

Analysis, User Profiles and Growth Forecasts for Worldwide Mobile Data Use 2011 to 2015

Technological advances within the mobile ecosystem have led to seismic shifts in terms of mobile data usage. But beyond the broad stroke analysis of industry headlines, there is a pressing need to understand the finer details of the surging uptake of data services among mobile users in both developed and emerging countries.

Building on our strong portfolio of high-quality, data-centric market studies - and naturally underpinned by wider analysis, growth forecasts and market sizing of mobile data revenue and traffic - this exciting report uses survey-led research to assemble country case studies to deliver invaluable insight in to the specific trends of mobile data use, culminating in a Typical User Profile for each market analysed.

Published in: Technology, Business
1 Comment
5 Likes
Statistics
Notes
No Downloads
Views
Total Views
8,131
On Slideshare
0
From Embeds
0
Number of Embeds
1
Actions
Shares
0
Downloads
367
Comments
1
Likes
5
Embeds 0
No embeds

No notes for slide

Transcript of "Mobile Data Usage Trends 2011-2015"

  1. 1. Mobile Data Usage Trends 2011-2015 © 2011, Portio Research. All Rights Reserved 1
  2. 2. Mobile Data Usage Trends 2011-2015 Portio Research Limited. Published August 2011 by Portio Research Limited © Copyright 2011. www.portioresearch.com info@portioresearch.com Disclaimer and Legal Notices Disclaimer Every care has been taken in the preparation of this study to ensure that the information contained herein is accurate, factual and correct to the best of our knowledge, at time of publishing. All opinions, suppositions, estimates and recommendations included in this document are solely the opinions of the authors unless otherwise stated. Portio Research Limited accepts no liability for any loss or damage or unforeseen consequential loss or damage arising from the use of the information contained within this document. The opinions, suppositions, estimates and recommendations within this document cannot be guaranteed, and readers use this information at their own risk. The information published in this document is subject to change without notice at any time, and Portio Research Limited accepts no liability or obligation to inform the reader of such changes. Portio Research Limited do not promote or endorse any specific companies or products, the views and opinions we express in this document are wholly our own assessments, and independent from any external interest or influence. Many terms and phrases and trade names used in this document are proprietary and Portio Research Limited recognises and acknowledges that all trademarks are copyright, belonging to their respective owners. Where possible, this document accords such terms and phrases and trade names to their respective owners. All Rights Reserved. No part of this document can be copied, shared, redistributed, transmitted, displayed in the public domain, stored or displayed on any internal or external company or private network or electronic retrieval system, nor reprinted, republished or reconstituted in any way without the express written permission of the publisher. Forwarding of this electronic document without the correct legal licence is theft. It‘s unethical, immoral and against the law. If you have any questions about the legal licence conditions under which this document has been distributed, please contact Portio Research on info@portioresearch.com If you did not buy this document and a colleague or associate has sent it to you, do not assume you are legally entitled to read it, it is your responsibility to ensure you have the correct legal licence to read this document. 2 © 2011, Portio Research. All Rights Reserved
  3. 3. Mobile Data Usage Trends 2011-2015 Contents Introduction ............................................................................................................................10 Worldwide Mobile Market ......................................................................................................16 Mobile Data Services Market.................................................................................................20 Evolution of Mobile Data Services Market ......................................................................................... 20 Types of Mobile Data Services .......................................................................................................... 24 Growth of Data Services Market ........................................................................................................ 26 Convergence of Mobile and Internet ............................................................................................... 26 Role of Smartphones in the Uptake of Mobile Data Services .......................................................... 26 Tablets Catalysing the Growth of Data Services ............................................................................. 27 High-Speed Data Networks ............................................................................................................. 27 Compelling and Innovative Data Services ....................................................................................... 27 Factors that make a Data Service Successful ................................................................................... 28 Monetising the Mobile Data Services Business ................................................................................. 30 Drivers and Inhibitors ......................................................................................................................... 32 Drivers ............................................................................................................................................. 32 Inhibitors.......................................................................................................................................... 33 Market Size..............................................................................................................................35 Forecast Methodology ....................................................................................................................... 35 Market Size ........................................................................................................................................ 35 Mobile Data Traffic .......................................................................................................................... 35 Mobile Data Revenue ...................................................................................................................... 39 Case Studies – Regional Trends ..........................................................................................44 Methodology ...................................................................................................................................... 44 The UK ............................................................................................................................................... 45 Monetisation of Mobile Services ...................................................................................................... 46 Popular Mobile Activities ................................................................................................................. 48 Smartphone Users .......................................................................................................................... 49 Internet Usage ................................................................................................................................. 50 Mobile Applications ......................................................................................................................... 53 Social Networking............................................................................................................................ 57 Typical User Profile ......................................................................................................................... 58 China ................................................................................................................................................. 59 Monetisation of Mobile Services ...................................................................................................... 60 Popular Mobile Activities ................................................................................................................. 61 Smartphone Users .......................................................................................................................... 62 Internet Usage ................................................................................................................................. 64 Mobile Applications ......................................................................................................................... 69 Social Networking............................................................................................................................ 72 Typical User Profile ......................................................................................................................... 73 India ................................................................................................................................................... 74 Monetisation of Mobile Services ...................................................................................................... 75 Popular Mobile Activities ................................................................................................................. 76 Smartphone Users .......................................................................................................................... 77 Internet Usage ................................................................................................................................. 78 Mobile Applications ......................................................................................................................... 81 Social Networking............................................................................................................................ 85 Typical User Profile ......................................................................................................................... 86 The US ............................................................................................................................................... 87 Monetisation of Mobile Services ...................................................................................................... 88 Popular Mobile Activities ................................................................................................................. 89 Smartphone Users .......................................................................................................................... 90 Internet Usage ................................................................................................................................. 91 Mobile Applications ......................................................................................................................... 94 Social Networking............................................................................................................................ 97 Typical User Profile ......................................................................................................................... 98 Chile................................................................................................................................................... 99 Monetisation of Mobile Services .................................................................................................... 100 Popular Mobile Activities ............................................................................................................... 101 Smartphone Users ........................................................................................................................ 102 © 2011, Portio Research. All Rights Reserved 3
  4. 4. Mobile Data Usage Trends 2011-2015 Internet Usage ............................................................................................................................... 103 Mobile Applications ....................................................................................................................... 106 Social Networking.......................................................................................................................... 110 Typical User Profile ....................................................................................................................... 111 The UAE .......................................................................................................................................... 112 Monetisation of Mobile Services .................................................................................................... 114 Popular Mobile Activities ............................................................................................................... 115 Mobile Applications ....................................................................................................................... 117 Internet Usage ............................................................................................................................... 117 Social Networking.......................................................................................................................... 119 Typical User Profile ....................................................................................................................... 121 Managing Data Traffic Growth ............................................................................................123 Summary and Conclusions .................................................................................................129 Appendices ...........................................................................................................................136 Glossary ........................................................................................................................................ 137 Portio Research Classifications ..................................................................................................... 151 Companies Mentioned in this Report ............................................................................................ 152 About the Authors.......................................................................................................................... 154 Also available from Portio Research Limited ................................................................................... 155 4 © 2011, Portio Research. All Rights Reserved
  5. 5. Mobile Data Usage Trends 2011-2015 List of Figures Figure 1: Figure 2: Figure 3: Figure 4: Figure 5: Figure 6: Figure 7: Figure 8: Figure 9: Figure 10: Figure 11: Figure 12: Figure 13: Figure 14: Figure 15: Figure 16: Figure 17: Figure 18: Figure 19: Figure 20: Figure 21: Figure 22: Figure 23: Figure 24: Figure 25: Figure 26: Figure 27: Figure 28: Figure 29: Figure 30: Figure 31: Figure 32: Figure 33: Figure 34: Figure 35: Figure 36: Figure 37: Figure 38: Figure 39: Figure 40: Figure 41: Figure 42: Figure 43: Figure 44: Figure 45: Figure 46: Figure 47: Smartphone User Base – Worldwide (In Million, 2008 – 2015F) ...................................... 11 iPad Shipments – Worldwide (In Million, Q2 2010 – Q2 2011) ......................................... 11 App Stores – Number of Mobile Application Downloads to date (Worldwide, In Billion, Early-July 2011) ................................................................................................................ 12 Cost per MB of Mobile Data – Worldwide (In USD, 2008 – 2015F) ................................... 13 Monthly Mobile Data Traffic per Smartphone User – Worldwide (In Megabytes, 2008 – 2015F) .............................................................................................................................. 13 Mobile Subscriber Base – Worldwide (In Million, 2008 – 2015F) ...................................... 16 Mobile Subscriber Base – Regional (In Million, 2008 – 2015F) ......................................... 17 Worldwide Subscriber Base – Regional Contribution (In Percent, 2010) .......................... 18 Worldwide Subscriber Base – Regional Contribution (In Percent, 2015F) ........................ 18 Evolution of Mobile Data Services Market (1993-2005) .................................................... 21 Evolution of Mobile Data Services Market (2006-2011) .................................................... 22 i-mode Services – Number of Subscriptions (Japan, In Million) ........................................ 23 Type of Mobile Data Services ........................................................................................... 25 App Stores – Number of Available Applications (June 2011) ........................................... 28 Factors Behind a Successful Data Service ....................................................................... 28 Drivers of Mobile Data Services........................................................................................ 32 Inhibitors of Mobile Data Services .................................................................................... 33 Mobile Data Traffic per Month – Worldwide (In Petabytes, 2008 – 2015F)....................... 36 Worldwide Mobile Data Traffic – Regional Contribution (In Percent, 2010) ...................... 37 Worldwide Mobile Data Traffic – Regional Contribution (In Percent, 2011F) .................... 37 Worldwide Mobile Data Traffic – Regional Contribution (In Percent, 2015F) .................... 38 Mobile Data Traffic Growth by Region (In Percent, 2010 – 2015F) .................................. 38 Mobile Data Revenue – Worldwide (In USD Billion, 2008 – 2015F) ................................. 39 Worldwide Mobile Data Revenue – Regional Contribution (In Percent, 2010).................. 40 Worldwide Mobile Data Revenue – Regional Contribution (In Percent, 2011F) ............... 41 Worldwide Mobile Data Revenue – Regional Contribution (In Percent, 2015F) ............... 41 Mobile Data Revenue Growth by Region (In Percent, 2010 – 2015F) .............................. 42 Break-out of Respondents by Average Monthly Mobile Spend – The UK (In Percent, June 2011) ................................................................................................................................ 46 Break-out of Voice vs. Non-voice Mobile Spend – The UK (In Percent, June 2011) ........ 47 Top 6 Activities on Mobile Phone – The UK (June 2011) ................................................. 48 Average Time Spent on Various Activities via Mobile per Day – The UK (In Hours, June 2011) ................................................................................................................................ 49 Contribution of factors deterring Smartphone Usage – The UK (In Percent, June 2011) . 49 Categories of Smartphone owned – The UK (In Percent, June 2011) .............................. 50 Drivers contributing to the increase in Mobile Internet access – The UK (June 2011) ...... 51 Break-out of Mobile Data Plan Types – The UK (In Percent, June 2011) ......................... 51 Break-out of Network Access preferred for Heavy File Downloads – The UK (In Percent, June 2011) ........................................................................................................................ 53 Percentage of Smartphone Users who Download Mobile Apps – The UK (June 2011) ... 53 Top 5 Mobile Application Types – The UK (June 2011).................................................... 54 Paid vs. Free Apps Download Behaviour – UK Smartphone Users (In Percent, June 2011) .................................................................................................................................... 54 Factors deterring Mobile App Users from Downloading Paid Mobile Apps – The UK (June 2011) ................................................................................................................................ 55 How do Mobile Application Users Discover New Apps – The UK (June 2011) ................. 56 Break-out of Respondents by Average Monthly Mobile Spend – China (In Percent, June 2011) ................................................................................................................................ 60 Break-out of Voice vs. Non-voice Mobile Spend – China (In Percent, June 2011) ........... 60 Top 6 Activities on Mobile Phone – China (June 2011) .................................................... 61 Average Time Spent on Various Activities via Mobile per Day – China (In Hours, June 2011) ................................................................................................................................ 62 Contribution of factors deterring Smartphone Usage – China (In Percent, June 2011) .... 63 Categories of Smartphone owned – China (In Percent, June 2011) ................................. 63 © 2011, Portio Research. All Rights Reserved 5
  6. 6. Mobile Data Usage Trends 2011-2015 Figure 48: Total Internet Users and Mobile Internet Users – China (In Million, 2006-2010) .............. 64 Figure 49: Mobile Internet Users as a percentage of Total Internet Users – China (In Percent, 2006 – 2010) ................................................................................................................................ 65 Figure 50: Percentage share of Internet Users accessing Internet via Desktop, Laptop and Mobile – China (In Percent, End-2010) ........................................................................................... 65 Figure 51: Drivers contributing to the increase in Mobile Internet access – China (June 2011)......... 66 Figure 52: Break-out of Mobile Data Plan Types – China (In Percent, June 2011)............................ 66 Figure 53: Break-out of Network Access preferred for Heavy File Downloads – China (In Percent, June 2011) ........................................................................................................................ 68 Figure 54: Percentage of Smartphone Users who Download Mobile Apps – China (June 2011) ...... 69 Figure 55: Top 5 Mobile Application Types – China (June 2011) ...................................................... 69 Figure 56: Paid vs. Free Apps Download Behaviour – China Smartphone Users (In Percent, June 2011) ................................................................................................................................ 70 Figure 57: Factors deterring Mobile App Users from Downloading Paid Mobile Apps – China (June 2011) ................................................................................................................................ 71 Figure 58: How do Mobile Application Users Discover New Apps – China (June 2011) .................... 71 Figure 59: Break-out of Respondents by Average Monthly Mobile Spend – India (in Percent, June 2011) ................................................................................................................................ 75 Figure 60: Break-out of Voice vs. Non-voice Mobile Spend – India (In Percent, June 2011) ............. 75 Figure 61: Top 6 Activities on Mobile Phone – India (June 2011) ...................................................... 76 Figure 62: Average Time Spent on Various Activities via Mobile per Day – India (In Hours, June 2011) ................................................................................................................................ 77 Figure 63: Contribution of factors deterring Smartphone Usage – India (In Percent, June 2011) ...... 77 Figure 64: Categories of Smartphone owned – India (In Percent, June 2011) .................................. 78 Figure 65: Drivers contributing to the increase in Mobile Internet access – India (June 2011) .......... 79 Figure 66: Break-out of Mobile Data Plan Types – India (In Percent, June 2011) ............................. 79 Figure 67: Break-out of Network Access preferred for Heavy File Downloads – India (In Percent, June 2011) ........................................................................................................................ 81 Figure 68: Percentage of Smartphone Users who Download Mobile Apps – India (June 2011) ........ 81 Figure 69: Top 5 Mobile Application Types – India (June 2011) ........................................................ 82 Figure 70: Paid vs. Free Apps Download Behaviour – India Smartphone Users (In Percent, June 2011) ................................................................................................................................ 82 Figure 71: Factors deterring Mobile App Users from Downloading Paid Mobile Apps – India (June 2011) ................................................................................................................................ 84 Figure 72: How do Mobile Application Users Discover New Apps – India (June 2011) ..................... 84 Figure 73: Break-out of Respondents by Average Monthly Mobile Spend – The US (in Percent, June 2011) ................................................................................................................................ 88 Figure 74: Break-out of Voice vs. Non-voice Mobile Spend – The US (In Percent, June 2011) ........ 88 Figure 75: Top 6 Activities on Mobile Phone – The US (June 2011) ................................................. 89 Figure 76: Average Time Spent on Various Activities via Mobile per Day – The US (In Hours, June 2011) ................................................................................................................................ 90 Figure 77: Categories of Smartphone owned – The US (In Percent, June 2011) .............................. 91 Figure 78: Drivers contributing to the increase in Mobile Internet access – The US (June 2011) ...... 91 Figure 79: Break-out of Mobile Data Plan Types – The US (In Percent, June 2011) ......................... 92 Figure 80: Break-out of Network Access preferred for Heavy File Downloads – The US (In Percent, June 2011) ........................................................................................................................ 93 Figure 81: Percentage of Smartphone Users who Download Mobile Apps – The US (June 2011) ... 94 Figure 82: Top 5 Mobile Application Types – The US (June 2011).................................................... 94 Figure 83: Paid vs. Free Apps Download Behaviour – US Smartphone Users (In Percent, June 2011) ..................................................................................................................................... 95 Figure 84: Factors deterring Mobile App Users from Downloading Paid Mobile Apps – The US (June 2011) ................................................................................................................................ 96 Figure 85: How do Mobile Application Users Discover New Apps – The US (June 2011) ................. 96 Figure 86: Break-out of Respondents by Average Monthly Mobile Spend – Chile (In Percent, June 2011) .............................................................................................................................. 100 Figure 87: Break-out of Voice vs. Non-voice Mobile Spend − Chile (In Percent, June 2011) .......... 100 Figure 88: Top 6 Activities on Mobile Phone – Chile (June 2011) ................................................... 101 6 © 2011, Portio Research. All Rights Reserved
  7. 7. Mobile Data Usage Trends 2011-2015 Figure 89: Average Time Spent on Various Activities via Mobile per Day – Chile (In Hours, June 2011) .............................................................................................................................. 102 Figure 90: Contribution of factors deterring Smartphone Usage – Chile (In Percent, June 2011) ... 102 Figure 91: Categories of Smartphone owned – Chile (In Percent, June 2011) ................................ 103 Figure 92: Drivers contributing to the increase in Mobile Internet access – Chile (June 2011) ........ 104 Figure 93: Break-out of Mobile Data Plan Types – Chile (In Percent, June 2011) ........................... 104 Figure 94: Break-out of Network Access preferred for Heavy File Downloads – Chile (In Percent, June 2011) ...................................................................................................................... 106 Figure 95: Percentage of Smartphone Users who Download Mobile Apps – Chile (June 2011) ..... 106 Figure 96: Top 5 Mobile Application Types – Chile (June 2011)...................................................... 107 Figure 97: Paid vs. Free Apps Download Behaviour – Chilean Smartphone Users (In Percent, June 2011) .............................................................................................................................. 107 Figure 98: Factors deterring Mobile App Users from Downloading Paid Mobile Apps – Chile (June 2011) .............................................................................................................................. 108 Figure 99: How do Mobile Application Users Discover New Apps – Chile (June 2011) ................... 109 Figure 100: Contribution of factors encouraging Multiple SIM Ownership – The UAE (In Percent, End2010) .............................................................................................................................. 112 Figure 101: Break-out of Respondents by Average Monthly Mobile Spend – The UAE (In Percent, June 2011) ...................................................................................................................... 114 Figure 102: Break-out of Voice vs. Non-voice Mobile Spend – The UAE (In Percent, June 2011) .... 114 Figure 103: Top 6 Activities on Mobile Phone – The UAE (June 2011) ............................................. 115 Figure 104: Average Time Spent on Various Activities via Mobile per Day – The UAE (In Hours, June 2011) .............................................................................................................................. 116 Figure 105: Top 5 Mobile Application Types – The UAE (June 2011) ............................................... 117 Figure 106: Categories of Online Commerce – The UAE (In Percent, End-2010) ............................. 118 Figure 107: Categories of Mobile Websites viewed – The UAE (In Percent, June 2011) .................. 118 Figure 108: Popularity of Social Networking Websites – The UAE (In Percent, End-2010) ............... 119 Figure 109: Device used to access Social Networking Websites – The UAE (In Percent, End-2010)120 Figure 110: Mobile Data Traffic per Month – Regional (In Petabytes, 2008 – 2010) ......................... 123 Figure 111: Non-voice Spend as a Percentage of Total Mobile Spend (In Percent, June 2011) ....... 129 Figure 112: Average Time Spent on Various Activities via Mobile per Day (In Hours, June 2011) .... 131 Figure 113: Average Time spent on Social Networking via Mobile Phone per Day (In Hours, June 2011) .............................................................................................................................. 133 Figure 114: Y-o-y growth of Mobile Data Traffic and Mobile Data Revenue – Worldwide (In Percent, 2009 – 2015F) ................................................................................................................ 134 © 2011, Portio Research. All Rights Reserved 7
  8. 8. Mobile Data Usage Trends 2011-2015 List of Tables Table 1: Table 2: Table 3: Table 4: Table 5: Table 6: Table 7: Table 8: Table 9: Table 10: Table 11: Table 12: Table 13: Table 14: Table 15: Table 16: Table 17: Table 18: Table 19: Table 20: Table 21: Table 22: Table 23: Table 24: Table 25: Table 26: Table 27: Table 28: Table 29: Table 30: Table 31: Table 32: Table 33: Table 34: Table 35: Table 36: Table 37: Table 38: Table 39: 8 Mobile Subscribers – Regional (In Million, 2008 – 2015F) ................................................ 17 Mobile Data Traffic per Month – Regional (In Petabytes, 2008 – 2015F) .......................... 36 Mobile Data Revenues – Regional (In USD Billion, 2008 – 2015F)................................... 40 Key Facts – The UK (End-2010) ....................................................................................... 45 Facts on Internet Users – The UK (End-2010) .................................................................. 50 Top 5 Websites accessed through Desktop – The UK (June 2011) .................................. 52 Top 5 Websites accessed through Mobile – The UK (June 2011)..................................... 52 Additional Analysis of Paid and Free Downloads – The UK (In Percent, June 2011) ........ 55 Frequency of Different Activities on a Social Networking Site via Mobile Phone – The UK (In Percent, June 2011) .................................................................................................... 57 Key Facts – China (End-2010).......................................................................................... 59 Facts on Internet Users – China (End-2010) .................................................................... 64 Top 5 Websites accessed through Desktop – China (June 2011) .................................... 67 Top 5 Websites accessed through Mobile – China (June 2011) ....................................... 68 Additional Analysis of Paid and Free Downloads – China (In Percent, June 2011) .......... 70 Frequency of Different Activities on a Social Networking Site via Mobile Phone – China (In Percent, June 2011) ......................................................................................................... 72 Key Facts – India (End-2010) ........................................................................................... 74 Facts on Internet Users – India (End-2010) ...................................................................... 78 Top 5 Websites accessed through Desktop – India (June 2011) ...................................... 80 Top 5 Websites accessed through Mobile – India (June 2011) ........................................ 80 Additional Analysis of Paid and Free Downloads – India (In Percent, June 2011)............ 83 Frequency of Different Activities on a Social Networking Site via Mobile Phone – India (In Percent, June 2011) ......................................................................................................... 85 Key Facts – The US (End-2010) ....................................................................................... 87 Top 5 Websites accessed through Desktop – The US (June 2011) ................................. 92 Top 5 Websites accessed through Mobile – The US (June 2011) .................................... 93 Additional Analysis of Paid and Free Downloads – The US (In Percent, June 2011) ....... 95 Frequency of Different Activities on a Social Networking Site via Mobile Phone – The US (In Percent, June 2011) .................................................................................................... 97 Key Facts – Chile (End-2010) ........................................................................................... 99 Facts on Internet Users − Chile (End-2010) ................................................................... 103 Top 5 Websites accessed through Desktop − Chile (June 2011) ................................... 105 Top 5 Websites accessed through Mobile − Chile (June 2011) ...................................... 105 Additional Analysis of Paid and Free Downloads – Chile (In Percent, June 2011) ......... 108 Frequency of Different Activities on a Social Networking Site via Mobile Phone – Chile (In Percent, June 2011) ....................................................................................................... 110 Key Facts – The UAE (End-2010) .................................................................................. 113 Facts on Internet Users – The UAE (End-2010) ............................................................. 117 Frequency of Different Activities on a Social Networking Site via Mobile Phone – The UAE (In Percent, June 2011) .................................................................................................. 120 Mobile Data Traffic per Month – Regional (In Petabytes, 2011F – 2015F) ..................... 124 Top 5 Mobile Activities in the Surveyed Countries (June 2011) ...................................... 130 Average Time Spent on Various Activities via Mobile per Day (In Hours, June 2011) .... 131 Top 5 Mobile Applications in the Surveyed Countries (June 2011) ................................. 132 © 2011, Portio Research. All Rights Reserved
  9. 9. Mobile Data Usage Trends 2011-2015 Chapter 1 Introduction © 2011, Portio Research. All Rights Reserved 9
  10. 10. Mobile Data Usage Trends 2011-2015 Introduction Mobile phones, which were primarily designed to provide simple voice communication services, have radically evolved into mini-computers over recent years. Now with Internet access and the ability to install software and applications, today‘s mobile phones enable users to perform almost all of the tasks on-the-go which have traditionally been associated with static desktops or laptops. With interactive features and services such as Internet connectivity, social networking, blogs, discussion forums, gaming, music, news, information, navigation, e-commerce, banking, location-based services, audio and video streaming, mobile phones have become a markedly more powerful tool. With the growing dependence on mobile phones, mobile data services have also gained popularity at an unbelievably fast pace, and this huge potential has led many players – including Mobile Network Operators (MNOs) – to target the mobile data services market. Considering that MNOs can no longer solely rely on voice revenue to be successful, they are increasingly focusing on providing innovative content and data services to their subscribers, as a means of counteracting the falling voice Average Revenue per User (ARPU). Mobile data market players – such as MNOs, handset/smartphone manufacturers, application developers, network equipment vendors and billing enablers – are collaborating to develop advanced devices and services, and to provide seamless connectivity to users. The number of mobile data services options saw impressive growth over the past year and is expected to continue to rise exponentially. The increased interest in data content and services can be attributed to the following factors: 1. Success of advanced mobile devices such as smartphones, tablets and netbooks 2. High-speed mobile Internet 3. Reduction in cost per megabyte (MB) of mobile data Success of Advanced Mobile Devices 2010 was a game-changing year in the mobile device space, with smartphone shipments increasing dramatically worldwide in 2010 after experiencing a slump in 2009. Handset vendors are constantly trying to offer new handsets with enhanced features at very competitive prices, and this fierce competition is especially intense in the smartphone segment. Smartphones – with large screen sizes, QWERTY keyboards and high resolution, along with advanced computing capabilities and abundant memory – allow users to download, install and run advanced applications, and offer a superior browsing experience. In 2010, the worldwide smartphone user base recorded staggering year-on-year growth of 55.4 percent to reach 470 million smartphone users. This user base is expected to increase to 1,869.7 million by end-2015, growing at a Compound Annual Growth Rate (CAGR) of 31.8 percent between 2010-2015. In the meantime, worldwide smartphone users are currently projected to total 686.2 million by end-2011. The figure on the next page depicts the worldwide smartphone user base from 2008-2015. 10 © 2011, Portio Research. All Rights Reserved With the growing dependence on mobile phones, mobile data services have also gained popularity at an unbelievably fast pace.
  11. 11. Mobile Data Usage Trends 2011-2015 Figure 1: Smartphone User Base – Worldwide (In Million, 2008 – 2015F) 1,869.7 Smartphone User Base (In Million) 2,000 1,800 1,549.0 1,600 1,400 1,235.8 1,200 943.9 1,000 686.2 800 470.0 600 400 237.9 302.4 200 0 2008 2009 2010 2011F 2012F 2013F 2014F 2015F Year Source: Portio Research Ltd. F – Forecasted Device technology continued to improve rapidly throughout 2010 and a spate of interactive and advanced features were made available to users. The mobile data market has also witnessed the relatively recent introduction of tablets – personal mobile computers. In January 2010, Apple unveiled the first look of its iPad tablet which was officially launched in the market in April 2010. It instantaneously created ripples in the mobile device market and since then many device vendors have launched their own tablets. Figure 2: iPad Shipments – Worldwide (In Million, Q2 2010 – Q2 2011) Shipments (In Million) 10 9.2 9 7.3 8 7 6 5 4 4.7 4.2 3.3 3 2 1 0 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Quarter Source: Portio Research Ltd. Advanced mobile devices, especially smartphones and tablets, have made a lasting impression on users and their potential is indisputable. Adoption of advanced devices has already changed the way companies do business and interact with end users, with companies developing mobile apps and mobile versions of their websites so that users can more easily access their offerings and services on a handheld device. The adoption of mobile applications is rocketing, and app stores such as Apple App Store, Google Android © 2011, Portio Research. All Rights Reserved 11 Device technology continued to improve rapidly throughout 2010 and a spate of interactive and advanced features were made available to users. Advanced mobile devices, especially smartphones and tablets, have made a lasting impression on users and their potential is indisputable.
  12. 12. Mobile Data Usage Trends 2011-2015 Market, GetJar, Nokia Ovi Store and BlackBerry App World have already become hotspots for application downloads. Mobile App Downloads (In Billion) Figure 3: App Stores – Number of Mobile Application Downloads to date (Worldwide, In Billion, Early-July 2011) 16 15.0 12 8 6.0 4 2.0 1.5 1.0 Nokia Ovi Store BlackBerry App World 0 Apple App Store Google Android Market GetJar Mobile Application Stores Source: Portio Research Ltd. High-speed mobile Internet The growth of smartphone and tablet shipments has provided the much needed impetus to the uptake of mobile Internet services. With the advent of smartphones and tablets, the power of a handheld device has further increased and the Internet has found its new companion, with mobile Internet usage growing faster than PC Internet. That said, MNOs are still under increasing pressure to offer high-speed Internet to their subscribers at an affordable price. MNOs are adopting strategic approaches, along with infrastructure investments, to provide greater bandwidth to their subscribers, avoid network congestion and generate diversified revenue streams. Mobile Data - Cost per megabyte (MB) continues to drop One of the major drivers of the growth in mobile data usage is the falling cost per megabyte (MB) of mobile data. The worldwide average cost per MB of mobile data has continuously dropped between 2008 and 2010 from USD 0.46 to USD 0.10. The cost is expected to further reduce to USD 0.01 by end-2015. The figure on the next page depicts the cost per MB of mobile data during 2008-2015. 12 © 2011, Portio Research. All Rights Reserved The worldwide average cost per MB of mobile data has continuously dropped between 2008 and 2010 from USD 0.46 to USD 0.10. The cost is expected to further reduce to USD 0.01 by end-2015.
  13. 13. Mobile Data Usage Trends 2011-2015 Figure 4: Cost per MB of Mobile Data – Worldwide (In USD, 2008 – 2015F) Cost per MB (In USD) 0.5 0.46 0.4 0.3 0.19 0.2 0.10 0.1 0.06 0.03 0.02 0.01 0.01 2012F 2013F 2014F 2015F 0.0 2008 2009 2010 2011F Year Source: Portio Research Ltd. F – Forecasted With the increasing affordability, the uptake of data services is growing among mobile users in both developed and emerging countries. Also, the consumption of data services has increased significantly among existing data services users. In 2010, the monthly mobile data traffic per smartphone user stood at 149 MB. It is expected to reach 3,390.7 megabytes by end-2015, growing at a CAGR of 45.1 percent between 2010-2015. The figure below highlights the monthly mobile data traffic per smartphone user from 2008 to 2015. Monthly Mobile Data Traffic (In Megabytes) Figure 5: Monthly Mobile Data Traffic per Smartphone User – Worldwide (In Megabytes, 2008 – 2015F) 4,000 3,390.7 3,500 3,000 2,256.1 2,500 2,000 1,519.7 1,500 1,041.5 1,000 500 149.0 323.1 527.9 736.3 0 2008 2009 2010 2011F 2012F 2013F 2014F 2015F Year Source: Portio Research Ltd. F – Forecasted © 2011, Portio Research. All Rights Reserved 13
  14. 14. Mobile Data Usage Trends 2011-2015 This study covers the overview of the mobile data services market, current market size in terms of mobile data traffic and revenue, market forecasts for 2011-2015, mobile data usage trends, and various strategies to cope with the ever-growing data traffic on mobile networks. For this report, we conducted a consumer survey to gather the mobile data usage trends among the mobile users of six countries – the UK (Europe), China and India (Asia Pacific), the US (North America), Chile (Latin America) and the UAE (Africa and Middle East). The survey was designed to determine the mobile user preferences and behaviour across geographies. With the results of the survey we have analysed, compared and highlighted the key differences in consumer behavior in the respective markets. We hope that the end result of this exercise creates a ‗Mobile Data Usage Behaviour‘ case study that can help MNOs, application developers and many others in the mobile space to maximise revenues from mobile data services. 14 © 2011, Portio Research. All Rights Reserved
  15. 15. Mobile Data Usage Trends 2011-2015 Chapter 2 Worldwide Mobile Market © 2011, Portio Research. All Rights Reserved 15
  16. 16. Mobile Data Usage Trends 2011-2015 Worldwide Mobile Market The worldwide mobile industry continues to grow at a significant rate. Since inception, this industry‘s prolific growth rate has perpetually amazed all, including experts themselves, and will be strengthened further with the ongoing convergence of services with mobile communications, and initiatives taken by MNOs. At end-2010, worldwide mobile subscribers stood at nearly 5.4 billion. This subscriber base is now projected to grow at a CAGR of 6.8 percent between 2010 and 2015, and is expected to reach nearly 7.5 billion by end-2015. The figure below highlights the growth in worldwide mobile subscriber base during 20082015. Please note that within these new forecasts we have revised our worldwide and regional mobile subscriber base forecasts based on actual, currently-stated subscriber figures for end-2010. Figure 6: Mobile Subscriber Base – Worldwide (In Million, 2008 – 2015F) Mobile Subscriber Base (In Million) 8,000 6,355.1 6,775.2 7,144.8 7,464.2 5,871.0 6,000 5,362.4 4,655.8 4,044.8 4,000 2,000 0 2008 2009 2010 2011F 2012F 2013F 2014F 2015F Year Source: Portio Research Ltd. F – Forecasted Asia Pacific is the largest mobile market worldwide. At end-2010, the region‘s mobile subscriber base stood at over 2.6 billion and is forecast to surpass 3.9 billion by end-2015 – growing at a CAGR of 8.5 percent during 2010-2015. Europe is the second-largest region worldwide in terms of subscribers and was nearing 1.1 billion subscribers at end-2010. The next table highlights regional mobile subscriber levels during 2008-2015. 16 © 2011, Portio Research. All Rights Reserved At end-2010, worldwide mobile subscribers stood at nearly 5.4 billion. This subscriber base is now projected to grow at a CAGR of 6.8 percent between 2010 and 2015, and is expected to reach nearly 7.5 billion by end-2015.
  17. 17. Mobile Data Usage Trends 2011-2015 1 Table 1: Mobile Subscribers – Regional (In Million, 2008 – 2015F) Mobile Subscribers (In Million) Region 2008 2009 2010 2011F 2012F 2013F 2014F 2015F Europe 999.7 1,038.3 1,066.4 1,102.6 1,128.5 1,149.4 1,166.2 1,179.8 Asia Pacific 1,733.8 2,132.1 2,605.1 2,913.6 3,219.5 3,484.8 3,716.8 3,914.8 North America 291.9 313.5 343.4 361.4 377.7 392.3 405.4 417.0 Latin America 449.5 494.0 549.2 589.9 624.5 655.1 681.8 705.0 Africa and Middle East 570.1 677.9 798.3 903.5 1,004.9 1,093.7 1,174.6 1,247.6 Total 4,044.8 4,655.8 5,362.4 5,871.0 6,355.1 6,775.2 7,144.8 7,464.2 Source: Portio Research Ltd. The figure below is the graphical representation of Table 1 above. Figure 7: Mobile Subscriber Base – Regional (In Million, 2008 – 2015F) Mobile Subscribers (In Million) 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0 2008 Europe 2009 Asia Pacific 2010 2011F North America 2012F Latin America 2013F 2014F 2015F Africa and Middle East Source: Portio Research Ltd. F – Forecasted 1 Note: Sum of regional numbers may not equal total due to rounding off errors. © 2011, Portio Research. All Rights Reserved 17
  18. 18. Mobile Data Usage Trends 2011-2015 Asia Pacific‘s subscribers constituted 48.6 percent of the worldwide mobile subscriber base in 2010, while the second largest contributor was Europe with 19.9 percent. The figure below depicts regional contribution to the worldwide mobile subscriber base in 2010. Figure 8: Worldwide Subscriber Base – Regional Contribution (In Percent, 2010) 48.6% 6.4% 10.2% 14.9% 19.9% Europe Asia Pacific North America Latin America Africa and Middle East Source: Portio Research Ltd. Between 2010 and 2015, the percentage contribution of the Asia Pacific and Africa and Middle East (AME) regions to the worldwide subscriber base is expected to increase at the expense of the remaining regions, which will see declines during the same period. Asia Pacific will continue to dominate the worldwide mobile market, and in 2015 over 52 percent of worldwide mobile subscribers will originate from this region. The increase in subscriber base share for the Asia Pacific and AME regions can be ascribed to the strong subscriber base growth in the emerging markets. 2 Figure 9: Worldwide Subscriber Base – Regional Contribution (In Percent, 2015F) 52.4% 5.6% 9.4% 16.7% 15.8% Europe Asia Pacific North America Latin America Africa and Middle East Source: Portio Research Ltd. F – Forecasted 2 Note: The percentages do not add up to 100 percent because of rounding off errors. 18 © 2011, Portio Research. All Rights Reserved The increase in subscriber base share for the Asia Pacific and AME regions can be ascribed to the strong subscriber base growth in the emerging markets.
  19. 19. Mobile Data Usage Trends 2011-2015 Chapter 3 Mobile Data Services Market © 2011, Portio Research. All Rights Reserved 19
  20. 20. Mobile Data Usage Trends 2011-2015 Mobile Data Services Market Mobile data services, including messaging, have added significant value by allowing users to do a lot more on their handsets than just placing and receiving voice calls. Mobile data services have not only extended peer-to-peer (P2P) modes of communication beyond simple core voice communication, but have also expanded mobile communications to include peer-to-application, application-to-peer and application-to-application communications. Data services now provide widespread accessibility from anywhere anytime and offer customised services to meet individual and business needs. Mobile data services now act as the primary catalyst for the revenue growth of Mobile Network Operators (MNOs). The data revenue generated from non-voice services has helped to stabilise the average revenue per user (ARPU) by offsetting the falling voice ARPUs. As voice becomes commoditised, mobile operators need to look at other sources to generate income and this has provided the impetus to formulate and implement strategies to create successful data services that help increase overall data ARPU. Mobile data services have significantly transformed the mobile market from a volume-based business to valuebased business. Mobile operators in both developed and emerging markets are devising strategies around data to increase the data usage among subscribers. MNOs have entered the mobile applications market and are investing in developing innovative apps to catch the subscribers‘ attention. Efforts are being undertaken to improve the user experience and interaction with various data services. MNOs worldwide are investing billions of dollars in upgrading their network speeds to facilitate seamless usage of data services, and marketing efforts are being made to push the uptake of data services. The growing mobile data market also requires complete support from handset and network infrastructure equipment manufacturers. As a general rule, handset vendors are continuously investing in building a vast portfolio of devices catering to the needs of diverse customers. Advanced mobile devices such as smartphones and tablets have fueled the growth of mobile data services, and have increased data traffic to such levels that the existing networks will be unable to support data traffic growth for long. The explosive growth in data traffic requires MNOs to upgrade their existing networks to ensure seamless services to users in the future. Some MNOs have proactively awarded contracts to equipment vendors (such as Nokia Siemens Networks (NSN), Huawei, Ericsson and Alcatel-Lucent) to supply equipment, build and manage next-generation networks such as LTE and HSPA+ in the near future. The data market has huge potential and the coming years look very promising. Evolution of Mobile Data Services Market Mobile data services have evolved from simple SMS to advanced data services. Initially, the mobile data services ecosystem only included SMS, but over the years it has expanded to include numerous services such as MMS, e-mail, instant messaging (IM), mobile commerce, music, games, TV, videos and user-generated content. Today, the market is flooded with hundreds of different types of data services. 20 © 2011, Portio Research. All Rights Reserved Mobile operators in both developed and emerging markets are devising strategies around data to increase the data usage among subscribers.
  21. 21. Mobile Data Usage Trends 2011-2015 Figure 10: Evolution of Mobile Data Services Market (1993-2005) First P2P SMS was sent by a Nokia engineer from one mobile handset to another 1993 1997 The ringtone market came into existence. A Finish operator (Radiolinja) launched the first monoringtone service for Nokia handsets. The first ever mobile game (Snake) was released on Nokia 6110 A microbrowser was deployed for the first time on handsets SMS-based mobile commerce was launched 1999 i-mode, the first mobile Internet-based service, was launched in Japan. i-mode introduced mobile e-mail and IM. The first location-based service was launched on a mobile phone 1998 Softbank Mobile Japan (formerly known as J-Phone) launched the first picture messaging system ‗Sha-Mail‘ Mobile ticketing was launched in several countries such as Japan (airline tickets), Norway (parking tickets) and Austria (train ticketing). The first smartphone (Ericsson R380s) to use an open operating system (Symbian) was launched 2000 SK Telecom introduced Caller Ringback Tones 2002 2001 2004 South Korea became the first country to have mobile TV Worldwide annual SMS traffic volumes crossed one trillion Japan‘s largest operator, NTT DOCOMO, launched the first 3G network NTT DOCOMO launched the first ever application store (i-Appli) for i-mode mobile phones AT&T launched the first ever mobile music store (mMode) in the US. It allowed users to search, listen and purchase music tracks via the handset. 2005 Source: Portio Research Ltd. © 2011, Portio Research. All Rights Reserved 21
  22. 22. Mobile Data Usage Trends 2011-2015 Figure 11: Evolution of Mobile Data Services Market (2006-2011) VOIP services were made available on mobile phones Japanese operator NTT DOCOMO launched DCMX, a credit payment service. It allows handsets to be used as credit cards and make purchases through DOCOMO‘s iD. 2006 2007 2009 Apple and Google launched their respective app stores: Apple App Store and Google Android Market. Layar launched the first augmented reality app store The worldwide mobile subscriber base crossed five billion Apple launched iPad Facebook crossed 150 million mobile subscribers YouTube crossed the milestone of 150 million views per day via mobile phone Apple launched iPhone The mobile versions of Facebook, Twitter and YouTube websites were launched during the year Facebook also launched its mobile application in the same year The first mobile augmented reality browser, Layar, was launched RIM, Nokia and Microsoft introduced their app stores First commercial LTE network was launched Apple launched iPhone OS 3 with MMS capabilities 2011 YouTube and LG partnered to enable users to take and share 3D videos via mobile Social networking giant Facebook integrated video chats with social networking 2008 2010 In addition to the examples explicitly mentioned in the preceding figures, there are numerous other services which have been added to the mobile data space over the years. Typically, once such services are established, market players make efforts to bring the updated versions to market or to re-invent the services. The mobile data services market has witnessed some very innovative moves from various market players. For example, mobile commerce has evolved from a simple SMS-based service to customised location-based services. SMS-based mobile commerce was launched in 1997 when the first mobile phone-enabled Coca Cola vending machines were installed in Helsinki, Finland. In 1999, i-mode made mobile commerce possible through the Internet on a handheld device. Since then, many services/applications – such as contactless payments, mobile credit card services and micro-payments – have been developed for ease of use. In recent years, mobile commerce has been integrated with location-based services. Now users receive local discount coupons and vouchers depending on their location. Source: Portio Research Ltd. 22 © 2011, Portio Research. All Rights Reserved
  23. 23. Mobile Data Usage Trends 2011-2015 While the history of data services can be traced back to 1993 when the first SMS was exchanged between two mobile devices3, the hype surrounding data didn‘t fully emerge for another six years. In 1999, Japanese MNO NTT DOCOMO launched i-mode services in the country. Several data services already existed in the market but it was i-mode that changed the landscape of the mobile data services market. i-mode offered incomparable services to users and thus introduced new growth avenues for MNOs. i-mode was an instant hit among subscribers, as evidenced by its dramatic growth to one million subscriptions within six months of launch. Figure 12: i-mode Services – Number of Subscriptions (Japan, In Million) 47 48 Nov-08 45 48 Nov-06 Number of Subscriptions (In Million) 60 50 40 35 36 24 30 i-mode Launched 20 10 12 5 1 May-11 Aug-05 Oct-03 Oct-02 Dec-01 Mar-01 Aug-00 Mar-00 Aug-99 Feb-99 0 Period Source: NTT DOCOMO i-mode‘s phenomenal success prompted competitors to enter the data services market and introduce very similar services. In April 1999, KDDI launched EzWeb, and Softbank Mobile (then J-Phone) launched J-Sky in December 1999. Today, every MNO worldwide is trying to make the most out of the lucrative data services market. 3 Note: The first SMS was sent on the Vodafone UK network from a PC to a mobile handset in December 1992, but the first P2P (Peer-To-Peer) SMS, from one mobile handset to another, was sent by a Nokia engineer in Finland in 1993. © 2011, Portio Research. All Rights Reserved 23 In 1999, Japanese MNO NTT DOCOMO launched i-mode services in the country. Several data services already existed in the market but it was i-mode that changed the landscape of the mobile data services market.
  24. 24. Mobile Data Usage Trends 2011-2015 Types of Mobile Data Services Messaging services  Short Messaging Service (SMS)  Multimedia Messaging Service (MMS)  Mobile E-mail  Mobile Instant Messaging (IM) Non-messaging mobile services  Mobile music  Mobile games  Mobile TV  Mobile video  Mobile user-generated content  Mobile commerce  Mobile portals Mobile Applications  Games  Productivity (including location-based services)  Multimedia  Communication (including social networking)  Travel  Utilities 24 © 2011, Portio Research. All Rights Reserved
  25. 25. Mobile Data Usage Trends 2011-2015 Figure 13: Type of Mobile Data Services Messaging Services Short Messaging Service (SMS): As expressed in the fifth edition of our messaging report ‗Mobile Messaging Futures 2011-2015‘, SMS is the single most successful mobile data service in the world, both in terms of traffic and revenue. Even as the whole world moves towards other data services at an accelerated pace, SMS still enjoys the largest market share and is the clear market leader. Multimedia Messaging Service (MMS): MMS did not achieve the meteoric growth seen by SMS, but it still stands strong as the second most successful messaging service worldwide Mobile E-mail: Subscribers can access mobile e-mail through three modes: Web e-mail, pull e-mail, and push e-mail by enabling Internet access on their handsets Mobile IM: Mobile IM is divided into two categories – real-time session-based services and SMS-centric transaction based-services Non-Messaging Mobile Services Mobile Music: Includes ringtones, caller ringback tones and streaming audios Mobile Games: Includes embedded games, SMS games and browser-based games Mobile TV: MNOs are offering services such as full-length live and on-demand episodes to their TV users Mobile Videos: Includes streaming videos and video calling. With 200 million views per day, YouTube has emerged as the clear winner in the mobile videos category. Mobile User Generated Content: Includes social networking, blogging, professional networking, forums, review-websites, and information/knowledge sharing platforms. Social networking sites have seen phenomenal growth in the last couple of years, and Facebook in particular has emerged as a leader in the social networking space. Mobile Commerce: Mobile commerce includes mobile banking, ticketing, coupons, loyalty cards, vouchers and mobile purchases Mobile Portals: A mobile portal is a website which has been customised for mobile web browsing Mobile Applications With the widespread adoption of smartphones and high-speed Internet, mobile applications have gained massive popularity among mobile users. Apple App Store alone has witnessed 15 billion app downloads as of early-July 2011. Mobile apps have emerged as a separate category in mobile data services. Mobile applications are functionalities provided to users by software that performs specific tasks. These applications now come pre-installed on handsets, or can be downloaded by users and installed on their handsets. Mobile applications include: Downloadable games Productivity apps including location-based services, word processor and directory services Multimedia apps including audio/video player, radio, image and presentation viewer Communication apps including social networking, mobile VoIP, e-mail and IM clients Travel apps including GPS/Maps, currency converter, city guide and flight/train tracking Utilities apps including news, weather, profile manager, task manager and antivirus Source: Portio Research Ltd. © 2011, Portio Research. All Rights Reserved 25
  26. 26. Mobile Data Usage Trends 2011-2015 Growth of Data Services Market The mobile data services market has grown exponentially since its inception in 1993. The market potential can be gauged from the fact that thousands of mobile apps are being developed, millions of videos are being uploaded, billions of SMS are being exchanged and billions of pictures are being uploaded via mobile devices every day. The present data services market presents great opportunity for all of its stakeholders. The primary factors driving the growth of the mobile data services market are the convergence of mobile and Internet, high-speed data networks, affordable tariff plans and the growing popularity of advanced mobile devices such as smartphones and tablets. In addition, easily accessible distribution channels and disruptive technologies (such as cloud computing) are providing the much needed impetus to the mobile data services market. The growth of the data services market is also dependent on a number of regional factors such as spending power of the population, mobile penetration, percentage of youth 4 population, desktop penetration , data consumption patterns of mobile users, MNOs‘ efforts (data services offered, pricing strategies, deployed technology and infrastructure investment plans) and availability of alternative options. For example, many countries in Africa still do not have proper banking infrastructure in place and the desktop penetration is also very low. Thus, they rely on their mobile phones for financial services. Convergence of Mobile and Internet Mobile and Internet existed as two separate worlds in the past. However, with the introduction of smartphones, the two have converged with each other, and high-speed networks, along with affordable data plans, have accelerated this convergence. With the ‗onthe-move‘ image that defines mobile telephony, convergence of mobile and Internet is the perfect bundle for users and mobile operators. It can be seen as a win-win scenario, with MNOs relying on and hence promoting data usage to compensate for their falling voice ARPUs, and subscribers utilising high speed Internet with plenty of choices in terms of available offers. The result is high-speed mobile Internet access that is available to the subscriber 24/7, which has led to an increase in mobile data usage with time. The convergence of mobile and Internet has unearthed an interesting phenomenon in terms of the radical shift from Internet being a need-plus-knowledge tool to a need-plusentertainment tool. In addition to voice and SMS, mobile phones are being used for several activities such as e-mail, IM, social networking, uploading photos and videos, audio and video streaming, and banking. The convergence of mobile and Internet offers great opportunity to MNOs in terms of both data usage and data revenue. MNOs have also been able to tap the business segment. Convergence has enabled them to provide business solutions catering to diverse corporate needs. Mobile Internet, along with innovative and compelling data services, has helped businesses improve efficiency and productivity by ensuring connectivity from anywhere, anytime. Role of Smartphones in the Uptake of Mobile Data Services Smartphones have played a big role in increasing mobile data usage. With declining technology costs and increasing features, they have significantly dented the feature phone market. The major factor is that smartphones are powered by advanced processors, whose processing speeds are catching up with those of computer processors. Consequently, they are increasingly making computers redundant. The increasing pace of smartphone adoption 4 Note: Desktop penetration refers to the number of desktops (PCs) as a percentage of the total population of the region. 26 © 2011, Portio Research. All Rights Reserved The primary factors driving the growth of the mobile data services market are the convergence of mobile and Internet, high-speed data networks, affordable tariff plans and the growing popularity of advanced mobile devices such as smartphones and tablets.
  27. 27. Mobile Data Usage Trends 2011-2015 has proved that the major deterrent was price. Handset manufacturers and operators are now increasingly introducing smartphones in the lower price segment as well. For the perfect user experience, synergy between the hardware and software is absolutely essential. The fact that the pace of hardware evolution has matched and even overtaken that of software technology within the mobile space is the biggest benefit to the end user. Smartphones now come equipped with enhanced features. With a host of connectivity options such as Wi-Fi, and countless apps available in the market, users always have something to look forward to. High data usage comes across as an obvious consequence. Tablets Catalysing the Growth of Data Services Every year, hardware technology improves and innovative devices are launched in the market, perpetually tempting users to upgrade their devices. Tablets, aptly referred to as portable personal computers, are the latest example of this. They have bridged the gap between smartphone and PC, and have unlocked new functionalities along with performance improvements. They ensure that users can stay connected at high-speeds all the time, even when they are on the move. Tablets allow users to connect with content, apps and the Internet in a more interactive and entertaining manner than ever before. Users can browse the web, manage their e-mails, stream audio and videos, watch TV, play games and locate their friends by making use of their tablet‘s personal and intuitive user interface. Apple is known to spur the growth of mobile data services by engaging users with their compelling devices, and the introduction of the iPad tablet proved it again. iPad became an instant hit among users. Within a month of its launch in April 2010, Apple was able to sell one million iPads. Features such as multi-touch user interface, larger screen size and highquality graphics keep users engaged with the device. iPad users downloaded 3.5 million apps and 600,000 iBooks within 5 days of its launch. High-Speed Data Networks The deployment of 3G and above networks provided a boost to mobile data services as this has enabled higher network speeds. MNOs have made efforts to tap this opportunity by investing in network upgrades and capacity expansion of mobile networks. As the number of smartphone users grows and data plans become more affordable, mobile data traffic is set to rise. To capitalise on the growing demand of data services, MNOs have to further upgrade their networks – both in terms of capacity and quality. This will further push the uptake of data services among subscribers. Compelling and Innovative Data Services Advanced mobile devices and networks alone are not enough to push the uptake of data services beyond a certain point. Users are tempted to explore data services if compelling and innovative content and applications are made available at their disposal. Content and applications add a dimension of multi-functionality to handsets. Market players – such as MNOs, app developers, content (such as music, videos, photos, themes, jokes and news) providers, app store/website owners and mobile API developers – are collaborating with each other to make the most of the opportunity provided by the growing demand for data services. These players are making efforts to constantly upgrade the content and develop numerous applications for users. © 2011, Portio Research. All Rights Reserved 27 Advanced mobile devices and networks alone are not enough to push the uptake of data services beyond a certain point. Users are tempted to explore data services if compelling and innovative content and applications are made available at their disposal.
  28. 28. Mobile Data Usage Trends 2011-2015 Number of Available Applications Figure 14: App Stores – Number of Available Applications (June 2011) 450,000 425,000 400,000 350,000 273,000 + 300,000 250,000 200,000 150,000 150,000 83,500+ 100,000 70,000 36,306 25,000+ BlackBerry App World 50,000 Windows Phone 7 Marketplace 0 Apple App Store Google Android Market GetJar Nokia Ovi Store China Mobile Market Mobile Application Stores Source: Portio Research Ltd. MNOs have themselves entered into the mobile apps market to increase revenue. With market players – especially MNOs – devising their strategies around data services and subscribers increasing their data usage, the future of mobile data usage certainly appears bright. Factors that make a Data Service Successful The worldwide mobile data market cannot be generalised. Each market is unique and a service that is successful in one market may not necessarily do well in another. There are various factors that make a mobile data service successful. Figure 15: Factors Behind a Successful Data Service Expand Perceived Value Continuing Upgrades Creating the right Business Model Factors Behind a Successful Data Service Minimise 'Clicks to Access' Choosing the Right Data Service Launch Timing Source: Portio Research Ltd. 28 © 2011, Portio Research. All Rights Reserved Each market is unique and a service that is successful in one market may not necessarily do well in another. There are various factors that make a mobile data service successful.
  29. 29. Mobile Data Usage Trends 2011-2015 Expand Perceived Value It is important to implement a service that adds value to subscribers, rather than being just an addition/upgrade to the existing array of services. Furthermore, it is equally important to price the service while keeping in mind the target audience. The service price is a combination of the following factors: understanding the target audience and their preferences, the value that the new service will deliver to the audience, and a cost that falls within the spending power of the target audience. Striking the right balance between these factors can make a new data service successful. A good example of delivering value to subscribers is Airtel India‘s service of accessing Facebook through USSD services. In May 2011, Airtel introduced a new service which allowed its users to access Facebook without subscribing to any mobile data plan. Users can update their Facebook status free of cost. In addition to status updates, users can also view news feeds, comment on or like news feed stories, post on friends‘ walls, confirm friend requests, view notifications, and find and add friends by paying INR 1 (USD 0.022) per day. 5 Minimise ‘Clicks to Access’ For mass adoption of a data service, the operator should ensure that the usability of such a service is simple and the service is easy to access. Subscribers may lose interest if they have to go through several links/buttons to access the service. Though it is understandable that not all services can be provided at the single click of a button, the operator should ensure that the portal that hosts the data service is accessible and easy to use. 3 Italia launched new handsets in conjunction with the launch of its mobile TV services. These handsets came with a TV button that gave subscribers easy access to mobile TV. Choosing the Right Data Service An operator should not only understand the subscriber‘s need for a data service, but should also understand the resources required to implement such a service. Each data service requires a different degree of resources; an operator should keep a watchful eye over the feasibility of introducing a service, ease of upgrading it, and the capital and manpower required. Launch Timing Correctly planning the right time to launch a data service plays a very important part in helping subscribers to easily relate to the service. Among the notable success stories highlighting the importance of effective launch timing is NTT DOCOMO‘s launch of mobile e-mail services in Japan – wherein it was recognised that Japanese subscribers were then more inclined to write lengthy messages, as opposed to the general trend of sending SMS. Similarly, 3 Italia launched its mobile TV services during the 2006 football World Cup (which Italy went on to win). These two services garnered success with increased user base for the services, and subsequently increased data ARPU. Creating the Right Business Model For a data service to be a commercial success, an appropriate business model must be identified. Even if a data service achieves high adoption rates, the operator may not gain the maximum benefit if the business model is not right. As data services involve other players in 5 Source: http://www.airtel.in/wps/wcm/connect/About%20Bharti%20Airtel/bharti+airtel/media+centre/bharti+airtel+news/mobil e/pg-first-ussd-based-facebook-access-service-in-india © 2011, Portio Research. All Rights Reserved 29
  30. 30. Mobile Data Usage Trends 2011-2015 the value chain, it is important for the operator to have control over this value chain to garner success from the services. NTT DOCOMO‘s DCMX (Mobile Credit Card) service was lauded for its successful business model. NTT DOCOMO acquired a stake in Sumitomo Mitsui Cards, a company with experience in delivering credit card services. This partnership was crucial for creating a successful business model for the DCMX data service. Continuing Upgrades The success of a data service is quickly outlived by new innovative services; its lifecycle is short due to the high number of innovations in the mobile industry. Hence, operators should offer regular upgrades to the portfolio of services provided. The progression from monophonic ringtones to polyphonic ringtones to caller ring back tones, and finally, to full track music downloads demonstrates the importance of upgrades within existing services. Monetising the Mobile Data Services Business MNOs are experimenting with different tariff plans to monetise the mobile data services market. Initially, MNOs offered unlimited data plans to their subscribers to push the uptake of data services but did not realise the fact that unlimited data plans would be unsustainable in the long term. Smartphones drove the level of use to such heights that it led to increasing network congestion, as the AT&T case study below attests. AT&T – A Lesson to be Learnt The US-based operator AT&T represents one of the major examples of a network straining under an unlimited data plan and intensive smartphone use. AT&T introduced unlimited data plans for USD 30 per month for all its smartphone users, including Apple‘s iPhone customers. Within a few days, the data usage skyrocketed among smartphone users, especially those using iPhones. iPhone users were using the majority of the network capacity, resulting in less available bandwidth for other smartphone users, who were actually experiencing poor network performance. AT&T‘s other subscribers were facing problems such as dropped calls, delayed text and voice messages and sluggish download speeds. AT&T‘s network was not ready for such a data use explosion and could not cope with the increased demands of bandwidth-hungry users. The situation degenerated further as the number of iPhones being used on the operator‘s network grew. In December 2009, the chief executive officer of AT&T Mobility and Consumer Markets - Ralph de la Vega - indicated that 3 percent of AT&T‘s smartphone users accounted for approximately 40 percent of the network capacity. He also indicated that high-bandwidth consuming activities included video and audio streaming. Several applications on the iPhone provide nonstop Internet radio (and were responsible for increasing data use). AT&T‘s painful experience is a priceless lesson. A very small percentage of AT&T‘s smartphone users clogged the company‘s entire network. In June 2010, AT&T shifted away from unlimited data plans and implemented a tiered pricing model. However, there has been no noticeable negative impact on demand for data services since tiered pricing was instituted in June 2010. 30 © 2011, Portio Research. All Rights Reserved
  31. 31. Mobile Data Usage Trends 2011-2015 Upgrading existing networks appears to be the most obvious solution to network congestion problems. However, given the fact that MNOs are already finding it difficult to recover the investments made in upgrading to 3G networks, and LTE deployments are still in the early stages, a network upgrade may not be a feasible option. One of the most effective ways to limit the data usage is to explore different pricing strategies. MNOs are now implementing tiered pricing in which multiple price points are offered to subscribers. Operators charge a premium for faster network speeds, higher data consumption, data usage during peak hours and for accessing websites/applications which generate very high data traffic. The various tiered pricing options which are being explored by MNOs worldwide include: Usage-based Tariff Plan: Verizon Wireless (US) has adopted usage-based tiered pricing for its feature phone customers. Feature phone customers can either opt for pay-per-use or can opt for a package worth USD 10 with an allowed limit of 75 MB. Speed Tiered Data Pricing: AT&T (US) intends to impose differential pricing based on speed tiers. AT&T‘s LTE users will pay more for faster speed access. Moreover, users with slower speeds can pay a fee to temporarily boost their network speeds. Subscription Package: KPN (Netherlands) offers a data subscription package similar to TV packages. It charges a separate fee for using Voice over Internet Protocol (VoIP) services such as Skype, streaming video and instant messaging applications. Pay-per-Site: Tata DOCOMO (India) introduced a pay-per-site tariff plan under which users just have to pay for the websites they want to browse. For example, if a user only accesses Facebook and YouTube on their mobile phone, they are required to pay monthly charges for only two websites. Peak and off-peak Hours: Users will be charged more for accessing mobile data during the peak hours of the day. Conversely, users will be offered incentives for using data services during off-peak hours. At present, MNOs are only charging subscribers for Internet access. Service providers that provide the content to subscribers are not incurring any cost for data delivery. To develop a win-win situation for both themselves and users, MNOs such as Vodafone, France Telecom, Telefonica and Telecom Italia are now suggesting a business model under which the service providers will also be charged for data delivery. In addition, this business model will also include smartphone vendors such as Apple and Android-based device manufacturers. MNOs want the content providers and smartphone vendors to contribute towards the cost of maintaining and improving networks. “Service providers are flooding networks with no incentive [to limit bandwidth]. It‟s necessary to put in place a system of payments by service providers as a function of their use”. Stephane Richard CEO, France Telecom “Companies such as Google and Yahoo! used our company‟s networks for free, which is good news for them and a tragedy for us”. Cesar Alierta CEO, Telefonica © 2011, Portio Research. All Rights Reserved 31 MNOs are now implementing tiered pricing in which multiple price points are offered to subscribers.
  32. 32. Mobile Data Usage Trends 2011-2015 Drivers and Inhibitors Drivers Figure 16: Drivers of Mobile Data Services Arrival of High-Speed Networks Arrival of high-speed networks such as 3G, HSPA and LTE has bolstered the growth of mobile data services. The high data traffic rate and better Quality of Service (QoS) provided by these advanced networks deliver a high quality experience to data services users. Arrival of High-Speed Internet Services Adoption of Smartphones Smartphones underpin the mobile data services market. These devices, packaged with affordable mobile data plans, are facilitating the uptake of mobile data services. Tablets further Catalysing the Growth In addition to smartphones, tablets will further boost the uptake of mobile data services Proliferation of Mobile Broadband With the increasing uptake of mobile broadband, consumers are fast adopting new content services and applications Cloud Computing Its benefits – such as an ability to handle unpredictable increased data traffic, centralisation of infrastructure and efficiency improvements – have encouraged more and more companies to adopt cloud computing. Cloud computing has facilitated the continuity of business through smartphones and thus has increased the mobile data usage among business users. Innovative and Compelling Data Services The emergence of sophisticated device-level and network-level APIs has led to the introduction of more elaborate and compelling data services Increasing Utility With increasing awareness, consumers are appreciating mobile data services utility in everyday activities – not just entertainment Services such as mobile banking, ticketing, videos and navigation are attracting the attention of millions of users, as these services support the realities of daily life Source: Portio Research Ltd. 32 © 2011, Portio Research. All Rights Reserved
  33. 33. Mobile Data Usage Trends 2011-2015 Inhibitors Figure 17: Inhibitors of Mobile Data Services Pace of Network Enhancements unable to keep up with the Increasing Consumption Patterns of Users After the arrival of smartphones, data traffic experienced an exponential growth leading to network congestion, especially in high-usage countries. The number of smartphones is set to increase in the coming years, putting pressure on MNOs to have robust networks in place to support the growing demands of users. “Mobile operators have been investing billions to upgrade and improve the capacity and performance of their networks, but in some high-usage cities, such as San Francisco, New York and London, we are still seeing users frustrated by chronic problems of network unavailability”. Hamadoun Touré Secretary General, ITU Revenue Growth slower than Data Traffic Growth Mobile data revenue is not growing at the same pace as mobile data traffic, primarily because of the unlimited data plans. In order to increase revenue opportunities and maximise profits, MNOs need to provide greater bandwidth to their users. However, network upgrades require huge investments which are a big challenge for MNOs in the present scenario. MNOs are already struggling to make profits against the investments made in building 3G and above network capacity. Privacy Users are not comfortable with device manufacturers and app vendors etc. collecting information from their devices without their knowledge Advertisers track users‘ locations using location-based services. Users should have a choice to opt-in or opt-out of targeted advertisements. Security Some mobile apps and websites pave the way for viruses to attack user‘s information Due to the staggering growth of mobile data traffic, mobile networks have become a potential platform for the hacker community Users‘ aversion to provide credit card and bank account details while using websites and applications on their mobile phone inhibits the growth of mobile commerce Lack of Usage Tracking Mechanism MNOs have introduced tiered pricing but there are no mechanisms for users to track their monthly mobile data usage. At the end of the month, users will know what data services they have used but they will have no idea about how much data traffic was generated by those services. Also, users find it challenging to estimate the data consumed by any data service in a minute or an hour. This leads to frustration among data services users. Unaffordable Smartphones and Data plans In emerging markets, smartphones and mobile data plans are still out of reach for many users Source: Portio Research Ltd. © 2011, Portio Research. All Rights Reserved 33
  34. 34. Mobile Data Usage Trends 2011-2015 Chapter 4 Market Size 34 © 2011, Portio Research. All Rights Reserved
  35. 35. Mobile Data Usage Trends 2011-2015 Market Size Forecast Methodology In this report, mobile data traffic is defined as the data traffic generated from mobile devices. Our mobile data traffic forecast for 2011-2015 essentially depends on the following three factors: 1. Percentage of the mobile subscriber base using mobile devices capable of intensive data consumption 2. Minimum data speeds available in the respective region 3. Average number of hours of data usage per day Various other factors – such as adoption of smartphones and tablets, affordability of smartphones, deployed technologies, pricing models, planned infrastructure investments and enthusiasm to try new services – affect the uptake of mobile data services. That said, these aforementioned factors were taken into consideration while estimating the percentage share of mobile devices of the total population of the region, minimum data speeds to be available in the region, average number of hours of data usage per day in the coming five years. Also, data points – such as spending power of the population, desktop penetration, youth population (age group 15-39) – were collected for all five regions to understand the overall state of the market. In this section, we have provided the forecasts for the mobile data services market in terms of mobile data traffic and mobile revenue from 2011 to 2015. Market Size Mobile Data Traffic The mobile data services market has recorded staggering growth in recent years in terms of data traffic, primarily due to the widespread adoption of smartphones and tablets. Highspeed data networks, affordable data plans and easy availability of compelling data services have also helped boost data traffic. Worldwide mobile data traffic stood at 231.1 Petabytes per month at end-2010. With the growing number of web-enabled mobile devices, cloud computing, alternate access networks such as Wi-Fi, and MNOs making huge infrastructural investments to improve the quality of networks, mobile data traffic is expected to grow at a Compound Annual Growth Rate (CAGR) of 91.2 percent between 2010 and 2015 to reach 5,904.1 Petabytes per month by end-2015. The figure on the next page depicts the monthly mobile data traffic from 2008 to 2015. © 2011, Portio Research. All Rights Reserved 35 With the growing number of web-enabled mobile devices, cloud computing, alternate access networks such as WiFi, and MNOs making huge infrastructural investments to improve the quality of networks, mobile data traffic is expected to grow at a Compound Annual Growth Rate (CAGR) of 91.2 percent between 2010 and 2015.
  36. 36. Mobile Data Usage Trends 2011-2015 Figure 18: Mobile Data Traffic per Month – Worldwide (In Petabytes, 2008 – 2015F) 5,904.1 Mobile Data Traffic (In Petabytes) 6,000 5,000 4,000 3,254.6 3,000 1,749.2 2,000 915.6 1,000 33.0 91.0 231.1 2008 2009 2010 470.6 0 2011F 2012F 2013F 2014F 2015F Year Source: Portio Research Ltd. F – Forecasted The table below highlights the growth in regional mobile data traffic from 2008 to 2015. Table 2: 6 Mobile Data Traffic per Month – Regional (In Petabytes, 2008 – 2015F) Mobile Data Traffic per Month (In Petabytes) Region 2008 2009 2010 2011F 2012F 2013F 2014F 2015F Europe 11.0 32.0 73.0 157.9 308.0 589.5 1,098.3 1,994.0 Asia Pacific 13.0 35.0 92.9 187.8 368.4 708.8 1,327.1 2,420.6 North America 6.0 17.0 47.8 91.4 176.5 334.9 619.3 1,117.2 Latin America 1.0 4.0 11.4 20.6 38.6 71.5 129.4 229.2 Africa and Middle East 2.0 3.0 6.0 12.9 24.1 44.5 80.7 143.2 Total 33.0 91.0 231.1 470.6 915.6 1,749.2 3,254.6 5,904.1 Source: Cisco and Portio Research Ltd. Asia Pacific had the largest regional mobile data traffic in 2010, constituting 40.2 percent of the worldwide mobile data traffic. It was followed by Europe and North America, with 31.6 percent and 20.7 percent shares respectively. The next figure breaks out the worldwide mobile data traffic in 2010 by regions. 6 Note: Sum of regional numbers may not add up to the total due to rounding off errors. 36 © 2011, Portio Research. All Rights Reserved
  37. 37. Mobile Data Usage Trends 2011-2015 Figure 19: Worldwide Mobile Data Traffic – Regional Contribution (In Percent, 2010) 40.2% 20.7% 31.6% Europe Asia Pacific 2.6% North America 4.9% Latin America Africa and Middle East Source: Portio Research Ltd. The figure below shows the projected contribution of the five regions to the worldwide mobile data traffic in 2011. Figure 20: Worldwide Mobile Data Traffic – Regional Contribution (In Percent, 2011F) 39.9% 19.4% 33.6% Europe Asia Pacific 2.7% North America 4.4% Latin America Africa and Middle East Source: Portio Research Ltd. The ranks of regions in 2011 and 2015, in terms of contributions to worldwide mobile data traffic, are expected to be the same as in 2010. Asia Pacific will continue its dominance over the next five years to 2015. Asia Pacific‘s huge subscriber base translates into a vast user base of web-enabled mobile devices. This is why the region contributes the most to the total mobile data traffic. The region will generate 41 percent of worldwide mobile data traffic at end-2015, followed by Europe with 33.8 percent. © 2011, Portio Research. All Rights Reserved 37
  38. 38. Mobile Data Usage Trends 2011-2015 The figure below highlights the regional share of worldwide mobile data traffic in 2015. Figure 21: Worldwide Mobile Data Traffic – Regional Contribution (In Percent, 2015F) 41.0% 18.9% 33.8% Europe Asia Pacific 2.4% North America 3.9% Latin America Africa and Middle East Source: Portio Research Ltd. F – Forecasted Worldwide mobile data traffic is forecast to grow at a CAGR of 91.2 percent between 2010 and 2015. Europe is expected to witness the highest percentage growth, due to the increased installed base of advanced devices and networks, and the growing online culture of sharing multimedia content including photos and videos. High growth is anticipated in all regions, as most markets aren‘t expected to saturate in the next five years. The figure below shows the regional CAGR for mobile data traffic growth in the period 20102015. Figure 22: Mobile Data Traffic Growth by Region (In Percent, 2010 – 2015F) CAGR Worldwide = 91.2 % 100 CAGR (In Percent) 93.8 CAGR 91.2% 91.9 88.6 87.8 90 82.2 80 70 60 50 Europe Asia Pacific North America Latin America Africa and Middle East Region Source: Portio Research Ltd. F – Forecasted 38 © 2011, Portio Research. All Rights Reserved High mobile data traffic growth is anticipated in all regions, as most markets aren‟t expected to saturate in the next five years.
  39. 39. Mobile Data Usage Trends 2011-2015 Mobile Data Revenue With the emergence of mobile data services, a valuable new revenue stream has arisen for operators. The growing importance of data services has prompted MNOs to design strategies to maximise the revenue-earning potential of these services. However, as noted earlier, mobile data revenue is not growing as fast as mobile data traffic. Worldwide mobile data revenue stood at USD 290.3 billion in 2010 and is expected to grow at a CAGR of 13.2 percent between 2010 and 2015 to reach USD 539.9 billion at end-2015. Mobile data revenue is not only experiencing a comparatively lower CAGR but the year-on-year growth rate is also expected to decline over the next five years. Flat-rate data plans have definitely been instrumental in driving the demand for mobile data services, however they have ultimately resulted in lower revenue for MNOs. Thus, MNOs have now started devising effective pricing strategies to boost their data revenue and regulate the network usage for the sustainable growth of mobile data services. The figure below depicts worldwide mobile data revenue from 2008 to 2015. Figure 23: Mobile Data Revenue – Worldwide (In USD Billion, 2008 – 2015F) 600 539.9 498.7 Revenue (In USD BIllion) 500 445.2 395.1 400 343.1 290.3 300 194.8 219.5 200 100 0 2008 2009 2010 2011F 2012F 2013F 2014F 2015F Year Source: Portio Research Ltd. F – Forecasted The table on the next page highlights the growth in regional mobile data revenue from 2008 to 2015. © 2011, Portio Research. All Rights Reserved 39 Mobile data revenue is not only experiencing a comparatively lower CAGR than mobile data traffic but the year-on-year growth rate is also expected to decline over the next five years.
  40. 40. Mobile Data Usage Trends 2011-2015 Table 3: 7 Mobile Data Revenues – Regional (In USD Billion, 2008 – 2015F) Mobile Data Revenue (In USD Billion) Region 2008 2009 2010 2011F 2012F 2013F 2014F 2015F Europe 56.3 66.0 101.9 118.4 131.2 141.4 152.8 161.4 Asia Pacific 78.9 81.9 97.2 111.5 126.3 140.1 153.2 158.3 North America 40.4 49.3 63.0 76.3 89.7 102.6 115.3 127.1 Latin America 10.2 11.4 13.8 16.3 20.2 24.4 29.5 34.7 Africa and Middle East 9.0 11.0 14.4 20.6 27.7 36.7 47.9 58.4 Total 194.8 219.5 290.3 343.1 395.1 445.2 498.7 539.9 Source: Portio Research Ltd. Europe had the largest regional mobile data revenue in 2010, constituting 35.1 percent of worldwide mobile data revenue, but was closely followed by Asia Pacific with a 33.5 percent share. North America accounted for 21.7 percent, while Africa and Middle East and Latin America respectively contributed 4.9 percent and 4.8 percent. The following figure breaks out the worldwide mobile data revenue in 2010 by regions. Figure 24: Worldwide Mobile Data Revenue – Regional Contribution (In Percent, 2010) 33.5% 21.7% 4.8% 35.1% Europe Asia Pacific 4.9% North America Latin America Africa and Middle East Source: Portio Research Ltd. The figure on the next page shows the expected contribution of the five regions to worldwide mobile data revenue in 2011. The regions‘ rankings, in data revenue terms, are expected to be the same as in 2010. 7 Note: Sum of regional numbers may not add up to the total due to rounding off errors. 40 © 2011, Portio Research. All Rights Reserved Europe had the largest regional mobile data revenue in 2010, constituting 35.1 percent of worldwide mobile data revenue, but was closely followed by Asia Pacific with a 33.5 percent share.
  41. 41. Mobile Data Usage Trends 2011-2015 8 Figure 25: Worldwide Mobile Data Revenue – Regional Contribution (In Percent, 2011F) 32.5% 22.2% 4.7% 34.5% Europe 6.0% Asia Pacific North America Latin America Africa and Middle East Source: Portio Research Ltd. F – Forecasted In 2015, Europe and Asia Pacific are expected be the top contributors to worldwide mobile data revenue, amassing 29.9 percent and 29.3 percent respectively, while North America is forecast to record 23.5 percent. The figure below highlights the regional share of worldwide mobile data revenue in 2015. 9 Figure 26: Worldwide Mobile Data Revenue – Regional Contribution (In Percent, 2015F) 29.3% 23.5% 6.4% 10.8% 29.9% Europe Asia Pacific North America Latin America Africa and Middle East Source: Portio Research Ltd. F – Forecasted Worldwide mobile data revenue is expected to grow at a CAGR of 13.2 percent between 2010-2015. Africa and Middle East and Latin America are expected to have the highest 8, 9 Note: The percentages do not add up to 100 percent because of rounding off errors. © 2011, Portio Research. All Rights Reserved 41
  42. 42. Mobile Data Usage Trends 2011-2015 CAGR for mobile data revenue in this period, primarily due to their smaller data revenue bases in 2010. The figure below depicts the regional CAGR for mobile data revenue between 2010-2015. Figure 27: Mobile Data Revenue Growth by Region (In Percent, 2010 – 2015F) CAGR Worldwide = 13.2 % CAGR (In Percent) 35 32.4 30 25 20.2 20 CAGR 13.2% 15.1 15 9.6 10.2 Europe 10 Asia Pacific 5 0 North America Latin America Africa and Middle East Region Source: Portio Research Ltd. F – Forecasted 42 © 2011, Portio Research. All Rights Reserved
  43. 43. Mobile Data Usage Trends 2011-2015 Chapter 5 Case Studies – Regional Trends © 2011, Portio Research. All Rights Reserved 43

×