It is tempting to ignore yet another report highlighting explosive mobile video growth, but Ericsson’s regular bulletins usually contain some interesting nuggets tucked away beneath the inevitable headline. In its latest Mobility Report, there is a rather large nugget in the finding that while video is accounting for nearly all raw data traffic growth, increasing at 60% annually, social networking is gobbling up more eyeball time, with consumers on some leading networks spending 85 minutes a day on it via mobiles. The survey also detected a swing from fixed devices such as PCs to mobiles for social network usage. This in turn is feeding the mobile video growth through recommendations within the social network, even though that activity does not involve that much streaming directly.
A continued rapid swing towards smartphones is also driving video. Smartphones accounted for about half of all mobile phone sales in Q1 2013, compared with roughly 40% for 2012 as a whole. Actual smartphone usage growth is greater than that figure suggests, since the total number of mobile subscriptions grew by 8% globally over the year ending Q1 2013. Of those, 3G as a whole gained 90 million subs, with the higher performance WCDMA/HSPA now well ahead at 60 million of those and GSM/EDGE at 30 million, while 4G/LTE continued to accelerate fast at around 20 million new subscriptions.
Given these trends not surprisingly mobile broadband is also rampant, with subs growing 45% year-on-year to reach 1.7 billion. This in turn led to overall data traffic volumes doubling between Q1 2012 and Q1 2013, with Ericsson predicting a further 12-fold growth by 2018.
The Mobility Report now also addresses some of the competitive and quality of service issues associated with increasing mobile broadband speeds, such as the concept of “app coverage” embracing the ability of users to access and enjoy their mobile apps across different networks and also within networks as coverage varies. Here Ericsson has yet to come up with hard data but has presented a new framework explaining the effects of varying network performance in a way relevant to the user.
As Ericsson pointed out, effective coverage of apps varies crudely with bit rate and in turn distance from the base station within a cell. But each type of app has its own specific needs, so that for social media or web browsing, user experience is affected most by how fast requested pages are rendered onscreen. For every second that passes between a user’s clicking a link and a page loading, the probability increases that the user will give up waiting and experience negative QoE.
Then apps that involve streaming media such as video impose even more stringent requirements on performance, relying on a range of mechanisms to smooth over variable network bandwidth, such as adaptive codecs, local caching and buffering. If the throughput is consistently insufficient, time to view grows and the app may periodically freeze until it is no longer possible to stream, before ceasing to function altogether.
Then while downlink throughput is the limiting factor for many apps, real-time interactive apps such as video conferencing require equally fast uplinks while being highly intolerant of latency.
Ericsson does not give detailed statistics here broken down by networks and operators but does indicate that for simple web browsing, email and instant messaging, 100 Kbps is sufficient so that coverage for these is almost ubiquitous providing there is a signal at all. Then1 Mbps is enough for audio and video streaming as well as social media with embedded multimedia content. Then for premium HD streaming and video conferencing, Ericsson suggests a 10 Mbps downstream link is desirable, although that seems an excessive demand for mobile networks. However the report indicates that in the US where LTE deployment is most advanced, 31% of Ericsson’s speed tests revealed downlink speeds of 10 Mbps or higher, compared with 27% in the Middle East and 17% in Europe.
Similarly the report now analyses the relationship between network performance and consumer loyalty. Although again there are no operator details, Ericsson has confirmed that network performance has become the principal factor in subscriber loyalty to mobile operators, cited by 29% of smartphone users as being most important, pushing value for money well down into second place at 15%.
The report indicates that global mobile penetration has just pipped 90% for the first time to reach 6.3 billion, driven by rapid growth in developing countries where cellular networks are often the only means of communication. However in raw numbers China is still leading growth, accounting for 25% of the 120 million net additions over Q1 2013. This was followed by India and Indonesia at 10 million each, then Brazil and Nigeria both 5 million.
Bangladesh has slipped down the league, having been third in Q4 2012 and well in front per capita, with 9 million net additions. Given its population of 154 million this was three times greater per capita than China and eight times more than India, a symptom of the country’s rapid economic growth running at 5% to 6% per annum. So while its perception in the developed world is still of a country full of dangerous sweat shops manufacturing garments for sale at knock down prices in stores such as Primark, its economy is expanding as fast as neighboring India’s and absolute poverty is falling rapidly. It is now on the Goldman Sachs ‘Next Eleven’ list of countries likely to become the ‘new BRIC’ of leading developing economies.