Cisco Projects Global Mobile Traffic to Increase 8-Fold by 2020

On February 3, 2016, Cisco released its annual Visual Network Index (VNI) Forecast Report: Mobile Data Traffic Update, 2015-2020. I certainly recommend exploring the global, regional, and national findings on Cisco’s helpful interactive website.

The proliferation of video applications are by far the biggest driving force behind the increases in mobile traffic over the past several years and will continue to be for the next five years as connections increase and networks expand. On a global level, video traffic is projected to comprise 75 percent of mobile data in 2020, an increase of 20 percentage points from 2015 (55 percent). While the United States certainly has been a leader in the growth of mobile connections and traffic, Cisco projects the rest of the world will have tremendous growth over the next five years.

Here are some key findings regarding the growth of mobile connections and traffic throughout the world:

• More than half a billion (563 million) mobile devices and connections were added in 2015.

• Mobile network (cellular) connection speeds grew 20 percent in 2015.

• Average smartphone usage grew 43 percent from 648 megabytes per month in 2014 to 929 megabytes per month in 2015.

• Global mobile data traffic will increase nearly 8-fold between 2015 and 2020.

• By 2020, 4G will be 40.5 percent of connections, but 72 percent of total traffic.

• The average smartphone will generate 4.4 gigabytes of traffic per month by 2020, a 5-fold increase over the 2015 average of 929 megabytes per month.

As you can see from the two graphs below, the global growth of both mobile traffic and the number of devices is projected to be enormous over the next five years.

Cisco Forecasts 30.6 Exabytes per Month of Mobile Data Traffic by 2020

Global Mobile Devices and Connections Growth

Here are some of the key findings for the United States:

• 43.3 million net new devices and connections were added to mobile networks in 2015.

• Mobile data traffic will grow 6-fold from 2015 to 2020, a compound annual growth rate of 42%.

• Mobile data traffic will grow 2 times faster than fixed IP traffic from 2015 to 2020.

• Mobile traffic per user will reach 8,835 megabytes per month by 2020, up from 1,775 megabytes per month in 2015, a compound annual growth rate of 37%.

• There will be 292.2 million (88% of the United States' population) mobile users by 2020, up from 275.7 million in 2015, a compound annual growth rate of 1.2%.

North America, and predominately the United States, has been a global leader in the innovation and development of mobile broadband networks. By 2020, 40.5 percent of all global devices and connections will have 4G capacity, but in North America, 59 percent of devices and connections will have 4G capability.

The United States’ leadership in the ongoing development of mobile broadband, devices, and content applications is the result of many economic and institutional factors. However, it should not go unnoticed that a light-touch regulatory environment has helped entrepreneurs spur investment in new products and services through the process of “permissionless innovation.” As laptops, tablets, phablets, and smartphones have morphed into each other and become substitutes, competition among them has increased, reducing the price and increasing the quantity demanded by consumers. This increase in consumer demand has created more innovation in mobile services, more broadband network expansion, and more application accessibility.

Additionally, because video currently comprises 55 percent of mobile data, strong intellectual property rights have also played a pivotal role, allowing for a growing number of brands in mobile devices and new video content. It is important for artists, innovators, and service providers to have secure copyrights and patent rights in order to incentivize returns on creation and investment. The prospect of profitable returns invites new entrants into the market, which ultimately leads to more investment and lower prices for consumers.

Cisco’s report provides very important information for policymakers. It is essential that the FCC not take for granted the way in which the development and deployment of mobile networks and technologies has benefited consumers. More licensed and unlicensed spectrum is needed to meet the growing consumer demand for advanced services and devices. Understanding the extent of mobile data growth and the resulting need for additional spectrum will be crucial for promoting future U.S. leadership in mobile broadband – as will be the need for the government to avoid imposing burdensome regulatory requirements in a market which is indisputably competitive.

  

Cisco’s report provides very important information for policymakers. It is essential that the FCC not take for granted the way in which the development and deployment of mobile networks and technologies has benefited consumers. More licensed and unlicensed spectrum is needed to meet the growing consumer demand for advanced services and devices. Understanding the extent of mobile data growth and the resulting need for additional spectrum will be crucial for promoting future U.S. leadership in mobile broadband – as will be the need for the government to avoid imposing burdensome regulatory requirements in a market which is indisputably competitive.