The Wireless Universe Is (Too?) Rapidly Expanding
What's surprising about the wireless industry's growth is its speed of acceleration. While that means loads of opportunities, there's also a dark cloud: The networks may not be able to handle the traffic. Carriers "need to find innovative ways to deliver ever-increasing amounts of data to users of smartphones, tablets and other devices," said TDG Research analyst said Joel Espelien.
11/13/13 9:27 AM PT
The next six years will see smartphone subscriptions triple and LTE network deployment make large strides in North America, according to the latest Ericsson Mobility Report.
The report, published Monday, details the ongoing evolution of the wireless industry. Mobile subscriptions are expected to increase from 6.3 billion in 2012 to 9.3 billion in 2019.
That figure includes 5.6 billion smartphone subscriptions, meaning smartphones will make up about 60 percent of the overall mobile phone market, an increase from the 25-30 percent they represent now. Smartphone traffic will multiply 10 times during the next six years, the report predicts.
The rise of smartphone adoption has been rapid. It took more than five years to reach 1 billion smartphone subscriptions and fewer than two years to hit 2 billion, the report notes. That growth will continue as lower-cost models become more available in emerging markets.
The world's networks will also expand to keep up with that demand for data. Ninety percent of the world's population is expected to be covered by WCDMA/HSPA networks by 2019, according to the report, and 65 percent will be covered by 4G/LTE networks.
North America's LTE connections will surpass those in other parts of the world, reaching around 85 percent coverage by 2019, it forecasts.
Crunch Time Coming
Ericsson's predictions regarding LTE expansion in North America reflect how quickly the networks are developing, said Joel Espelien, senior analyst at TDG Research.
"LTE is just entering its growth phase," he told the E-Commerce Times. "Wireless technologies are fairly long-lived. LTE will indeed be the dominant technology in 2019, with very few 3G devices still in market."
One of the biggest challenges facing the industry is how to manage that growth, said GigaOM analyst Colin Gibbs. The major U.S. carriers are eager to expand their speedy LTE networks but can't risk compromising overall service.
"They need to find innovative ways to deliver ever-increasing amounts of data to users of smartphones, tablets and other devices," he told the E-Commerce Times. "Building out LTE networks will be crucial for carriers in the U.S. and other markets in the next few years, but those carriers will also have to find ways to use WiFi and other technologies to ease traffic on their cellular networks."
With Great Data Comes Great Opportunity
The next phase of the wireless industry won't just be about keeping up with the increased need for mobile device data, though, Gibbs noted. As consumers turn to wearable tech and WiFi-enabled home gadgets, carriers will have a chance to become even more omnipresent in their lives -- as long as they can keep up with demand.
"Perhaps the biggest opportunity for carriers in the U.S. and other mature markets is the Internet of Things," added Gibbs.
"Smartphone and tablet use will continue to increase, but the big growth in the next decade is likely to come from other devices -- everything from wearable gadgets like Google Glass to in-dash mobile data systems to fully connected homes," he suggested. "The biggest challenge for carriers will be in building complex new business models with multiple partners to provide those offerings for consumers and businesses."