Ten years, vicissitudes. This is true of life, and it is also true of the mobile communications industry.
Ten years ago, 4G was in the ascendant and smartphones were not yet widespread; ten years later, 5G was commercial, and the Internet of Everything was gradually approaching.
As a century-old store in the communication equipment market, Ericsson has witnessed countless technological and industrial changes, and is also the only communication equipment manufacturer that has participated in the whole process from 1G to 5G.
Ten years ago, in November 2011, Ericsson released its first Traffic and Market Data Report, which was renamed Ericsson Mobile Market Report a year later, thus beginning Ericsson's research on the mobile industry...
Ten years later, in November 2021, Ericsson released the Ericsson Mobile Market Report for a decade (hereinafter referred to as the "Report"), based on the results of current and historical network data.
So, what dramatic changes have taken place in the mobile communications industry in the past decade? What are the new trends in the future? What are the successful experiences in the face of the challenges of 5G development? Let's take a look at this freshly baked report.
The revelation behind 300 times more traffic
Over the past decade, mobile communications technology has had an incredible impact on people, society, and business beyond anyone's imagination. In the past ten years, the number of mobile users, the number of smartphone users, and mobile network data traffic have shown amazing changes.
The report sorts out key data changes in the past decade: global mobile subscriptions grew from 6 billion in 2011 to 8.1 billion in 2021, of which global 4G users soared from 9 million in 2011 to 4.7 billion at the end of 2021; smartphone users grew from 700 million in 2011 to 6.3 billion in 2021 (the number of new smartphone users exceeded 5.5 billion in the past decade). Driving mobile data traffic from less than 0.25 exabytes per month in 2011 to 65 exabytes per month in 2021, nearly 300x more mobile data traffic in a decade.
The increase in the number of users and traffic has benefited from increased population coverage and the parallel operation of multi-generational mobile communication technologies.
Ericsson believes that the enlightenment of the early stage of 4G development is that to determine the right drivers, Ericsson correctly predicted the most important parameter of the industry's growth - smartphone subscription users, and because 4G was launched faster than expected, traffic growth was also more rapid; and once a mobile standard became a global standard, covering a large number of people, and the ecosystem around the standard was also established, the public acceptance of it may be faster than the most optimistic forecasts.
The ecosystem that has been built means new business opportunities, triggering new business models, new companies entering the market, and competition becoming fierce. During this period, due to the emergence of new technologies, the performance of the network continued to improve, coupled with the increase in video content, which further promoted the consumption of mobile data traffic and the migration of 3G users to 4G, and finally prompted the industry to use 4G high-speed networking capabilities to serve new market segments.
5G will be the fastest mobile communications technology ever deployed
If 3G has pried open a window of the mobile Internet, then 4G has completely opened the door to the era of mobile Internet, and has achieved new business applications, business models and giants such as high-definition video, mobile online games, and social software. However, the evolution of mobile communication technology will basically follow the development rhythm of the new generation every decade.
Since the official commercial use of 5G in 2019, operators have accelerated the promotion of 5G deployment, and as of now, more than 180 5G commercial networks have been launched worldwide.
Ericsson expects that the global 4G subscription will reach a peak of 4.7 billion by the end of 2021, and as more and more users migrate to 5G, the number of global 4G subscriptions will drop to around 3.3 billion by the end of 2027. In terms of 5G, by the end of 2021, the number of global 5G contracted users will exceed 660 million.
Since China participated in the 5G business earlier than 4G, several suppliers launched 5G terminals in a more timely manner, and the price of 5G terminals fell faster than 4G terminals, so the growth rate of the number of 5G contracted users is expected to be significantly faster than the growth rate after the listing of 4G (LTE) in 2009, and 5G users will reach 1 billion two years earlier than 4G. The Ericsson report predicts that the number of global 5G subscriptions will reach 4.4 billion by the end of 2027, accounting for about 49% of the total number of mobile subscriptions at that time.
From the perspective of population coverage, Ericsson expects that by the end of 2021, 5G is expected to cover more than 2 billion people worldwide, and by the end of 2027, 5G will cover about 75% of the world's population. By 2027, 62% of the world's smartphone traffic will be carried by 5G networks.
In terms of terminals, at present, 5G mobile phones account for 23% of global mobile phone sales, while 4G mobile phones account for only 8.7% of global mobile phone sales in the same period. In the 10th quarter of the technology cycle, the market share of 5G mobile phones exceeded that of 4G mobile phones in the same period.
It can be seen that whether it is calculated from the number of signed users, population coverage, or the proportion of 5G mobile phone sales, 5G is expected to become the fastest mobile communication technology deployed in history.
5G drives innovation in "service"-based connectivity packages
In the early stage of 5G commercialization, the formulation of packages tested the wisdom of operators. Unlimited packages are a major selling point for operators to attract users in the 4G era, but simple and extensive unlimited packages need to be constantly innovated in the 5G era, such as additional packages customized around specific service types and even multiple services.
Today, users are increasingly using service-based connections instead of unlimited data plans, with more than 50% of operators offering some form of service-based connectivity. The Ericsson report states that in the past, the main service targets of these connection packages were social media, music and video streaming, and the pandemic seems to have pushed operators to provide connection packages based on services such as video conferencing, and even more advanced connection packages such as "work and education packages" have emerged, containing several gigabytes of discounted traffic packages that can be used for video conferencing, web browsing, video streaming and office software suite services.
In 2021, Ericsson is seeing an increasing number of packages for cloud gaming. More and more carriers are offering unlimited premium packages, from 35% 6 months ago to around 37%. In addition, there are restrictions on setting restrictions, including restrictions on connecting or using IoT devices, and limits on the amount of data that can be shared in a home or end device plan. More than 80% of operators with the above conditions have launched 5G commercial services.
The report shows that nearly 46% of operators surveyed have now launched 5G services for smartphones, and about 36% of them have higher 5G service tariffs than comparable 4G services. More than a third of 5G operators bundle media content with contracts. In addition, charging by different speed classes is also used as an effective means, combined with unlimited traffic and limited data packages, to stimulate consumers to increase the tariff level.
5G boosts QoS for FWA
The arrival of 5G has also brought better user experience and quality of service to fixed wireless access (FWA).
The report shows that more than 75% of operators around the world currently provide FWA services. According to ericsson's findings, 239 of the 312 operators studied provide FWA services, representing an average of 77% globally. Among them, the number of operators providing 5G FWA services has increased rapidly, and in the past 6 months, the number of operators providing 5G FWA services has increased from 46 to 57, an increase of nearly 25%.
According to the latest FWA CPE shipment survey and Ericsson research, it is expected that global FWA connections will be close to 90 million by the end of 2021, and it is expected that global FWA connections will reach 230 million by 2027 (an increase of nearly 3 times), of which 5G FWA connections will increase to around 110 million, accounting for almost 50% of the total number of FWA connections.
The actual significance of FWA to society is far greater than the number of FWA connections, and according to regional demographics, a FWA connection can provide connections for 3 to 5 people in a household. Ericsson expects FWA connections to reach nearly 230 million by the end of 2027, equivalent to more than 800 million people having access to wireless broadband connections. By 2027, FWA will provide broadband services to more than 800 million people.
At the same time, FWA QoS services with different speed classes will also grow rapidly. Ericsson pointed out that most of the traditional FWA services are best-effort services, with monthly traffic tariff schemes based on usage (GB/month), and only about 12% of operators provide FWA QoS services (FWA services are sold at different speeds). Operators offering 5G FWA services are more likely to offer QoS services, with 17 of the 56 operators (30%) offering QoS services, and operators increasingly tending to generate revenue by charging tariffs based on speed classes.
Accelerate digitalization with innovation
What exactly is the killer app of 5G? This is a problem that the whole industry is exploring together. In this regard, Ericsson listed the cutting-edge exploration of 5G use cases by the world's leading operators in the report.
As one of the first operators in the world to launch 5G services, Saudi Telecom (STC) has deployed about 6,200 5G sites in 75 towns in 56 counties in 136 counties since it began offering 5G commercial services in June 2019, with about 20 million mobile subscribers and a 40% market share. At present, it has more than 1.5 million 5G users, and its 5G network population coverage rate has reached 32%, and the target is to reach 42% by the end of 2022.
Due to the higher amount of data generated by users with 5G fixed wireless access, and more users using unlimited 5G packages, Saudi Telecom's 5G users consume an average of 101GB of data per month (the average monthly data consumption of 4G users is only 43GB), and the number of 5G active users of Saudi Telecom has grown at a rate of 12% per month since December 2020.
In order to make full use of 5G network capabilities, Saudi Telecom is currently exploring new innovative solutions and services. One of these is to identify new business models for entrepreneurs and their businesses, enabling them to transform their businesses, accelerate innovation and digitization, supported by the latest network technologies and services.
Currently, Saudi Telecom's focus areas for 5G use cases include: gaming, leveraging the ultra-low latency capabilities of 5G networks, Saudi Telecom has established a new subsidiary focused on gaming business, and has established partnerships with a cloud game provider to jointly develop solutions and game packages; smart cities, Saudi Telecom is working with partners, government agencies and municipalities to develop smart city solutions; SOHO, a QoS-guaranteed wireless cloud office leveraging 5G networks. Suitable for small and home office office (SOHO) enterprises; 5G secure campus network, the use of 5G independent networking capabilities in the core network, the use of network slicing technology to provide enterprises with 5G intelligent security campus network products.
Break the energy consumption curve
It should be noted that the rapid development of mobile communications is also under pressure for environmental sustainability.
Ericsson estimates that the current annual energy cost of running a mobile network worldwide is around $25 billion. From a cost and carbon footprint perspective, energy consumption is one of the biggest challenges facing the mobile communications industry today.
In the 5G era, due to the higher deployment frequency band and greater density of base stations, the energy consumption of 5G may be several times that of 4G, and the energy consumption of 5G has become a common challenge facing the industry.
Ericsson pointed out in the report that mobile data traffic is expected to increase by more than 4 times to reach 288 EXB per month by 2027. Operators must reduce energy consumption while expanding capacity and strive to reduce carbon emissions.
How can we break the energy consumption curve? To meet the industry's expectations for net-zero carbon emissions, Ericsson believes that a way to break the rising energy consumption of global networks is needed. Leading operators are using a holistic approach to this challenge, leading to a gradual reduction in energy consumption. This is achieved by combining network modernization with new features and capabilities that can be applied to network design, build, and energy intelligence, while switching to renewable energy is also critical to achieving overall emission reductions. C114 Communication Network Li Ming