Spectrum capacity is under pressure from the rapid expansion of mobile data applications and the increasing volume of data that is downloaded. Revenue from data traffic is now outpacing revenue generated by voice traffic. Transmission and reception of data relies on a higher amount of bandwidth than traditional voice applications. The communications report from the Australian Communications and Media Authority (the ACMA) shows that in 2010–11:
mobile wireless broadband subscribers increased by 39 per cent
mobile phone handset internet subscribers grew by 43 per cent
mobile phone handset services without an internet fell by six per cent.
Smartphones and smart devices are a major driver in mobile data traffic and their users generate approximately 10 times the amount of traffic compared to a non-smartphone user. Demand for increased data rates in turn produces demand for increased bandwidth and increased spectrum occupancy. Demand for spectrum is influenced by growing affordability of mobile broadband, combined with the consumer trend of increased data transmission and or higher bandwidth applications.
What is not known are the future applications that will derive their data from mobile services and therefore it is likely that this pressure will continue to increase as new technologies appear over time.
In Figure 2.3, the ACMA outlines its expectations for data and spectrum demands through to 2020 as outlined in the ACMA discussion paper Towards 2020—Future spectrum requirements for mobile broadband. The blue bar chart represents data demand based on industry assumptions to 2015 and ACMA trending to 2020. The red curve is the ACMA’s anticipated level of spectrum demand to meet the needs of mobile broadband.
Figure 2.3 Expectations for spectrum demand and traffic out to 2020
The ACMA expects demand for spectrum to be based on the increasing use of data cards, USB dongles and machine-to-machine applications.
Machine-to-machine (M2M) has been defined in a recent paper by the Organisation for Economic Co-operation and Development (OECD) as devices that are communicating using wired and wireless networks, are not computers in the traditional sense and are using the Internet in some form or another.
The ACMA expects that the demand for spectrum to support services such as:
will increase over time in response to the increased proliferation of M2M interactions and a rise in data usage.
M2M is still a relatively new technology and it is expected to grow rapidly with the availability of embedded devices. There have been forecasts of M2M device numbers in orders of magnitude greater than that of today’s personal devices, which already exceed 5.0 billion. While there are approximately 75 million cellular M2M connections in the world, this is expected to increase to 225 million by 2014.
Australia is a ‘mature’ user of mobile technology with a fast uptake of new services and the ACMA expects that data demand will increase exponentially as a result of this trend until about 2018. As demand in mobile technology begins to slow, the ACMA expects an increase in demand for M2M devices to sustain the exponential nature of this demand curve through to 2020.
1 Refers to services offered via a datacard or dongle. Excludes mobile phone handset internet subscribers.
2 International Telecommunication Union, Newsroom Press Release, ITU sees 5 billion mobile subscriptions globally in 2010 – Strong global mobile cellular growth predicted across all regions and all major markets, 15 February 2010, http://www.itu.int/net/pressoffice/press_releases/2010/06.aspx, retrieved 14 June 2011.
3 Northstream Strategy and Sourcing, Whitepaper, The revenue opportunity for mobile connected devices in saturated markets, February 2010, http://northstream.se/wp-content/uploads/2010/02/The-revenue-opportunity-for-mobile-connected-devices-in-saturated-markets.pdf, retrieved 14 June 2011.