Wireline-wireless gap to widen

Metaratings
23 May 2014
00:00
Article

Point Topic has just released its forecast for worldwide fixed broadband at the end of the decade – its estimate is 989.4 million lines at the end of December 2020.

Let’s put that number in perspective. That’s significantly less than current 1.1 billion fixed telephone lines and less than half the 2.3 billion active mobile broadband subscribers the ITU reported in May.

Actually, comparing 2014 figures, the ratio is closer to 3:1 – global mobile broadband penetrating is 32% vs 9.8% for fixed broadband, according to the ITU. (No doubt the subscriber number is inflated due to multiple SIMs per user – but anyway you look at it, the gap is huge can getting bigger). And to be fair, the comparison isn’t apples to apples – it’s lines or households to subs/users.

It took three years for the number of fixed broadband lines to double from 200 million to 400 million (Q4 2005 to Q4 2008). Another 13 quarters passed before the next 200 million lines were added – reaching 600 million lines in Q1 2011.

Growth peaked in mid-2012 and will continue to decline over the next seven years.

The next 200-million milestone will take 16 additional quarters – hitting 800 million lines in Q1 2016. And we won’t see the one-billion mark surpassed until early 2021.

Meanwhile, back to the mobile side, Ericsson’s Consumer Lab predicts that the number of mobile broadband subs will quadruple from some two billion today to eight billion by 2019, when 80% of total mobile subs will be 3G or 4G. Even if that number is 50% inflated, mobile broadband connections will outnumber fixed four to one at the end of the decade.

And taking into account the falling average selling price of a smartphone (which fell to $337 last year and forecast to hit $265 in 2017), personal/mobile computing is becoming much more affordable in emerging markets, where fixed broadband service is scarce and usual pricey. In Asia-Pacific IDC expects the average price to decline to $215 in three years. The impact on the entire ecosystem (from ISPs to PC makers) will be huge. Who needs a fixed-line connection when you don’t have a PC?

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