Surging consumer and business demand for mobile content will outpace the ability of operators to provide it unless investments are accelerated in areas like 5G and the cloud, according to a report from Bell Labs Consulting.
The Nokia Bell Labs division found that audio and video streaming will be the highest contributors to the increased traffic demand in years ahead, accounting for a 79% total increase by 2020.
Bell Labs Consulting models show that by 2020, 67% of the worldwide consumption demand forecast can be met by Wi-Fi. Another 14% can be addressed by the current adoption rate of 3G, LTE, small cells and the emergence of new technologies such as 5G.
Between now and 2020, that leaves 19% of demand unable to be satisfied based on current and projected economics. Thus, network operators will need to accelerate their path to 5G and cloud technologies, such as network function virtualization (NFV) and software-defined networking (SDN), and adopt new business models to address the demand gap.
The emerging unknown in the network equation is IoT, the report states. The number of IoT connected devices is expected to grow from 1.6 billion in 2014 to between 20 billion and 46 billion by 2020.
Of this total, cellular IoT devices will be between 1.6 billion and 4.6 billion in 2020. Despite this massive adoption, the overall cellular traffic generated by IoT devices will only account for 2% of the total mobile traffic by 2020 until video-enabled sensors and cameras begin to predominate.
However, even in the near term IoT traffic will generate a substantially higher volume of signaling traffic relative to data traffic. For example, a typical IoT device may need 2,500 transactions or connections to consume 1 MB of data, while the same amount of data can be consumed in a single mobile video connection.
As a result, daily network connections due to cellular IoT devices will grow by 16 to 135 times by 2020 and will be three times the connections initiated by human generated traffic.