3. The rise of the data exclusive
In 2016, 26% of smartphone users in developed markets will not make any traditional phone calls in a given week. We call these individuals ‘data exclusives’. They have not stopped communicating, but are rather replacing traditional voice calls with a combination of messaging (including SMS), voice and video services delivered ‘over the top’. The data exclusive contingent was 22% of all smartphone users in 2015, and 11% in 2012.
In recent years there have been two contrasting trends with voice. First, mobile voice volumes as measured in minutes have increased by 20% between 2012 and 2015, likely because of the increased affordability of voice minutes, the rising take-up of unlimited voice packages, an increase in voice minute allowances and an ongoing substitution of fixed to mobile calling. Second, most smartphone owners’ usage patterns have become more data-intensive, with the proportion of time spent on non-voice activity increasing considerably; in some markets, such as the UK and the US it has reportedly trebled.
What may be happening is a polarization in the usage of voice on mobile: some users are increasing their voice call volumes; at the other end of the scale a growing proportion are not using voice at all.
4. The dawn of the Gigabit internet age: every bit counts
The number of Gigabit per second (Gbps) internet connections will surge to 10 million by year-end, a tenfold increase, of which about 70% will be residential connections. Rising demand is likely to be fueled by increasing availability: in 2015, the number of Gbps tariffs almost doubled in just three quarters, from just over 80 to over 150, and falling prices. The 10 million subscribers will likely, however, represent a small proportion of the 250 million customers on networks capable of Gpbs (or 1,000 Mbps) connections as of end-2016. Looking further ahead, we forecast about 600 million subscribers may be on networks that offer a Gigabit tariff as of 2020, representing the majority of connected homes in the world.
While Gbps subscriptions should surge this year (albeit from close to nothing to niche) the sharpest inflection point for the service may be in terms of perception. For homes, the perceived reasoning for Gbps service will likely evolve from meeting the needs of a single application running on a single device to meeting the aggregate demand from multiple devices. Although a Gbps connection for a single device may be overkill, consumers are likely to continue accumulating connected devices in the long term. At the start of 2016, upper quartile homes in developed countries may have already accumulated a dozen connected devices, each of which may individually ‘sip’ data, but collectively, at peak time, might ‘gulp’ data. Through 2020 that dozen may well become dozens. And as average data connections get faster, we expect existing services to become steadily more bandwidth consumptive, new formerly nonviable data-intensive services to launch, and new ‘data-gulping’ devices to come to market.
5. Photo sharing: trillions and rising
In 2016, 2.5 trillion photos will be shared or stored online, a 15% increase on the prior year. About three-quarters of this total will likely be shared, and the remainder backed up online. We estimate the number of photos shared online to be about 31 times the volume taken (let alone shared) in the 1990s, when about 80 billion were taken every year.
The expected network impact of all this sharing will be about 3.5 exabytes, a 20 percent increase over the previous year. We expect the network impact of photographs to continue rising for the foreseeable future, driven by steady increases in the volume of photos taken, shared and backed up, as well as rising average file size.
We estimate that over 90% of the photos shared or stored online will have been taken on a smartphone. The dominance of the smartphone for photo sharing is due to its ubiquity and the rate at which owners upgrade their devices. Photo sharing has been and will likely be enabled and encouraged by improvements in smartphone capabilities, as well as faster fixed and mobile connectivity. Photography’s appeal is partly about capturing and sharing a moment: smartphones enable both to occur almost simultaneously. Also, they remove the lengthy time lag with standard photographic film between taking and sharing a photo. Smartphones can reduce the processes of taking, adjusting and sending a high definition photo to less than a second.