Mobile data traffic accelerates, infrastructure needs to keep up

2 August 2015 by Steve Blum
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The average mobile data customer in the U.S. is consuming 2.5 gigabytes of bandwidth every month. At least that was the picture at the end of the first quarter of this year according to mobile market analyst Chetan Sharma, who tracks such things. Likely, that number is even higher now – Sharma had average usage pegged at 2 GB just three months before.

Sharma believes mobile consumption is accelerating, while the cost to users continues downward

In the US, it took roughly 20 years to reach the 1GB/user/mo mark. However, the second GB mark has been reached in less than 4 quarters. An entire year’s worth of mobile data traffic in 2007 is now reached in less than 75 hours.

From 2010 to 2013, the data pricing declined by only single digits YoY. However, in 2014, the data pricing has plummeted by 77%. In Q1 2015, the data pricing stayed pretty steady.

Looking ahead, Sharma says that AT&T’s early success in the connected car segment could generate big benefits for the company in the future

Our estimates suggest that the connected car segment will become a billion dollar business for AT&T by 2016. The M2M+Connected Car revenue stream is already a billion dollar business for AT&T. Verizon is also slowly getting there. Their M2M+Telematics revenue stream should reach an annualized revenue stream of over a billion dollars by 2016.

This growth – in overall mobile data consumption and in the number of market segments and applications supported – will have significant consequences for infrastructure planning, both by the industry and local agencies. One back of the envelope illustration: simply assuming a 500 MB increase in usage every quarter and continuing growth in the number of mobile accounts means that total traffic will more than double this year.