Cisco (NASDAQ:CSCO) Forecasts Major Growth For Mobile Industry

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Cisco Systems, Inc. (NASDAQ:CSCO) came out with new forecasts for the data industry that have major implications for players in the space. Among the most notable are these four:

  • More people will have mobile phones (5.4 billion) than electricity (5.3billion), running water (3.5 Billion) and cars (2.8 billion) by 2020.
  • By 2020, more than 75% of the world’s mobile data traffic will be video.
  • By 2020, 4G connections will make up 72% of overall mobile data traffic, an increase of 47% of overall mobile data traffic in 2015.
  • By 2020, the average mobile connection speed will increase more than 3-fold to 6.5 Mbps from 2.0 Mbps in 2015.

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Cisco’s methodology in predicting these numbers involved surveying independent analyst forecasts as well as real-world mobile data usage studies based on the organization’s internal assessments and projections of mobile application adoption, minutes of utilization and transmission speeds. Other factors included in the findings are device computing power and mobile broadband speed.

Cisco’s major mobile momentum metrics utilized in creating their global mobile data traffic forecast include monitoring mobile user growth, mobile connections, mobile speeds and greater utilization of mobile video.

Global mobile data traffic growth is projected to increase at a Compound Annual Growth Rate (CAGR) of 53% from 2015 to 2020. Cisco discovered that in 2015, 3.7 exabytes of data per month, or 3.7 quintillion bytes, were utilized. Utilization is projected at 30.6 exabytes per month for 2020 which is an 8-fold rise from 2015.

Smartphones and tablets will still be dominating mobile data traffic while M2M (Machine-to-Machine) will also rise by 2020. Cisco forecasts that global mobile devices will rise from 76% from 2015 to 81% in 2020. M2M will have the largest percentage gain rising from 3% in 2015 to 7% in 2020.

Worldwide mobile users will rise from 65% (4.8 billion) in 2015 to 70% (5.5billion) of the world’s population by 2020. Africa and the Middle East will have a 4.4% CAGR, Asia-pacific will have 3% CAGR and Latin America will have 1.6% CAGR.  Average mobile speed will increase more than three-fold from 2.0Mbps in 2015 to 6.5 Mbps in 2020.

Smart mobile devices as well as connections are forecasted to make up 72% of total mobile devices and connections by 2020, an increase from 36% in 2015. Smart devices are also predicted to produce 98% of mobile data traffic by 2020. Cisco also discovered from the individual device perspective that smartphones will account for 81% of worldwide global mobile traffic by 2020 rising from 76% in 2015.

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