The Accelerated Pace of Generation Adoption
Statistics from The Mobile World suggest that the number of LTE subscriptions worldwide surpassed 1 billion in October 2015. It’s a milestone for the technology marketed as 4G, in part because the large round number is cause for celebration but also because it provides a headline opportunity for comparison of wireless generations.
There’s some degree of extrapolation on our part — The Mobile World reported 818 million LTE subscriptions at the end of 2Q15. But uptake has been consistently rising about 20 percent on a quarter-by-quarter basis, and the current pattern suggests the industry should reach 1 billion LTE subscriptions today, give or take a few days.
It took fewer than six years for LTE to reach the 1 billion subscriptions milestone, having taken 3G more than eight years and 2G services more than a dozen. The Mobile World says that first-generation, analogue-based wireless services never quite surpassed 100 million users. Each sequential generation of service has enjoyed greater success than the one before thanks to global standards and a network effect that makes it increasingly difficult for households and individuals to stay away.
The first billion historically tends to be the hardest. The number of global 3G subscriptions reached 1 billion in late 2011, about eight years after its general availability. Less than three years later, the number reached 2 billion and now, two years later, it’s about to pass 3 billion.
Coverage and cost remain the key variables in mobile penetration, and most of the world’s cellular users still rely on 2G connectivity as their only or primary route of access. GSM remains the de facto global standard, and 3G and 4G have years of subscriber growth ahead as users switch from basic handsets and services to LTE smartphones and dongles.
The wireless industry is sharing its 2020 vision of 5G access, but LTE is much closer to the beginning of its potential than even its mid-life. There are now more than 200 LTE service providers around the globe. Coverage is limited to key metropolitan areas in many countries, but ongoing network build-outs will provide billions more people with access to 4G networks in the coming years.
A few markets can be credited with big contributions to reaching the 1 billion milestone. China is one such example, with China Mobile — the world’s largest operator by subscriber count — having achieved an impressive 4G roll-out after receiving its TD-LTE licence in December 2013. China Mobile alone has almost 250 million 4G subscriptions, according to the GSMA.
We’ve written recently that China is now the undisputed leader in LTE customer numbers, having recently surpassed the US. Research from the GSMA predicts that LTE connections in China will reach 1 billion in 2020, or two-thirds of the global total. This rise will be driven by an increasingly wide range of 4G devices subsidised by operators. We also expect subscriptions in India to pick up considerably in the next two years as operators launch LTE networks in more cities.
There are long overlaps between wireless generations, and strong connections between them. Few industries can talk about volumes in the billions. For LTE, it’s the warm-up lap.
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