UK Mobile Data Usage Set to Skyrocket

Forecast Shows Data Traffic Could Rise Sevenfold to 2021

The average UK mobile subscriber could devour as much as 18GB of data per month in 2021, according to our latest UK mobile operator forecast, published yesterday.

As consumers’ appetite for content shows little sign of relenting, this would represent a massive sevenfold hike from the current average of 2.5GB per month.

Based on our demand-driven scenario, such a leap would need network operators to launch increasingly attractive deals to satisfy pent-up demand. This could include further moves into unlimited data, a path that only Three has dared to tread. The operator’s customers are by far the most data-hungry in the UK, gobbling up about 7GB per month, an average over three and a half times higher than its rivals’.

Furthermore, supplier advances in high-definition content, 360-degree video as well as virtual and augmented reality, alongside greater capabilities in smartphones such as gigabit LTE, all point toward further strong growth in content consumption.

Finland is a prime example of how data traffic can soar, should operators encourage it. Here, operators offer unlimited data bundled according to different speed tiers. This has resulted in phenomenal usage; customers of DNA, for example, consumed a huge 16.5GB per month in the third quarter of 2017.

Operators Turn to Zero-Rated Content

In the UK, efforts by network operators to offer zero-rated content could boost average consumption in 2018 by as much as 1GB per month, compared with 2017. This has been a fashionable play of late, evidenced by promotions from EE, Three, Virgin Mobile and Vodafone.

One of the most interesting concepts is Vodafone’s recent launch of a series of data passes giving users unlimited access to specific app genres for a set monthly fee. The offer aims to enable “worry-free” usage and encourage incremental spending.

Another important driver of data growth is, of course, network enhancement. Improvements to LTE coverage and capacity are well underway, with EE claiming “real world” speeds of 428 Mbps in Cardiff earlier in 2017.

UK Moves toward 5G

This represents an important step in the shift to 5G, for which the first networks are expected in the UK in 2020. We expect good adoption of the technology to occur from 2022, when total subscribers will hit 17 million. By the end of 2025, more than half of all mobile connections in the country will be on a 5G network.

However, eye-watering growth in mobile data consumption is far from guaranteed. The forecast also recognises an alternative scenario in which operators limit demand, either through preference or necessity.

Uncertainty remains over the much-delayed auction of 4G and 5G spectrum, originally slated for early 2016. And although operators grapple to make “more-for-more” strategies a reality, they could be tempted to use pricing to temper demand. In our alternative, supply-constrained scenario, data usage could remain as low as just 6GB per month.

The direction of travel in mobile data is unmistakable, the only question is how fast it will move.

The chart below offers a snapshot of our latest UK mobile operator forecast.

CCS Insight’s UK operator forecast provides a holistic review of hot topics in this market and focuses on drivers of change. This qualitative analysis is followed by a detailed five-year forecast on all important operator metrics. The full report is available to CCS Insight’s clients here. If you’d like to know more about this service, please contact us.