GSMA forecasts APAC mobile data traffic will quadruple between 2023 and 2030 – really?

The headline claim in the report is that Asia Pacific’s mobile economy is forecast to grow to $1 trillion by 2030, fuelled by ‘5G technologies’. As you can see in GSMA infographic below, APAC’s mobile economy is currently sized at $880 billion so that means a CAGR of just 1.8% over the period of the forecast. Since regional economic growth is expected to exceed 4% for the next few years, that implies the relative contribution of the mobile economy will actually shrink.

This is especially surprising when you factor in the GSMA’s prediction that ‘mobile data traffic in Asia Pacific will quadruple between 2023 and 2030 driven by an increase in data intensive content and growth in 5G adoption.’ That indicates a CAGR in excess of 20% for mobile traffic, which you’d think would be a key driver of the mobile economy.

What seems more likely is that the mobile data traffic forecast is wildly optimistic. As you can see from the table below, taken from Ericsson’s Q1 2024 mobile network data traffic report, growth has been in steady decline for the past four years. Ericsson also forecasts steady growth for the rest of the decade but both seem to be counting on the current growth declines suddenly stopping and even reversing.

What is the basis for this assumption? We recently discussed the matter of mobile data growth with independent telecoms consultant William Webb, who has long forecast that mobile data traffic will slow to a crawl before long, so we posed that question to him.

"There is nothing in the report about how they have made this prediction,” said Webb. “The only text I could find says ‘As 4G subscribers migrate to 5G, average mobile data traffic per smartphone will increase and is expected to reach 53 GB per month in 2030. In India, for example, 5G users have been consuming approximately 3.6x as much mobile data compared to 4G since October 2022, according to Nokia’s MBiT 2024 report. Furthermore, as countries in the region progress with their digital nation agendas, new services could result in faster growth in mobile data traffic’.

“There's a lot that's very wrong with this. Firstly, those migrating early to 5G are invariably the high data users. So what happens is that it looks like 5G users have a much higher usage than 4G initially but actually the average stays the same and as more 4G subscribers move across the multiple drops. Plenty of studies in countries where almost all users are on 5G show there is no ‘5G effect’. And then what are these ‘new services’? We've certainly not seen them in more developed countries."

GSMA and Ericsson aren’t the only organisations to forecast perpetual mobile data growth but, as Webb recently told Light Reading “there is only so much data that a mobile subscriber can consume.” Since the mobile data-enabled handset market is nearing saturation in most regions, the assumption seems to be that each user will constantly increase their data consumption, but what form will that take? More video? Something to do with AI? It’s not at all clear.

While it’s understandable that organisations with a direct interest in the growth of the mobile industry will wish it well, they don’t do themselves any favours by issuing implausibly optimistic forecasts. “It looks to me like GSMA has its head in the sand over data growth rates, as does Ericsson,” said Webb. “Sadly neither can be trusted to provide unbiased and justified forecasts.”