mobile traffic forecast

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Long-Term Mobile Broadband Traffic andSubscription Forecasts

Kjell Stordahl

The 31th International

Symposium on Forecasting

Prague, 26-29 June, 2010



Outline

• Long-term mobile broadband traffic forecasts for

Western Europe

• Traffic drivers

• Limited data, short time series

• Available statistics

• Traffic truncation because of limited capacity

• Forecasting approach

• Conclusions



Mobile broadband traffic

forecasting. Why?

• The forecasts are crucial for:

- dimensioning

- planning

- investment strategies- rollout of MBB networks

- revenue and business case analysis

- establishing bid strategies for new mobile

spectrums• The forecast are crucial especially because the

radio part of the investments is extremely heavy



Mobile broadband:

Drivers for traffic evolution

•

Increased number of mobile devices, Mediaplayer,Ebook, Game consol, iPhone and other Smartphones,

Tablets, Notebook

• Increased traffic from mobile devices

- application usage- video

- file sharing

• Larger screens

• Higher speed

• New habits, social networks, ---

4



Mobile broadband and the data traffic

Type of data traffic

• Large screen contracts

(Laptop, Tablets, Notebook - )

• Small screen with exclusive data contracts

(Smartphone, Feature phone, - )

• Small screen voice and data contracts

(Smartphone, Feature phone, - )

• Pay as you go data traffic without contracts

(All devices)

• Home gateway and hotspots

• M2M (Machine to Machine) data contracts



Mobile broadband traffic forecasts

The mobile broadband traffic forecasts are calculatedbased on the evolution of:

- Number of MBB subscribers

- Traffic per MBB subscriber

The mobile broadband traffic forecast is expressed as:

Forecasts of number of MBB subscriptions

Multiplied by

Forecasts of traffic per subscription

The traffic forecasts are either traffic in GB per month

or traffic in Kbps in the busy hour per subscription



Mobile broadband penetration

2006 – 2009, Western European countries.

Copyright: Informa UK limited

0 %

5 %

10 %

15 %

20 %

25 %

Q3

2006

Q4

2006

Q1

2007

Q2

2007

Q3

2007

Q4

2007

Q1

2008

Q2

2008

Q3

2008

Q4

2008

Q1

2009

Q2

2009

Q3

2009

Q4

2009

Finland

Sweden

Portugal

Austria

DenmarkSwitzerland

Spain

UK

Ireland

Norway

ItalyGermany

France

Netherlands

Belgium

Greece



Diffusion models for long-term mobile

broadband subscription forecasts

Logistic four parameters model:

Yt = M/(1 + e + t

)g

Yt is the accumulated demand at time t

M the saturation level

a level parameter

b, g growth parameters.



Mobile broadband - Large screen -

saturation level for Western Europe

MBB saturation

consumer market and

business market

PopulationOrdinarymobile

ShareMBB

PotentialMBB

PotentialMBB

Inhabitants 406.000.000 85 % 40 % 34,0 % 138.040.000

Employees 187.000.000 60 % 50 % 30,0 % 56.100.000

Total/mean 593.000.000 77% 43,2 % 32,7 % 194.140.000



Mobile broadband penetration

2006 – 2009, Western European countries.

Copyright: Informa UK limited

0 %

5 %

10 %

15 %

20 %

25 %

Q3

2006

Q4

2006

Q1

2007

Q2

2007

Q3

2007

Q4

2007

Q1

2008

Q2

2008

Q3

2008

Q4

2008

Q1

2009

Q2

2009

Q3

2009

Q4

2009

Finland

Sweden

Portugal

Austria

DenmarkSwitzerland

Spain

UK

Ireland

Norway

ItalyGermany

France

Netherlands

Belgium

Greece

Mean value



Mobile broadband penetration consumer

market and business market 2006 – 2009

Mobile broadband market saturation

Market Saturation

Consumer 34 %

Business 30 %

Separate forecasting models for

the consumer and business market

Input to the forecasting models:

Per inhabitants

Per employees

Market 2006 2007 2008 2009

Consumer 0,1 % 0,7 % 2,4 % 4,1 %

Business 0,6 % 2,3 % 4,5 % 6,4 %



Large screen penetration and subscription

forecasts for Western Europe, consumer

and business market

The forecasts are developed for a

Western Europe with 406 mill

inhabitants and 187 mill employees.

The MBB consumer and business

penetrations are calculated based onthese numbers



Large and small screen penetration

forecasts consumer and business market

The MBB penetration forecasts are

separated in large and small screen

subscriptions.

Here, it is assumed that small

screen contracts in the markets were

introduced in 2009.

Telenor introduced Small

screen contracts in 2009 and

reached roughly the same thesame penetration as Large

screeen in the middle of

2011in both markets



Large screen GB per month per

subscription Telenor’s network

Consumer and Business market



Tools for traffic reduction

• Subscription contracts limited to a maximum traffic volume

per month (Could be 5 GB or 10 GB)

• Traffic priority on different subscription types and vice

versa

• Automatic procedures for speed reductions for customers

who have exceeded the monthly traffic volume limits

• No speed guarantee

•

AT&T has dropped the flat rate principle and chargeaccording to the usage

• The reason:

Too expensive capacity upgrades



16

Basic

2G/3G

HSPA

14.4

HSPA

10.8HSPA

7.2

HSPA

3.6

HSPA

1.8

HSPA

20

HSPA

28

HSPA

80

LTE

HSPA

160

HSPA

42

Capacity

Technology

developmentBasicHSPA

New coding/antennas

Channelcombining

Channel

combining

2x4x

Technology

leap

MIMO

64-QAM

Both

SW Upgrades

HW + SW Upgrades

MBB system upgrades – sectors capacities



Monthly traffic in GB per subscription,

Scandinavian market

Market 2007 2008 2009

Consumer 1,04 2,08 2,29

Business 0,35 0,58 0,71



Traffic forecast in busy hour in Gbps

for the Large screen, small screen and

Pay as you go market



Traffic forecast in busy hour in Gbps

for the Consumer and business market



Total MBB traffic increase in busy hour

Increase relative to

the traffic level at the

end of year 2009

Yearly traffic increase

in % relative to last

year

Year Increase I

2009 100 %

2010 220 %

2011 417 %

2012 689 %2013 1044 %

2014 1453 %

2015 1907 %

Year Increase II

2009 125 %

2010 120 %

2011 89 %

2012 65 %2013 52 %

2014 39 %

2015 31 %



Conclusions

• The long-term traffic forecasts are crucial for MBB network planning,

dimensioning, investments and rollout

• Independent forecasting models based on number of inhabitants and

number of employees are developed and used for the MBB

penetration forecasts

• For the moment different strategies are used to reduce the MBB busy

hour traffic significantly

• The reason is too expensive investments in the radio part of the MBB

network

•The forecasts take into account continuous upgrading of capacitythrough (speed increase, frequencies, antenna sectors, LTE --)

• The forecasts indicate 1900% higher MBB traffic in 2015 compared

with 2009 for a medium size Western European country

mobile traffic forecast

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