With global smartphone subscriptions reaching 5.6B by 2019, Ericsson turns to 'app coverage'

Ericsson (NASDAQ:ERIC) today released its latest "mobility report," predicting increases in the sale of smartphones and data traffic. But the company also turned its attention from the basic metrics of mobile users in order to cover the more nuanced problems encountered by smartphone-toting mobile subscribers.

"We see app coverage as fundamental in terms of customer end user experience," explained Doug Gilstrap, head of strategy for Ericsson. "Operators are moving from the macro to the micro to the in building solutions."

Specifically, Ericsson noted that a base station covering 4 square kilometers would be able to provide voice services to around 85 percent of indoor locations, mainly because voice calls only require 12.5 Kbps connections. However, under that same scenario an operator would be able to provide streaming video services to only 17 percent of indoor subscribers because a video streaming connection requires speeds of 720 Kbps.

Further, Ericsson used network speed test data from Ookla's Speedtest.net service to evaluate the "app coverage" in major cities across the world. According to the company's findings, Copenhagen showed by far the fastest speeds, at more than 1,500 Kbps, followed by Oslo and Seoul. Two American cities--Miami and New York--were in the middle of the pack, providing average speeds of around 320 Kbps.

Not surprisingly, Gilstrap noted that Ericsson's new line of in-building equipment would help operators provide suitable "app coverage" in buildings and other hard-to-reach locations. Gilstrap specifically pointed to Ericsson's new Radio Dot System, a miniature disk-shaped cellular radio that weighs only 300 grams and will be available commercially in late 2014.

More broadly though, Ericsson's Mobility Report provided forecasts on a number of major wireless industry measurements, derived from the company's management of around 100 wireless networks across the globe. Ericsson predicted that mobile subscriptions will near 9.3 billion by 2019, 5.6 billion of which will be for smartphones. The company also said that 90 percent of the world's population will be covered by WCDMA/HSPA in 2019, and 65 percent will be covered by LTE. In North America, LTE will represent the majority of subscriptions in the region in 2016, growing to around 85 percent in 2019.

Interestingly, Ericsson found that, in 2013, the total amount of wireless data traffic generated by mobile phones exceeded that from mobile PCs, tablets and mobile routers for the first time. The company attributed this to the shift in usage to smartphones, along with the devices' increasing screen size and utility.

As for the types of content people are accessing on mobile networks, Ericsson said that in 2013 around 35 percent of traffic was video, but that percent will balloon to more than 50 percent in 2019.

For more:
- see this release
- see this report (PDF)

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Ericsson forecasts 3-5% growth in network gear market in years ahead
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