Ericsson: 50% of all mobile traffic will be video by 2020

STOCKHOLM--Ericsson's (NASDAQ: ERIC) top executives painted a picture of the world in 2020 in which there will be 9 billion people on the planet, 9.1 billion mobile subscriptions and video traffic will dominate, accounting for at least 50 percent of all traffic on the network.

Speaking today at the Ericsson Business and Innovation Forum here, Ericsson CEO Hans Vestberg talked about how he believes the world is in the midst of a major technology revolution and that one of the challenges he faces is how to position his company so it will be relevant today as well as in the next 25 years.

"We are at an inflection point between the first phase and the second phase" of this revolution, he said, adding that the winners in the first phase are not necessarily winners in the second phase. "But we will transform and be relevant in both phases."

One way he is helping to position Ericsson and the telecom industry for the future is by making sure that organizations such as the United Nations understand the role Information, Communications and Technology, or ICT, will play in moving many different types of industries, such as healthcare, transportation and more.

Vestberg also talked about the importance of research and development in this time of transformation. That's why Ericsson has committed to investing $5 billion in R&D. Some of that is going toward the development of "5G" networks. 

Sara Mazur, vice president and head of Ericsson Research, noted that in July of this year Ericsson conducted a test in its lab and was able to reach speeds of 5-gigabits per second. The company is working with several partners to delve further into 5G technology and help develop a standard--and she emphasized the need for one 5G standard in order to avoid fragmentation and leave some without access to 5G.

Interestingly, Vestberg also showed a correlation between broadband penetration and a country's gross domestic product. Specifically, he said that doubling the broadband speeds can result in a 0.3 percent growth in GDP.

Mobile broadband traffic continues to escalate on the network and there appears to be no end in sight. According to Ericsson CTO Ulf Ewaldsson, mobile broadband traffic is expected to grow 10-fold by 2020 from 2 petabytes today to 20 exabytes in 2020. Because of this growth, Ewaldsson emphasized the need for more spectrum and more efficient use of existing. "Spectrum will become more valuable than oil," Ewaldsson predicted.

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