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Summary:

Smartphones will expand rapidly into the developing world, according to Ericsson, not only because devices will become cheaper. Cheaper data plan options and the economic benefits of mobile internet connectivity will help drive their proliferation.

In 2019 there will be 9.4 billion mobile subscriptions around the world, and 5.6 billion of them, or 60 percent, will be linked to a smartphone, according to new study by mobile network vendor Ericsson. If Ericsson’s predictions are true, that means we’re going to see a huge expansion of the smartphone in the developing world.

Currently smartphones account for 25 percent to 30 percent of global mobile subscriptions — totaling 1.9 billion devices at the end of 2013 — but they’re fastest growing segment of mobile device, representing 55 percent of devices sold in the third quarter, Ericsson found in its newest Mobility Report, which combines its own ConsumerLab trend research, metrics from its customers’ global networks and outside research data.

Ericsson Mobility 2013 Smartphone data

Today smartphones tend to be the playthings of rich countries and rich people in developing countries, but as smartphones proliferate they’ll become more accessible to a greater amount of the world’s poorer people. Smartphones will definitely become cheaper (they’ve already gotten cheaper), but that’s not the sole reason for their global spread, said Doug Gilstrap, Ericsson head of global strategy. One of the biggest expenses in owning a smartphone is the cost of data, and data plans are becoming far more accessible.

Gilstrap stopped short of saying the average cost of a gigabyte of data would become cheaper, but he pointed to the growing variety of data options, such as the tailored social media plans offered in many developing countries. By selling cheap access to services like email and social networks that use up relatively few network resources, carriers can make the mobile internet available at a much cheaper price point, Gilstrap said. As Wi-Fi becomes more accessible to people, particularly in urban markets, people can access more bandwidth-intensive services like video streaming that they normally couldn’t afford to access over cellular.

Ericsson Mobility 2013 total sunscriptions

But Gilstrap added that there is definitely a willingness for people in the lower socio-economic classes to pay more of their disposable income for mobile data services due to the benefits those services bring. In many parts of the world, the mobile internet is the only means people have of accessing the internet at all. Ericsson likes to cite the example of Indian fishermen using their mobile phones to find out the market price of fish in different markets before deciding to which port to take their catch.

Gilstrap’s point is that while data plans and devices will become cheaper, the economic benefits of owning a smartphone also justify spending a greater percentage of your income for connectivity. Just as owning and maintaining a car is key to getting a job in many parts of the U.S., owning a smartphone and maintaining a smartphone in Asia, Africa and the Middle East could be key to improving your lot in life.

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  1. To extrapolate the cell phone subscriptions beyond the population of the world… Does that mean 2 in 7 people will have a SECOND subscription? Feels like the curve should level off…

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