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Video Continues to Be a Key Factor in US Mobile Data Use

TMCnet Feature

February 26, 2014

Video Continues to Be a Key Factor in US Mobile Data Use

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By Rory Lidstone
TMCnet Contributing Writer

Global mobile data traffic is on the rise, with one Cisco report predicting there will be about 5.2 billion people on earth using mobile phones. But it’s not just the sheer number of mobile users driving data usage up, it’s also the kinds of data those users prefer. This is according to new mobile industry research from Parks Associates (News - Alert).


Currently, around 29 percent of U.S. broadband users watch video on a mobile phone monthly, with the average user watching 1.7 hours of video on a mobile phone each week. With video being one of the most bandwidth-intensive applications out there, it’s no surprise this is having a pronounced effect on network operators — but not a necessarily negative one.

"Since 2008, revenues from voice services for the top-four U.S. mobile network operators (MNOs) have declined six percent, while data revenues have grown 129 percent," said Harry Wang, director of Health and Mobile Product Research at Parks Associates, in a statement. "Mobile data revenues will be key to offsetting stagnant growth in voice revenues. Most major MNOs worldwide are transitioning or have already adopted tiered or shared usage-based data plans, and they will continue to experiment with pricing models to optimize the revenue-generation potential of mobile data access."

Indeed, many MNOs face increasing competition from OTT providers of messaging and multimedia value-added services (VAS) particularly. In fact, a recent report from Juniper Research (News - Alert) suggests that OTT apps now account for 75 percent of mobile messaging traffic.

As a result, revenue from these sources is declining. Fortunately, MNOs can combat this by launching their own OTT services, partnering with OTT service providers or, best of all, bundling VAS services with data plans.

Other findings from the Parks Associates report include that the number of people in North America who watch mobile video and TV shows on mobile devices on a weekly basis will increase to 173 million by 2017. Meanwhile, smartphone ownership will top 300 million by the end of 2016.




Edited by Blaise McNamee


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