Global mobile connections to surpass 6 billion by year-end - Latest billion connections added in just 16 months; Asia-Pacific to account for 50% of global total

Total global mobile connections are set to surpass 6 billion by year-end, according to the latest GSMA Intelligence forecasts, a landmark which would mean the industry has added the last 1 billion connections in just 16 months. GSMA Intelligence estimates that the 6 billion milestone will be reached in late November and that total global connections will end the year at 6.07 billion.

The latest census estimates predict that the world’s population will also reach a major milestone soon, surpassing 7 billion people worldwide in October 2011. This implies a global mobile penetration rate of 86 percent, up from 74 percent at the 5 billion connections point.

Our forecasts for Q4 2011 include a number of other milestones. Global growth is being driven by the Asia-Pacific region, which will rise to account for 50 percent of all connections by year-end, up a percentage point from Q2 2011. Almost two-thirds of the Asia-Pacific total relates to China and India, the two largest mobile markets in the world, which are both on track to each hit 1 billion connections early next year.

Six of the world's top ten largest mobile markets will be located in Asia-Pacific by this point. As well as China (#1) and India (#2), these include Indonesia (#4), Vietnam (#7), Japan (#8) and Pakistan (#9). Also in Q4, Africa is set to overtake the Americas as the second-largest regional market on 648 million connections (11 percent of the total). Africa is forecast to record the strongest year-on-year connections growth of all the global regions, rising 18 percent over the previous year. The quarter will also see Eastern Europe overtake Western Europe in terms of connections. Western Europe is forecast to record the weakest year-on-year growth, up just 3 percent. The 5 billion global connections milestone was reached in July 2010, and came 18 months after the 4 billion mark was reached at the end of 2008. The mobile penetration rate on a global basis at the 5 billion mark was 74 percent, compared to 60 percent at 4 billion.

On a technology basis, GSM is expected to account for 73 percent of global connections in Q4, followed by WCDMA/HSPA (16 percent) and CDMA (9 percent). Other technologies – including LTE – will account for the remaining 2 percent. The main trend seen between the 5 billion and 6 billion connections milestones has been the ongoing growth in WCDMA/HSPA connections, which were up from 12 percent of the total at 5 billion and from 8 percent at 4 billion. GSM still accounts for the vast majority of connections in emerging regions such as Africa, Eastern Europe and the Middle East. However, its share in more developed markets is shrinking as customers migrate to the WCDMA family of technologies, the primary migration path for GSM operators. The global share of GSM connections (73 percent) was down 5 percentage points from the 5 billion point.

Joss Gillet, Senior Analyst, GSMA Intelligence:

Developing economies are largely driving global growth, representing close to 80 percent of global mobile connections. In 2012, we expect these countries to contribute over 40 percent of global revenues - compared to 33 percent four years ago – passing 5 billion connections and 100 percent market penetration. Such growth in the developing region is offsetting declining trends seen in developed economies – particulary in Europe where operators' revenues have been negatively impacted by market saturation and regulatory measures. However, connection figures and penetration rates across the world are inflated by multiple connections per user and the large shares of inactive connections that are often included in reported figures. Our recent study of the Indian market showed that 30 percent of the country's total market size is redundant, while we estimate that 'real' penetration in Western Europe is closer to 90 percent than the reported 132 percent. By this yardstick, our recent studies also show that metrics such as ARPU and MoU on a per user basis are actually following more positive trends than the virtually flat growth implied in the reported data.

Global mobile connections (forecasts) Q4 2011
Source: GSMA Intelligence