Asia Pacific to add 600mil new mobile subscribers by 2020: GSMA study

By Digital News Asia July 6, 2016

Mobile ecosystem adds US$1.3 trillion in economic value to APAC economy
The four largest markets in the region are China, India, Indonesia and Japan

Asia Pacific to add 600mil new mobile subscribers by 2020: GSMA study

THE number of mobile subscribers in the Asia Pacific region reached 2.5 billion at the end of last year and will grow to 3.1 billion by 2020, according to a new GSMA study unveiled at GSMA Mobile World Congress Shanghai.

The new report, The Mobile Economy: Asia Pacific 2016, finds that 62% of the Asia Pacific population was subscribed to a mobile service in 2015, and this forecast to rise to almost three-quarters of the population by 2020 as a further 600 million new subscribers are added over the period, the GSM Association (GSMA) said in a statement.

It is calculated that mobile technologies and services made up 5.4% of Asia Pacific’s GDP (gross domestic product) last year, equivalent to US$1.3 trillion in economic value – this economic contribution is set to increase to US$1.7 trillion by 2020.

“More than half the world’s mobile subscribers are based in Asia Pacific and the region will be the main engine of global subscriber growth for the remainder of the decade,” said GSMA Director General Mats Granryd.

“Rising subscriber penetration, alongside accelerating migration to faster networks and more advanced services, continues to fuel innovation and digitisation across both advanced and emerging markets in this highly diverse region.

“Mobile is helping Asia build digital societies that allow its citizens to access services, anytime and anywhere – and these mobile-powered digital societies are becoming major drivers of social and economic development,” he added.

Growth across the board

Asia Pacific will account for 60% of the one billion unique mobile subscribers that will be added to the global total by 2020, with the region continuing to add subscribers at a faster rate than the global average, the GSMA said.

The four largest markets in the region – China, India, Indonesia and Japan – together accounted for more than three-quarters of the region’s total subscriber base.

India alone is expected to add nearly 250 million new subscribers by 2020 but smaller countries in the region such as Bangladesh, Indonesia, Myanmar and Pakistan will also make major contributions to subscriber growth.

Mobile broadband (3G/4G) accounted for 45% of total mobile connections in Asia Pacific last year, forecast to rise to 70% by 2020 as operators continue to invest in 4G (Fourth Generation) network build-outs and subscribers migrate to higher-speed networks.

4G is on track to account for more than a third of total connections in Asia Pacific by 2020, according to the GSMA.

At the end of 2015, the region had 76 live 4G-LTE (Long-Term Evolution) networks and 20 live VoLTE (Voice-over-LTE) networks.

According to the report, 4G migration is now gathering pace in markets such as Indonesia, Malaysia, the Philippines and Thailand.

Meanwhile, the region’s 4G pioneers – such as South Korea, Japan and China – are driving the development of 5G mobile technologies in readiness for deployments before the end of the decade.

The number of smartphone connections in Asia Pacific totalled 1.7 billion at the end of 2015, accounting for 45% of regional connections.

China, India and Indonesia have been the main drivers of smartphone growth, helping the region double its overall smartphone base over the last two years, the report said.

The region will add a further 1.3 billion smartphone connections by 2020, reaching three billion, or two-thirds of the region’s total connections base, by that point.

Rising contributor to the Asian economy

The US$1.3 trillion in economic value generated by the Asia Pacific mobile industry last year is expected to rise to US$1.7 trillion by 2020 as the region continues to benefit from the improvements in productivity and efficiency made possible by increased take-up of mobile services and the adoption of new technologies such as machine-to-machine (M2M), said the GSMA.

The mobile ecosystem in Asia also supported 15 million jobs in 2015. This includes workers directly employed in the ecosystem and jobs that are indirectly supported by the economic activity generated by the sector.

In addition to the mobile sector’s impact on the economy and labour market, it makes a substantial contribution to public sector funding; approximately US$111 billion was raised in the region last year via general taxation.

Asia’s mobile industry is also playing a leading role in delivering digital inclusion and addressing the digital divide. According to the report, there were 1.8 billion citizens across Asia Pacific accessing the Internet over mobile devices at the end of last year, equivalent to 45% of the region’s population.

It is predicted that a further 800 million people in Asia will connect to the mobile Internet by 2020 (63% of expected population).

As a result, mobile has become a platform that enables digital identity, financial inclusion, and a range of social and developmental services that are helping to deliver the United Nations’ Sustainable Development Goals (SDGs).

“Mobile is the primary tool for extending connectivity and Internet access to all corners of Asia, delivering a myriad of economic and social benefits,” said Granryd.

“But there is still work to be done. The mobile industry must work with regulators and ecosystem players to address the key barriers to digital inclusion in Asia Pacific, such as lack of locally relevant content, affordability and a lack of digital skills,” he added.

The new report, The Mobile Economy: Asia Pacific 2016, is authored by GSMA Intelligence, the research arm of the GSMA.

To access the full report, go here. Click the infographic below to enlarge.