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Global Mobile Data Usage Shoots Up

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By: Sam Quest
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Data usage per consumer in the US jumped from an average of 690 MB per month in 2012, to 1.2 GB this year. At the same time, global data consumption grew over 70%, recording an average monthly data consumption of 240 MB per user. The report, released by industry expert and consultant, Chetan Sharma, is based on data consumed over wireless networks and does not include Wi-Fi usage on mobile devices.

The report cites increasing smartphone penetration, faster networks, and ever-evolving cell phone technology which have fuelled the demand for data.

Increasing availability of cell phones and expanding global coverage has led to growth in the number of data subscriptions, which are now almost at par with the global population figures; in fact, 2014 is expected to be the year when the number of active mobile connections actually surpasses global population numbers.

Data usage, which has been the key driver behind mobile growth, has revitalized the telephony industry; the demand is only expected to grow going forward. A Cisco Systems, Inc. (CSCO) report expects mobile data consumption to exceed wired PC data consumption by 2016.

With the emergence of smartphone juggernauts like Apple’s (AAPL) iPhone and Samsung Electronics’ (SSNLF) Galaxy line of products, device manufacturers will continue to further push the boundaries and capabilities of technology. Smartphone penetration already exceeds 60% in the US; global smartphone users, according to ABI Research are close to 1.5 billion. If smart phone shipments, which have increased by a 5-year CAGR of 42.5%, are any indication, the trend should continue well in to the future.

The devices alone, however, are not the only reason for the growing demand for data. Customers are increasingly adopting services such as Instagram, SnapChat, and Youtube - all these demand higher data consumption. In order to accommodate increasing traffic and volume, wireless carriers around the world continue to upgrade their networks and coverage.

Long Term Evolution (LTE) is the most rapidly expanding network technology in the wireless industry history. Most developed nations are already on 4G LTE networks, but there is lots of room to grow before the market is saturated, and the US is adopting 4G LTE at a faster rate than any other country. Emerging nations, in the meantime, are still in the process of switching over to 3G networks. All of this will result in more data intensive apps, leading to higher data usage globally.

If the trend continues in the US, Sprint Corp. (S) and T-Mobile US (TMUS) stand to benefit more than industry giants, AT&T Inc. (T) and Verizon Communications Inc. (VZ). This is because Sprint and T-Mobile both offer unlimited data usage on their plans, while AT&T and Verizon put limits on how much data can be consumed.

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