The digital transformation we are witnessing across most industry sectors and throughout the world presents a clear opportunity for players from across the mobile ecosystem. The challenge is to seize the opportunity and to respond through service innovation. Against the backdrop of a renewed and flexible regulatory environment, consumers and society as a whole will reap the benefits of significant technological and socio-economic development.
1. INDUSTRY OVERVIEW
2015 has been a year of continued growth in the mobile industry, with more than 7.6 billion mobile connections (representing 4.7 billion unique subscribers) and operator revenues of more than $1 trillion. The acceleration of 4G has been a major highlight; the global 4G connection base passed the 1 billion mark in late 2015. 4G networks are now available in 151 countries across the world.
The global subscriber penetration rate now stands at 63%. However, overall subscriber growth rates continue to slow, due to saturation in developed markets and the difficulties of connecting low-income populations in developing markets. The global subscriber base will reach 5.6 billion by the end of the decade.
2. MOBILE DRIVING GROWTH
In 2015, the mobile ecosystem generated 4.2% of global GDP, a contribution that amounts to more than $3.1 trillion of economic value added, a figure that will reach $3.7 trillion by 2020. In addition, the mobile ecosystem directly provided employment to nearly 17 million people, and indirectly supported an additional 15 million jobs in other sectors of the world economy. The industry also contributed $430 billion in general taxation, with a further $90 billion paid through spectrum auctions.
The third quarter of 2015 showed the largest amount of venture-capital activity on record into the mobile sector. The high levels of investment into the mobile ecosystem will further fuel the rapid pace of technological and service innovation, with new companies continuing to emerge and scale rapidly.
3. MOBILE ADDRESSING SOCIAL CHALLENGES
Mobile technology plays a central role in addressing a range of socio-economic developmental challenges across the developing world, particularly digital and financial inclusion. This will drive economic and infrastructure development, increasing productivity and employment across the economy, as well as improving access to vital services such as education and healthcare.
The mobile money industry is now widely established, bringing financial inclusion to a growing number of previously unbanked and underbanked populations across the developing world. At the end of 2015, 2.5 billion individuals across the developing world were accessing the internet through mobile devices, a figure that will increase by more than 1.3 billion by 2020. However, more than 40% of the population in the developing world will still lack internet access by the end of the decade
4. RETHINKING REGULATION
Although digital convergence is benefitting consumers, it also creates regulatory challenges. Rapid innovation in terms of both technology and business models is blurring the boundaries between once-distinct markets and regulatory regimes. The net result is a complex and dynamic digital ecosystem in which both consumers and businesses face regulatory uncertainty.
Policymakers all over the world are working to implement reforms that will protect competition and consumers without impeding social and economic progress. In most markets, regulatory policies and institutions need to be reviewed, and potentially overhauled. A new regulatory framework needs to be cost-effective, as well as flexible to allow markets and technologies to evolve while preserving and enhancing regulators’ ability to achieve their objectives.