Report: Smartphone boom will allow PH to hit 40% LTE penetration by 2018

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Although the Philippines currently has a low smartphone penetration rate of 40 percent, the country is expected to hike its smartphone subscriptions to around 70% by 2018.

This increase in smartphone adoption will in turn push the Philippines to reach a LTE subscription rate of 40 percent by 2018 ? the third highest after tech powerhouses Australia and Singapore in the Southeast Asia and Oceania region.

Analysis performed by Ericsson based on Ookla speedtest data showed that the peak mobile Internet speed in the Philippines is 13Mbps while the average speed is 2Mbps. This is at par with the speed with rest of the region except for Singapore and Australia which have substantially faster speeds, according to Ericsson Philippines head Sean Gowran
Analysis performed by Ericsson based on Ookla speedtest data showed that the peak mobile Internet speed in the Philippines is 13Mbps while the average speed is 2Mbps. This is at par with the speed with rest of the region except for Singapore and Australia which have substantially faster speeds, according to Ericsson Philippines head Sean Gowran

This is according to the latest edition of the Ericsson Mobility Report, which also showed that more than 75 percent of people in the Southeast Asia and Oceania region will have access to LTE networks by 2021.

The report said LTE/5G subscriptions in the region is forecast to gain momentum and surpass 500 million by 2021, driven by 3G migration and new services like VoLTE (Voice over LTE).

Sean Gowran, head of Ericsson Philippines and Pacific Islands, said take-up of smartphones will intensify now that mobile operators have rolled out their LTE networks.

?This year, smartphone subscription penetration for the country is estimated at around 40 percent and we see this growing to around 70 percent by 2018. UN data states that the urban population of the country is at 44 percent level, so we can expect that by 2018 smartphone subscription penetration will exceed the urban population.

With the continued rise of smartphones and an accelerated growth in data usage, the total mobile data traffic in the region is seen to increase 14-fold by 2021, the study indicated.

With a growing mobile broadband traffic, more consumers are migrating to higher data volume packages. In 2015, 40 percent of consumers in the region are subscribing to 2.1-5GB mobile broadband plans, compared to 30 percent in 2014.

However, in the Philippines a higher percentage of consumers — almost 60% — are subscribing to 2.1-5GB mobile broadband plans, compared to around 40% in 2014.

The report also noted that of the Philippine consumers who have a mobile broadband volume package, around 40 percent utilize less than 50 percent of their plan allocation and 20 percent of consumers use more than 100% of their allocation.

Gowran said: ?The study shows that subscribers are consuming more data than ever before and that they are subscribing to larger volume packages. We expect that consumers who underutilize their subscription packages will have a lower perception on the value for money of the package from the service provider. The challenge is that this may lead to churn. This signals an opportunity for operators to reduce churn proactively recommending the best packages that match their subscribers? usage pattern.?

The report also stated that the countries in the region with the best network performance are Australia and Singapore, due to their leadership in deploying LTE and LTE Advanced.

The Philippines did not fare badly in the analysis performed by the Swedish telecom equipment maker as it logged a 2-Mbps average mobile broadband speed ? which is par with its regional neighbors except Singapore and Australia.

The Ericsson report showed that data-intensive applications, such as HD video streaming, could easily be delivered by mobile networks in Singapore and Australia across the whole coverage area. LTE carrier aggregation in Australia has enabled possible peak download speeds of up to 600 Mbps.

?Similar applications could be a challenge for operators to deliver in developing countries, although we expect developing countries? networks to greatly improve in performance over the coming years,? the report said.

?In addition, with the next wave of new smartphone users expected to come from rural and remote areas, the challenge will be how to deliver a similar mobile broadband experience to these populations in a cost-effective way,? it added.

The report also observed that operators are growing their mobile business in a number of ways, for example, by capitalizing on the rapid uptake of mobile data and exploring ways to improve their share in the ICT value chain.

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