NORTH
EAST ASIA
ERICSSON MOBILITY REPORT
NOVEMBER 2015
Market Overview
Key figures: North East Asia
2015
2021
CAGR 2015–2021
Mobile subscriptions (million)
1,560
1,850
3%
Smartphone subscriptions (million)
1,260
1,750
5%
Data traffic per active smartphone (GB/month)
0.8
6
40%
Total mobile traffic (EB/month)
1.4
11
40%
The North East Asia region consists of Mainland China, Japan, South Korea,
Taiwan and Hong Kong and represents 22 percent1 of the world’s population.
Mainland China and Japan are currently the second and third largest consumer
markets in the world after the US. For mobile subscriptions, Mainland China,
Japan and South Korea are currently in the top four global LTE markets
The North East Asia region is a useful testing ground for
new telecom technologies, like 5G, with deployments taking
place in ultra-dense areas, both in terms of data volume and
the number of subscribers.
In Mainland China, LTE networks have been growing rapidly
and many LTE devices have been launched. Currently,
Mainland China is the largest LTE market in the world,
surpassing the US in 2015. As more people adopt mobile
devices, the number of LTE subscriptions in the country is
estimated to reach around 1.2 billion by the end of 2021.
This will represent approximately 25 percent of total global
LTE subscriptions.
Japan is expected to have 90 million LTE subscriptions
by the end of 2015. All operators have launched carrier
aggregation of LTE-Advanced in order to provide a better
user experience, and pave the way for 5G technology
by 2020.
In South Korea, LTE is expected to represent 80 percent
of total subscriptions at the end of 2015. The country’s
mobile connection speed is evolving. With tri-band carrier
aggregation of LTE-Advanced, South Korea has the fastest
mobile network service available globally – four times faster
than standard LTE. It has set itself a target to launch
pre-standard 5G technology in time for the PyeongChang
2018 Winter Olympics.
1
United Nations, World Population Prospects: The 2015 Revision
2 ERICSSON MOBILITY REPORT NORTH EAST ASIA NOVEMBER 2015
Taiwan has a long-term commitment to deploy new
technologies. The Government’s 4G mobile broadband
smart city plan promotes LTE adoption. An objective of this
3 year project is to increase GDP by USD 2.3 billion, and the
expansion of LTE services is seen as a key contributor in
achieving this.
The North East Asia region is a useful testing
ground for new telecom technologies
VIDEO IS GOING MOBILE
In many markets, video makes up the largest proportion of mobile data
traffic, and globally it is expected to grow around 14 times up until the
end of 2021. The same trend is visible in the North East Asian markets
New TV and media services and more video-capable
devices are prominent factors in the rapid growth of video.
User behavior is also changing, resulting in video being
consumed in larger quantities – including when people
are out and about – and on all types of devices. Globally,
as many broadband users say they watch streamed
on-demand video/TV at least once a week as those who
say they watch scheduled linear TV. In Mainland China,
41 percent of all viewing is on-demand, and the number of
hours spent watching streamed on-demand videos per week
has increased by more than 5 hours compared to 2011. For
markets like Taiwan, this trend is even clearer. In 2014, the
proportion of people who stream on-demand content had
already overtaken broadcast TV among internet users. The
daily usage of streaming content continues to grow in 2015.2
TV and video content is increasingly being accessed via
mobile devices such as smartphones, tablets and laptops.
This has seen the global ratio of traditional to mobile
device-based TV/video-watching change over the last
5 years, from 70/30 to closer to 50/50. In Mainland China
and Taiwan, more than 80 percent of smartphone users
watch videos on their phones, and more than 50 percent
of total weekly viewing time is spent on mobile devices. 2
Viewing of different media types at least once per
day (self-reported frequency of viewing), Taiwan
Streamed on-demand
(YouTube, short clips, movies,
TV series and programs)
Scheduled linear TV
Recorded linear TV
Smartphone viewing continues to be driven by shorter
videos, whereas tablets are preferred for longer video
content. Even though Wi-Fi caters for a significant share
of TV and video data traffic, in a market like South Korea,
mobile data accounts for 20 percent of video viewing
consumption on smartphones. 4G users consume four times
the amount of data through TV and video viewing than
3G users.2
In a few years, the internet TV era will be firmly embedded.
The Networked Society will bring dramatic fragmentation
to the television experience, creating challenges and
opportunities for operators, service providers, content owners,
broadcasters and investors. Meeting rapidly changing
consumer demands will require ever-better streamlined
experiences and diversity in content and delivery.
Share of estimated total weekly TV/video viewing time
per year on respective devices
Tablet screen
Desktop screen
Smartphone screen
TV screen
Laptop screen
100%
90%
80%
75%
70%
60%
Smartphone,
tablet and laptop
50%
50%
40%
25%
30%
20%
0%
2010
2011
2012
2013
2014
2015
Source: Ericsson ConsumerLab, TV and Media 2015
Base: At least weekly viewers of TV/video with broadband at home,
Taiwan (three years moving average for showing the trends)
2
Ericsson ConsumerLab, TV and Media 2015
10%
TV screen
and desktop
0%
Global
Mainland
China
Taiwan
Source: Ericsson ConsumerLab, TV and Media 2015
Base: At least weekly viewers of TV/video with broadband at home
NORTH EAST ASIA NOVEMBER 2015 ERICSSON MOBILITY REPORT 3
Mobile subscriptions
The number of mobile subscriptions is growing in North East Asia. The total mobile
subscriptions in the region is expected to be around 1.6 billion at the end of 2015,
which is around 20 percent of the global market. This will grow at a Compound Annual
Growth Rate (CAGR) of 3 percent, reaching around 1.8 billion subscriptions in 2021
LTE subscriptions are exploding
In North East Asia, LTE subscriptions are expected to
reach almost 500 million at the end of 2015. Migration from
3G to 4G has accelerated in Japan, Mainland China and
South Korea. Globally, these markets are among the top
four that use LTE. In Mainland China, LTE subscriptions
are expected to reach around 350 million by the end of
the year, accounting for close to 35 percent of all LTE
subscriptions globally.
Despite starting late with LTE in the region, Taiwan
experienced very fast uptake of the technology. By the
end of September – 16 months after the first commercial
network launch – Taiwan had gained more than 9 million
LTE subscriptions, comprising around 30 percent of total
mobile subscriptions according to NCC. This growth is set
to continue, with a total of 11 million LTE subscriptions
expected by the end of 2015.3
The number of smartphone subscriptions in the region is
predicted to increase at a CAGR of 5 percent between
2015 and 2021 to 1.7 billion. As a result, more than
95 percent of handsets will be smartphones in 2021.
Mobile subscriptions, North East Asia (million)
Mainland China will account for close
to 35 percent of all LTE subscriptions
globally by the end of 2015
LTE/5G subscriptions, North East Asia (million)
LTE/5G subscriptions
Mainland China
Japan
Other
South Korea
Rest of RNEA
1,600
2,000
1,400
1,200
1,500
1,000
800
1,000
Mainland China,
Japan and South Korea
are among the top four
markets worldwide
using LTE
600
500
400
200
0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
3
National Communications Commission, Taiwan
4 ERICSSON MOBILITY REPORT NORTH EAST ASIA NOVEMBER 2015
0
2011
2013
2015
2017
2019
2021
Mobile traffic
Total mobile data traffic in North East Asia is expected to be
around 1.3 Exabytes per month at the end of 2015, of which
almost 1 Exabyte per month will come from smartphones
On average, total mobile traffic in the region will grow by
40 percent each year between 2015 and 2021, increasing
a total of 8 times. Mobile data traffic in North East Asia is
expected to reach 11 Exabytes per month in 2021. Voice
traffic will grow on average by two percent each year over
the next six years. In 2021, 99 percent of the region’s mobile
traffic will be from data.
99%
In 2021, 99 percent of the
region’s mobile traffic will be
from data
Increasing data traffic in China
Mainland China currently has the lowest data consumption
in North East Asia, due to a high number of 2G subscriptions.
However, the data traffic in Mainland China is increasing with
the introduction of LTE. Currently, Chinese consumers are
rapidly changing to 4G, with nearly 90 percent of devices
sold being 4G capable.4 Data traffic in Mainland China is
set to grow 55 percent per year between 2015 and 2021.
Mobile traffic, North East Asia (monthly PetaBytes)
Voice
Data
12,000
10,000
8,000
High smartphone and LTE penetration rates drive data
The increase of data traffic is accelerated by high smartphone
and LTE penetration rates. Markets already advanced in
these technologies, such as Japan and South Korea, will
continue to have rising data traffic due to the growth of
mobile video.
6,000
4,000
2,000
0
2011
2013
2015
2017
2019
2021
Mobile data traffic, North East Asia, split per device
(monthly PetaBytes)
Mobile PCs, tablets and mobile routers
Smartphones
12,000
10,000
8,000
6,000
4,000
2,000
4
CAICT report and GSMA Intelligence (2015)
0
2011
The increase
of data traffic is
accelerated by high
smartphone and LTE
penetration rates
2013
2015
2017
2019
2021
NORTH EAST ASIA NOVEMBER 2015 ERICSSON MOBILITY REPORT 5
Network
performance
The growing demand for video streaming is illustrated by the high mobile traffic
usage per smart device in North East Asian networks. Therefore, video streaming
service quality is important in achieving high customer satisfaction
The demand for a great visual experience has driven
innovation in video compression, display technology and
application processors for smart devices. 4K devices are
being introduced in the market and are growing in popularity.
They are able to capture 4K Ultra High Definition (UHD)
video, and soon users will expect to be able to send and
receive 4K content over mobile networks.
Probability of user downlink speed ≥20 Mbps
53%
g
S
on
H
h
ut
So
pa
Ko
n
g
ea
Ko
r
an
w
Ta
i
ai
n
C lan
hi d
na
24%
Source: The analysis was performed by Ericsson based on Ookla’s
Speedtest Intelligence Data from Speedtest.net, Q2 2015
Operators’ ongoing efforts to evolve their mobile broadband
networks through technologies like LTE-Advanced, carrier
aggregation and performance optimization, will continue to
contribute to an improved user experience. Advanced LTE
operators have acknowledged the importance of network
capacity and performance in meeting the demands of a high
bitrate network and increased data usage.
Probability of user experience speed in multiple
mobile broadband networks
100%
Downlink throughput ≥ 20 Mbps
M
The graph to the right shows North East Asian networks that
were analyzed to determine the probability of experiencing a
downlink throughput equal to, or greater than 20 Mbps. User
experience varies widely between countries. In Mainland
China there was a 53 percent probability of experiencing this
speed within the duration of the analysis, while in Japan it was
only 25 percent. This difference is mainly due to the timing of
LTE roll-outs.
25%
U
31%
To support the smooth streaming of 4K video content,
a high-speed network is needed, with a downlink speed
requirement of up to 20 Mbps.
n
39%
Ja
44%
80%
The chart to the left is based on the user experience speed
across multiple mobile broadband networks in North East
Asia, South East Asia and the United States. It gives a
picture of the positioning of operators in building app
coverage to meet service requirements. The results are
benchmarked against a downlink throughput greater than
5 Mbps and 20 Mbps.
60%
40%
20%
0%
0%
20%
40%
60%
80%
100%
Downlink throughput ≥ 5 Mbps
Source: The analysis was performed by Ericsson based on Ookla’s
Speedtest Intelligence Data from Speedtest.net, Q2 2015
6 ERICSSON MOBILITY REPORT NORTH EAST ASIA NOVEMBER 2015
Based on the analysis, a leading North East Asian network
has been ranked best among the benchmarked operators,
having achieved downlink throughput greater than 5 Mbps
for 85 percent of users, and greater than 20 Mbps for almost
60 percent of users. The differences in achievement can be
explained by the total bandwidth available, the maturity of
the LTE-Advanced deployment and optimization efforts.
Population
coverage
Mobile network coverage in North East Asia is constantly increasing.
WCDMA/HSPA coverage is very high, accounting for around 95 percent
of the total population in the region. GSM/EDGE coverage, however,
has only increased slightly, as Japan and South Korea do not have it
Since LTE was launched, operators have started to focus
on LTE population coverage, especially in Mainland China.
By 2021, LTE population coverage is forecast to be on par
with WCDMA/HSPA.
South Korea and Japan expand LTE-Advanced
to offer faster speeds
In parallel to building out LTE population coverage,
operators in South Korea and Japan are also expanding
their LTE-Advanced services, including carrier aggregation
for faster speeds. The focus is shifting from population
coverage to app coverage, as the number of smartphone
users increases and the usage of different apps grows.
App coverage for any given app is the geographical area
within which a mobile broadband network delivers sufficient
performance for a good user experience. To achieve
satisfactory app coverage, it is also vital to improve indoor
network performance.
Population coverage, North East Asia
~85%
2014
2021
GSM/EDGE
>85%
~95%
2014
2021
~75%
2014
2021
>95%
WCDMA/HSPA
LTE
>95%
In 2021, LTE population coverage
will be on par with WCDMA/HSPA
NORTH EAST ASIA NOVEMBER 2015 ERICSSON MOBILITY REPORT 7
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