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Australians are consuming so much video and internet on their smartphones that mobile data usage is forecast to grow 32-fold from 2010 to 2015, according to the world’s largest provider of network equipment, Cisco Systems.

But as people look to use their smartphones for everything they could do on a PC, it remains to be seen whether the telcos’ networks will hold up. Two-thirds of the increase in usage is expected to come from mobile video.

The surge in mobile data usage – which has almost tripled every year for the last three years – caught many carriers off guard, with Optus’s network buckling under the weight of all of its iPhone users when the device first launched and more recently Vodafone’s network struggling with the surge in smartphone and mobile broadband users.

Kevin Bloch, chief technology officer of Cisco in Australia, said the figures – contained in Cisco’s Global Mobile Traffic Forecast – meant it was critical for telcos to continue upgrading their infrastructure or risk widespread issues.

“I think the risk is that they’ve got to continue to enhance their infrastructure to keep up with it,” he said.

The problem, Bloch said, was that telcos were being asked to invest more and more in their networks while also reducing their prices.

“They need to work out how to monetise this [extra mobile data traffic] otherwise they’re not going to be able to afford it … how do you continue to build up and invest to keep the consumer happy if you don’t have a revenue stream to fund that,” he said.

Bloch noted that now more smartphones were being sold than regular handsets and this coupled with a string of new devices like tablets and wireless broadband dongles was putting significant strain on networks.

Cisco forecasts that there will be 56 million mobile-connected devices in Australia in 2015, which is approximately 2.4 for every person.

In 2009, the average Australian smartphone used 41MB of data per month, and this grew to 119MB in 2010. By 2015, according to Cisco, each smartphone will generate 1548MB.

Soon, potentially in the next year or two, there will be more mobile devices than PCs, Block said. Smartphones generate 21 times more mobile data traffic than a basic handset.

“We’re going from a society of PCs based on Windows that has dominated the world for the last decade to a society of mobile phones running Android and iOS,” he said.

With the latest phones coming out this year offering powerful dual-core processors that are as powerful as PCs were just a few years ago, demand for mobile video streaming is only set to rise.

Mark Novosel, telco analyst at research firm IDC, said that unlike in the past he believed the telcos would be ready to meet the extra demand.

When Optus launched the original iPhone model in Australia, Novosel said, the telco had the most competitive plans by far and took the lion’s share of first-generation iPhone customers, and this occurred at the same time as the mobile broadband “revolution”.

“This was at a time when mobile data usage was very low compared to where it is today – I don’t think that the networks envisaged such a sudden onset of mobile data which really took them by surprise,” said Novosel.

“I think moving forward we won’t see the rapid onslaught of mobile data as we have in the past, so it will just be a steady increase over time; that’s something that the networks should be able to cope with quite well.”

Telsyte research director Foad Fadaghi said there was huge demand for video on mobile devices – such as live television – but today’s networks “can’t handle doing that to many concurrent people at the same time without a loss of quality”.

“I think that’s the experience globally, that what consumers generally want to do on their mobile phones far and away exceeds the capability of their networks particularly as the number of users has massively increased,” said Fadaghi.

A Telstra spokeswoman said: “We have understood that there is a data ‘tsunami’ heading our way and have been actively preparing for this for a number of years.”

A Vodafone spokesman said the company was continuing to plan for customers’ demand for data, including a project to build a new 850MHz network.

“This new network capability will be particularly good for smartphones and data devices and we are also rolling out additional network coverage to accommodate future demand from smartphone and mobile broadband customers,” the spokesman said.

“At the same time, we are also introducing new transmission improvements including IP enablement and continued fibre roll out to connect many of these new and extended sites and provide our network with improved data capacity.”


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