Tefficient said usage growth rates decelerated in most markets and for the first time several markets have the end of the S-curve in sight
Scandinavian consulting and research company Tefficient said mobile data usage grew in every country year-on-year, with Saudi Arabia remaining the usage leader. However, growth rates have decelerated – Portugal saw the highest increase at 32%, while Croatia and Finland posted just 5%. The stats came in its latest public analysis of mobile data trends covering 39 countries – its 43rd report.
Data-only subscriptions, while limited in market share, continue to define average usage. Latvia led with 164GB per month in 2023, followed by Austria with 136GB per month in the first half of 2024. In pure FWA, Australia led with 498GB per month in 2023, followed by Sweden with 316GB in 2023 and Ireland with 313GB in the first half of 2024. Unlike data-only subscriptions, 5G’s impact on traffic remains limited, except in South Korea, Austria, and Saudi Arabia.
However, less-intense price competition and price rises across multiple countries seem to be having an impact on stabilising revenues for MNOs. Tefficient found that mobile service revenue per gigabyte continued to decline but at a slower pace, with Luxembourg seeing the sharpest drop, 22%.
Inflation-affected Turkey, however, again saw its revenue per gigabyte skyrocket. But this time Finland had an increase too – a first-ever for the country. “Encouragingly, 70% of markets saw ARPU growth aligned with higher data usage – a positive outcome in line with our previous edition of this analysis,” wrote the analysts.
Data usage
Tefficient omits M2M traffic – and explains in detail why – but noted that data usage is still growing year-on-year in all countries. A few countries flipped rankings but overall, the report suggests that for most markets, there was little usage growth in the first half of 2024. The markets with the lowest data usage in Figure 2 are New Zealand, Belgium, Germany, Czechia, the Netherlands, Portugal, and Hong Kong. There are only maximum twelve countries left with a usage lower than 10 GB per month among Tefficient’s 39. Some of these, like Portugal, showed faster usage growth, 32%, than e.g. the UK with just 11%.
While Portugal had the fastest growth in mobile data usage, Qatar is the number two in growth with 25%. Luxembourg is number three with 22%, closely followed by Lithuania with 21%. The mature markets of Croatia and Finland only saw 5%, while South Korea and Spain managed 6-8%.
The key here is that 15 of 23 countries (65%) had decelerating growth rate which Tefficient puts down to the end of the S-curve in mobile data usage development coming into sight. Its analysis showed strong correlation between the data-only share of a country’s SIM base and the average data usage.
“Finland, Lithuania, Austria, Poland, and Latvia are the data-only powerhouses of the world,” wrote Tefficient. Finnish statistics show that mobile networks carried 41% of the total data traffic in the first half of 2024, with fixed networks handling 59%. With that, Austria overtook Finland since the split there was 43/57% in Q1 2024, the latest reported quarter. Unlike Finland, mobile’s share of traffic is still increasing in Austria.
5G questions
While the report struggles with dealing with the ad hoc way regulators and operators report 5G numbers, but the analyst house gleaned that 5G coverage doesn’t drive data usage. Tefficient added several caveats given 5G coverage needs to keep growing and overcome difficulties like in-building coverage.
Some European countries – Romania, Germany, and Belgium – struggle with 5G traffic take-up having achieved just 1.6% to 6.3% in 2023. Spain, Lithuania, Portugal, Sweden, the UK, Ireland, Denmark, Finland, and Austria are all above 10%, at least in 1H 2024. There has been good growth in 5G’s proportion of traffic between 2023 and 1H 2024 in Spain, Lithuania, Portugal, Sweden, Ireland, Finland, and Austria.
A bright spot they saw for 5G was FWA. “Since each FWA subscriber consumes so much more traffic than the average mobile data user, even a small amount of 5G FWA customers will move the needle. Through stand-alone and slicing, 5G also offers the possibility to set monetisable thresholds for the speeds and quality of FWA,” they conclude.
Tefficient said that regardless of ‘G’, increased data-only penetration, particularly through fixed line substitution, has the potential to elevate data usage. However, a prerequisite for this, and for high data usage in general, is maintaining a low total revenue per gigabyte. “Countries such as Latvia, Lithuania, Estonia, China, Poland, Taiwan, Finland, and Turkey exhibit this characteristic, while New Zealand represents the opposite end of the spectrum,” they state.
Despite variations in data usage, market ARPU does not consistently correlate with usage levels. Norway, New Zealand, Luxembourg, Ireland, and South Korea boast higher ARPU, though the first three do not have high usage. Tefficient did however conclude on a brighter note, stating that 14 of 20 markets could grow ARPU on the back the data usage growth which means that the positive ARPU trend continued from its previous edition of this analysis.