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The end of mobile

I’ve been making charts of internet use, mobile phones and smartphones since the early 2000s. At one point, they were confounding and exciting – could it really be growing that fast? How many people would have these things? Now, we know the answer: everyone. Everyone would have one.

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There are about 5.3bn people on earth aged over 15. Of these, around 5bn have a mobile phone. This is an estimate: I’m going with the GSMA’s but most others are in the same range. The data challenge is that mobile operators collectively know how many people have a SIM card, but a lot of people have more than one. Meanwhile, ownership starts at aged 10 or so in developed markets, whereas in some developing markets half of the population is under 15, which means that a penetration number given as a share of the total population masks a much higher penetration of the adult population.

About 4bn people have a smartphone. How do we get to this number? Well:

  • Apple gave a number of 900m active iPhones at the beginning of the year, which is consistent with the unit sales that it reported until recently.
  • Google said at this year’s IO conference that there are 2.5bn active Android devices, and the Android developer dashboard says that about 95% of these are phones.
  • Google’s number does not include Android phones in China, which do not come with any Google services (conversely Apple’s number does include iOS devices in China). The Chinese government estimates just over 800m internet-connected smartphones in China, and perhaps 20% of these are iPhones, giving a round number of 650m Android phones.

How many of these are online? These sources are all based on devices that connect to the internet regularly in order for them to be counted, but ‘connection’ is a pretty fuzzy thing. The entry price for low-end Android is now well under $50, and cellular data connectivity is relatively expensive for people earning less than $10 or $5 a day (and yes, all of these people are getting phones). Charging your phone is also expensive – if you live without grid electricity, you may need to pay the neighbor who owns a generator, solar cells or car battery to top up your battery. Hence, MTN Nigeria recently reported that 47% of its users had a smartphone but only 27% were active data users (defined as using >5 meg/month). Of course, some of these will be limiting their use to wifi, where they can get it. These issues will obviously intensify as the next billion convert to smartphones (or near-smartphones like KaiOS) in the next few years. There are lots of paths to address this, including the continuing cost efficiencies of cellular, cheaper backhaul (perhaps using LEO satellites), and cheap solar panels (and indeed more wifi). The fratricidal price wars started by Jio in India are another contributor, though you can’t really rely on that to happen globally. But this issue means that on one hand there are actually more than 4bn smartphones in use in some way, but on the other that fewer than 4bn are really online.

What platforms? The platform wars ended a long time ago, and Apple and Google both won (outside China, at least). However, as one would expect given the range of prices, these devices are not evenly distributed: surveys in the US suggest that over 80% of teenagers have an iPhone, whereas the situation in India is pretty much the reverse. The use of these devices also matters: people who buy high-end phones tend to use them more.

Meanwhile, the PC market, which has had flat-to-falling sales for the last few years, has something around 1.5bn active devices (including a bit over 100m Macs and a similar number running Linux of various kinds, and 800m running Windows 10, which was released 4 years ago), split roughly 50/50 consumer/enterprise. Quite which number you use depends on which analyst firm’s estimates you prefer, but they’re all in the same range.

What about tablets? Apple says 900m iPhones and ‘over 1.4bn’ total active devices: if you subtract 200m Macs, Watches and Apple TVs combined that leaves about 300m iPads (again, this is consistent with historically reported unit sales) – 350m seems possible. Google’s numbers cited above imply something between 100m and 150m Android tablets (I hesitate to be more precise given how rounded these numbers are). Non-Google Android tablets in China might be double that, or even more – here again the question of whether the device goes online to show up in the stats means it’s hard to make a firm estimate (I’m sure people will disagree with this one). But this means there are certainly over half a billion tablets in use.

So. There’s an old joke that the career of an analyst progresses from Word to Excel to Powerpoint. That’s pretty much what’s happened here over the last 20 years: first we discussed what might happen (“imagine if everyone had a phone!”), then we tracked the numbers of what was happening, and finally we draw diagrams and bullet points of what that means. That’s where we are now – we try to work out what it means that almost everyone on earth has a phone or a smartphone (I made a presentation about this).

But this also means that now we go back to the beginning: I’m not updating my smartphone model anymore. The next fundamental trends in tech, today, are probably machine learning, crypto and regulation. I can write about those, but it’s too early to make charts.

Source: ben-evans

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