Mobile data traffic in Europe to triple in five years

Mobile data traffic in Europe will almost triple in five years, driven by migration to 4G in central and eastern areas and improved 5G coverage, according to a new GSMA study. Due to new network deployments, 5G adoption continues to grow, and the standard is expected to dominate the region, eliminating 2G and 3G versions once and for all.

5G is expected to benefit most sectors of activity in the European economy, depending on the ability to incorporate use cases into business. By 2030, 53 per cent of the benefits are expected to come from the services sector, while 29 per cent will originate from the manufacturing sector.

However, significant disparities in 5G deployment still persist in Europe, especially in rural areas, with an investment gap estimated at least €174 billion to meet the connectivity targets of the Digital Decade program, which sets concrete objectives for Europe’s digital transformation by 2030. According to a report recently published by the European Commission, 65 percent of populated rural areas are not currently covered by 5G. According to the GSMA, in order to change this scenario, the region must focus on policies that address a framework for digital infrastructure, the simplification of regulations, the development of scale through market consolidation and a pro-investment spectrum policy.

In the field of the Internet of Things (IoT), Europe will have more than 500 million licensed cellular connections by 2030 due to growth in the automotive and public services sectors. More than 70 percent of operators in Europe consider IoT to be a very or extremely important success factor in their corporate portfolios, second only to 5G connectivity services.

According to the GSMA survey, consolidation of the IoT market and ecosystem is taking place in certain areas, especially those adjacent to connectivity. “Operators are rethinking their IoT strategies, and many are maintaining an interest in being directly involved in IoT, while others are considering different plans, such as creating independent IoT units or even selling them,” the study highlights.

Operators’ revenues are expected to grow marginally in Europe as they continue to diversify their services and seek to generate new revenue streams. Consumer services make up the largest share of revenue, while the corporate segment is the main driver of growth, as operators increasingly turn to digital transformation in verticals. In addition to connectivity, services such as security and cloud, and more diversified services have become strategic imperatives for operators, according to the GSMA.

Private 5G networks are a new type of business for operators, with opportunities to generate new revenue streams. To give you an idea of this movement, in the second quarter of 2023, Europe was the leading region in terms of the number of private wireless networks, accounting for around 40 percent of the world’s deployments. Because of this trend, almost half of operators expect private wireless networks to account for more than 10 percent of revenue by 2025, according to the GSMA. This contribution is expected to rise in the second half of the decade as equipment and devices for this class of 5G networks become more readily available.

Europe’s mobile data economy

According to the GSMA, mobile technologies and services will add €910 billion to the European economy in 2022, or 4.3 percent of GDP across Europe. Productivity based on mobile devices contributed €670 billion to the economy in the region, while operators accounted for €110 billion. The entire ecosystem generated 2.2 million jobs, directly or indirectly, in 2022.

By 2030, the sector’s economic contribution is expected to reach €1 trillion, driven mainly by the expansion of the ecosystem and vertical segments benefiting from the productivity and efficiency improvements provided by mobile services. 5G technology is expected to benefit the European economy with €153 billion by 2030, representing around 15 percent of the mobile sector’s overall economic impact. According to the GSMA, many of the benefits will be realized over the next five years. By the end of the decade, the growth in the economic benefits of 5G will have stabilized, with widespread adoption of the technology.