COMMUNICATION SERVICES IN EMERGING ASIA-PACIFIC: TRENDS AND FORECASTS 2016-2021 - Analysys ...
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Communication services in emerging Asia–Pacific: trends and forecasts 2016–2021
RESEARCH FORECAST REPORT
COMMUNICATION SERVICES IN EMERGING ASIA–PACIFIC:
TRENDS AND FORECASTS 2016–2021
STEPHEN SALE AND HARSH UPADHYAY
analysysmason.com
© Analysys Mason Limited 2016
Communication services in emerging Asia–Pacific: trends and forecasts 2016–2021
About this report
This report provides an outlook on the mobile communication GEOGR APH IC AL COVER AG E KEY METR ICS
services market in the Emerging Asia–Pacific (EMAP) region. It
provides forecasts for voice and messaging services provided by Regions covered in this report: Non-operator/OTT services
both mobile network operators and OTT1 providers. Worldwide Voice and messaging
EMAP region Active users by device type
A complete set of forecast results is provided in the accompanying
China Outgoing traffic by device
Excel data annex.
Indonesia type
The forecast is based on several sources: Malaysia Operator traditional services
Philippines Handsets
Analysys Mason’s internal research, including our regional
forecasts, Connected Consumer surveys and various trackers in Circuit-switched (CS) voice
and SMS
the Future Comms and Media research programme Forecast results provided in the
data annex: Outgoing traffic
interviews with stakeholders in the communications market Operator IP-based services
Worldwide
around the world. Active users by service type
EMAP region
China VoLTE, Wi-Fi calling, IP
WHO SHOULD R EAD T HIS R EPOR T messaging
India
Strategy and planning executives who are responsible for mobile Outgoing traffic by service
Indonesia type
operators’ communication services strategies and partnerships with OTT
players. Malaysia VoLTE, Wi-Fi calling, IP
Executives in mobile operators’ technology and innovations teams who Philippines messaging
are responsible for developing communication services. Thailand Retail revenue
Marketing executives at vendors of communication services equipment Rest of EMAP region Voice and messaging
and software, as it will help them understand the needs of their operator Average spend per user
customers and size the addressable market for their products.
1 The term ‘over-the-top’ is used throughout this report to refer to services that are made available
to the general public via the public Internet. The term is defined from the perspective of network
operators and is somewhat controversial for this reason, but is nevertheless widely understood.
© Analysys Mason Limited 2016 2
Communication services in emerging Asia–Pacific: trends and forecasts 2016–2021
Contents
5. Executive summary 16. Regional trends
6. Executive summary 17. Emerging Asia–Pacific: Continued strong growth is expected in the
messaging market, attracting both local and global players
7. Worldwide trends
18. Emerging Asia–Pacific: An extra one billion mobile users will be the principal
8. Worldwide: Messaging apps have overtaken SMS in traffic – over 11 trillion
driver of traffic growth over the forecast period
messages were sent through apps in 2015
19. Country-level trends
9. Worldwide: OTT messaging services will be used by over 60% of the
population by 2021 20. China: WeChat dominates the OTT messaging market – operators have not
given up, but their focus is on VoLTE
10. Worldwide: The platform proposition advanced by LINE and WeChat is
spreading beyond core Asian markets 21. Indonesia: LINE dominates the youth market – operators are focusing on
improving LTE (and voice) coverage
11. Worldwide: Smartphones will continue to be the dominant communication
device 22. Malaysia: Both competition between operators and the entry of converged
players will popularise VoLTE
12. Worldwide: Strategic responses from operators vary markedly in different
regions 23. Philippines: Operators are partnering with OTT providers to drive
smartphone growth and increase data usage
13. Worldwide: Operators are migrating smartphone users to VoLTE services –
nearly 2.4 billion subscribers are expected by 2021 24. Forecast methodology and assumptions
14. Worldwide: Many operators are rolling out Wi-Fi calling, principally to 25. Forecast outputs and definitions
improve indoor coverage
26. Forecast methodology
15. Worldwide: Google’s involvement may boost Rich Communications
27. About the authors and Analysys Mason
Services, but usage is likely to remain low
28. About the authors
29. Analysys Mason’s consulting and research are uniquely positioned
© Analysys Mason Limited 2016 3
Communication services in emerging Asia–Pacific: trends and forecasts 2016–2021
List of figures
Figure 1: Messaging traffic, Emerging Asia–Pacific, 2010–2021 Figure 11: Traffic for all mobile operator messaging services and number of
operator-provided IP messaging service users worldwide, 2015–2021
Figure 2: Mobile voice traffic, Emerging Asia–Pacific, 2010–2021
Figure 12: Messaging traffic, Emerging Asia–Pacific, 2010–2021
Figure 3: Messages sent by message type worldwide, 2010–2015
Figure 13: Mobile voice traffic, Emerging Asia–Pacific, 2010–2021
Figure 4: Messages sent by message type and number of OTT messaging active
users worldwide, 2010–2021 Figure 14: Messaging traffic by message type, China, 2010–2021
Figure 5: Percentage of OTT messaging users by device worldwide, 2010–2021 Figure 15: Messaging traffic by message type, Indonesia, 2010–2021
Figure 6: Percentage of OTT voice users by device worldwide, 2010–2021 Figure 16: Messaging traffic by message type, Malaysia, 2010–2021
Figure 7: Retail revenue for operator mobile voice services worldwide , 2015– Figure 17: Messaging traffic by message type, Philippines, 2010–2021
2021
Figure 18: Overview of the main forecast outputs
Figure 8: Retail revenue for SMS services worldwide, 2015–2021
Figure 19: Overview of the forecast methodology used in this report
Figure 9: Active users of VoLTE services by region, 2015–2021
Figure 10: Wi-Fi calling service users and traffic worldwide, 2015–2021
© Analysys Mason Limited 2016 4Communication services in emerging Asia–Pacific: trends and forecasts 2016–2021
Worldwide: Messaging apps have overtaken SMS in traffic –
over 11 trillion messages were sent through apps in 2015
Several messaging apps have user bases in the hundreds of Figure 3: Messages sent by message type worldwide, 2010–2015
millions. High usage levels have resulted in these apps rapidly
overtaking SMS in volume of messages sent. 14 000
User base in 2015
WhatsApp is the largest messaging service in the world – it 2.3 billion individual app users 11 641
reached a billion active users in February 2016. Several other 12 000 billion
6.6 billion handsets
services have huge user bases: for example, Facebook Messenger
had 900 million active users at the end of April 2016 and WeChat
had 597 million at the end of 2015. 10 000
Messages sent (billion)
Users very often have multiple apps. We estimate a global average
of 1.9 apps per person in 2015. There were around 2.3 billion 8 000
8 470
individual users of messaging services worldwide at the end of
billion
2015, with nearly 2 billion of them on smartphones.
6 000
These applications have driven high levels of usage by offering a
strong user experience, typically with no charge. WhatsApp
reported a peak of 42 billion messages sent over a 24-hour period 4 000
in February 2016. We estimate average app usage to be much
lower, but still over 500 messages per month.1
2 000
Traditional operator services benefit from a larger addressable
market, but have a relatively poor user experience and much lower
average usage levels. The average smartphone user sent 132
SMS messages per month in 2015. 2010 2011 2012 2013 2014 2015
1 There are several factors that prevent us from simply extrapolating from WhatsApp’s usage (which SMS OTT/Non-operator IP
would imply average usage of >1000 messages per month). First, WhatsApp reports peak, not
average, volumes. Second, usage levels of other popular apps are typically much lower than those Source: Analysys Mason
of WhatsApp. Finally, some traffic will be caused by spambots and application-to-person services.
© Analysys Mason Limited 2016 8Communication services in emerging Asia–Pacific: trends and forecasts 2016–2021
China: WeChat dominates the OTT messaging market –
operators have not given up, but their focus is on VoLTE
Tencent’s WeChat is the dominant communication app in China.
FORECAST METRICS 2021
The user base has grown from 50 million in 2010 to 697 million in
2015 (the majority of which are in Asia). Tencent also owns QQ
Chat, a popular web-based service. These apps will not remain
solely communication services, but will become platforms,
connecting content and service providers with consumers.
Facebook and Google products are not allowed in the local
86% 13%
7.3
TRILLION
75% 975
MILLION
market, which has supported WeChat’s growth. Alibaba, another
domestic Internet player, is probably the main challenger. It has
built a strong presence in payments and has also developed an
enterprise chat service (similar to Slack). The approval of MVNO
licences may give an additional boost to this sector (as well as to Figure 14: Messaging traffic by message type, China, 2010–2021
device players such as Xiaomi), allowing OTT providers to offer a
wider range of services. 10000
Messages sent (billion)
8000
Chinese mobile operators have also been active in the app space.
China Mobile’s Feixin offered an improved SMS user experience, 6000
but with only limited success. It is likely to be replaced by RCS-
4000
based services.
2000
The main focus for operators has been the rollout of VoLTE. The
largest operator, China Mobile, launched in August 2015. China 0
2011
2021
2010
2012
2013
2014
2015
2016
2017
2018
2019
2020
Unicom launched in January 2016 and China Telecom is expected
to follow soon. We expect China to be the largest market in the SMS OTT/Non-operator IP Operator IP messaging
world for VoLTE, with nearly a billion users by 2021. Source: Analysys Mason
© Analysys Mason Limited 2016 20Communication services in emerging Asia–Pacific: trends and forecasts 2016–2021
CONTENTS
EXECUTIVE SUMMARY
WORLDWIDE TRENDS
REGIONAL TRENDS
COUNTRY-LEVEL TRENDS
CHINA
INDONESIA
MALAYSIA
PHILIPPINES
FORECAST METHODOLOGY AND ASSUMPTIONS
ABOUT THE AUTHORS AND ANALYSYS MASON
© Analysys Mason Limited 2016 27Communication services in emerging Asia–Pacific: trends and forecasts 2016–2021
About the authors
Stephen Sale (Research Director) oversees Analysys Mason's consumer research and is also the lead analyst for the Future Comms and
Media research programme. His primary areas of specialisation include next-generation communication services, OTT player strategies and
mobile pricing. He also has extensive experience in analysing operator strategies and forecasting fixed and mobile service markets. Before
joining Analysys Mason in 2004, Stephen worked in the industry on areas that include VoIP, next-generation service architecture and broadband
access. He has a degree in economics and an interdisciplinary MRes from the University of London.
Harsh Upadhyay (Analyst) contributes to Analysys Mason's Asia–Pacific research programme, and is based in our Singapore office. His
research focuses on market tracking, competitive assessment, data forecasting, next-generation services and consumer behaviour analysis in
the Asia–Pacific telecoms market. He also supports consulting projects and presents at industry events. Harsh's experience in the TMT industry
is diverse, and he has a detailed understanding of the telecoms market in the region. He has previously worked with Frost & Sullivan and IDC as
an analyst and consultant, and his clients have included leading ICT firms and government bodies. Harsh holds a master's and bachelor's
degree in Business Management from India.
© Analysys Mason Limited 2016 28Communication services in emerging Asia–Pacific: trends and forecasts 2016–2021
Analysys Mason’s consulting and research are uniquely positioned
Analysys Mason’s consulting services and research portfolio CONSULTING
We deliver tangible benefits to clients across the telecoms
industry:
communications and digital service providers, vendors,
financial and strategic investors, private equity and
infrastructure funds, governments, regulators,
Consumer broadcasters, and service and content providers.
Regulation
and SME
and policy Our sector specialists understand the distinct local challenges
services
facing clients, in addition to the wider effects of global forces.
Digital
economy We are future-focused and help clients understand the
Transaction challenges and opportunities that new technology brings.
support
Regional RESEARCH
markets
Our dedicated team of analysts track and forecast the
Telecoms different services accessed by consumers and enterprises.
Strategy
software and and planning We offer detailed insight into the software, infrastructure and
networks technology delivering those services.
Clients benefit from regular and timely intelligence, and direct
access to analysts.
© Analysys Mason Limited 2016 29Communication services in emerging Asia–Pacific: trends and forecasts 2016–2021
PUBLISHED BY ANALYSYS MASON LIMITED IN JULY 2016
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Figures and projections contained in this report are based on publicly available information only and are produced by the Research Division of Analysys Mason Limited independently of any
client-specific work within Analysys Mason Limited. The opinions expressed are those of the stated authors only.
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