Swedish telecoms network gear maker Ericsson raised its forecast for mobile data traffic, in a further boost to companies that benefit from rising numbers of consumers viewing online videos on platforms such as YouTube and Netflix.
Ericsson, the world's top mobile network equipment maker, expects a tenfold surge in mobile data traffic globally between 2015 and 2021 as the number of smartphone subscriptions rise. In its mobile industry report in June it forecast that growth would be eightfold between 2014 and 2020.
Inge Heydorn, fund manager at Sentat Asset Management, which invests in telecom and IT shares globally, said Ericsson is aiming to attract telecoms operators to invest in its networks by showing how much data traffic is expected to grow.
Heydorn said the inexorable rise in mobile data benefits telecoms operators more than it does Ericsson, which reported a 7 percent drop in sales this year despite the growth in smartphones. But content providers, such as Netflix, Facebook and YouTube owner Google are the biggest winners from the increase in data traffic, he added. "Technology development and price pressure move faster than the increase in data traffic," said Bengt Nordstrom, head of telecoms consultancy Northstream.
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