The U.S. Wireless Industry – An Overview

**UPDATE 9/22: We've added even more facts to the overview presentation. Here's the latest version.**

Late last month, we released our one page overview on the wireless industry’s value, innovation and economic impact that has led to a high volume of consumer usage.

Today, we’re sharing our “Wireless Industry Overview” PowerPoint, which provides a more detailed review of the U.S. wireless landscape. The PPT offers numerous statistics from well-respected third party organizations on some of the fastest growing wireless industry areas, such as M2M and data usage. We also include a high-level policy overview on several policy issues, including the our industry’s need for more spectrum, wireless taxes and fees, sustainability, responsible wireless use by kids and safe driving.

Here are a few highlights from the “Wireless Industry Overview”:

Economic Impact/Infrastructure Investment

• 4G network build out could mean $25-53 billion for the U.S. infrastructure investment by 2016; create 371,000-771,000 jobs and GDP growth between $73 billion-$151 billion.¹
• In 2010, U.S. providers reported making capital investments totaling $24.9 billion.²
• For every $1 invested in wireless broadband, it will create an additional $7-10 for GDP.³
• Wireless economic contributions have grown faster (16%) than the rest of the economy (3%).⁴
• The average U.S. consumer spends $60 on accessories for their wireless device.³
• Businesses spent more than $1.9 billion in 2010 on non-handsets (e.g. tablets, notebooks, e-readers). By 2014, it will be more than $5 billion on non-handsets.⁵

Innovation

• App revenue in 2010 was $5.2 billion; 2011 it is expected to be $15.1 billion; 2015 it is projected to be $57 billion.⁶
• North America is poised to lead in downloading smartphone apps by 2011, surpassing the current leader Europe and still leading Asia-Pacific.⁷
• 1 in 4 American adults actively use apps.⁸
• Average price of a smartphone has fallen by more than 50% in the last four years.⁹
  • Q4 2006, average smartphone price after discount was $220; Q1 2011, the average smartphone price after discount is $93.⁹
• The first 4G handset was introduced at International CTIA WIRELESS 2010. Today, there are more than 25 4G handsets and tablets available.
• By 2015, there will be >15 billion network devices worldwide, or almost 2 devices per person.¹⁰

Wireless Landscape/Usage

• As of December 2010, there were 29.7% U.S. wireless-only households.¹¹ As of December 2005, there were 8.4% wireless-only households.¹²
• Prepaid/Pay-As-You-Go share of overall wireless market (penetration) is 21.1%.¹³
• Prepaid/Pay-As-You-Go revenue accounts for almost 10% of all-industry revenues.¹³
• Cisco Systems, The Yankee Group and Coda Research projected (on average) that data traffic in 2014 would be 35 times the volume of traffic in 2009.¹⁴
• By 2020, there will be more than 2.1 billion M2M devices worldwide; compared to 62 million in 2010.¹⁵
• 3G Technology has been deployed to more than 98% of the U.S. population.¹⁶
• The U.S. is home to 56% of global mobile WiMAX subscribers.¹⁷
• The U.S. is home to >90% of global LTE subscribers.¹⁷
• U.S. has >164 million 3G/4G subscribers.¹⁷

**UPDATE 9/22: We've added even more facts to the overview presentation. Here's the latest version.**

1. Deloitte, The impact of 4G technology on commercial interactions, economic growth, and U.S. competitiveness, August 2011, available at http://www.deloitte.com/assets/Dcom-UnitedStates/Local%20Assets/Documents/TMT_us_tmt/us_tmt_impactof4g_081911.pdf.

2. CTIA's Wireless Industry Indices: Semi-Annual Data Survey Results, A Comprehensive Report from CTIA Analyzing the U.S. Wireless Industry, Year-End 2010 Results, released May 2011.

3. Jeremy Kessel, Wait, the cell phone accessory market is worth how much?, (2009), http://www.mobilecrunch.com/2009/08/26/wait-the-cell-phone-accessory-market-is-worth-how-much/.

4. Harold Furchtgott-Roth, The Wireless Services Sector: A Key to Economic Growth in America 2008 Report (January 2009).

5. “US Business Non-Handset Wireless Spending to Surpass $5 Billion by 2014, Says In-Stat”, m2m.com available at http://m2m.tmcnet.com/news/2011/03/21/5389813.htm (last accessed May 18, 2011).

6. “Gartner Says Worldwide Mobile Application Store Revenue Forecast to Surpass $15 Billion in 2011” available at http://www.gartner.com/it/page.jsp?id=1529214.

7. Press Release, “Smartphone Downloads from Mobile App Stores to Peak in 2013”ABI Research available at http://www.abiresearch.com/press/1651-Smartphone+Downloads+from+Mobile+App+Stores+to+Peak+in+2013.

8. “The Rise of Apps Culture”, Pew Internet, available at http://pewinternet.org/Reports/2010/The-Rise-of-Apps-Culture/Overview.aspx (last accessed July 26, 2011).

9. FCC 15th Annual Report and Analysis of Competitive Market Conditions with Respect to Commercial Mobile Services, 192; David Barden, Wireless pricing constructive, upgrades more expensive, Bank of America Merrill Lynch at 8, 11 (April 11, 2011).

10. “Cisco predicts 15 billion network devices in 2015”, InfoWorld available at http://www.infoworld.com/d/networking/cisco-predicts-15-billion-network-devices-in-2015-788.

11. Blumberg SJ, Luke JV. Wireless substitution: Early release of estimates from the National Health Interview Survey, July-December 2010. National Center for Health Statistics. June 2011. Available at http://www.cdc.gov/nchs/data/nhis/earlyrelease/wireless201106.htm.

12. Blumberg SJ, Luke JV. Wireless substitution: Early release of estimates based on data from the National Health Interview Survey, July – December 2006. National Center for Health Statistics. May 2007 available at http://www.cdc.gov/nchs/data/nhis/earlyrelease/wireless200705.pdf.

13. See CTIA‘s Wireless Industry Indices: Semi-Annual Data Survey Results: A Comprehensive Report from CTIA Analyzing the U.S. Wireless Industry, Year-End 2010 Results, at Appendix C “Prepaid Wireless Snapshot” (May 2011) (“CTIA‘s Wireless Industry Indices Report”).

14. See FCC, Mobile Broadband: The Benefits of Additional Spectrum, filing at http://transition.fcc.gov/Daily_Releases/Daily_Business/2010/db1021/DOC-302324A1.pdf (October, 2010).

15. Machine-to-machine device connections: worldwide forecast 2010-2020, Analysys Mason, available at http://www.analysysmason.com/Research/Content/Reports/RRE02_M2M_devices_forecast/.

16. FCC 15th Annual Report and Analysis of Competitive Market Conditions with Respect to Commercial Mobile Services, 73.

17. Informa Telecoms & Media Group, WCIS database, accessed July 15, 2011.