Posted Date: 6/19/2012

Research: Mobile Hotspots Drive External Modem Market

By Jessica Binns, Contributing Editor
Sales of external modems are predicted to show a marked uplift driven by cellular hotspot routers according to the Strategy Analytics Mobile Workforce Strategies (MWS) service report, "Mobile Broadband Devices: 5-Year Market Outlook on Embedded and External Modems."

This study predicts cellular modem sales growth of 16 percent CAGR, from 150 million units in 2012 to 312 million in 2017. By 2017, over 35 percent of external modems will be mobile hotspot routers, driven by growth in consumer electronics (CE) devices such as eBook readers, tablets and ultrabooks. The ubiquity of Wi-Fi in devices has stimulated demand for cellular hotspot routers, a singular cellular appliance that can connect multiple Wi-Fi devices, requiring only one data subscription.

Key findings include:

• In 2012, cellular modem sales will grow fastest in North America, at 69 percent year on year growth, followed by Asia Pacific at 34 percent;
• The mobile broadband device installed base of USB modems, PC cards and embedded notebooks and netbooks will grow from 266 million units in 2012 to 688 million by 2017;
• LTE will comprise 48 percent of all cellular modem shipments by 2017.

"The cellular modem market will continue to show healthy growth through 2017 at 16 percent CAGR, driven by a need to connect multiple devices such as tablets, notebooks, netbooks, e-readers, ultrabooks and other CE devices," said Andrew Brown, Director of Enterprise Research at Strategy Analytics. "The ability to connect five or more devices to mobile hotspot routers offers a major opportunity to make these devices a vital connectivity hub."

"LTE networks in the US and in other regions offer an ideal opportunity for mobile operators to showcase the speed and utility of their data networks for helping people stay connected," commented Mark Levitt, director, enterprise software and communications at Strategy Analytics.