Asia Pacific Blog
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The mobile Internet economy in Asia Pacific: what would you give up before your smartphone?
Thursday, February 12, 2015
Editors note: This post comes from Dominic Field, a partner and managing director at the Boston Consulting Group
Nowhere is the impact of the mobile Internet economy more evident than in Asia Pacific.
Mobile Internet revenues in five APAC nations—Australia, China, India, Japan and South Korea—total almost $300 billion, more than the U.S. and more than twice the five biggest economies in Europe combined. By 2017, we estimate that the five APAC nations’ mobile Internet revenues will more than double to $622 billion. The annual growth rate in India will be almost 40 percent.
Like everywhere else, consumers in Asia Pacific are the big winners. They get enormous value from their smartphones, tablets and other mobile services, as well as from the apps they install and the services they access. And costs are coming down fast, thanks to vibrant competition throughout the mobile ecosystem. The benefit consumers receive over and above what they pay for devices, apps, services and access can be quantified; economists call it consumer surplus. In the five APAC countries, this surplus totals $1.4 trillion a year. On a per person basis, the consumer surplus averages almost $3,000.
Here’s a snapshot of the mobile Internet’s impact in each of the five APAC countries surveyed in our new report,
The Growth of the Global Mobile Internet Economy
At 77 percent, Australia has the highest smartphone penetration of the five countries sampled (higher than Japan or South Korea), but there are still 8 percent of Aussies who would rather shower than give up their mobile Internet access.
Mobile Internet revenues in China ($144 billion in 2013) already exceed those of the EU5 (Germany, France, Italy, the UK and Spain) and they will increase two and a half times by 2017. The Chinese love their smartphones—30 percent would relinquish both showering and sex to keep their mobile Internet access.
India has the fastest growing mobile Internet economy of the five countries we measured. As network coverage expands, connectivity improves (from 2G to 3G and 4G) and costs come down, usage is expected to soar, with mobile Internet economic activity more than tripling between 2013 and 2017. And mobile commerce will grow from $6 billion in 2013 to more than $14 billion in 2017
Japanese consumers get the biggest per capita consumer surplus of the five countries sampled—almost $6,800 per person per year. Along with South Korea, Japan is perhaps the most mature mobile internet economy in the Asia Pacific region; Japanese consumers have been using mobile e-mail, contactless payments, and, streaming live video for two decades or more.
South Koreans are wed to their mobile devices. The country has the second highest mobile penetration rate in our sample—74 percent. Three-quarters of consumers would give up newspapers, chocolate, and fast food, and 60 percent alcohol and coffee. A third would abstain from sex and 20 percent from showering to keep their mobile Internet access.
Posted by Dominic Field, Partner and Managing Director, Boston Consulting Group
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