Deloitte predicts UK telecommunications sector trends for 2018
17 January 2018
- 90% of adults in developed markets - and 92% of adults in
UK- will have a smartphone within the next five years;
- 85% of
55-75 year oldswill own a smartphone by 2023;
- Future smartphone innovation will mostly be invisible: sensors, connectivity and software – and the impacts of these improvements will be tangible in the form of enhanced user experiences;
- In 2018, one billion airline passenger journeys globally will be carried out on planes fitted with in-flight connectivity;
- Findings come from Deloitte UK’s TMT Predictions 2018 report, published today
The technology, media and telecommunications (TMT) practice at Deloitte, the business advisory firm, has today announced its predictions for the UK telecommunications sector in 2018. The news comes following the launch of the seventeenth edition of TMT Predictions 2018.
The future of the smartphone
Deloitte predicts that smartphone adoption will continue to grow in the next five years. By the end of 2023, the smartphone will be – by a clear margin – the most used digital device. More than 92% of adults in the UK are expected to have a smartphone, rising from 85% today. Similarly, by 2023, more than 85% of 55-75 year-olds will have a smartphone, exceeding penetration of PCs and laptops within this age group.
Deloitte also predicts that global smartphone sales will be 1.85 billion per year in 2023, a 19% increase over 2018, equivalent to more than five million units sold every day.
Globally, 180 million smartphone units will be sold in retail for $1,000 or more in 2018, generating more than $200bn in revenue. Deloitte also forecasts an average selling price (ASP) for smartphones of $350 in 2023, implying a total market value of $650 billion, versus $478 billion in 2017.
In addition, Deloitte predicts that in 2018, 45% of adults will worry that they are using their phones too much. In the UK last year, 37% of adults worried about using their smartphones too much. Similarly, almost two-thirds (65%) of
Dan Adams, partner and head of telecommunications at Deloitte, commented: “Over the past 10 years the smartphone has redefined how people live and interact with each other. Over the next five, the smartphone will enter an era of ‘invisible innovation’, with under-the-surface improvements to connectivity, memory, sensors and artificial intelligence. Technology such as 5G and artificial intelligence will become prevalent, and this will have considerable ramifications for the work of
“For half of the UK’s workforce, the smartphone may be the ideal digital tool: its merits are its portability, biometric security and constant connection. The smartphone will drive much of the next phase of business process reinvention, providing a digital tool for the tens of millions of workers in the UK whose roles are not desk-based.
“The smartphone is a once-in-a-generation innovation whose full potential is far from realised.”
In-flight connectivity takes off
Deloitte predicts that globally, one billion air passenger journeys – a quarter of all passengers – are expected to be on planes fitted with in-flight connectivity (IFC) in 2018. This is a 20% increase from the previous year. Deloitte expects that the technology will generate ancillary airline revenues close to $1bn in 2018.
While IFC has been available for many years in markets such as North America, it should be more popular and lucrative than ever in 2018, thanks to the rising number of routes covered, higher connection speeds and greater data capacity per flight.
UK airlines will increasingly adopt the technology from 2018, with IFC being commonly available by the end of the decade. This trend implies that within a few years, the
Ed Shedd, head of technology, media and telecommunications at Deloitte, comments: “For three-quarters of air travellers at present, being on a plane means disconnection from the world, whether or not they want that.
“In 2018, the airline industry will commence a significant step-change. Newer aircraft and improved telecommunications technology will mean that connectivity will not only improve, but it will also become cheaper and, as a result, IFC is likely to become standard. The plane, too, will be connected – and the majority of passengers will be delighted by this and will express their happiness on social networks from 35,000 feet up.
“We expect that demand for in-flight connectivity among UK consumers will soar – the majority of people relish being connected, and will happily pay to connect as one of the paying in-flight options offered to air travellers.”
Note to editors
About the TMT Predictions 2018
The 2018 series of TMT Predictions is the 17th edition of the report and has drawn on internal and external inputs from thousands of conversations with member firm clients and contributions from Deloitte member firms’ partners and managers specialising in TMT, and discussions with industry analysts as well as interviews with leading executives from around the world and proprietary quantitative research.
Please click on the following link to read about Deloitte’s TMT Predictions 2018.
In this press release references to “Deloitte” are references to one or more of Deloitte Touche Tohmatsu Limited (“DTTL”) a UK private company limited by guarantee, and its network of member firms, each of which is a legally separate and independent entity. Please see deloitte.com/about for a detailed description of the legal structure of DTTL and its member firms.
Deloitte LLP is a subsidiary of Deloitte NWE LLP, which is a member firm of
The information contained in this press release is correct at the time of going to press.
For more information, please visit www.deloitte.co.uk.
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UK smartphone market penetration (2012-17; 2023 projection)