internet use

The rate of fixed broadband traffic growth is slowing, according to new research from Strategy Analytics. The research firm’s bandwidth demand forecast calls for most households to need no more than 300 Mbps over the next ten years. 

“Close examination reveals that the applications usually cited as drivers of bandwidth growth are not as bandwidth intensive as some believe,” the author wrote in an executive summary of the report, titled “Is the end in sight for Nielsen’s Law? Despite dramatic increases during the pandemic, fixed broadband traffic growth may be slowing.” 

While downstream bandwidth demand will continue to increase, according to the researchers, the rate of increase will slow from 34% annual growth in 2018 to 6% in 2030. 

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The Strategy Analytics bandwidth demand forecast is based on several assumptions, including: 

  • Streaming video adapts to match available capacity 
  • Video encoding innovations tend to offset the impact of higher display resolution 
  • 4K (UHD) streaming needs only modestly higher speeds than HD 
  • 8K (UHD-2) video streaming will likely be a niche market 
  • Consumer adoption of augmented reality and virtual reality will be slow 
  • Console game play requires low latency rather than high speeds, and the effect of higher speeds on reducing latency is no longer significant 
  • Streaming game play looks to the network like HD or UHD video 
  • Most smart home devices consume negligible bandwidth and cloud-connected smart home video devices do not require very high bandwidth 
Forecast Downstream Chart
Source: Strategy Analytics, Commscope

“For most households, 100-300 Mbps broadband service is adequate,” the report states. “We see little evidence to suggest that this will change any time in the next 10 years.” 

That statement undoubtedly will be anathema to some readers. 

Ever since people began connecting to the internet 25 years or so ago, there have been those who have argued against bullish bandwidth forecasts, yet new bandwidth-intensive applications have continued to arise, broadband boosters will argue.

The author himself notes that since 1983, Nielsen’s Law has accurately predicted that the data rate of the highest available broadband service tier for cable consumers grows at a rate of 50% per year. 

“According to conventional wisdom, [this] will continue with no end in sight,” the author writes in the bandwidth demand forecast report. “But conventional wisdom appears to be wrong.” 

I would be interested to hear what readers think about all this. 

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3 thoughts on “Bandwidth Demand Forecast: 300 Mbps Will Be Enough for Most Households to 2031

  1. In 1889, Charles H. Duell, the Commissioner of US patent office made the assertion “Everything that can be invented has been invented.” Just over a decade ago, the FCC developed a National Broadband Plan which cited “Except for high-definition video, most applications in use today can be supported by actual download speeds of about 1 Mbps”. As of April 2021, the average internet speed is 191.97 Mbps (d/s) and 67.80 Mbps (u/s) and the U.S. isn’t even ranked in the Top 10 countries for speed (Ookla).

    We live in a world where the pace of change and innovation is accelerating and COVID has significantly accelerated the pace of technology adoption. Those holding on to outdated architectures can publish reports and shout from the rooftops that we have all the bandwidth we need but the reality is that we haven’t even scratched the surface. Our future is going to continue to include amazing technology advances which is going to demand more bandwidth than we could have ever imagined. Do not fight this advancement but embrace it and prepare with future proof, long-term solutions.

    Gary Bolton, President & CEO Fiber Broadband Association

  2. Gary,
    As author of the report, I must respectfully disagree.

    It is always difficult to predict the future. Technological predictions have turned out to be too optimistic, as well as too pessimistic: otherwise, we’d have flying cars and nuclear power too cheap to meter.

    One way to predict the intermediate-term future is by extrapolating data sets of historical measurements. I am not the first to observe a slowing of growth in Broadband traffic, based on the admittedly limited data available. [As an aside, it would be helpful if FBA could publish aggregated busy hour per-subscriber traffic data, as voluntarily supplied by members, for use of researchers.]

    The report points out that of the most-cited reasons as why traffic growth will continue at a double-digit CAGR, few stand up to scrutiny. If not those, than what applications will be drive continued growth?

    To be clear: I am not taking sides in the battle over which technologies should or should not be subsidized in a future broadband infrastructure bill. This report was not sponsored, and represents my own opinions based on independent analysis of the facts and data available to me. I welcome any new facts or data that might prove me wrong.

    Regards,
    Dan Grossman
    Strategy Analytics

    1. Hi Dan, I think the one thing that there needs to be clarity on is the difference between adequacy and preference. I do believe that most people can make 100-300mbs work for them but they would prefer higher speeds if it were available to them.

      If you take the gaming community into consideration, they are having to install updates that are 100Gb and above. What would you prefer? Download that update with a 100Mbps connection or 8Gbps connection (New Zealand is rolling out Hyper Fiber which is capable of 8Gbps up and download).

      Also, it seems cloud storage will become stronger and stronger (Microsoft just announced their cloud OS as well), all of this will have a huge impact on how much bandwidth we will consume and the speeds that will be required to achieve these new technologies as they arise. Phones are upgrading their cameras all the time (Resolution and Frame Rates) and this in return creates bigger files. If all of these are getting uploaded into cloud services, would you not think higher speeds would be more advantageous?

      Even with 4K content, content creators will love higher up and download speeds and it is only a matter of time before 8K becomes normal (Although that could take another 10 years) as well as higher frames rates, which will push the demand for bandwidth even higher.

      Another industry that would be drive up data would be the automotive industry with self driving cars. Automation and AI in general will also be a factor going forward.

      I think it’s hard to say what will be required going forward but I would find it hard to believe that the internet will be capped at 100Mbps – 300Mbps. Once higher speeds are available to the public, there is not doubt that developers will take advantage of this, which in return will create new technologies for the public that will drive up internet speeds.

      Just my 2 cents

      Thanks Dan

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