Alan Weissberger Broadband

OpenVault: Broadband usage +47% in Q1 2020; Power users are the new normal

Introduction: #

Broadband analytics and solutions firm OpenVault reports that total broadband usage increased 47% in the first quarter (Q1) of 2020, to roughly 402.5 gigabytes per user, versus the year-ago period.  As expected this increased use of broadband was largely due to the millions of people subject to “shelter in place” and the resultant data traffic spikes from video/audio streaming and video conferencing.

OpenVault based its latest OpenVault Broadband Insights Report (OVBI) [PDF] on anonymized data from ISP partners primarily located in the U.S. The data analytics firm noted average consumption at the end of Q1 2020 was 17% more than the 344GB average from Q4 2019.

Key findings from the 1Q 2020 OVBI: #

  • The monthly weighted average data consumed by subscribers in 1Q 2020 was 402.5 gigabytes (GB), up 47% from 1Q 2019’s weighted average of 273.5 GB.
  • The power user category grew sharply with 10% of weighted average subscribers now consuming over 1 TB of data per month, up 138% from 4.2% in 1Q 2019.
  • The gigabit speed category was the largest percentage gainer among all speed tiers both year-over-year and quarter-over-quarter in 1Q 2020.
  • Average monthly data usage percentage growth rose sharply during the pandemic, with 1Q 2020 year-over-year median usage growth of 60% and overall usage growth of 47%.
  • Daily usage patterns shifted dramatically during 1Q 2020, with daytime usage spiking the week of March 23rd.

Editor’s Note: #

This is what “flattening” the bandwidth curve looks like according to the OpenVault data.

The animated illustration, above, depicts how demand increased greater in the day time than at the traditional evening peak hour. The bandwidth demand curve shifts towards a flatter slope during the workday and primetime. This is consistent with what Matt Polka of ACA Connects and Patty Boyers of Boycom discussed in an April 27th ViodiTV interview.

Another interesting insight is that the average and median North American usage is 62% and 43% greater, respectively than European data usage. This might point to data throttling that has been reported to ensure European networks aren’t overloaded. It is also consistent with what Open Vault’s Josh Barstow indicated in this March 31st, 2020, ViodiTV interview regarding the robustness of the U.S. broadband networks compared to those of Europe

OpenVault is confident that the average monthly usage for April 2020 will be more than 460GB, vs January’s pre-COVID-19 forecast that average consumption would reach 425GB by the end of 2020.

“Nearly all the growth in broadband usage we would have expected for 2020 has now been achieved in the first quarter, with much of it concentrated in the last two weeks of the quarter,” OpenVault stated in their report.

As noted above, OpenVault reported a big increase in the number of “power users” that consume at least 1 terabyte of data per month, and “extreme power users” that gobble down 2 TB or more.

OpenVault also found that the percentage of customers provisioned for gigabit service increased to 3.75% in Q1 2020, up an astonishing 97% from the year-ago period.  As corroboration of the 1-Gig trend, Altice USA reported that gross adds of 1-Gig customers in Q1 2020 rose 56%, and the sell-in rate of that product was about 13% across all gross adds where gigabit service is available.

Author’s Note: #

Several U.S. ISPs, including Comcast, CableOne/Sparklight, and AT&T, have temporarily relaxed data usage policies during the COVID-19 pandemic. OpenVault estimates that subscriber usage with relaxed usage-based broadband packages jumped by 49.05% in Q1 2020.

Median usage across all data plans rose nearly 60% to 233.6 GB in Q1 2020 versus the year-ago period, and up 22% from 190.7 GB at the end of 2019, OpenVault said.

The surge in network traffic in the first quarter continues to flatten out.  According to the NCTA’s COVID-19 Dashboard, peak upstream usage actually decreased by 0.2% for the week of April 18-25. Downstream peak rates also dipped another 1.4% during that time period.

Conclusions: #

OpenVault found that the COVID-19 pandemic significantly changed broadband usage patterns, perhaps permanently. The fundamental shifts of work, learn, and socialize via videoconferencing from home will surely decline when the shelter in place orders are lifted, but they probably won’t entirely disappear.

The company believes a “new normal” will emerge post-pandemic, undoubtedly with more dependency on broadband from home networks than ever before.

Broadband network operators will need to understand the implications of this shifting broadband usage behavior and plan their network performance capabilities accordingly.

Early indications of this shifting behavior can be found in 1Q 2020 data:

  • Average monthly broadband usage of 250 GB is approaching 50% of all broadband subscribers in 1Q 2020.
  • What just a few years ago was considered a power user — 250 GB of monthly consumption — will now include over half of all subscribers.
  • 83% of the 2020 benchmark prediction of 12% of subscribers using 1 TB of data on a monthly basis was achieved in 1Q 2020!
  • Median usage of 233.6 GB in 1Q 2020 was up nearly 60% from 1Q 2019’s 146 GB, and up 22% from 4Q 2019’s median of 190.7 GB.

It’s highly unlikely this trend will return to pre-pandemic levels, meaning the new normal will include significantly higher broadband usage.

These trends are also nudging subscribers towards ever faster speeds. The gigabit-speed category was the largest percentage gainer among all speed tiers both year-over-year and quarter-over-quarter in 1Q20. Just over 58% of subscribers now have a broadband speed tier of 100 Mbps or more. Understanding these trends, especially in the historical context of the COVID-19 pandemic, gives broadband operators important market intelligence benchmarks for better network planning and customer experience goals.

Addendum: #

Omdia: Covid Implications on the overall bandwidth market:

  • Unprecedented step function in data traffic growth with a geographic shift.
  • Carriers responded with incredible agility and shifted Capex to facilitate a huge increase in data traffic.
  • Sector malaise will impact carrier revenue, leading to Capex conservatism The uncertain recovery CSP Revenue/Capex impacts 2H20-2021
  • Greater acceptance of on-line business in many fields, including telemedicine, online retail, video conferencing, and online learning. etc.

Author Alan Weissberger

By Alan Weissberger

Alan Weissberger is a renowned researcher in the telecommunications field. Having consulted for telcos, equipment manufacturers, semiconductor companies, large end users, venture capitalists and market research firms, we are fortunate to have his critical eye examining new technologies.

2 replies on “OpenVault: Broadband usage +47% in Q1 2020; Power users are the new normal”

Point Topic has just published a new fixed broadband subscriber report which tracks global markets up to the end of December 2019.

The main trends for spot 4Q 2019:

-Although China continued to be the largest fixed broadband market with 40 per cent of all global subscribers, the country saw an unusual drop of nearly 600,000 subscribers this quarter. One possible reason is the launch of 5G by the Chinese operators which could have made some subscribers swap fixed broadband for mobile. We will monitor the situation to see whether there will be any restatement of the fixed broadband figures.

-South Africa also reported a big drop in fixed broadband subscriber number as the growth in fibre connections failed to compensate for the DSL decline.

-Belgium, Thailand, Ireland, Brazil, France and UK were among the countries which recorded the highest FTTH quarterly growth rates – 26.3 per cent, 17.9 per cent, 12.4 per cent, 12.3 per cent, 11.2 per cent and 10.8 per cent, respectively.

-Wireless (mostly FWA) and FTTH connections were the fastest growing categories, having increased by 22.7 per cent and 14.1 per cent respectively between Q4 2018 and Q4 2019.

-Copper connections continued to decline, having dropped by a further 9.8 per cent year-on- year while satellite connections increased by 9.3 per cent and FTTx connections grew by 5.5 per cent. Cable based connections went up by 3.6 per cent.

Read the full report World Broadband Statistics – Q4 2019

May 9, 2020 – Communications Service Providers (CSPs) losing out on 5G enterprise business:

“Only one in five early enterprise 5G deals are CSP-led, proving that the way CSPs want to sell is at odds with the way in which businesses want to buy,” said Angus Ward, CEO of BearingPoint//Beyond. “What’s deeply concerning is that some of these early deals, such as the ones we see in automotive, cut out CSPs entirely – even connectivity is being provided by other suppliers.

“Businesses want to buy complete solutions that fit their needs and help them solve business problems, rather than individual technology assets. This is a multi-billion-dollar opportunity that CSPs need to address fast and requires CSPs to collaborate with enterprises and SMBs to better understand their reality.”

“CSPs will only realize value from 5G if they can identify, partner, codevelop, implement, and run a proposition with application-specific and industry-specific specialists,” said Evan Kirchheimer, Research VP, Service Provider & Communications at Omdia. “CSPs that can orchestrate such a complex web of relationships will be capable of capturing a greater share of the market and will not be relegated to being one of many connectivity providers competing solely on price.”

It seems that network operators are selling 5G on features and benefits rather than solutions, even though the rest of the world got that memo a decade or two ago. The report urges them to focus on applications and vertical-specific solutions rather than just bragging on about how great 5G is.

According to Omdia almost 80% of early enterprise 5G deals involve the manufacturing, transport, utilities and energy/mining sectors, so that seems to be where the smart money is. Furthermore the COVID-19 pandemic seems to be making industry keener than ever to digitise and automate, presumably to minimise disruption when none of their employees are allowed to leave the house. As ever a culture change at CSPs is required, which they’ve shown little historical inclination towards.

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