Cisco Forecast: 8 Billion Mobile Devices by 2016

Cisco Systems (NASDAQ:CSCO) released a report on Tuesday predicting that there will be over 8 billion handheld or “personal mobile-ready” devices in use globally by 2016. The forecast also claims that close to 2 billion “machine-to-machine” connections, such as GPS systems and medical applications, will be operating by then.

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The report, officially known as the Visual Networking Index Global Mobile Data Traffic Forecast, warns that the use of so many devices will cause a staggering 18-fold increase in mobile data traffic — up to 10.8 exabytes per month, or 130 exabytes a year — by 2016.

According to a CNET report, 130 exabytes is the equivalent of 33 billion DVDs, 4.3 quadrillion MP3 files, or 813 quadrillion text messages. Cisco expects only 1.3 exabytes per month to be used in 2012.

Many leading mobile carriers are already having a hard time keeping up with mobile data demands, and companies like Verizon (NYSE:VZ) and AT&T (NYSE:T) have resorted to tiered plans in order to control consumption of mobile data. If Cisco’s predictions are on target, carriers will soon have to invest enormous amounts of cash in infrastructure improvements in order to contend with the incredible amount of data.

Suraj Shetty, Cisco’s vice president of product and solutions marketing, said that by 2016, 3 billion people, or 60 percent of mobile users worldwide, will each generate one gigabyte or more of mobile data traffic each month — that compares to only one-half percent of mobile users in 2011.

“This impressive growth in mobile traffic will be driven by more powerful devices, notably smartphones and tablets, using faster networks, such as 4G and Wi-Fi, to access more applications, particularly data-intensive video,” said Shetty.

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To contact the reporter on this story: Gina Smith at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com