Cisco Complete Visual Network Index (VNI) Forecast and what it means for Service Providers in Asia Pacific

This quarter, I’m excited to announce we released our annual Cisco Complete Visual Network Index (VNI) Forecast, which covers global, regional, and country-level projections and trends associated with fixed and mobile networks. It’s a must-read for every Asia Pacific service provider seeking to optimize network investments and performance. The report is a treasure trove of insightful findings covering everything from devices/connections growth, Internet of Things (IoT) advances by industry verticals, IPv6 adoption, traffic growth by application (video, AR/VR, gaming, etc.), traffic patterns (peak vs. average), network transformation at the edge, cord cutting implications, a 5G mobile preview, Wi-Fi hotspots and broadband network performance to security issues.

But what does this mean for a service provider in the Asia Pacific region? We’ve distilled the latest VNI report data through this lens, and came up with four key regional trends for the next five years.

Trend 1: Adapt to shifts in device usage

Devices and connections are growing faster than the population and internet users. According to the latest Cisco Complete VNI Forecast, there will be an increase in devices and connections from 8.6 billion in 2017 to 13.1 billion in 2022. 86% of Asia Pacific IP traffic will be due to non-PC devices like smartphones and tablets. In comparison, PCs will account for 14% of Internet traffic in 2022, down from 45% in 2017. On top of that, video devices will have a multiplier effect on traffic. By 2022, nearly two-thirds (62%) of connected flat panel TVs will support 4K, and Ultra high-definition (UHD) IP video will account for 19% of Asia Pacific IP video traffic by 2022.

Due to the proliferation of smart mobile devices and connections, the surge in traffic will exert tremendous pressure on service providers to maintain an optimal user experience on their networks. Moving forward, service providers will need to ensure their systems are ready to handle traffic growth and support new and emerging technologies. Failure to do so could have dire consequences.

Trend 2: A future-ready network is key to growth

The IoT is no longer a phenomenon and will shortly become mainstream as more people, processes, data and things connect to IoT. By 2022, M2M connections will be nearly half of total connections in Asia Pacific. Connected homes will represent the largest amount of M2M connections, and connected cars will experience the fastest growth.

With content providers moving towards IPv6 adoption and enablement in the Asia Pacific region, this will allow for more unique TCP/IP address identities to be created, enabling IoT connectivity. And service providers that are able to not only enable IoT connectivity, but also manage and secure IoT traffic, will be in a solid position to unlock more opportunities to drive new customer experiences, revenue streams and a competitive advantage.

Trend 3: Meet the increasing demand for video

Building on the “cord cutting”[1] phenomenon, more families today are turning towards internet video, with cord-cutting households generating 141GB per month in 2017 as compared to 82 GB generated by an average household.

Not only that, we are seeing a trend in which the growth in digital television service that denotes television viewing across all digital platforms (cable, IPTV, satellite, etc.) is growing much more slowly relative to mobile video. Also, mobile video growth rates are even higher in emerging regions because these areas are bypassing fixed connectivity.

This will mean increase in internet traffic per user and average household. Average traffic per user per month will increase from 20GB in 2017 to 69 GB in 2022, as well as average traffic per household[2] per month from 60GB in 2017 to 205GB in 2022. There’ll also be a huge opportunity for content delivery networks, which is set to deliver 72% of Internet traffic by 2022 globally.

Content is and will continue to be king. And with a bulk of mobile network traffic coming from video content over the next five years, the question is whether you’ll be able to meet this demand.

Trend 4: Make security a priority

The last several years have certainly been the most eventful from a security threat perspective, with breaches like WannaCry and NotPetya making headlines around the world.

Peak attack size increased 174% Y/Y.[3] In fact, Distributed-Denial-of-Service (DDoS) attacks can represent up to 25% of a country’s total Internet traffic while they are occurring. Average DDoS attack size between 1-2 Gbps increased 37% Y/Y which is faster than Internet traffic at 33% Y/Y. Also, across industries, 864 total breaches were observed, and 34.2 million records were exposed, with an average of 39,554 records exposed per breach. And the bad news is that security threats are only going to accelerate as 5G networks become a reality.

Based on the latest projections, attacks will double to 14.5 million by 2022 globally. That said, cybersecurity can longer be treated as a mere IT issue, but a top business priority. In the coming years, users will be looking for service providers who can improve their organization’s security posture.

Get the complete picture

As these trends suggest, the next five years will see tectonic shifts in the network landscape. How you stay informed and plan for it will be critical to your success as a service provider. Get more regional and country specific projections and insights by accessing the Cisco Complete VNI Forecast here and see our CKN webinar on the latest VNI findings here.

[1] Cord-cutting refers to the trend in which traditional and subscription television viewing is increasingly being supplanted by other means of video viewing, such as online and mobile video, which are available to viewers through fixed and mobile Internet connections.

[2] Household average includes only Consumer devices and connections

[3] 1H2017-1H2018