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Is the end in sight for Nielsen's Law? Despite dramatic increases during the pandemic, fixed broadband traffic growth may be slowing.

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Report Summary:

Since 1983, Nielsen’s Law has predicted that the data rate of the highest available broadband service grows at a rate of 50 % per year.
Now that may be changing.
Despite large increases due to the pandemic in 2020, the growth in demand for Fixed Consumer bandwidth may be slowing. And Video Streaming, Virtual Reality and Gaming may not be the drivers for Fixed Bandwidth Growth that some have predicted.
This report reviews recent US and other countries’ cable and telecoms Traffic Data to challenge conventional thinking, evaluate the evidence and assess the implications.

Table of Contents

1. Executive Summary. 4

2. Why consumer Internet usage won’t keep growing as it has. 4

2.1 Nielsen’s law predicts ever-faster residential broadband speeds. 4

2.2 Customers use only a tiny fraction of the bandwidth they pay for. 5

2.3 The Pandemic caused an anomalous spike in Internet traffic. 7

2.4 The pandemic traffic surge was an anomaly. 11

Key Indicators for the Cable Broadband Traffic dataset: 12

2.5 Video dominates broadband traffic profiles today. 13

2.6 Fixed Broadband Traffic growth appears likely to stagnate in the 10-year horizon. 14

3. Where are the Drivers for Bandwidth growth? Is there no ‘Killer App’?. 17

3.1 4K (UHD) and 8K (UHD-2) video are not going to be growth drivers for Fixed Bandwidth in the near term... 17

Encoding innovations offset improved resolution.. 17

3.2 Consumer Augmented Reality (AR) and Virtual Reality (VR) are not Consumer Bandwidth drivers. 19

3.3 Gaming is Not as Traffic Intensive as some might think. 19

Console Game Download.. 20

Console game play. 21

Streaming game play. 22

3.3.1 Observations and prognosis. 22

3.4 Smart Home and Consumer IOT are Not Going to Be Huge Source of Fixed Broadband Traffic. 23

Cloud Connected Video.. 24

Caveat. 24

4. Conclusion. 24

4.1 Summary. 25

4.2 Implications. 25

4.3 Recommendations. 26

5. Analyst Contacts. 29

5.1 Other Contacts: 29



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