Mobile broadband modems — used in mobile devices and computing outside of smartphones – are likely to dip 27 percent to 53 million units in 2014, said ABI Research.
The size of the global mobile broadband modems market is nearly $3.5 billion. On the other hand, worldwide smartphone revenue rose 2 percent sequentially to $88 billion in Q3 2014 alone.
The report said vendor ecosystem consolidation continues with some modem makers shifting focus to M2M modules, while other suppliers have been acquired or divested their R&D effort entirely.
Infonetics Research last month said global mobile broadband modems unit shipments increased 3 percent sequentially to 37 million in Q3 2014.
“Increased form-factor choices from tablets to 2-in-1 ultraportable PCs have pushed mobile broadband modems further down the list of must-have features. Mobile device data sharing plans are helping bring awareness to Mobile Hotspot Routers, though these offers still remain rare on a global scale,” said ABI Research Senior Practice Director Jeff Orr.
USB modems are expected to decrease 35 percent, though 60 percent of total mobile broadband modem shipments in 2014 are expected to remain USB. The convenience of plugging in the stick to an existing portable computer is likely to retain USB’s volume lead through 2019.
Apple’s broadband strategy has impacted the embedded modem module shipments in 2014. Apple shifted its iPad mobile broadband strategy away from the use of a module and towards design-in modem chipsets.
Mobile Hotspot Routers, smartphone-sized and able to provide mobile broadband access to Wi-Fi-enabled devices, remain the bright spot for modem connectivity. In 2014, more than 14 million devices are expected to ship, up 11 percent year-over-year.
Meanwhile, the market for broadband consumer premises equipment (CPE) will grow 20 percent to nearly $11 billion in 2014, said IHS Technology in a note in October 2014.
ABI Research said the majority of mobile broadband modem shipments support either the HSPA or HSPA+ air interface protocols with nearly 36 percent of 2014 shipments expected for each protocol.
Modems supporting 4G technologies (LTE and WiMax) are forecast to be included on only 9 percent of worldwide shipments according to data from the leading modem OEMs.
Both Infonetics and ABI Research said LTE will continue to be a driver for smartphones.
John Byrne, directing analyst for M2M and IoT at Infonetics, said: “We are approaching an inflection point at which sales of LTE smartphones begin to outpace W-CDMA/HSPA smartphones. While both categories will see strong growth in 2015, LTE-based smartphones will account for the clear majority of smartphone sales beginning in 2016.”