Mobile Web Will Rule by 2015

In a dense, 87-page report, Morgan Stanley analysts have charted the most important online trends and predicted the future of the Internet. In addition to forecasting more online shopping and showing the geographical distribution of Internet users, the study also shows a dramatic shift toward mobile web use.

Including devices such as the Kindle, Ipad, the iPhone and other smartphones, web-enabled tablets, GPS systems, video games and wireless home appliances, the growth of the mobile web has been exponential — and we’re still just at the beginning of this cycle. Morgan Stanley’s analysts believe that, based on the current rate of change and adoption, the mobile web will be bigger than desktop Internet use by 2015.

The mobile wealth creation/destruction cycle is in its earliest stages. The proliferation of better devices and the availability of better data coverage are two trends driving growth; having better services and smaller, cheaper devices has led to a huge explosion in mobile technology that far outpaces the growth of any other computing cycle.

And speaking of coverage, global 3G penetration is expected to hit 21% this year. In Japan, where the U.S. looks to find its mobile roadmap for the future, 96% of mobile subscribers already have 3G coverage. In Western Europe, the penetration is around 54%, just slightly above 46% in the U.S. In developing and/or economically depressed areas, including the Middle East, Africa, parts of Asia, Eastern Europe and South America, 3G penetration is still in the single digits. Morgan Stanley identifies 3G access as a key point in the success of the mobile web.

Finally, mobile e-commerce is ramping up faster than online e-commerce, now making up 4% of total retail sales. In certain categories, such as computers, consumer electronics, music, movies, tickets, video games and books, online sales account for between 45% and 20% of the total retail market. Japan’s Rakuten shows how the mobile share of e-commerce is growing as well, from 10% of e-commerce in 2006 to nearly 20% now.