LTE just became the dominant mobile network technology last year, but the industry is already looking ahead
Mobile network operators are projected to invest more than $1.1 trillion in their networks over the next five years, and about 80% of that will be in 5G technology, according to a new report from GSMA Intelligence. The industry is putting a lot of time and money into the next generation of wireless technology, even as LTE only became the dominant network technology last year. 2019 was the first year when LTE connections accounted for more than half of mobile connections, hitting 52%; that figure for LTE connections is projected to hit 56% by 2025.
Meanwhile, the report projects that 5G will account for 20% of global connections by 2025, with particularly strong uptake in developed Asia, North America and Europe. The report says that the needle will start to move on 5G connections beginning this year.
Ana Tavares Lattibeaudiere, head of North American operations for the GSMA, said that the report reflects a relatively fast 5G roll-out in the U.S., compared to other regions—even though the technology deployments and the services that will ultimately be developed for them are still in early days overall.
“When you think about all the services that 5G could bring, it’s just scratching the surface right now,” she said.
While the first thing people think of with 5G is increased broadband data speeds, she added, it has the potential to have widespread social impact on people’s lives, through being applied in areas such as education and healthcare.
The GSMA Intelligence report also pointed out that other network improvements, such network slicing, edge computing and lower latency, “are not widely appreciated” and many companies believe that “4G remains ‘good enough.'”
“Most of the key benefits for enterprises won’t come until standalone 5G is deployed,” the GSMA Intelligence report added, but telecom companies need to start conversations now and lay a foundation to help businesses understand the problems that 5G will be able to solve. “As this is a highly competitive area given the presence of Amazon, Microsoft, Google and other cloud companies, speed to market is an important factor,” the report said.
“I think there’s a whole new set of services that can come to the enterprise, that 4G wasn’t able to deliver,” Tavares Lattibeaudiere added.
Other findings of the report include:
- The global appetite for upgrading to 5G, and paying more for it, varies widely.”In general, consumers in South Korea, China and the Middle East tend to be the most willing to upgrade to 5G, while those in the U.S., Europe and Japan seem satisfied using 4G for the time being,” the GSMA Intelligence report said. The report estimated that by 2025, half of 5G connections will be in developed Asian nations, with North America close behind at 48% of 5G connections.
- There is still a global “coverage gap,” with about 9% of the global population or 673 million people who don’t get live within the footprint of a mobile network. GSMA Intelligence also identified a “usage gap,” of people who are covered by at least one mobile network but don’t use them.
- IoT will be an “integral” part of 5G, and the smart home is a “critical battleground,” the report said, where fragmentation is a challenge to integration and adoption — but early signs indicate that smart speakers are likely to pay a central role in a “smart home revolution in 2020.”
- GSMA Intelligence said that as of the end of 2019, 5.2 billion people were using mobile services, or 67% of the global population. That is expected to rise to 5.8 billion by 2025, with most of the new growth in subscribers coming from China, India, Pakistan and Nigeria.
Check out the accompanying infographic for the report below:
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