Ericsson Says 5G Creates USD 41B Revenue Opportunities

Ericsson Says 5G Creates USD 41B Revenue Opportunities

June 23, 2020

According to the Ericsson Mobility Report June 2020, 190 million 5G subscriptions is forecast by end of 2020 with 2.8 billion by the end of 2025. 5G is expected to enable up to USD 41 billion in revenue opportunities for service providers in South East Asia by 2030.

The latest Ericsson report takes an incisive look at the role of networks and digital infrastructure in consumer behaviours, usage and consumption prior to and during the COVID-19 pandemic.

Accordingly, Ericsson Head of SE Asia Nunzio Mirtillo, in South East Asia and Oceania, says 5G may account for 21 percent of mobile subscriptions by 2025.

“The current Covid-19 pandemic has challenged us to do many things differently and to move activities online to different digital platforms. This has led to data proliferation as well as a geographical shift of data traffic from downtown business and public areas to residential areas on both fixed and mobile networks. The crisis has also demonstrated the critical importance of connectivity,” says Mirtillo.

Mirtillo says while 5G subscription growth in some markets has slowed as a result of the pandemic, this is outweighed by other markets where it is accelerating, prompting Ericsson to raise its year-end 2020 forecast for global 5G subscriptions.

“5G is a platform for innovation. Unlike previous generations centred around consumer and personal communications, 5G will serve both consumers and enterprises, 5G will take IoT to the next level where superior connectivity is a prerequisite,” says Mirtillo.

Value of digital infrastructure

Changes in behavior due to lockdown restrictions have caused measurable changes in the usage of both fixed and mobile networks. The largest share of the traffic increase has been absorbed by fixed residential networks, which has experienced a 20-100 percent growth. But many service providers also noticed a spike in demand on their mobile network.

In a recent study conducted by Ericsson Consumer Lab, 83 percent of the respondents from 11 countries claim that ICT helped them a lot to cope with the lockdown. The results show an increased adoption and usage of ICT services, such as e-learning and wellness apps, that have helped consumers adapt to new realities, underpinned by connectivity.

Looking ahead, while 57 percent say they will save money for financial security, one-third says they plan to invest in 5G and an improved broadband at home to be better prepared for a potential second wave of COVID-19.

5G Business Potential

The current COVID-19 pandemic has also highlighted the importance of digitization for businesses worldwide. Connectivity has enabled companies to continue engaging with customers as well as conduct business transactions online.

According to Ericsson CTO APAC Magnus Ewerbring, the combination of 5G and digitalization may create new opportunities for service providers to extend their businesses beyond connectivity into a variety of sectors ranging from healthcare, automotive to manufacturing.

“Reliable, fast and responsive, 5G has the capabilities to empower new businesses and open up revenue streams for communication service providers. At Ericsson, we have been investing actively in R&D to establish a wide portfolio of 5G products and solutions to enable our customers transition seamlessly to 5G and leverage the full benefits of 5G,” says Ewerbring.

In South East Asia, Ewerbring says the projected value of the 5G-enabled digitalization revenues for service providers will be approximately USD 41 billion by 2030.

(Ed. The report also includes forecasts on data traffic growth, regional subscriptions plus insights into cloud-based gaming as well as in-depth articles on private dedicated networks and Verizon’s millimeter wave strategy for targeted metropolitan areas. To download the June 2020 edition of the Ericsson Mobility Report click here.)

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