Written by Ashraf El Hadi
- Communications service providers in the top 20 5G markets report revenue growth
- Enhanced mobile broadband and fixed wireless access are proving early use cases
- Cloud gaming and network deployments for enterprises and industries are gaining momentum
New research from the Ericsson Mobility Reporting Team (NASDAQ: ERIC) provides encouraging evidence for telecom service providers around the world linking growing 5G penetration to revenue growth.
Revenue reconciliation is an important challenge facing service providers around the world, and it often influences network investment decisions, which are part of their business growth strategies fall under the ‘monetization’ heading of the industry.
A special edition of the Ericsson Mobility Report, Business Review, looks at these monetization opportunities as they relate to 5G.
The report also highlights the positive trend of revenue growth associated with the increase in 5G subscriptions in the top 20* of this network market since the beginning of 2020, which dominates around 85% of all 5G subscriptions worldwide.
Among the findings of the report:
- Scalable pricing models are critical to service providers, both in order to effectively meet each customer’s individual needs, and to continue to drive revenue growth over the long term.
- The top 20 5G markets witnessed significant growth in network performance after providing 5G services.
- After a period of slow or no growth, wireless revenue curves are once again trending upwards in these markets, and this revenue increase is related to the increased penetration of 5G subscriptions.
Commenting on the report, he said Fredrik Yedling, Executive Vice President and Head of Networking, EricssonFinding solutions to the challenges our customers face lies at the heart of research and development efforts and in every product we develop at Ericsson. The close relationship between the increased penetration of 5G subscriptions and revenue growth in the top 20 markets of these networks confirms that the role of 5G networks is not only a game changer, but also that it is of great benefit to the parties that achieve precedence in using it. What is encouraging is that while 5G is still at a relatively early stage so far, it is growing exponentially, with proven early use cases and promising new and innovative use cases in the medium and long term.”
Confirming previous expectations, enhanced mobile broadband was the most important early use case for 5G, due to its increasing geographic coverage and superior offerings. This use case has more than 1 billion currently active 5G subscriptions across approximately 230 commercial networks around the world. Enhanced mobile broadband provides the fastest revenue generation opportunity from 5G, as it represents an extension of service providers’ existing businesses, building on the same pre-existing business models and processes. It is worth noting that even in the top 20 5G markets, about 80% of consumers have not yet switched to 5G subscriptions, which is an important indicator of the great potential for revenue growth.
And as stated in The November 2022 edition of the Mobility ReportFixed wireless access is the second largest early use case for 5G networks, particularly in areas with underserved or underserved broadband markets. Fixed wireless access also offers significant revenue growth potential for communication service providers, as it utilizes mobile broadband assets to a large extent. Fixed wireless access is expected to grow significantly, reaching 300 million connections within six years.
In addition to consumer subscribers, there are increasing opportunities offered by fixed wireless access in businesses and public sector organizations around the world. The fifth generation network provides great value to businesses, especially with the deployment of private fifth generation networks and wireless wide area networks for institutional and industrial use.
Upgrading existing 4G network sites to 5G has great potential to achieve About 10 times increases in data capacity, and reduces power consumption by more than 30%which provides an important opportunity to increase revenues and reduce costs, while adhering to the sustainability agenda.
added Yiddling: “Revenue growth and sustainability issues are some of the topics that come up frequently in my interactions with clients. This special edition of the Ericsson Mobility Report highlights ways in which service providers can take advantage of the opportunities presented by the 5G network. We see initial signs of revenue growth in developed 5G markets, with broad coverage and attractive service offerings. Another important aspect of 5G technology is that it reduces costs and helps service providers deal with the significant growth in data volume, which in turn leads to increased revenues in the future. This can make the 5G network a strong catalyst for growth.”
