A report released yesterday by Ericsson entitled “Harnessing the 5G Consumer Potential,” stated 5G could drive up to USD $31 trillion in cumulative consumer revenue in the ICT industry by 2030. The study was done in partnership with Omdia, a global technology research company. The report estimates that communications service providers (CSPs) could earn USD $3.7 trillion of that total – a figure that could increase further as new adjacent digital services opportunities arise.
The report also estimates that CSPs could generate up to USD $131 billion by 2030 from digital service revenues alone, by proactively bundling and marketing 5G use cases. About 40 percent of these revenue projections are attributed to consumer spending on enhanced video, augmented reality (AR), virtual reality and cloud gaming over 5G networks. The report projects that AR is likely to drive more than half of all consumer spending on immersive media by 2030 – starting with gaming and extending to other areas like shopping, education and remote collaboration.
Key findings also highlight how the impact of the COVID-19 pandemic on personal finances and financial priorities may have affected consumers’ willingness to pay a premium for 5G subscriptions. Such high levels of early adopter take-up could help drive economic recovery, according to the report.
The report also projects that by proactively driving 5G consumer adoption, CSPs could gain 34 percent higher 5G average revenue per user (ARPU) by 2030. This could boost consumer revenues at a compound annual growth rate (CAGR) of 2.7 percent compared to flat revenue growth of 0.03 percent by taking a passive approach across the decade.
“This is the first time that Ericsson has presented a revenue forecast for the 5G consumer market,” Jasmeet Singh Sethi, Head of ConsumerLab, Ericsson Research, said, “which remains the core business of communications service providers. Through our research, we have highlighted the role of use case development, tariff innovation, quality 5G coverage and ecosystem partnerships to unlock the true potential of this market. It is clear that 5G will drive enormous opportunities for CSPs in consumer business over the decade. As this journey is already underway, those CSPs that quickly and proactively evolve their consumer propositions are likely to be bigger winners.”
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