5 things you need to know about the 5G consumer business case
Enhanced mobile broadband will be the first large-scale global use case for 5G, a point that President and CEO Börje Ekholm emphasized in his press conference at Mobile World Congress 2018 in Barcelona.
Let’s look at five findings from a new report that highlight this 5G consumer business case.
1. 8x mobile data traffic growth in 6 years
Total mobile traffic is projected to grow eight times larger between 2017 and 2023. With video traffic growing by 75, we predict that 20 percent of traffic will be carried by 5G by the end of the period.
An important strategic objective for building out 5G networks is to identify the highest traffic densities and then provide enhanced mobile broadband in those areas.
2. 3Mbps is required at the cell edge to deliver HD video
The performance required at the cell edge to deliver video is a good measure for predicting customer experience. Standard definition video requires an average performance of 1.5Mbps at the cell edge, with 3Mps required for High Definition video.
Your future user experience will be defined by how well your network handles HD video as well as the evolution to 4K and 8K video. This means that a high-resolution screen on your mobile devices might be a reality before you next upgrade your TV.
3. 10X cost efficiency increase from combining 4G and 5G in an optimal way
Modelling of operator networks shows potential for a site fully evolved with 4G and 5G capacity to deliver mobile data at one tenth of the cost compared to a basic 4G site today.
The enhanced mobile broadband cost improvement is not a 5G game alone but about combining the two network generations in the most optimal way.
4. 30 “frontrunners” captured the majority of market growth for 4G
During the 2012-2016 period, we measured the performance of leading and lagging operators. A group of 30 frontrunners exploited early time to market to deliver a 10 percent CAGR during the period. The comparison group, with 240 operators, showed a slightly declining CAGR (-0.8%) during the same time frame.
We expect stiff competition for the precious frontrunner roles from current frontrunners, and operators with aspirations to leverage 5G to win back lost ground. This is a game where the late fee will be high.
5. Time to market advantages can be leveraged in three different ways
For 4G introduction, a time to market advantage of 6 months turned out to be sufficient. Three different strategies paid off well. First, leveraging an early market entry and continuous network investment to maintain premium pricing. Second, by growing market from a challenger position. And last, leaders being out early to extend their market share leadership.
Similar strategies can be expected for enhanced mobile broadband. And with a faster overall pace in the market now, we can see material gains with shorter time to market advantages.
Excited to engage further on the subject?
This blogpost highlighted a few key findings from The 5G consumer business case: an economic study of enhanced mobile broadband, which can be accessed in full here.
President and CEO Börje Ekholm in his press conference at Mobile World Congress 2018 in Barcelona.