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Industry digitalization and 5G business potential in ASEAN

IoT. From how to right now_smart manufacturing
Denis Brunetti 

President and Head of Vietnam & Myanmar

In July of this year, manufacturing growth in Vietnam showed its highest level in seven years amid faster export growth. Indeed, its strong manufacturing sector has allowed the country to have one of the fastest growing economies in the world to date, with data from their General Statistics Office (GSO) registering a 6.8 percent increase in GDP during 2017, slightly above government targets. According to the Brookings Institute, Vietnam’s manufacturing production rose 14.4 percent over the year, with a 21 percent increase in exports during 2017.

From what we have seen in markets around the world, such impressive growth in manufacturing and a global competitive edge can be sustained with a country’s increased investment in infrastructure. Ericsson has studied how 5G brings new revenue opportunities and can drive the transformation known as Industry 4.0.

5G digitalization investments

In the second edition of our report The 5G business potential – Industry digitalization and the untapped opportunities for operators, we calculate that globally, 5G digitalization investments will generate an estimated USD 619 billion revenue opportunity for telecom operators by 2026, and that telecom operators can profit from an additional 36 percent revenue potential by 2026 from 5G enabled market opportunities. For Vietnam, we estimate that 5G addressable revenues for operators can increase by up to USD 1.1 billion by the year 2026, depending on where they are in the value chain. It’s no surprise that 18 percent of this opportunity is coming from manufacturing.

World Economic Forum in ASEAN

All of this is top of mind for us at Ericsson in Vietnam this week, as Hanoi hosts this year’s World Economic Forum (WEF) on ASEAN. The focus of the meeting this year is on Entrepreneurship and the Fourth Industrial Revolution. While ICT has a fundamental role to play in accelerating the Fourth Industrial Revolution, its full potential will only be realized if governments and policymakers collaborate with the private sector to create a vibrant and empowered ecosystem. In the case of government, access to harmonized spectrum is key to facilitating investments in 5G.

Operator ambitions are key

Equally important will be operator ambitions towards 5G. Their ambition in terms of which role they play in the value chain and deployment actions will ultimately determine whether the calculated additional value from 5G will be realized. Clearly, there is potential for mobile operators in developing markets in Asia to address additional revenue opportunities as well as accelerate the transformation of industries, and therefore nations. For countries such as Vietnam, where manufacturing shows sustained growth as well as great potential, it’s essential that public and private sectors work on a roadmap for digital transformation, to realize the Fourth Industrial Revolution.

Find out more insights by viewing the full 5G business potential – Industry digitalization and the untapped opportunities for operators report.

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