GSMA Intelligence recently published its annual ‘Global Mobile Trends’ research report, sharing insights for the global mobile industry following the Covid-19 pandemic. The report forms part of an annual report series where the association takes an end-of-year view of the most important trends shaping the telecommunications and wider Technology, Media and Telecommunication (TMT) sectors.
Beyond Covid-19, the report analyses the telecoms industry’s underlying trends, such as 5G adoption, which are building momentum and shaping the telecoms sector outlook.
“Other trends include network transformation and the shift to open Radio Access Network (RAN); enterprise digitisation; changes to consumer entertainment consumption from streaming and immersive reality and the 4G smartphone wave in emerging markets. Provided there is a gradual economic recovery in 2021, we expect activity in each of these areas to gather pace,” said Mr Tim Hatt, GSMA Intelligence’s Head of Research.
According to the report, in higher income countries, there was a negative impact of 4-8 per cent in telecoms revenues. In the same countries, this decrease was around half the comparable drop in Gross Domestic Product GDP) since the start of 2020.
It said further that the Covid-19 impact on telecoms revenue was primarily concentrated in four areas: roaming, due to a lack of international travel; lower handset upgrades, due to retail store closures; challenges in corporate and small- medium-sized enterprise (SME) markets, and general consumer spend pressures, particularly in the prepaid mobile segments.
“However, operators’ resilient mobile and fibre networks have met the demands of increased data traffic, spiking to 50-100 per cent. The increases were driven by home entertainment and work from home communications, such as video and voice calls.
“While 2020 saw some early slowdown in new 5G launches due to the pandemic, activity has recovered; 113 mobile operators have launched a 5G network in 48 countries. It is expected that operators will spend 80 per cent of sector CAPEX ($890 billion) on 5G networks over the next five years.
Consumer adoption of 5G will reach 20 per cent of global mobile connections by 2025. That said, adoption rates will be higher among countries at the forefront of 5G: the U.S., China, South Korea, Japan, the Gulf states, Australia and parts of Europe
“The near-term outlook in 2021 depends, to a large extent, on the timing of an economic recovery from the pandemic given pressures on consumer incomes. However, a continued fall in 5G smartphone prices will help; in the GSMA Intelligence’s global consumer trends survey for 2020, 37 per cent of consumers said they intended to upgrade to 5G, compared to 30 per cent in 2019.
While the increase is welcome, it also highlights the challenge for the mobile industry to convince the mass market of 5G’s value compared to 4G.
“On the enterprise front, 56 per cent of operators see manufacturing as the highest potential for 5G, serviced with a mix of Internet of Things, cloud and private networks,” the report added.
According to Hatts, as a new technology generation, 5G provides mobile operators with an opportunity to evolve or transform the way they build digital mobile networks. The timing of 5G also aligns with the availability and commercialisation of open networking technologies, such as Open Radio Access Network (RAN). He said Open RAN is a paradigm shift in the way networks are made and operated.
“It helps the industry reduce costs and increase agility to unbundle network assets to monetise use cases such as edge compute. It also helps increase competition among network equipment vendors; 57 per cent of operators intend to introduce new vendors into their network supplier roaster,” he stated in the report.
It is also projected that by 2025, 4G will account for 57 per cent of the global mobile customer base, by the far the largest share. The report added that Smartphone and 4G adoption are rising in many high growth emerging markets.
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