Industry Thought Leadership

Dynamic 5G Networks Key to Building Tomorrow’s Digital Economy

March, 2019
Chafic Traboulsi
Head of Networks

Ericsson Middle East & Africa

With digital transformation taking place across all industries as the fourth industrial evolution unfolds before our eyes, momentous shifts in next-generation mobile cellular communications are set to change connectivity as we know it.

Throughout the last few decades, each new generation of wireless service has resulted in mobile technology reaching new heights to offer better quality services and enhanced customer experiences. For mobile operators, each evolution has culminated in a rise in their operation effectiveness.

In the context of 5G’s evolution, this notion is even more apparent. The world’s connectivity needs are changing - global mobile data traffic is expected to multiple by five before the end of 2024. Particularly in dense urban areas, the current 4G networks simply won’t be able to keep up. Therefore, early adoption of 5G is crucial to building the digital economy of the future.

While the emergence of 4G enabled networks to support voice and data IP and faster broadband for an enhanced mobile experience, 5G networks will expand broadband wireless services like never before.

New technology brings new capabilities
In 2019, commercial 5G networks are expected to be deployed which will drastically redefine the telecommunications landscape. With this evolution, telecom operators are forecast to undergo a raft of dynamic changes.

5G commercial networks are starting to go live. The first use cases are enhanced mobile broadband bringing better experience for smartphone users and fixed wireless access, providing fiber speeds without fiber to home. In addition, 5G smartphones will be available in 2019 as well.

Being able to download a full-length HD movie in seconds and share your wow-moments with friends – that’s just the beginning. The true value of 5G is the opportunity it presents for people, business and the world at large: industries, regions, towns and cities that are more connected, smarter and more sustainable.With these changes come unprecedented opportunities.

While 5G will empower consumers and revolutionize their connected experience with higher speeds and lower latency, opportunities and benefits are aplenty for mobile network operators.

5G will provide capacity to handle growing data traffic, as well as present opportunities for operators to grow top-line and improve their consumer business. As networks evolve and technologies like Massive MIMO and 5G New Radio are introduced, cost per gigabyte will decrease. This cost efficiency will grow stepwise with the continued capacity improvements in 4G.

As highlighted in the most recent Ericsson Mobility Report, we project 5G to reach more than 40% population coverage by 2024, with an expected 1.5 billion subscriptions.

The rapid uptake expected for 5G applications is significant when compared to previous generations of mobile, with the next generation forecast to be the fastest generation ever to be rolled out on a global scale.

What this means for network operators is that there will be an unprecedented number of users on their networks. Their ability to take customers beyond mobile internet to power Internet of Things (IoT) and critical communications segments, such as real-time communications sensors, healthcare monitoring systems or even drone and autonomous car navigation, will be unparalleled compared to previous connectivity iterations.

The speed of 5G device penetration will determine how quickly operators can benefit from 5G capabilities. With a proactive approach on the evolution to 5G, it’s clear that the technology can offer significant economic rewards.

One thing we learned from the introduction of 4G is that first movers grow faster. Operators who rolled out 4G ahead of competitors enjoyed increased revenue and market share. To take advantage of this window of opportunity operators need to set their 5G deployment and marketing strategies as the commercial roll-out of 5G is approaching.

5G to boost ICT business & innovation
With the 4G era we unlocked enhanced mobile internet. Now with 5G we have the means to power a barrage of new use cases as tactile internet revolutionizes network capabilities and consumer and enterprise applications.

5G is enabling a new wave of innovation. It has the potential for changing the world, further powering the hottest trends in tech today: IoT, AI (Artificial Intelligence) and AR (Augmented Reality) – among many more.

The short answer to why 5G is a game changer: it will improve your network connection dramatically. You won’t have to deal with disruptions when sharing videos from crowded arenas, nor will high-quality videos on your newsfeed cause frustration from all the buffering.

Instead, you’ll get a faster, more stable, more secure connection – along with new services and experiences, just around the corner. More efficient capabilities and vastly increased capacity means you’ll enjoy better performance than ever before.

The staggering increase in bandwidth throughput and network capacity opens up an entirely new world of use cases, especially for enterprise segments. Globally, we expect 5G driven innovations to drastically improve edge and cognitive computing.

With the growth of 5G networks, this will intensify the number of IoT and Machine to Machine (M2M) connections and develop tactile internet functions beyond mobile internet to unlock endless possibilities.

The number of cellular IoT connections is expected to reach 4.1 billion in 2024. As the IoT application market widens, the use cases will become more advanced. This means that optimized voice quality, more accurate device positioning and device mobility support to grow rapidly.

What does this mean for service providers?
The introduction of 5G will make it possible for communications service providers to improve their business in various ways. Just as 4G shook up the landscape, whereby data packages became more important than voice and SMS packages, 5G brings opportunities for communications service providers to offer new services. 5G will also improve cost-efficiency. Ericsson research on enhanced mobile broadband shows that evolution to 5G will enable 10 times lower cost per gigabyte than current 4G networks.

Meanwhile, Fixed Wireless Access (FWA) can provide connectivity for households and businesses. Research demonstrates that the investment payback time is under two years when connecting underserved suburban households on the existing mobile wireless network.

5G also presents an opportunity for operators to tap into revenue streams emerging from the digitalization of industries. Enabling new use cases, new services new business models and new eco-system, service providers can benefit from up to $619 billion market opportunity globally in 2026. In other words, this represents the chance to add up to 36% growth in revenues across this period.

Momentum is building in many markets as service providers accelerate their plans for 5G rollout. In the Middle East and Africa, the potential for dynamic 5G networks is coming to life. As 5G hits the market, the mobile ecosystem will become larger and more widespread and extensive than ever.

Combining revolutionary levels of efficiency with higher capacities to send data: that’s 5G. Not only will it tangibly benefit you, it’s here to improve societies across the globe, and it’s equipping industries to do many things which – not too long ago – they could only envisage. Better yet, this new era of advancement is just getting started.