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5G will be the engine behind mobile industry growth for years to come

By Georgi Zarkov

Updated: Mar 06, 2020, 6:36 AM

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5G will be the engine behind mobile industry growth for years to come

The hype surrounding 5G started so much earlier than it was actually available to consumers that by the time 5G phones actually became available, people were already getting tired of it. But 5G is here to stay and it’s spreading throughout the world like wildfire.

GSMA, the organizer of Mobile World Congress, which like many other events, was canceled this year, just released its annual report on the mobile economy. The report highlights the strides that 5G has made over the past months and where it’s heading in the years to come.

5G helps mobile economy achieve slight growth

The biggest push for 5G is coming from network operators, which are seeking new revenue streams as smartphone sales are slow and users are upgrading less and less frequently.

Before carriers can reap the benefits of 5G, however, they must pour massive amounts of money into building the necessary infrastructure. According to GSMA, between 2020 and 2025, carriers are expected to invest around $1.1 trillion globally, 80% of which will be in 5G networks.

One way operators will recuperate the investments is through Internet-of-things (IoT) devices. That market segment is often mentioned hand in hand with 5G and the prediction is that by 2025 the number of IoT devices would triple and bring a hefty $1.1 trillion in revenue (not profit!).

Overall, the revenue of the mobile sector is expected to rise with around 1% each year for the next 5 years, a small growth but better than nothing.

New users pouring in by the millions

Infographic by GSMA

Part of the revenue boost, as small as it is, is coming from new users joining the global connected family. In the next 5 years, around 600 million unique new mobile users will join networks worldwide. And when it comes to mobile internet access, the number of users will increase with a staggering 1.2 billion.

Of course, most of those will be in developing markets. When it comes to North America, the question is not so much if you have access to mobile internet but how fast it is

Infographic by GSMA

5G users in North America might be statistically insignificant number right now, but by 2025 almost half (48%) of the mobile userbase will be using 5G regularly. A huge increase in a relatively short amount of time. Meanwhile, users with 3G maximum speeds will be halved and 2G will be phased out almost completely.

If GSMA’s predictions are correct, North America’s adoption of 5G will be rivaled only by the so-called Developed Asia region, where the percentage of 5G users should reach 50 by 2025.

5G is facing all sorts of obstacles

Of course, reaching those numbers won’t be all sunshine and rainbows. Beyond the billions of dollars carriers have yet to spend, there are other, non-technical challenges for the smooth adoption of 5G.

Due to 5G’s use of ultra-high-frequency waves, and transmitters that have to be many times more than those required for 4G, concerns are arising from all sides of society. Those range from trivial things like worries about 5G hardware making our cities uglier to concerns about the negative effects on human health the technology might have.

Even if some of the alarms are raised by overly paranoid citizens unfamiliar with the technology, governments should still make sure all the necessary steps are taken for the safe implementation of 5G.

One important hurdle that can be overcome only with government support is band allowance. Carries must receive licenses to operate the different frequencies 5G uses and not all administrations are willing to hand them out at a moment’s notice. Those that are less cooperative might cause their countries to fall behind in the 5G race, causing billions of lost revenue in the process.

As you see, under 5G hides a whole web of issues and opportunities that are yet to unfold. Will our 5G future be as bright as companies envision it or fall short from expectations, we'll find out in a few years, it seems.