5G in urban environments could increase economic growth by $17 trillion by the year 2035, reports a new study by ABI Research: 5G urban deployment: debunking the capex myth and unlocking new growth. This staggering total includes more than direct 5G revenue streams, but takes into account indirect revenue, as well as income derived from efficiencies in productivity and speed. This might even be underestimating the impact, given that 4G generated $4.956 trillion in revenue in 2018 alone, despite the fact the technology was standardized a decade ago.
ABI claim that the first use of 5G will be in enhanced mobile broadband. However, more advanced features, such as machine-type communications and reliable low-latency communications will come in 2020 which will support a far wider number of devices, machines, networks, and smart cities in general.
Some of the 5G Growth Opportunities for Smart Cities:
According to Henry Tirri, CTO of InterDigital:
“Many are trying to understand how they will monetize this next generation of wireless technology, and most importantly, how they’ll deliver ROI from it. But while there may still be several questions and doubts surrounding 5G monetization, these findings clearly demonstrate the growth opportunities that 5G is set to bring about.”
An analyst at ABI Research, Dimitris Mavrakis, said: “5G has the potential to completely change our everyday lives, but only if mobile service providers can roll out 5G in a way that makes economical and logical sense – that is, to start with mobile broadband connectivity deployments in urban areas to create the right use cases that will justify investments in CAPEX and OPEX.”
Revenue potential next 10 years
Over the next ten years, the study predicts that 5G will generate:
- $2.4 trillion in direct revenue (mainly subscription fees from end users).
- $3.2 trillion in revenue due to increased productivity/connection speeds.
- $866 billion in indirect revenue. This includes products and services, advertisement, devices, applications, infrastructure, and so on.