5G is driving revenue growth for communication service providers (CSPs) worldwide and the top 20 5G markets have seen a significant network performance boost following the introduction of new services, a report showed on Tuesday.
Flattening revenues have been a challenge for service providers in all parts of the world, often impacting network investment decisions as part of their business growth strategies, known as ‘monetization’ in the industry. An Ericsson (BS: ERICAs) Mobility report now highlights a positive revenue growth trend since the beginning of 2020 in the top 20 5G markets — accounting for about 85 percent of all 5G subscriptions globally — that correlates with increasing 5G subscription penetration in these markets. The report found that tiered pricing models are key for service providers, both for effectively addressing the individual needs of each customer and for continuing to drive long-term revenue growth. After a period of slow or no growth, wireless service revenue curves are again pointing upward in these leading markets. This correlates with 5G subscription penetration growth. “The link between 5G uptake and revenue growth in the top 20 5G markets underlines that not only is 5G a game changer, but that early adopters benefit,” said Fredrik Jejdling, Executive Vice President and Head of Networks, Ericsson.
What is particularly encouraging about this is that, while 5G is still in a relatively early phase, it is growing fast with proven early use cases and a clear path to medium- and long-term use cases, he added. As expected, enhanced mobile broadband (eMBB) is the main early use case for 5G, driven by increasing geographical coverage and differentiated offerings. More than one billion 5G subscriptions are currently active across some 230 commercial networks globally. 5G eMBB offers the fastest revenue opportunities for 5G, as it is an extension of service providers’ existing businesses, relying on the same business models and processes.
Even in the top 20 5G markets, about 80 percent of consumers have yet to move to 5G subscriptions, — one pointer to the potential for revenue growth, the report mentioned. Upgrading existing 4G sites to 5G has the potential to realize increases of 10 times in capacity and reduce energy consumption by more than 30 percent, offering the possibility of growing revenue and lowering costs, while addressing sustainability,