5G market to reach US$700bn by 2030

The rollout of 5G is predicted to contribute US$700 billion to the global economy by 2030, with a compound annual growth rate of 20%, according to IDTechEx Research. Mobile services, fixed wireless services and narrowband IoT are some of the main contributors to this growth.

The ‘5G Technology, Market and Forecasts 2019–2029’ report analysed 5G infrastructure and its impact on end-user industries. As well as accelerating the growth of the telecommunications industry, Dr Luyun Jiang, IDTechEx Technology Analyst on 5G and author of the report, suggested the 5G rollout will also have a major impact on the automotive, manufacturing and entertainment sectors.

IDTechEx identified 5G will bring opportunities in four aspects: infrastructure, user equipment, 5G services and vertical applications. Network and user equipment providers in particular are expected to benefit.

In April 2019, both the United States and South Korea launched commercial consumer 5G networks.

“More than half of the telecom operators, including those in China, Japan and Europe, have sped up their 5G rollout and targeted a commercial launch within 2019 or 2020. China alone expects 5.8% of its GDP growth to derive directly from 5G technology by 2030,” the report said.

The first wave of 5G investment is the deployment of 5G infrastructure. Last year, the US and South Korea spent US$41 billion while the global capital expenditure on 5G was around US$161 billion. In the next 10 years, global telecom operators are predicted to invest up to US$1.5 trillion on 5G network rollouts, most of which will be for sub-6 GHz 5G.

Heavyweights such as Ericsson, Nokia and Huawei account for the largest share of infrastructure investments. Huawei has a 28% global market share and has signed more than 40 commercial 5G contracts and shipped more than 70,000 base stations already, the report said. However, future competition is still unclear as the US government increases pressure on many countries to ban Huawei from supplying equipment for 5G networks. Australia is one of the countries to ban its participation in their 5G rollout.

“The massive rollout of 5G opens a new and increasing market for materials and components that are essential for 5G technologies (such as higher frequency requirements and massive MIMO). The companies that develop innovative solutions for radiofrequency front-end modules (filter, power amplifier and more), active antennas, optical transceivers, optical fibres, thermal management and small cells will benefit from the fast growth in the 5G area,” explained IDTechEx.

The second wave of 5G investment will comprise new 5G user equipment, such as 5G smartphones and 5G chipset.

5G also enables the possibility to link various wireless services to one universal cellular network.

“Sectors, including automotive (autonomous drive, in-car entertainment systems), industry 4.0 (remote-controlled robots and drones, intelligent machines), media experiences (5G TV, cloud game-streaming) and health care (remote diagnostics and surgery, digital health) are all set to be influenced by the 5G service boom to come.”

According to IDTechEx, these service sectors will contribute 60% of the revenue for 5G technology in 2030. However, it will take years for these vertical applications to adopt the technology, as a search for a sustainable business model continues.

For the full report, click here.

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