Surpassing 4G LTE
The global 5G network has been on a steep growth trajectory since its inception. According to 5G Americas, the number of 5G connections is predicted to surpass those of 4G LTE by over two billion in the first decade. By the end of Q2 2023, the 5G network had achieved 1.4 billion connections, a testament to its rapid adoption worldwide. The same source projects an ambitious target of 8 billion 5G connections by 2028.
This impressive growth can be attributed to several factors. Firstly, 5G offers vastly improved data speeds and lower latency than its predecessor, 4G LTE. 5G networks can achieve peak download speeds between 2 and 20 Gbps, while upload speeds range between 15 and 150 Mbps. In contrast, typical 4G LTE networks provide maximum download and upload rates of around 100 Mbps and 50 Mbps respectively. As such, 5G enables much faster download and upload times, as well as a smoother, more reliable internet experience.
Furthermore, 5G also promises significantly lower latency of just 1 to 4 milliseconds, compared to an average of 45 to 65 milliseconds on 4G networks. This almost real-time responsiveness is critical for applications requiring instant feedback such as industrial automation, autonomous vehicles, tactile internet, and more.
Secondly, 5G supports a significantly larger number of connected devices, making it ideal for Internet of Things (IoT) applications and machine-to-machine communication (M2M) at scale. While 4G LTE supports around 100,000 devices per square km, 5G networks can connect up to a million devices in the same coverage area. This paves the way for smarter cities, homes, factories, healthcare and more through widespread device interconnectivity.
Regional Growth and Projections
The rate of 5G adoption varies significantly across regions. In North America, for instance, the number of 5G connections is projected to reach 669 million by 2028 according to the Digital Market Outlook (DMO). This represents over 35% of all mobile connections in the region. The substantial growth is driven by aggressive infrastructure development in the form of 5G macro and small cells, as well as consumer demand for faster, more reliable internet connections across mobile and home broadband.
In contrast, the Asia Pacific region has seen mixed levels of 5G adoption. Countries like South Korea, China, and Japan have made significant strides in deploying 5G technology. South Korea, for example, reached around 4 million 5G subscribers by January 2023, accounting for nearly 20% of its total mobile subscriptions. Meanwhile, China already has the largest number of 5G base stations globally, and all three major mobile operators are rapidly building out 5G capabilities.
On the other hand, countries like Malaysia, Indonesia and Thailand are still in the early stages of 5G network development with limited coverage primarily in major cities so far. This could represent a growth opportunity in future years as the technology becomes more accessible across these populous markets. The developing world also faces cost and infrastructure hurdles to swift 5G deployment which needs to be overcome.
European markets have seen steady progression in 5G rollouts. Around two-thirds of mobile connections in Western Europe are expected to be 5G by 2025 as per GSMA data. Furthermore, the European Union has ambitious targets such as 5G coverage in urban areas across all member states by 2025. To spur development, the EU has provisioned billions in funding towards 5G-related research and initiatives. Still, the fragmented regulatory landscape between member countries remains a challenge for rapid, coordinated deployment.
Annual Increases and Future Coverage
The annual increase in 5G connections has been nothing short of staggering. As of April 2023, global 5G connections have risen by 76% annually, reaching 1.05 billion connections. Considering LTE took almost 8 years to reach the 1 billion mark, 5G achieving this within 2 years highlights the unprecedented adoption.
Several reports predict that 5G will continue its immense growth over the next few years. According to the GSA, almost 210 commercial 5G networks will be live globally by 2023. Meanwhile, the GSMA predicts that by 2025, 5G networks will likely cover one-third of the world’s population, catalyzing adoption further across consumer and enterprise segments.
The expansion is supported by huge investments from governments and telcos. For instance, Chinese operators are expected to deploy over 1 million 5G base stations by end 2023. Similarly, leading U.S. telcos such as Verizon and AT&T have pledged to invest $25 billion and $20 billion respectively towards 5G rollouts from 2020-2022. As coverage expands globally through macro cells and networks densify through small cells, 5G adoption will scale immensely.
Impact on Connected Industries
The lightning-fast, low latency 5G network also stimulates development across several interconnected industries from manufacturing to media. By enabling massive machine type communications, 5G can drive smart factory adoption to optimize manufacturing and supply chains leveraging IoT sensors, robots, VR and big data analytics.
5G also transforms on-site operations like mining by facilitating remote control of machinery and ensuring connectivity across vast, hard to wire sites. Logistics sectors similarly benefit from real-time shipment tracking, efficient fleet routing and emerging concepts like autonomous trucks platooning behind a lead vehicle. Effectively, 5G serves as the lifeblood empowering automation and intelligence across essential sectors.
Its impact further extends to sectors like healthcare, education and utilities. For instance, high-definition medical imaging and even complex procedures like surgery can be delivered remotely through 5G connectivity. Retail, hospitality and entertainment sectors are also primed for innovation with immersive augmented and virtual environments using 5G. Even smart city infrastructure like air quality monitoring, traffic optimization, public safety and more can thrive on a 5G network backbone.
Impact on Network Equipment Market
The rapid expansion of 5G connectivity drives significant growth in the global network equipment market. The market is expected to witness a Compound Annual Growth Rate (CAGR) of 22.3% for the 5G segment through 2027, as per Grand View Research reports. This leads to lucrative opportunities for telecom equipment manufacturers focused on next-gen infrastructure including Ericsson, Nokia, Samsung, ZTE and Huawei among others.
The substantial demand is fueled by network operators rapidly upgrading infrastructure in the 5G era. This includes deploying small cells for targeted coverage, upgrading cell towers with 5G gear often through single-RAN radios supporting multiple networks, acquiring spectrum optimized for 5G and leveraging technologies like network slicing for customized performance. Carriers also adopt new 5G core networks while consolidating and enhancing transport capacity through fiber and high bandwidth microwave links.
Furthermore, rising usage of 5G across verticals necessitates testing and measurement equipment for smooth deployments and upgrades. Expanding private 5G networks also bolster equipment sales, for instance in industrial manufacturing settings. Effectively, the widespread mainstreaming of 5G globally across consumer and enterprise spaces catalyzes networks sales.
Impact on Data Centers
Furthermore, the proliferation of 5G networks is forecasted to drive immense growth in the global data center chip market. This market is anticipated to witness a CAGR of 14.4% from 2023 to 2031, reaching US$ 28.48 Billion by the end of the forecast period according to FactMR projections.
The tremendous growth is fueled by surging data traffic and computing workloads stemming from 5G adoption across billions of connections. As the number of endpoints transmitting data through 5G multiply, including consumer mobile devices, connected cars, IoT sensors, artificial intelligence platforms and more, the resultant data tidal wave necessitates vast increases in data storage and processing capabilities.
Effectively data centers need to radically augment their capacity through additions like hyperscale facilities, leveraging processing accelerators like GPUs and FPGAs, adopting advanced cooling techniques and more to handle 5G-era workloads. The processing demands are exacerbated by emerging concepts like multi-access edge computing that distribute storage and computing to localized edge data centers to deliver low latency. Thus 5G and edge computing mutually drive data center expansions worldwide.
Network Coverage Outlook
Around 280 5G networks have been launched worldwide as of November 2022 spanning leading economies in North America, Europe and the Asia Pacific region according to the GSA. Besides the extensive 5G rollouts, 4G network coverage continues to provide crucial connectivity for billions globally.
Ericsson projects that 4G population coverage will be around 90 percent globally at the end of 2023 and is expected to continue growing driven by advanced LTE features like LTE-Advanced Pro. In comparison, 5G population coverage is forecast to reach 40 percent by the same period.
This indicates that while 5G is rapidly expanding, 4G networks will continue playing a pivotal role in providing high-speed connectivity, particularly across developing countries where 5G deployment is still nascent. The two technologies are designed to interwork and complement each other for the foreseeable future. For instance, 5G non-standalone networks rely on existing 4G infrastructure for the core network and coverage fallbacks.
Even as users migrate to 5G services, 4G networks carry substantial loads. Ericsson predicts monthly global 4G data traffic per smartphone will exceed 50GB on average by 2027, a 3.5X increase over 2022 levels. Thus despite the hype and game changing capabilities of 5G, 4G promises to remains mainstream for years.
Conclusion
The global rollout of 5G represents a new era of hyper connectivity promising immense societal and economic transformation. 5G adoption is accelerating at an unprecedented pace, catalyzed by infrastructural development and burgeoning demand for higher broadband speeds, lower latency and massive capacity. In fact, 5G connections are estimated to surpass 4G in the early years of this decade itself.
The new networks support applications ranging from self-driving vehicles, augmented medicine and factory robots to smart cities and lightning fast downloads for consumers. Effectively, 5G serves as a platform for creativity, spurring advance across industries through endless connectivity. It brings increased productivity, automation and real-time operation capabilities while expanding opportunities for rural populations.
While the technology holds great promise, realizing its potential requires sustained collaboration between governments, regulators, standards bodies and private sector players towards coordinated spectrum allocations, pragmatic policies, and security frameworks. As 5G coverage expands globally in coming years, the seamless device connectivity and intelligent data analysis it engenders will undoubtedly uplift economies and societies alike.
^1: 5G Americas
^2: RCR Wireless
^3: 5G Americas
^5: GSMA Future Networks
^6: Qualcomm
^7: Yahoo Finance
^8: Ericsson Mobility Report
^9: EIN Presswire
^10: The Fast Mode