Communications service providers (CSPs) could earn $3.7 trillion of the 5G consumer market that will be worth $31 trillion by 2030, according to a report from Ericsson ConsumerLab.
The report estimates that SPs could generate up to $131 billion by 2030 from digital service revenues alone, by bundling and marketing 5G use cases. About 40 percent of these revenue projections are attributed to consumer spending on enhanced video, augmented reality (AR), virtual reality (VR) and cloud gaming over 5G networks.
The report projects that AR is likely to drive more than half of all consumer spending on immersive media by 2030 – starting with gaming and extending to other areas like shopping, education and remote collaboration.
The average consumer was willing to pay a 20 percent premium for 5G in 2020 as compared with 20 percent in early 2019.
One in three early adopters are still willing to pay a 20 percent premium. Such high levels of early adopter take-up could help drive economic recovery.
The report projects that by proactively driving 5G consumer adoption, SPs could gain 34 percent higher 5G average revenue per user (ARPU) by 2030. This could boost consumer revenues at a compound annual growth rate (CAGR) of 2.7 percent compared to flat revenue growth of 0.03 percent by taking a passive approach across the decade.
5G will drive enormous opportunities for CSPs in consumer business over the decade. As this journey is already underway, those CSPs that quickly and proactively evolve their consumer propositions are likely to be bigger winners, Jasmeet Singh Sethi, head of ConsumerLab, Ericsson Research, said.
The report highlights the enabling role technologies such as edge computing and network slicing will play in helping service providers to secure 5G-enabled consumer revenue. This could come from core digital services like cloud gaming and augmented reality applications, or adjacent digital services, such as in-car connectivity and associated safety features.