5G services, which is capable of 8-10x the download speeds of 4G, is delivering more value through an improved user experience for migrating customers, Strategy Analytics’ Philip Kendall said in a blog post.
5G smartphones on 5G mobile network typically enjoy a 2-3x speed gain over 4G phone models from the same vendor. 5G download speeds outperform both 4G and Wi-Fi by a 5-8x ratio in developing economies such as the Philippines, analysis from Opensignal shows.
South Korea’s MSIT reports average data usage per 5G customer (26.8 GB) at 3.3x 4G (8.2 GB) in June 2022.
In China, average data usage per 5G customer is estimated at over 2x.
DNA Finland’s 5G smartphone users consumed 33GB per month in 2021, 15 percent higher than 4G smartphones and nearly 7x higher than 3G phones, while 5G modem use of 231GB was 115 percent above 4G levels.
5G operators in some markets have used content-based service bundling to encourage higher monthly spend and expose users to 5G-enhanced content services such as cloud gaming, UHD video, and AR/VR. These user experience and pricing dynamics are contributing to healthy ARPU uplift (of typically 10-20 percent) as users upgrade from 4G to 5G.
For example, 5G ARPUs are 1.3x higher than 4G in the US, and 1.6x higher in South Korea and China.
The 5G fixed wireless access market has been a new revenue stream for a growing number of operators, making a healthy revenue contribution in Gulf states and the US in particular, though also important in a number of European markets such as Finland, Austria, Germany, and Switzerland.
For operators such as Austria’s Magenta and Switzerland’s Sunrise, 5G FWA has been a useful anchor for FMC propositions outside of fiber coverage.
In its Gulf state markets, 5G has lifted Zain’s revenues in Saudi Arabia and Kuwait as 5G has helped to transform a >1 million FWA customer base ARPUs 30 percent higher than 4G.
T-Mobile US has over 1.5 million FWA customers contributing roughly 1.5 percent to postpaid revenue.
Operators are also targeting 5G private networks as a new business domain. China is using network slices on 5G standalone rather than dedicated on-premises capacity, with operators there supporting over 4,200 5G private networks at the start of the year.
Telefonica Germany’s 5G hospital network in Leipzig, Vodafone’s 5G intermodal railway hub in Hungary, Orange’s 5G ports in Le Havre and Antwerp and MTN’s 5G smart mining in South Africa are some of the latest examples of 5G private networks.
In the US, T-Mobile’s leadership in mid-band 5G network deployments (using 2.5 GHz while AT&T and Verizon have waited to begin 3.5 GHz services until 2022 and having twice the mid-band population coverage of either) is delivering a 5G market share more than five percentage points above its overall market share and more 5G FWA customers than Verizon and AT&T combined.
In South Korea, LG Uplus enjoyed some early market share gains through an aggressive 5G network deployment and a strong focus on 5G-enhanced content; it’s 5G market share still trends above its 4G share, it has increased its revenue share by approximately one percentage point and has also unlocked revenue of over US$23 million from 5G content exports by playing an active role in the XR content ecosystem in particular.
5G networks reached 27 percent of the world’s population in 2021. The rate of 5G coverage will increase from 650 million inhabitants added in 2021 to 760 million added in 2022, Strategy Analytics forecasts.
5G phone makers sold over one billion 5G smartphones by the end of March 2022, with the technology accounting for 42 percent of phone sales in Q1. Strategy Analytics’ smartphone experts forecast that 5G will account for 60 percent of global smartphone sales by Q4 2022.
Mobile service revenue is currently increasing by over 4 percent per annum (levels not seen since 2012) and 5G’s contribution to growth has been an important factor here.