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ABI Research predicts that mobile operators could see a significant revenue boost from 5G, with global 5G revenue expected to reach $247 billion by 2025. This expansion will be driven primarily by markets in North America, Western Europe, and the Asia-Pacific region.
“5G will be a fast-growing cellular technology, likely outpacing previous generations including 4G,” says Joe Hoffman, Managing Director and Vice President at ABI Research. “Over the next few years, the technology migration will accelerate the decline of 2G. While 3G and 4G will continue to grow in many areas, 5G will enable new use cases and open additional revenue streams.”
The exact technical standards for 5G are still being finalized, with standards organizations expected to complete their work around 2020. Soon after standardization, vendors and operators are expected to ramp up deployments as they compete to offer 5G services to customers.
It will be better, cheaper, greener, and incredibly high-speed wireless data access for the mass market
As with previous generational rollouts, the primary challenges are likely to be operational and regulatory rather than purely technological. Key issues include spectrum fragmentation, coverage and range limitations, device availability, and capital and operational expenditures. Most importantly, commercial success will depend on clear, profitable use cases that leverage 5G’s unique advantages.
Supporting the Internet of Things (IoT) is expected to be a major application of 5G, as billions of devices will need reliable, widespread connectivity. To meet this demand, ABI Research forecasts the deployment of 8.5 million small cells by 2020 to build the dense infrastructure required for rapid 5G millimeter-wave rollouts.
“The 5G network of tomorrow will, over time, evolve to embrace cellular, Wi‑Fi, and wired connectivity in addition to millimeter wave,” Hoffman concludes. “It will deliver better, cheaper, greener, and extremely high‑speed wireless data access to the mass market, sparking a wave of business innovation.”
Several mobile operators across North America and the Asia-Pacific have already announced projects and plans for 5G initiatives. For instance, Verizon Wireless, NTT DoCoMo, KT, and SK Telecom formed the 5G Open Trial Specification Alliance. Verizon’s acquisition of XO Communications’ fiber network business also helps secure strategic access to fiber infrastructure and licensed millimeter-wave spectrum.
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