US, China, Japan and Korea to dominate 5G

Berlin

CHINA, the United States, Japan and Korea will account for more than half of the world's subscribers to super-fast 5G mobile networks by 2025, leaving Europe lagging, a study showed on Thursday.

Europe, moving more slowly to build 5G networks, will lag in terms of consumer take-up. Yet the picture looks different in business, where 5G will be able to run "smart" factories using connected robots, devices and sensors.

"It's going to be a small cluster of countries that leads adoption in 5G, with the rest of the world following," Tim Hatt, head of research at GSMA Intelligence, told Reuters. "China, Japan, Korea and the US - between those, you're looking at well over half of worldwide 5G subscribers by 2025."

The rapid rollout of 5G networks, with speeds fast enough to download a movie to a smartphone in seconds, has surprised many.

Nokia, the world's No 2 network vendor behind Huawei, recently suspended its dividend to invest in upgrading the 5G gear it sells to carriers.

In Korea, 66 per cent of mobile connections will be 5G by mid-decade, GSMA Intelligence forecast in a 100-page study, followed by the US (50 per cent) and Japan (49 per cent).

In terms of sheer numbers, China will predominate with 600 million 5G connections. Worldwide, 1.57 billion people are expected to adopt 5G by 2025 - or 18 per cent of total mobile users.

Early experience shows that carriers can hike 5G prices by 15-20 per cent, offering "more for more" unlimited data plans. But, if the past is anything to go by, those gains will eventually be competed away.

With standards to take effect in a couple of years that will support the development of the industrial Internet of Things (IoT), such usage is seen by European industry as a more promising way to recoup the vast outlays needed for 5G.

Rather than sell to enterprise clients, Mr Hatt said carriers would be better off teaming up with them on projects in the IoT - a market that GSMA Intelligence forecasts will be worth US$1 trillion in 2025, roughly equal to total mobile industry revenue last year.

Yet of that, only 5 per cent will come from connectivity, forcing carriers to compete with global consulting firms and Silicon Valley tech giants like Amazon or Microsoft for the rest of the pie, said Mr Hatt.

For developing nations, it's the spread of affordable connectivity through older 4G technology - and not 5G - that will affect the lives of billions of people for years to come, the research arm of telecoms industry group GSMA found.

Looking to emerging markets like Nigeria, Mexico, India or Indonesia, a combination of cheap Android smartphones and affordable data still offers growth potential.

GSMA Intelligence forecasts that 59 per cent of total worldwide mobile connections will be 4G in 2025. REUTERS