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Telcos defy COVID-19 stress in commercial 5G push

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Mobile operators across the globe have defied the strain caused by the COVID-19 pandemic to accelerate the roll out of commercial 5G offerings.

This is according to the Ericsson Mobility Report, which forecasts 5G subscriptions will reach 190 million by the end of 2020.

Amid the disruptions caused by the coronavirus, Ericsson says telecom networks have stood up to the task.

It notes that while in some markets, 5G subscription growth has slowed as a result of the pandemic, this is outweighed by other markets where it is accelerating, leading Ericsson to raise its forecast of global 5G subscriptions at the end of 2020.

Last month, SA’s biggest mobile operator Vodacom switched on its commercial 5G mobile network in three cities – Johannesburg, Pretoria and Cape Town – with further rollouts planned to other parts of the country.

During the COVID-19 lockdown in SA, Vodacom was assigned temporary spectrum by telecoms regulator ICASA for the duration of the national state of disaster, including 1 x 50MHz in the 3.5GHz band, which has been used to fast-track its 5G launch, says the operator.

According to reports, MTN is also planning to launch commercial 5G services using the emergency spectrum issued by the regulator.

In September last year, mobile data-only network operator Rain activated South Africa’s first commercial 5G network.

Pandemic panic

Despite the uncertainty caused by the pandemic, service providers continued to switch on 5G, and more than 75 have now announced commercial 5G service launches, says Ericsson.

“We have increased our estimate for the number of 5G subscriptions, and now forecast about 190 million by the end of 2020. This is mainly due to a faster uptake in China than previously expected.

“For other parts of the world, slight downward adjustments have been made due to the effects of the pandemic,” the report says.

For example, it notes, several spectrum auctions in Europe have been delayed, with a slower uptake of 5G subscriptions in the near term expected as a result.

“We have slightly decreased our 5G subscriptions forecast for 2020 and 2021 in North America, compared to previous estimates. Both Europe and North America are expected to reach the same 5G subscription figures by 2025 as previously forecast.”

Over the forecast period, 5G subscription uptake is expected to be significantly faster than that of LTE, following its launch in 2009.

Key factors are China’s earlier engagement with 5G compared to 4G (LTE), as well as the earlier availability of devices from several vendors.

“By the end of 2025, we forecast 2.8 billion 5G subscriptions globally, accounting for around 30% of all mobile subscriptions at that time,” Ericsson says.

Comparison of 5G and 4G subscription uptake in the first years of deployment (billion). Source: Ericsson Mobility Report.
Comparison of 5G and 4G subscription uptake in the first years of deployment (billion). Source: Ericsson Mobility Report.

HSPA dominates in Africa

Ericsson says LTE accounted for around 11% of subscriptions in 2019 in Sub-Saharan Africa.

Over the forecast period, mobile broadband subscriptions are predicted to increase, reaching over 70% of mobile subscriptions.

The company believes LTE share will reach around 30% by the end of the forecast period, but HSPA will remain the dominant technology with a share of around 40%, which is similar to 2019.

According to the report, driving factors behind the growth of mobile broadband subscriptions include a young, growing population with increasing digital skills, and more affordable smartphones.

Over the forecast period, discernible volumes of 5G subscriptions are expected from 2022, reaching 3% by 2025, it adds.

Ericsson is of the view that LTE will remain the dominant mobile access technology by subscription during the forecast period.

“It [LTE] is projected to peak in 2022 at 5.1 billion subscriptions and decline to around 4.4 billion subscriptions by the end of 2025 as more subscribers migrate to 5G.”

In 2025, 88% of subscriptions are projected to be for mobile broadband.

Says Ericsson: “Today, there are around eight billion mobile subscriptions. We estimate this figure will increase to 8.9 billion by the end of 2025, out of which 88% will be for mobile broadband. This is a slightly lower share than previously forecast, due to a slower decline in 2G (GSM/EDGE-only) subscriptions mainly in the India region.”

It points out that the number of unique mobile subscribers is projected to reach 6.3 billion by the end of the forecast period.

Mobile phone subscriptions

Smartphone penetration continues to rise, the report adds, noting that subscriptions associated with smartphones account for about 70% of all mobile phone subscriptions.

There were 5.5 billion smartphone subscriptions at the end of 2019. The number of smartphone subscriptions is forecast to reach 7.5 billion in 2025, which accounts for around 85% of all mobile subscriptions.

Subscriptions for fixed broadband are expected to show limited growth of around 4% per year through 2025, says the report.

It adds that subscriptions for mobile PCs and tablets are expected to show moderate growth, reaching around 390 million in 2025.

“There were 5.5 billion smartphone subscriptions at the end of 2019. The number of smartphone subscriptions is forecast to reach 7.5 billion in 2025, which accounts for around 85% of all mobile subscriptions.”

Ericsson expects subscriptions for fixed broadband to show limited growth of around 4% per year through 2025, while subscriptions for mobile PCs and tablets are expected to show moderate growth, reaching around 390 million in 2025.

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