Ericsson forecasts $31 trillion 5G consumer market by 2030

The global 5G consumer market could be worth $31 trillion by 2030, according to a new report by Ericsson.

The report – the 5G Consumer Potential – estimates that communications service providers (CSPs) could earn $3.7 trillion of that total – a figure that could increase further as new adjacent digital services opportunities arise.

The report also estimates that CSPs could generate up to $131bn by 2030 from digital service revenues alone, by proactively bundling and marketing 5G use cases. About 40 per cent 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.

Read: Ericsson to help set up 5G, IoT innovation centre in Oman

Covid-19 pandemic seems to have affected consumers’ willingness to pay a premium for 5G subscriptions, the report shows. In early 2019, the average consumer was willing to pay a 20 per cent premium for 5G. As 2020 draws to an end, that figure has dropped to 10 per cent. However, one in three early adopters globally are still willing to pay a 20 per cent premium.

The report also projects that by actively driving 5G consumer adoption, CSPs could gain 34 per cent higher 5G average revenue per user (ARPU) by 2030. This could boost consumer revenues at a compound annual growth rate (CAGR) of 2.7 per cent compared to flat revenue growth of 0.03 per cent by taking a passive approach across the decade.

“It is clear that 5G will drive enormous opportunities for CSPs in consumer business over the decade,” said Jasmeet Singh Sethi, head of ConsumerLab, Ericsson Research. “As this journey is already underway, those CSPs that quickly and proactively evolve their consumer propositions are likely to be bigger winners.”