The global 5G market in aviation was valued at USD 481.50 million in 2021. It is projected to reach USD 24,011.65 million by 2030, growing at a CAGR of 54.40% during the forecast period (2022-2030).
The fifth generation (5G) network is used in aviation to operate efficient aircraft and airports. The 5G network is expected to bring the first commercial benefits to the industrial sectors of manufacturing, IT and telecom, robotics, etc. However, the future of developments involving applications in several other industries is still questionable. Several end-user businesses are investing heavily in 5G in the aviation industry. While the uncrewed aerial vehicle and drone industries are booming in the aviation sector, 5G applications for civil and private networks are still in the early stages of development. Civil aviation, commercial flight, general aviation, UAV surveillance, and other areas have significant growth and application potential for ground-air broadband data connection based on 4G/5G ATG-LTE mobile communication technology.
Robust internet connectivity is necessary for passengers, visitors, and the airport for administrative purposes from an IT operational standpoint in airports. However, this creates challenges for maintaining service continuity when the deployment is on a large scale. Furthermore, the Wi-Fi-capable data throughput and speeds fall short of the level of performance needed for automation applications and to enable Airport 4.0. In light of this, implementing a private wireless network over 5G is being driven by this factor. Additionally, the airport can run a cable-free, independent network environment with its equipment and outside clients using a frequency other than the public mobile networks. The most recent Wi-Fi standard, Wi-Fi 6, was created to improve Wi-ability Fi to handle increasing traffic demands successfully. Wi-Fi 6 is being implemented in airports to support critical 5G needs for capacity, throughput, latency, connection density, and speed.
The term used by the industry to refer to Wi-Fi equipment that uses 6 GHz is Wi-Fi 6E. The Wi-Fi 6E standard extends Wi-Fi 6's capabilities and features into the 6 GHz band, enabling faster data rates and improved performance. As Wi-Fi 6 networks improve passenger apps such as mobile boarding passes, wayfinding, streaming, and downloading huge files, these elements may increase the use of 5G in airports for improved flight experience service. Convergence and interoperability are becoming increasingly critical as wireless communication grows in importance thanks to cutting-edge technologies. The neutral host is an ideal business model for supporting 5G use cases and controlling all radio spectrum types.
The capital expenses of deploying the necessary 5G infrastructure and software updates internationally have become a big problem. Large-scale new cell sites, new or updated connective nodes and central switches, software, and completely new mobile devices might all be necessary for the effective rollout of the 5G network. Since 5G operates at a different frequency than the 4G standard, standalone 5G necessitates installing new infrastructure and hardware.
Compared to the wavelengths used by 4G, the millimeter waves used by the 5G standard are much shorter. A 5G connection can transfer significant data much faster than a 4G connection thanks to the shorter wavelength, but it also has a much smaller operating range. The range of 4G wavelengths is almost 10 miles. Only 2% of 4G's coverage is covered by 5G wavelengths, which range around 1,000 feet. Therefore, a large number of 5G cell towers and antennas are needed everywhere to ensure a strong 5G signal, which raises the setup cost.
From the carrier's point of view, the RAN and core networks raise the total cost of ownership. For instance, towers, cabinets, radio antennas, baseband processing, power, and cooling equipment are examples of the basic subcomponents that a RAN may deploy. Also, one of the problems that telecom companies have to solve is the rising energy cost. Compared to 4G, the energy costs associated with Massive MIMO antennas and VNFs maybe 2-3 times higher.
The widespread availability of 5G in airports would enable smart connections for any devices within proximity. The Internet of Things (IoT) introduces the inescapable need to handle expanding numbers of items and data. IoT connectivity is anticipated to be significantly more agile and adaptable with 5G. Massive data flows that provide real-time, forecast, and historical perspectives of airport operations may be made possible by the new networks. This is anticipated to facilitate and improve communication between airports, airlines, air traffic controllers, ground handlers, and concessionaires. As a result, the airport's lineups are intelligently monitored, and autonomous vehicles that assist are controlled.
Airbus testing is a noteworthy illustration of how the IoT is used in the aviation industry to increase the number of services. On the A350-900 Flight Lab, an ecosystem based on IoT technology has been put in place, making it possible to offer extra services to passengers, crews, and the airlines themselves. The IoT solution's adoption enables the flight crew to wirelessly control the passenger cabin, enabling staff to respond to passengers' requests more quickly and better manage passenger safety.
The global 5G market in aviation is segmented by connectivity type.
The global market is bifurcated into ground-to-ground communication and air-to-ground communication.
The ground-to-ground communication segment is the highest contributor to the market and is expected to grow at a CAGR of 51.50% during the forecast period. With the growing proliferation of technologies and connected solutions being used across the airports, the demand for low latency and high-speed communication is increasing at a faster pace as airports of all sizes launch next-generation wireless technologies to not only satisfy passenger connectivity demands but to enhance their operations such as MRO functions and passenger screening. Maintenance, repair, and overhaul (MRO) organizations are crucial for keeping aircraft safe and flight-worthy, and constant communication is one of the vital requirements. Industrial-grade 5G-powered private wireless connectivity can give MRO organizations new capabilities to strengthen their MRO functions.
Airports are increasingly deploying 5G infrastructure across their premises to enhance connectivity, thus propelling the need for connected technologies. For instance, in May 2020, Shenzhen airport got full 5G coverage as the airport accelerated the construction of a 5G network by building 41 outdoor base stations with signals that can cover all places, including terminals, the flight area, and the freight transport area. Security and surveillance are another significant part of the application that requires communication technology across the airports. Currently, a substantial share of airports across the world has incorporated private LTE (PLTE), making them a perfect candidate for the deployment of 5G. Citizens Broadband Radio Service airports are strong candidates for this 5G network offering as the shared band provides a favorable, cost-effective mid-band spectrum for fast and secure connectivity.
Air-to-Ground (ATG) uses mature land mobile communication technologies to provide a high-speed mobile network for airlines by deploying dedicated ground base stations to cover the sky. 5G ATG is expected to support the high-speed movement of aircraft; provide super-large coverage radius; adopt ground and air co-spectrum to save spectrum resources, support high peak rate in aircraft, and fulfill the high-security requirement of aviation equipment. 5G technology is expected to transform in-flight connectivity (IFC) and 5G air-to-ground (ATG) networks, with significant vendors entering the space to expand their product and solution offering.
Major 5G vendors are increasingly forming alliances and partnerships with aviation industry players to offer and develop custom solutions specific to the industry. For instance, in September 2020, Nokia spin-off SkyFive signed a partnership agreement with Airbus China Innovation Center, looking to develop a 5G air-to-ground solution for the Chinese aviation market. The company is one of the delivery partners for Inmarsat and Deutsche Telekom's European Aviation Network (EAN). Moreover, in February 2021, ZTE announced that it expects to work with Chinese mobile operators to construct and commercialize 5G ATG networks in China.
The global 5G market in aviation is bifurcated into four regions: North America, Europe, Asia-Pacific, and LAMEA.
North America is the most significant shareholder in the global 5G market in aviation and is anticipated to grow at a CAGR of 53.2% over the projection period. The number of people flying to and from North America makes it one of the primary markets for the aviation sector. The region's aviation industry is one of the end-users to the region's leading telecom operators and infrastructure providers, including Verizon, AT&T, Sprint, Ericsson, and Nokia, which are offering the technology. For instance, in January 2021, at Tampa International Airport, AT&T introduced 5G+ services, providing coverage to travelers. These factors are anticipated to drive the global 5G market in aviation growth over the forecast period.
Asia-Pacific is expected to grow at a CAGR of 61.60%, generating USD 9,635.19 million during the forecast period. The Asia-Pacific region is among the first 5G technology-adopting countries, making it one of the aviation industries with the largest growth rates globally. In addition, it is anticipated that China, India, South Korea, and Japan, among other nations in the area, will see an increase in demand due to the government's drive to adopt 5G technology. One of the nations leading the adoption of 5G is China, which also has one of the largest aviation markets in the world. The country's aviation sector is rapidly focusing on introducing and adopting 5G. For instance, the Shenyang general aviation industry base in Liaoning Province unveiled a 5G base station in February 2019, making it the first public aviation airport in northeast China to support 5G.
Europe is one of the primary air passenger hubs due to its leadership in international tourism and the growth of the aviation industry in crucial nations like Germany, France, the United Kingdom, Spain, Italy, and others. Recently, a sizable portion of the region's airports have upgraded their 5G connectivity, and nations like Germany are at the forefront of the technology. For instance, the German operator Deutsche Telekom reported in December 2020 that it had upgraded 45,000 antennas overall for 5G services in 2020, including those at airports. In addition, the business offers its services at Frankfurt Airport. Major firms in the aviation sector are also eager to implement the technology to improve their regional capabilities.
The Middle East region was in front of other nations regarding early 5G implementation in terms of execution speed and attaining the most significant mass coverage. For instance, the Middle Eastern telecom provider Zain initially launched 5G services in Kuwait in June 2019, but 5G services were only partially made accessible in Asia-Pacific nations like China in late 2019. In addition, 95% of Kuwait's populated areas are currently covered by commercial 5G services offered by Zain, and complete coverage is soon to follow. Also, Zain Saudi Arabia declared in May 2019 that one of its network's first 5G calls in the Middle East had been completed. All these elements significantly contributed to the Middle Eastern aviation industry's significant adoption of 5G.
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