5G Services Market Size, Share & Trends Analysis Report By Communication Type (FWA, eMBB, uRLLC, MMTC), By Vertical (Consumer, Enterprises), By Application (Smart cities, Smart buildings, Industry 4.0, Autonomous vehicles, Smart Healthcare, Smart utilities, Immersive media & gaming, Others) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2022-2030

Market Overview

The global 5G services market size was valued at USD 46.2 billion in 2021. It is projected to reach USD 2290.53 billion by 2030, growing at a CAGR of 54.30% during the forecast period (2022-2030). 

A fully mobile and connected environment is made possible by 5G wireless mobile services by providing customers with a variety of business models and use cases. The user experience would be enhanced when using 5G internet for a variety of use cases, such as seamless video calling, Virtual Reality (VR) and Augmented Reality (AR) gaming, and Ultra-High Definition (UHD) videos, among others, thanks to advantages like extremely low latency and faster data speeds provided by the 5G technology. These services are expected to increase in the upcoming years due to the rising demand for high-speed data connectivity for unified Internet of Things (IoT) applications, such as smart home energy management.

Market Dynamics

Global 5G Services Market Drivers

Growing Demand for High-Speed Data Bandwidth 

Many people use data since it is widely available and easy to access. Additionally, its use for surfing, streaming videos, and video calling has increased due to the widespread use of smartphones, tablets, and smart TVs. To give users a smooth experience, the resulting rise in data traffic has led to a requirement for high-speed internet connectivity. Numerous applications, from straightforward ones like Virtual Reality (VR) and Augmented Reality (AR) gaming and Ultra-High Definition (UHD) video streaming to more sophisticated ones like robotic procedures, autonomous vehicles, and autonomous defense equipment, are anticipated to be made possible by the commercialization of 5G-enabled services. The demand for 5G services is expected to be driven by these elements.

Huge expenditures are being made by sectors like manufacturing, healthcare, transportation, and logistics in an effort to move toward automated business operations. For instance, robots are expected to drastically alter the industrial environment by performing jobs or operations presently carried out by humans. They would also need extraordinarily low latency to be completely functional, carry out jobs effectively, and adhere to safety requirements. Benefits from 5G services, like their reduced latency and improved data connectivity, are anticipated to support such transitions.

Global 5G Services Market Restraints

High Spectrum Costs

The government or telecom regulatory bodies charge telecom service providers a high cost for acquiring the license or rights to transmit signals over particular electromagnetic spectrum bands. Additionally, governments worldwide only permit a small spectrum to be licensed by telecom carriers. These elements are predicted to impede the market's expansion for 5G services. For instance, the Telecom Regulatory Authority of India (TRAI) has suggested a starting price of INR 492 per MHz for 5G spectrum in the 3300 MHz to 3600 MHz area. Higher subscription prices to use 5G services are anticipated due to the rising cost of the 5G spectrum combined with high infrastructure expenditures related to their rollout. This will likely hurt consumers and impede the development of 5G services over the forecast period.

Global 5G Services Market Opportunities

New Business Avenues in Cloud Computing

Businesses across various industrial verticals are anticipated to benefit from the advent of 5G technology in terms of growth opportunities. With the rollout of 5G services, it is expected that the application of AI and IoT in various business processes will pick up steam, providing growth prospects for all ecosystem participants. In May 2019, it was revealed that IBM Corporation and Vodafone Group Plc. would work together to create an open, agile, and secure IT environment using IBM's hybrid and multi-cloud analytics and AI security capabilities. The businesses would also work together on combined IoT and AI projects.

Organizations have been forced to switch to cloud computing due to the high expenses of developing and maintaining on-premise systems. In addition, cloud computing requires better network connectivity to function. It is projected that integrating cloud technologies with 5G services will improve various businesses' functionality, operational capacity, and flexibility and allow network carriers to provide exceptional, competitive services. They should also open up several investment options for cloud enterprises. Organizations should switch to cloud-based solutions of the 5G network services' high-speed data access and decreased latency levels.

Regional Analysis

The global 5G services market is divided into four regions, namely North America, Europe, Asia-Pacific, and LAMEA. 

Asia-Pacific Dominates the Global Market

Asia-Pacific is the most significant shareholder in the global 5G network market and is expected to grow at a CAGR of 47.50% during the forecast period. Major market players in the Asia-Pacific area, including China Telecom, China Mobile, SK Telecom, and KT Corp., are making significant investments in rolling out the 5G network infrastructure in China, Japan, and South Korea. Most of these investments go toward constructing next-generation infrastructure for the manufacturing, transportation and logistics, healthcare, and media and entertainment sectors. These investments are expected to hasten the growth of the Asia Pacific regional market throughout the projection period. Additionally, a significant amount of 5G-capable smartphones are being produced across the region due to the strong demand for handsets that support faster data rates.

North America is expected to grow at a CAGR of 45.50% during the forecast period. Some of the most significant investments in building the 5G network infrastructure are being made in the United States. For instance, the GVR study indicated that between 2010 and 2017, U.S.-based mobile operators invested almost USD 250 billion in the rollout of mobile network infrastructure. It is anticipated that vigorous spending on the nation's creation of smart cities, smart industries, and smart households will boost regional market expansion during the forecast period.

Europe is anticipated to grow significantly over the forecast period. The European Commission introduced a unified EU-wide voice termination rate by the delegated act in December 2020 in pricing legislation. The German government is also actively encouraging the development of lightweight base stations (standardized), such as tiny cells, for 5G in crowded metropolitan areas, as per the lightweight regulation for small-area wireless access points (SAWAPs). This law is also supported by other EU member states. Additionally, according to the German telecom regulatory body, the spectrum allotted to the telecom operators in the 5G spectrum auction would last until 2040. Simultaneously, the acquired spectrum would become available for re-assignments in 2040 if no additional assignments have been made to the present 5G spectrum owners.

Segmental Analysis

The global 5G services market is segmented by communication type and vertical.

Based on communication type, the global market is bifurcated into FWA, eMBB, URLLC, and MMTC.

The eMBB segment is the highest contributor to the market and is expected to grow at a CAGR of 44.70% during the forecast period. This can be attributable to 5G network operators' initial focus on delivering better internet capabilities for applications like fast cloud gaming, augmented reality and virtual reality, UHD video, and uninterrupted video conversations. The eMBB offers breakneck data speeds for home and commercial use. As a result, eMBB is anticipated to support a variety of use cases, including in-vehicle infotainment, 4K video access, and virtual meetings, helping to propel the eMBB segment's expansion throughout the forecast period.

Fixed Wireless Connectivity (FWA) is a type of wireless network technology that uses beamforming and a high-frequency mmWave spectrum to deliver internet access to households and businesses. The mmWave spectrum used by the radio access units and core network in the 5G FWA provides ultra-high-capacity broadband services. To give FWA deployments more flexibility, Nokia Corporation announced the extension of its fixed wireless access portfolio in October 2019.

The ultra-reliable and low-latency communications (uRLLC) focuses on latency-sensitive services, such as next-generation transportation connection, industrial automation, smart grid, etc., to meet the demands of the digital industry. Large-scale applications like smart cities, smart agriculture, remote asset monitoring, etc., can communicate in high bandwidth thanks to extensive machine-type communications.

Based on vertical, the global market is bifurcated into manufacturing, public safety, healthcare and social work, IT and telecom, and others.

The IT and telecom segment owns the highest market share and is expected to grow at a CAGR of 49.25% during the forecast period. The corporate sector, which consists of both large and small and medium-sized businesses (SMEs), is the primary driver of the worldwide IT and telecom segment's high market share and expansion. As part of their digital transformation activities, businesses are adopting and using modern technology at varying levels. These changes include multi-vendor connectivity on a centralized platform, cloud computing, and next-generation Wi-Fi networking. As a result, the 5G network would be crucial in ensuring the uninterrupted operation of the apps by offering seamless connectivity. The availability of many devices with high-speed network access and the ability to join them is causing 5G to gain traction with businesses. The commercialization of 5G services is causing a significant shift in the telecom sector.

Factory automation is the result of a transition in the manufacturing sector toward new technologies. The decision-making processes become decentralized due to this trend toward innovative factory operations using connected devices. These gadgets require reliable, fast, and continuous connectivity since they can perceive their surroundings and interact through wireless communication systems. The manufacturing industry is expected to function as a catalyst for the adoption of 5G services, which will lead to the highest growth of these services in this vertical due to the extraordinary benefits of these services, such as high-speed connectivity, high bandwidth, and ultra-low latency.

With an increase in 5G use cases, including robotic surgery, IoT, and AI, the healthcare sector is predicted to undergo a technological transition. The healthcare value chain is anticipated to change because of 5G's exceptionally low latencies and significant data rates. Pharmacies, payers, and providers are some of the major players in the healthcare value chain. With the rollout of 5G services, each participant is anticipated to experience various effects. With the use of 5G, it is now possible to follow people's movements, check hospital occupancy rates, and monitor vast inventory levels. The 5G Network can be used to incorporate all these insights into the Electronic Medical Record (EMR) system, which will aid in managing and assessing hospital operations.

The media and entertainment sector depends on communication network capabilities, particularly in the wake of the COVID-19 outbreak, which restricted the industry to TVs and smartphones. Here, the 5G services' high-speed communication capabilities will encourage people to use smart devices. The launch of 5G services is also projected to open up new economic opportunities for the media, gaming, and advertising sectors, which can benefit from next-generation technologies like Artificial Reality (AR), Virtual Reality (VR), and Mixed Reality (MR). These technologies, which provide users with cutting-edge experiences with less than 1ms of latency and high-speed connectivity, will take the media and entertainment sector by storm.

Impact of covid-19

Recent Developments

• October 2022- Verizon recently started putting customer traffic onto the new cloud-native, containerized design core, which will deliver unparalleled levels of service agility, flexibility, and automated scaling, following early testing and friendly user trials of the 5G core. Software applications, compute resources, networking, and storage make up the service-based architecture of the core.
• October 2022- Verizon announced that specific 5G Home and LTE Home Internet services are free to qualifying households under the new Verizon Forward Program. This announcement was part of Verizon's continuous effort to ensure everyone can access the internet equally and affordably.