Take-up of 5G services may be slightly slower in 2020 and 2021 due to the Covid-19 pandemic, but the long-term outlook for the new mobile technology remains positive, according to CCS Insight. The market researcher upgraded its long-term forecast for 5G connections to pass 1 billion worldwide in 2022 and grow to 3.2 billion in 2025.
The health crisis will have only a moderate and short-term effect on adoption, caused by relatively minor delays in the roll-out of 5G networks and sale of spectrum as well as macroeconomic uncertainty after governments lift lockdowns, CCS said. These trends will be partially offset by widespread availability of 5G smartphones and accelerating momentum for 5G in China.
An important assumption in the new forecast is that the global mobile phone market will make a full recovery by 2022, with shipment numbers exceeding those in 2019. A faster-than-expected drop in prices for 5G smartphones below USD 400 will fuel take-up of the new services, the market researcher expects. This is supported by new chipsets and fierce competition in the phone market.
China is leading the growth, with already around one in four handsets bought there coming with 5G. CCS expects China to reach nearly 100 million 5G connections this year and pass 1 billion in 2024. Elsewhere, 5G momentum has continued in South Korea and Japan, and 5G networks are now up and running in 17 countries in Europe, including the first launches in Belgium, the Netherlands, Norway, Poland and Sweden, all during lockdowns.
CCS expects slower 5G growth in the industrial IoT market, due to the economic disruption caused by the pandemic. Industrial companies and city authorities are shifting their short-term priorities, which will lead to some delays in adoption of 5G connectivity. Still, the market researcher predict that by 2025, 270 million IoT devices will be connected to 5G networks worldwide.
