As the world becomes ever more digitally and globally connected, industries are experiencing an Information Communication Technology (ICT)-driven transformation. Digitalization is growing across the globe , and it is predicted that digital revenue for ICT players will be worth around USD 3.5 trillion by 2026 across the 10 key industries studied in the Ericsson 5G Business Potential Report.
Industry digitalization revenues for ICT players come from adopting or integrating digital technologies into a specific industry. These industry digitalization revenues are substantial – even today. In fact, revenues reached USD 968 billion in 2016. Operators should consider that this young market is already bearing fruit for those who take the opportunity to reap the financial rewards.
Global business trends such as hyper competition, new customer power and sophistication, the fast-paced change in business ecosystems and disruptive technological advances all affect vertical industries to different extents. Industries are moving towards digitalization for better business outcomes: to increase revenue by better serving their customers, increasing demand, and beating competition; to decrease costs by increasing productivity and efficiency; and to decrease risk by increasing safety and security.
The 5G market potential
Telecom operators globally, are facing multiple challenges : increasing demands from consumers , hyper competitive pricing and competition are only a few of the factors causing market stagnation for the industry. Despite high growth in both mobile subscriptions and mobile data traffic, overall mobile service revenue growth has flattened out, compared to the 10 to 15 percent annual growth a decade ago. Operators are struggling to turn the growing usage of mobile data services into greater revenues.
The current average forecast for operator service revenues is expected to increase by 1.5 percent annually from 2016 to 2026 globally. While this offers a steady revenue stream, it is slim when compared to 5G-enabled revenue growth opportunities in industry digitalization. In case of 5G, telecom operators can profit from an additional 36 percent revenue potential globally by 2026 from 5G-enabled market opportunities if they expand their role from being connectivity and infrastructure providers to becoming service enablers and service creators.
Effects of 5G on Industries:
The manufacturing industry: Production line robotics: Manufacturing is one industry identified from the study that shows a strong market potential for ICT players when addressing 5G enabled industry digitalization. The challenge for manufacturers is to increase productivity, efficiency and flexibility and to enable greater personalization of products and services. 5G technologies can help to address these key trends and challenges and make a significant impact. One key example is enabling and enhancing critical control of production line robotics.
Critical control of production line robotics includes tethered or untethered robots that are controlled, monitored, and can be reconfigured remotely. This technology could be used in factory floor production, reconfiguration and layout changes, real-time analysis and even to steer a robot’s movement from a remote location. 5G plays a major role in connecting production line robotics by providing high-performance mobile services such as:
• Connectivity for robotics, removing the need for fiber tethering
• Quick reactions to discrepancies, helping to avoid damaging expensive components
• Live remote monitoring of video streams from robotics
• Low latency-enabled remote control applications
The technology in such a scenario has an estimated potential opex saving of 15 to 20 percent, and helps production operations become more flexible, efficient, safer and cheaper to maintain.
The energy and utilities industry: Real-time monitoring – The energy and utilities industry is second only to manufacturing in its operator-addressable revenue potential. The lion’s share of the opportunity is to be found in the smart grid area. An interesting future use case for the energy and utilities industry is that of drones being controlled remotely to monitor and/or maintain transmission or production assets, generating a 30 percent cost reduction potential compared to sending humans into the field. This will lead to increased safety for workers, improved grid uptime and reduced costs.
The retail industry: Tomorrow’s virtual world: Retail is another industry that is projected to be transformed by 5G. Consumers’ shopping experiences can be enhanced by way of AR/VR, which allows them to test products in a virtual world, access product information and visualize products in their homes. The use of AR/VR will be enabled by 5G’s high-speed in-store connectivity, allowing rich content delivery. 5G’s low latency also enables mobile AR/VR applications that prevent nausea.
5G in India
Digitalization will enable a $27 billion revenue opportunity for the ICT industry in India by 2026 and 5G can enable Indian operators to garner around 50% of the same. The largest opportunity will be seen in sectors like manufacturing, energy and utilities followed by public safety and health sectors. This will be over and above the revenue generated from traditional services which is expected to grow up to $63 billion by 2026 .
In India, agriculture will open-up revenue opportunities up to $400 million for telecom operators. The application of 5G will be in areas like field monitoring and mapping, livestock routing and monitoring, on-field applications, and related services. The retail sector in India will offer potential 5G enabled revenue of up to $1.15 billion by 2026. 5G can help in revolutionizing customer experience and increase operational efficiencies within the retail segment.
(Brand Connect Initiative)