One of the fast-growing regions in the world with over half of the world’s total subscribers, Asia Pacific is a hotbed for 5G adoption. According to Juniper Research, over 60% of global 5G connections will be located in the region by 2026.
A game-changing technology that offers immense possibilities for enterprises and consumers, 5G offers the potential to drive economies. Research firm Frost & Sullivan forecasted 5G market revenues to grow from US$2.13 billion in 2020 to US$13.90 billion in 2025, at a compound annual growth rate of 45.5%. However, to unleash the full potential of 5G, mobile operators and governments must work in tandem to accelerate 5G investments and innovations.
Policy-makers can invest in future economic growth by intensifying infrastructure deployment, allocating adequate and harmonized spectrum to address future demands, and incentives to provide operators more 5G monetization opportunities.
At the same time, mobile network operators must give consumers adequate reasons to upgrade to 5G. They must also move up the value chain to deliver viable use cases to enterprises across industry verticals.
We look at what leading 5G operators in the region are doing to deepen their 5G journey.
The government plays a key role in propelling South Korea’s 5G evolution. It has been coordinating collaborative work in the ecosystem to promote R&D and develop 5G equipment and applications. According to the ministry of science and ICT, 5G coverage has been deployed across its 85 cities, with the number of 5G subscribers reaching 20.19 million in November 2021, accounting for more than a quarter of 72.57 million mobile subscriptions in the country.
However, despite rapid 5G deployments made possible with increased tax incentives to Korean operators, industrial 5G is not taking flight as quickly as desired.
Last July, the ministry unveiled a US$190 billion Korean Digital New Deal 2.0 to grow hyperconnected industries. This includes developing open metaverse platforms, cloud computing, blockchain, and services based on ICT convergence. More than 1,800 companies specializing in new 5G services will also be created to boost 5G adoption. This will support a national ambition to deliver 5G services to 3,200 locations by 2026, up from just 195 in the second half of last year.
To appeal to younger generations, all three South Korean operators, namely SK Telecom, KT, and LG UPlus have launched cloud gaming services powered by 5G. Motivated to provide users enhanced experiences in gaming, as well as facilitating partnerships with other industries, SK Telecom also plans to develop its metaverse service into an open platform.
In the consumer market, SK Telecom will also continue to invest in IPTV to converge OTT and home media services. To target industrial IoT businesses, the carrier will build more data centers, as well as grow 5G MEC and dedicated line infrastructure.
With more than 560,00 5G base stations in China, China Mobile aims to increase its 5G coverage to all rural towns across the country by the end of the year. Adding about 11 million 5G customers each month, China Mobile ambitions to become the main driving force of a digitized and intelligent country.
Through innovative apps, the carrier intends to continue leveraging 5G capabilities to provide consumers full immersive experiences. For instance, cloud gaming built on 5G edge to provide very low latency, as well as 5G combined with AI or video processing for other applications. The carrier also plans to expand 5G industry applications across 18 key vertical sectors.
Recently, China Mobile jointly launched the Green 5G Joint Innovation Lab to develop 5G energy-saving technologies and products. These technologies aim to help energy-demanding industries such as chemical and steel reduce energy consumption and carbon emissions.
With deployments nationwide, China Mobile makes reducing OpEx through network automation a priority in its 5G strategy. Through partnerships with ecosystem stakeholders, the carrier aims to reach Level 4 autonomous network by 2025. It has already achieved partial Level 3 capabilities, with plans to roll out this process across its subsidiaries globally.
Last July, China announced a 3-year plan to attract 560 million 5G mobile subscribers by the end of 2023. Focused on expanding the use of 5G across industries, the plan is to grow the penetration rate of fast wireless technology in big industrial enterprises by 35% then, and scale up 5G applications in sectors such as mining and grid.
Leading Japanese mobile operator NTT Docomo launched 5G in March 2020, with plans to invest over US$7 billion to expand its network to 97% of the populated areas of the country by 2025.
With secure and quality ICT, including 5G, being crux to Japan’s digital foundation, emphasis is placed on mitigating supply chain risks.
As part of Beyond 5G to realize next-generation communications systems with industry, academia and, governments globally, NTT also joins hands with overseas partners to develop new technologies and standards. For instance, NTT, together with Finnish partners will build a pilot 6G network for an event in Osaka in 2025.
Australia’s first 5G mover, Telstra’s latest T25 plan builds on the foundation of its T22 plan to transform the business. This new plan, which comes into effect later this year, aims to extend 5G coverage across Australia, deliver enhanced customer service and reduced its annual fixed costs by US$366 million. Telstra will continue to deploy 5G network and double metro cells to increase density, with hopes to provide 5G coverage to about 95% of the population by 2025. By then, an estimated 80% of all mobile traffic will be on 5G. 4G coverage will be expanded to 100% of the carrier’s network by 2024, to deliver 4G, 5G, and eventually 6G.
To attract more 5G subscribers, Telstra offered postpaid small plan users free 5G connectivity for 6 months last August – a plan dedicated to only medium and higher-plan subscribers. In November, Telstra its first 5G home and business plans.
Despite a drop in revenue last year, Telstra shared that their investments are paying off. A restructure is also underway to ensure more agile operations.
While high-income countries are leading this evolution, widespread 5G deployment in the rest of the region will bid its time. However, operators can still justify highly-targeted 5G deployment for key sectors such as agriculture and manufacturing. In ASEAN for instance, A.T Kearney’s analysis shows that Indonesia has the highest value potential with 5G, followed by Thailand and Malaysia.
As the world prepares for a 5G-powered future, mobile operators will naturally navigate this trajectory differently to capture the most value of 5G. What is essential is long-term coordinated efforts with regulators and industry partners to bring the biggest impact to the connectivity landscape.