Dubai: Fifth generation mobile wireless networks (5G) are opening doors to a digital economy and telecom operators can play a major role in that transformation, a Saudi Telecom Company (STC) official said.
Haithem M. Al Faraj, senior vice-president of technology and operations at STC, said that 5G will be a key enabler to fulfilling the demands of 50 billion connected devices, which are expected to be online by 2020. That means there will be seven connected devices per person on the planet.
He added that digital was fuelling the Fourth Industrial Revolution while mobile was enabling an unprecedented connectivity of things.
”Technology has also changed our business. It is making differences in between business processes and systems. Cloud computing technology and cloud storage are another change that is happening currently,” said Al Faraj, speaking at the two-day 5G Mena conference taking place in Dubai.
Chafic Traboulsi, vice-president and head of networks at Ericsson Middle East and Africa, said that the network is at the heart of 5G and service providers can address explosive traffic growth while also enabling completely new use cases.
Moreover, he said that 50 per cent of data consumption comes from videos now, a trend expected to rise to 75 per cent over the next few years. The videos are becoming ”heavier” and the screen resolution ”higher”, he said.
According to him, mobile data traffic on 4G in 2017 came in at 14 exabytes per month, a huge jump over the 0.3 exabytes per month seen in 2010. One exabtye is equal to one trillion megabytes.
In 2023, 4G is going to be six times more than the data currently on the networks. By 2023, 5G will carry 1.5 times the total value of data on the networks in 2017.
”We will see an eight-fold data increase in five years,” he said. “The biggest question operators ask is how are we going to make money out of 5G?”
He said that studies showed that a lot of revenues will come from enhancing mobile broadband.
Quoting a report, he said that the revenue growth forecast from existing services on 4G will be 1.5 per cent the annual growth rate through 2026, or $1.74 trillion compared to $1.49 trillion in 2016. He added that the potential revenues for operators addressing industry digitalisation with 5G will stand at $619 billion in 2026, or 36 per cent of revenue potential for operators.
The STC’s Al Faraj said the digital market could add $95 billion per year to the Middle East’s annual gross domestic product (GDP). He added that telecom operators globally are the backbone of digitisation.
”The telecom ecosystem has provided the fundamental building blocks — access, interconnectivity and applications. More than $10 trillion in incremental value from digitalisation depends on telecoms,” he said.
Despite opportunities, he said that there are major challenges that should be addressed for the successful launch and roll out of 5G services and these include spectrum readiness, digital evaluation and service enablement, adaptation of use case evaluations as well as mobile hardware readiness.