Urbanisation drive 5G users boost in Southeast Asia
Growing economies are fueling the demand for high quality video content.
By 2029, 5G subscriptions in Southeast Asia Are projected to reach approximately 560 million, fueled by technological advancements and market dynamics. Today, more than 300 mobile networks are operating globally, with another 300 planning to invest in 5G technologies, according to Khurram Shahzad, Senior Director Analyst at Gartner.
"By the end of 2023, approximately one-third of the global population is covered by 5G infrastructure. This rapid uptake is driven by economic growth, urbanisation, and the increasing demand for high-quality video content, online gaming, and social media, which have outpaced the capabilities of older 4G networks,” he said.
Hrushikesh Mahananda, Telecom Research Analyst at GlobalData, emphasised the technological advancements that are propelling 5G adoption: "Standalone networks offering low latency and increased bandwidth have accelerated adoption. In Singapore, for instance, operators have covered over 95% of the country with 5G standalone services, supporting the growth of 5G connectivity among consumers and enterprises."
Government support and policy initiatives are also pivotal in driving 5G adoption. Shahzad noted, "Governments in the region are actively promoting 5G technology through spectrum allocation and infrastructure investments. This support is crucial for developing the necessary ecosystem for 5G to thrive."
The rise of industrial and enterprise applications is another significant factor contributing to 5G's growth. "5G is being utilised in industrial automation initiatives such as smart manufacturing, logistics, IoT, and autonomous vehicles," Shahzad explained. "These applications offer improved operational efficiencies, reduced costs, and a competitive advantage for telecom enterprises."
However, the transition to 5G presents challenges for telecom providers, particularly in terms of monetisation. Mahananda pointed out, "Telcos are finding it challenging to maintain premium pricing due to a lack of differentiation between the two. This affects their revenue, as the increase in speed and access is not substantial for the average user."
Jiana Edades, ICT and Cybersecurity Analyst at Frost & Sullivan, agreed, adding, "The challenge lies in telcos maintaining higher price points for their 5G services. With the rapid growth in data consumption, the limits of 4G capabilities are being pushed, making 5G the preferred technology."
As 5G becomes more widespread, the telecommunications industry is witnessing shifts in revenue and market dynamics. "Telcos are evolving from being connectivity providers to digital technology players, offering a range of digital services such as cloud, IoT, and cybersecurity," Mahananda explained. "This transformation is essential to cater to changing market dynamics and remain competitive."
The enterprise segment emerges as a key growth area for 5G adoption. Edades noted, "The enterprise segment is growing, presenting opportunities for telcos but also increased competition. Other vendors and system integrators are supplying directly to large enterprises, challenging telcos to differentiate themselves."
Looking ahead, the future of 5G promises further advancements. Shahzad envisions continued development of 5G standards, integration with emerging technologies, and increased interoperability.
Mahananda anticipates significant growth over the next two to four years: "As 5G expands globally, it will boost data and traffic, opening new opportunities for revenue streams through industry-specific applications and innovative solutions."
Edades added, "Private networks and industry-specific applications, especially in manufacturing, healthcare, and logistics, will rise, offering customised solutions with tailored coverage, latency, and security."
