With ambitious roll-out plans from operators and strong consumer demand for new services, the US and Canada are among the global leaders in terms of 5G adoption, yet following extensive 5G network buildout in recent years, spending is set to begin to trend downwards as operators turn their attention to generating a return on investment, according to GSMA research.
The study by the global mobile industry’s trade association highlighted the trends shaping the mobile ecosystem in the present day and beyond, noting that the main focus of the market over the next few years would be on improving 5G coverage in less densely populated areas while also ramping up investment to support the growing momentum behind use cases enabled by 5G standalone (SA) and 5G-Advanced.
There is a great reason for doing so. The report showed clearly how 5G connectivity is already proving to be a powerful driver of GDP growth, with 5G’s contribution to GDP in North America expected to surpass $200bn in 2030, 16% of the overall annual economic impact of mobile in the region.
Beyond its contribution to GDP, the GSMA said the mobile ecosystem also supports 2.1 million jobs, directly and indirectly, and makes a substantial contribution to the funding of the public sector, with $130bn raised through taxation in 2022. This economic contribution, said the GSMA, underlined the importance of stakeholders taking the right steps to sustain the impact of mobile services on the digital economy, with spectrum availability a key driver of affordable 5G for all.
And as 5G adoption grows, the monetisation imperative will escalate. GSMA’s research showed a rise in the mobile average revenue per unit in the US and Canada in the 12 months after launching 5G. The technology was also having a positive impact on revenue growth for North American operators beyond mobile services, as highlighted by fixed wireless access (FWA) momentum in the region.
Looking forward, the GSMA said the enterprise sector was expected to be the main growth driver for operators. 5G SA brings a host of new capabilities that will be crucial to monetising 5G investments, including improved support for network slicing. There are also synergies between 5G SA and private wireless networks, opening up new opportunities for mobile operators.
In terms of specific industries where the report highlighted particular growth, the GSMA observed significant opportunities from a fintech sector with surging demand. The survey data showed that between 2020 and 2022, the share of 4G/5G smartphone users in the US using their devices for financial services on a daily basis had grown by four percentage points on average across mobile banking, online shopping, paying bills and contactless payments.
This reflected growing momentum behind digital financial services as the competition heats up in the fintech market, said the GSMA. As an example, it cited Apple launching a buy now, pay later (BNPL) service, which it expected to contribute to a boost in e-commerce transactions. Apple has also launched a high-yield savings account, through a partnership with Goldman Sachs, which reportedly brought in $990m in deposits over its first four days. By the end of the first week, around 240,000 accounts were said to have been opened.
In terms of technologies to note, the report, not surprisingly, noted the rise of generative AI, which it said was pushing the envelope on AI capabilities and thrusting AI technology into boardroom conversations globally. The report added that with generative AI tools, operators could attempt to automate more complex customer service functions that require a better understanding of context, improved ability to follow a conversation and advanced synthesis of information.
The report also said eSIM momentum was building, with the past few years crucial for development and commercialisation, highlighted by Apple’s launch of eSIM-only smartphones in September 2022 in the US and Canada.
The report noted the acceleration in operator eSIM deployments and commercial launches since, even though it felt eSIM awareness among consumers remained limited. As the main contact points with users, operators and smartphone manufacturers were said to have a key role to play in accelerating consumer awareness and adoption.
Additionally, eSIM technology has long been seen as a major enabler and accelerator of internet of things (IoT) deployments across multiple sectors.