5G pacesetters CSPs twice as likely to raise revenue, says Ericsson

News Desk - 10/11/2021

When compared to other CSPs, 5G pacesetters – the leading communications service providers (CSPs) now driving global consumer 5G demand – are three times more likely to retain consumers and nearly twice as likely to raise average revenue per user (ARPU) and mobile services revenues. These are some of the findings of Ericsson Consumer Lab’s latest 5G Pacesetters research.

Erik Ekudden, CTO, Ericsson, says: “A commitment towards technology leadership and network quality is key to unlock CSP 5G revenue growth by enhancing the core consumer business while at the same time exploring new business opportunities. Not surprisingly, 5G Pacesetters seek new ways of challenging industry conventions to make 5G connectivity more relevant to people, business, and society.”

Jasmeet Singh Sethi, Head of ConsumerLab, Ericsson Research, says: “5G-enabled consumer services can unlock up to USD 3.7 trillion in cumulative revenue opportunities for communications service providers (CSPs) by 2030. This report outlines that 5G pacesetters who can demonstrate an ability to adopt new technologies, influence consumer perception and are prepared to invest and focus on 5G service innovation are already stepping ahead of competitors in the race to new revenue opportunities. By exploring new 5G-enabled opportunities, more CSPs can become 5G pacesetters and grow their revenues at the same rate.”

The report is the first in the industry to combine customer happiness data with market realities, measuring the 5G maturity and market revenue plans of 73 CSPs across 22 markets globally using 105 criteria.

According to the research, there are four stages of 5G maturity: 5G Explorers – those who are just getting started with 5G; 5G Potentials -CSPs with happy customers due to better-performing 4G networks, but who haven’t put much effort into developing 5G networks and offers; 5G Aspirationals—CSPs saw as market contenders who are aiming high with 5G while attempting to increase customer happiness;5G Pacesetters – companies that are ahead of the curve in terms of offering best-in-class 5G coverage, performance, and innovation, but still have opportunity to improve.

Consumers regard one-in-five of the investigated CSPs as market leaders within the 5G consumer category, however, they are not necessarily market share leaders or incumbents in their local markets.

They are distinguished by having the highest net promoter score (NPS) in their respective markets and promoting innovation by providing an average of three consumer 5G services, including cloud gaming, immersive video (AR/VR), and 5G fixed wireless access.

While advanced 5G markets in North-East Asia and North America account for most CSPs in the 5G Pacesetter category, Europe accounts for one-third of the total.

Key 5G pacesetter insights:

50 percent of 5G Pacesetter category CSPs increased ARPU by one percent or more year-on-year compared to a quarter of all other CSPs
75 percent of the 5G Pacesetter monetize 5G based on tiers of speed, quality of service, fixed-mobile convergence (FMC), or bundled content
5G Pacesetter category CSPs have an average 5G population coverage of 75 percent, download speeds of 270 Mbps, and average 5G availability of 14 percent or above
On average, 70 percent of pacesetter’s subscribers consider them to be a 5G market leader
Almost 50 percent of 5G Pacesetter category CSPs have already launched 5G fixed wireless access
5G Pacesetter category CSPs are the most proactive in implementing 5G standalone and multi-access edge computing (MEC) capabilities

The paper proposes several paths for CSPs to emerge as, or improve their position as, 5G pacesetters, based on market-leading strategic insights: