How has COVID-19 affected the 5G market?
2020 was supposed to be the year 5G started to make waves, but there can be little doubt that COVID-19 is the most significant challenge mobile network and handset vendors have faced. Globally, governments have announced extreme measures to support economies including low-interest government loans, income subsidies and tax breaks. The UK government is issuing £330 billion in loans to businesses, but even with this assistance the mobile industry, 5G will be one of the hardest hit!
Consumers are not going to stop using mobile phones, but most will not be in a position to spend more on a service which is still very much seen as a nice to have, rather than a necessity.
So what are the major areas of impact that this current pandemic has placed on 5G?
A decline in Consumer Interest:
Many vendors are reporting that consumers are showing limited interest in upgrading to 5G. This is most apparent in the UK and Europe, where nearly 80 per cent of consumers in the UK did not plan to upgrade, while many in France and Germany were not even aware of the technology.
5G has been launched in a number of areas across the world. However, in most cases, coverage has been limited to small and densely populated areas. Operators in early adopting markets had planned to spend the next two years expanding and densifying networks. Pre-pandemic it was thought that 2020 should have been the year of the 5G smartphone, but many of the parts used for both devices and networks originate from Chinese companies. While the nation now seems to be over the worst of the epidemic, with month-on-month smartphone shipments dropping by around 50% it is clear that the impact on productivity resulting from enforced factory closures will be felt for some time to come.
With all of this in mind, it is easy to only see the negative, but 5G has also had a positive impact on how we are getting through the impact of coronavirus and how we are adapting to a new way of life. A crisis can often be a driver of technological advances and 5G is in some cases already proving its worth.
In Wuhan, for example, Huawei installed a 5G network in a specialist hospital in three days! 5G-enabled robots can now help to take care of patients in the hospital and take measurements, reducing the amount of time medical staff need to spend with infectious patients.
More broadly, for the millions of people now in isolation, internet connectivity is allowing work to continue without the need to go into the workplace. While working from home has been an option for office workers for some time, 5G can provide a far better experience for virtual meetings and, of course, higher network capacities, making it an important tool in simply keeping up with new traffic demands.
Work and productivity aside, 5G will, in our new socially distanced world be a key tool in entertaining and connecting people. Mobile internet connectivity allows us to keep in touch with loved ones who would otherwise be isolated. It is also worth considering that with sports and TV shows cancelled or restricted, people will look for new ways to entertain themselves and some of those could be enabled by 5G.