These businesses will need a 5G network to run on, of course, and SKT has already announced a $5 billion investment in that.
“Once the 5 trillion won is poured into the industries, it will provide opportunities for growth to front and rear industries, inducing production worth 9 trillion won and more than 60,000 new jobs,” SKT said in its statement.
The idea is that 5G will be an enabler and an economic multiplier on a scale we have rarely seen before. Like a new highway between two remote cities or the establishment of a new port, but many times over, the infrastructure has the potential to foster a host of new businesses springing up through industry verticals.
In the US alone, consultancy Accenture has forecast that the deployment of 5G networks could create up to three million new jobs - both directly and indirectly - and add around $500 billion to US GDP. In a January 2017 report, Accenture estimates that to achieve this, operators will have to invest as much as $275 billion over seven years as they build out 5G.
Seven years? Does that mean that the 5G world will only gain momentum by 2025?
Given the scale of the build-out and the intensity of the transformation, that is probably reasonable. So let’s not get so hung up about 2020.
Accenture talks about “three tidal effects” from 5G: the 5G business model will facilitate evolution and collaboration, new RAN architecture will promote disruption in greenfield areas, and network and IT architecture will merge, leading to a “tidal” transformation in stacks, processes and people.
“Vertical industry will drive the 5G business case and monetization will require an ecosystem play,” said the consultancy.
It sees verticals such as automotive, manufacturing, health, consumer and retail directing global GDP into 5G transformation, adding “pervasive” connectivity to business architectures.
Accenture’s advice to operators: create a horizontal platform which can best expose 5G capabilities to partners and customers. It’s all about speed of deployment and agility.
“The report shows what an incredible opportunity there is in all community sizes,” said Tejas Rao, Accenture’s managing director and mobile offering network lead for the North American practice. “5G-powered smart city solutions applied to the management of vehicle traffic and electrical grids alone could produce an estimated $160 billion in benefits and savings for local communities.”
Smart cities is a phrase which also resonates in Telecom Asia’s own patch, particularly in India. There, the government of Narendra Modhi wants to build 100 smart cities by 2020, and nearly 100 initiatives are already set for implementation in 20 initial locations.
For this, 5G is not just an enabler, but is seen as a nation builder. All these are big predictions, and great expectations. Prepare for some cynicism along the way, but get ready for some spectacular results.