Worldwide 5G connections are forecast to see a strong pace of growth in 2022, elevating 5G from a nascent to a fledgling technology. This is the main message from our latest global 5G market forecast (see Market Forecast: 5G Connections, Worldwide, 2021-2026).
Following the pandemic turbulence experienced in the last two years, resulting in headwinds for 5G deployment, a clearer path of uptake is now in sight. This is thanks to vast availability of 5G-capable smartphones, refined operator strategies and delayed network launches starting to take place.
Despite 5G’s foundational years being clouded by the Covid-19 pandemic, resulting in difficulties in the mobile phone market and delayed network launches and expansions, the market is in a stronger position as we enter the second half of 2022. And although the world faces a turbulent macroeconomic and geopolitical outlook in 2022, coupled with supply chain difficulties, the transition of mobile subscribers to 5G networks is set to make good pace, with 5G connections forecast to nearly double this year to 1.2 billion.
Mobile broadband usage on smartphones, cellular-connected tablets, laptops and other similar devices will account for 99% 5G connections worldwide in 2022. 5G connectivity has now become a default feature in premium smartphones and has made a strong push into mid-tier mobile phones. With 681 million phones or 44% of all mobile phone unit sales in 2022 expected to have 5G connectivity, a strong base of 5G-ready mobile phones is developing. This is despite expectations of a weak year for the mobile phone market, hit by both supply limitations and falling demand. However, this negative trend is less pronounced in the 5G segment, which is prioritized by chipset- and phone-makers, and sits in the more expensive, higher-margin part of the market, where demand is still strong.
By 2026 we forecast 4 billion 5G mobile broadband connections, representing 45% of the worldwide total, but regional disparity will remain when it comes to adoption across the world. We believe 5G is well on its way to becoming a mature technology in advanced markets such as North America and Western Europe, however, despite some high-tech hubs and pockets of 5G connectivity in the developing world, a delayed transition in markets such as India and the Middle East and Africa is expected. Overall widespread 5G coverage has a long road ahead.
An associated area also expected to see a boost in 2022 is fixed wireless access, with a 160% growth forecast in 2022, reaching 7 million connections at the end of the year. Competition in this area is heating up, particularly in North America, where fixed wireless access has become an important part of carriers’ 5G strategies and service portfolios. T-Mobile, Verizon and AT&T are positioning the technology as an integral part of their 5G strategy and they’re already seeing results — T-Mobile has reported over 1 million customers. As more and more operators worldwide use 5G to provide high-speed home broadband, without the expense of deploying fibre networks, CCS Insight believes connections are set to grow, hitting 83 million in 2026.
Machine-to-machine (M2M) and cellular Internet of things (IoT) applications for 5G also offer tremendous promise, with a significant rate of growth expected for 2022. The category’s connection total remains small, reaching just 9 million to date. But after the pandemic dampened growth in IoT 5G connections, the market is now picking up, and the emergence of out-of-the-box IoT solutions and the beginnings of private mobile network deployments are delivering some momentum.
By 2026, we expect 455 million 5G M2M and IoT connections, with China leading the way thanks to major investments in manufacturing and other high-tech industries. Still, the big potential for these business and industrial applications remains further in the future, in the second half of the 2020s and beyond.
Contact us if you’d like to learn more about our projections for the global 5G market.
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