75% organisations willing to pay more for 5G

A recent global Gartner survey revealed that 75 per cent of end-user organizations would be willing to pay more for 5G mobile capabilities.

Although most of the respondents think their organizations would be prepared to pay more for 5G, few (8 per cent) expect 5G to deliver cost savings or increase revenues. The survey also found that respondents from the telecom sector are less persuaded than those in other industries that 5G will be a revenue enhancer.

“Those in the telecom industry are more likely to be prepared to pay more than those in other industries,” said Sylvain Fabre, research director, Gartner.

“End-user organisations in the manufacturing, services and government sectors, for example, are less likely to be willing to pay a premium for 5G than telecom companies, which are willing to pay a 5G premium for their internal use,” added Fabre.

In addition to offering better prices for industries in which users are less convinced of the business benefits of 5G, communications service providers (CSPs) must create value propositions that entice customers to start 5G migration projects sooner.

The survey found that almost half the respondents intend to use 5G to access videos and fixed wireless capabilities. More interestingly, though, the majority respondents (57 per cent ) believe that their organization’s main intention is to use 5G to drive Internet of Things (IoT) communication.

“This finding is surprising, as the number of deployed ‘things’ that need cellular connectivity won’t exceed the capacity of existing cellular IoT technologies before 2023 in most regions,” said Fabre.

Gartner predicts that, by 2020, only 3 per cent of the world’s network-owning mobile CSPs will have launched 5G networks commercially. “Although standards-compliant commercial network equipment could be available by 2019, commercial rollouts of 5G networks and services by CSPs before 2019 are likely to use prestandard equipment,” added Fabre.

CSPs’ marketing organizations need realistic roadmaps for 5G coverage and typical performance, so that they communicate with customers accurately. They also need to publish clear 5G rollout plans for the years 2019 to 2021 to help innovators understand when and where 5G will be available for IoT applications.

Over 200 IT and business leaders from the Gartner Research Circle participated in a survey conducted in the second quarter of 2017. The objective of the survey was to understand how demand for 5G is growing and to learn about adoption plans for this technology.