Marketing, Content and Community Lead, Informa Tech
5G World, with insight from research powerhouse Omdia, both part of Informa Tech, examine how the COVID-19 pandemic has impacted the global 5G market just as it was on the edge of an exponential boom.
Gaming and video streaming contribute to a major increase in online traffic during lockdown
As shown by data from Omdia, countries in lockdown are – unsurprisingly – experiencing network traffic surges. For example, in the early stages of the lockdown, Telecom Italia saw a 70% surge in internet traffic, while Spanish carriers reported a 40% increase in IP network traffic1.
Much of this has been driven by video streaming and online gaming, with one US operator seeing a 75% increase in traffic from gaming sites. The increase in video-based communications has also boosted traffic volumes.
The impact on network traffic patterns won’t necessarily be just short-term. China Mobile has had to respond to an increase in digital and cloud-based services usage since the outbreak ramped up in China, and it is not clear when and if this will drop off.
COVID-19 may cause 5G roll-out delays and falling revenue for mobile operators
The COVID-19 pandemic will almost certainly slow down 5G rollout in most markets affected by the virus. In China, the effects have already been felt in the first quarter of 2020, although activity is now starting to pick up. Europe and North America are expected to experience a slowdown in Q2.
Countries in lockdown are – unsurprisingly – experiencing network traffic surges.
While this slowdown could allow operators more time to rectify issues that were not fully resolved in the rush to deploy commercial 5G services a key concern is what will happen to the telco investment if we see a delay in 5G network upgrade plans.
Omdia is already anticipating a decline in mobile service revenues in 2020, something that will in turn feed into lower investment. Indeed, network analysts currently anticipate that there could be a 3% fall in mobile infrastructure investment this year, with a mobile infrastructure rebound only occurring in 20222.
China – the only country on track for 2020 5G roll-out
Most probably, and for many reasons, 5G rollout in 2020 will almost certainly be significantly slower than anticipated, with China being a possible exception. The deployment of SA 5G had been expected to start in early 2020 with SK Telecom and China Mobile already announcing plans to launch their SA networks in the first half of the year, and operators in Singapore, the US, and Switzerland, among others, planning to follow suit.
“At Omdia we are revising our 5G forecast,” said Omdia 5G Practice Leader, Dario Talmesio. “There are many factors to be looked at, including consumer confidence, business confidence, disposable income, employment data, availability of networks, availability of devices, retail environment, marketing budgets… We previously believed that 2020 was going to be the real year of 5G. This is no longer that case under the current circumstances. The only country that is exception to that is China where telecom operators are confirming or even increasing their 5G investment.”
 Omdia: “COVID-19: The Impact on Telecoms Operations and IT” |  Omdia: “5G Deployments: Progress so Far, Implementation Strategies, and Technical Challenges
“COVID-19: The Impact on Telecoms Operations and IT”: https://www.ovumkc.com/Products/Service-Provider-Technology/Telecoms-Operations-and-IT/COVID-19-The-Impact-on-Telecoms-Operations-and-IT/Summary
“5G Deployments: Progress so Far, Implementation Strategies, and Technical Challenges”: https://www.ovumkc.com/Products/Service-Provider-Technology/Network-Infrastructure-and-Software/5G-Deployments-Progress-so-Far-Implementation-Strategies-and-Technical-Challenges/Summary