In 2020, 5G networks will represent a decisive breakthrough: by the end of the year, more than a billion people, or 15 percent of the world’s population, will live in areas with 5G coverage. This is the conclusion of the current October issue of Ericsson’s (NASDAQ:ERIC) Mobility Report. The report provides analysis of current developments in the mobile communications market in the third quarter of 2020 and forecasts for the next five years. By 2026, Ericsson predicts that 5G will account for 68 percent of all mobile phone contracts in Western Europe. This puts Western Europe in second place behind North America, for which the report predicts a 5G share of 80 percent. Northeast Asia, which ranked second in last year’s Ericsson Mobility Report, will then take third in terms of 5G subscription share, with a share of 60 percent.

Fredrik Jejdling, Executive Vice President and Head of Networks, Ericsson says: “5G is here to stay. Rapid societal changes are making fast mobile networks the critical infrastructure that will impact our daily lives in multiple ways. The COVID-19 pandemic has decisive contribution to driving the ongoing digitization of the economy and society, and the 5G expansion and the number of 5G contracts will also benefit from this.”

In the third quarter of 2020 alone, the number of 5G contracts related to a 5G device worldwide increased by 50 million to 150 million. The current edition of the Ericsson Mobility Report therefore forecasts a total of 220 million 5G subscriptions by the end of this year. And this trend continues: by 2026, 3.5 billion 5G subscriptions are expected worldwide, which will then make up 40 percent of all mobile subscriptions.

By 2026, the 5G market share in Western Europe will increase to 68 percent

LTE networks (LTE: Long-Term Evolution) are currently still the dominant mobile network infrastructure. In the third quarter of 2020, the global share of LTE subscriptions grew by 70 million. That means a total of 4.5 billion and therefore 57 percent of all mobile phone contracts. In Western Europe, LTE is the leader with 81 percent of all contracts. But the share is expected to drop to 29 percent by the end of 2026, as more and more users will opt for 5G. This will lead to a 5G market share of 68 percent by 2026. In the region, 35 service providers already offer 5G services, with 6.5 million subscriptions expected by the end of 2020. In Central and Eastern Europe, 35 percent of all mobile subscriptions are 5G.

Some of the spectrum auctions planned for late 2020 or early 2021 could not take place or had to be postponed. However, this will only slow down the further expansion of 5G networks in the short term.

Other factors driving the global adoption of 5G include new features such as New Radio (NR) and the launch of 5G-enabled Apple devices. NR will also have a major impact on industrial IoT deployments, especially in cloud-based IoT solutions that rely on fast connectivity and low latency. At the 5G Industry Campus in Aachen, Ericsson and its partners are already testing how new infrastructures can promote Industry 4.0 and smart production processes.

Cheaper 5G smartphones expected for 2021

In addition, chip manufacturers are working on more attractively priced 5G devices for the mass market. The first 5G smartphone for under $300 is now available outside of China and even lower prices are expected in 2021.

Another focus of the report is the 5G network expansion, which is already very advanced in some countries. For example, Switzerland already made 5G available to 90 percent of the population at the end of 2019, which was due to the extensive coverage expansion. In general, the 5G expansion in Europe was mainly driven by the use of existing LTE frequency bands, including in Germany. In the US, on the other hand, additional frequency bands below the 6 GHz band and frequency bands in the microwave range have also been developed to ensure 5G coverage. In the US, for example, a large part of the population can be provided with 5G.

As a result of all these developments, more than 60 percent of the world’s population will have access to 5G networks by 2026. These fast networks will then carry more than half of the worldwide mobile data traffic. In 2026, that would be about 226 exabytes (EB) per month. Smartphones will be at the forefront of the access devices used. More than six billion people will use 5G data services, as well as laptops and other mobile devices. This includes mobile games, which are also seen as drivers of development and as an attractive 5G growth market.

Largest increase in FWA in Western Europe in the last six months

In addition, the good prognosis for FWA connections (FWA: Fixed Wireless Access) from the latest Mobility Reports has further improved. By the end of 2026, there should be more than 180 million FWA connections worldwide. The currently highest growth rate in the period from February to October 2020 can be found in Western Europe – here the increase was 93 percent. One reason for this is the increased need for stable and fast broadband networks during the pandemic. And for network operators, FWA is often a fast and cost-effective alternative to conventional fixed networks, which are also partly subsidized by the state.

The full report, with full data and other examples, such as US FirstNet, a nationwide network for medical first aid and safety applications, can be found here: https://www.ericsson.com/en/mobility-report