*By Luciano Saboia and Audry Rojas
In September, Brazil enters the 5G era. But what does this mean for companies? What will change with the arrival of new mobile connectivity technology?
The answer is simple: it will change everything.
According to a study carried out by IDC – International Data Corporation, 5G connections worldwide, both for mobile subscribers and for IoT (Internet of Things) connections, will grow from 706.7 million in 2021 to 4.5 billion in 2025, with an average annual rate of 93.3% over the next five years. Also, IDC's October 2021 Future Enterprise Resiliency and Spending Survey revealed that while 5G and edge computing services are designed to support applications and use cases across all customer segments, the greatest impact of 5G deployment will be in the corporate segment, in what we now know as Industry 4.0, and will have the potential for a new industrial revolution.
Yet, the same IDC global survey found that “improving customer satisfaction” emerged as a top priority for companies, followed by employee productivity, innovation and operational efficiency. In this way, taking advantage of the high-speed, low-latency 5G characteristics is one of the motivators for companies to invest in new digital technologies in their value chain and, thus, deliver superior performance in the customer experience, in addition to generating new flows of revenue along the way. In fact, 5G will act as true enabler innovation for the B2B segment, as it was designed to give operators the flexibility to support this wide range of applications and meet the specific needs of each customer or business segment.
Within business agility, 5G and MEC (multi-access edge computing) should be the protagonists regarding the “ultra-low latency” theme and will allow network slicing, that is, the customization of targeted and suitable offers for B2B. Operational efficiency and business agility are attributable to connectivity services and therefore companies have been increasing their post-COVID-19 budgets. For these reasons, 37% companies are expected to increase their budgeted investments in 4G and 5G connectivity services in 2022.
Despite being profoundly disruptive to society, the roll-out of 5G-enabled use cases will come gradually. And while the adoption of some integrated solutions can happen more easily — such as augmenting video data with an artificial intelligence layer to identify and alert security system risks — more complex use cases such as V2V (vehicle to vehicle) communications ) that support autonomous vehicles will take many more years of development.
Examples of use cases with 5G – Source: IDC, 2021
5G in Brazil: capacity to generate US$ 23 bi by 2024
In Brazil, a study carried out by IDC at the end of 2021, estimates that the accumulated expenses with 5G network infrastructure will be in the order of US$ 2.5 billion by 2024. 5G will provide approximately US$ 23 billion in the B2B segment by 2024, with great emphasis on IoT (almost 50% of this amount).
IoT use cases are extremely diverse and have different priorities for each industry vertical. Some require just a simple collection of data from a few basic devices in a relatively closed system, while others use advanced analytics, a large number of devices, huge amounts of data, autonomous machines, and integration with an organization's complete IT systems and operations. .
As we see, reaching the transformative potential of 5G is not simply plug-and-play. This is all, not to mention the time and expense needed to connect a country of continental dimensions. Mobile operators and other players in the ecosystem will need to develop new applications and software and invest in cutting-edge hardware to leverage real-time responsiveness and autonomous intelligence, key attributes in the new paradigm coming with fifth-generation connectivity.
5G will change everything. However, it still takes a while for us to feel this change in our daily lives.
*Luciano Saboia is Telecommunications Research and Consulting Manager at IDC Brazil
*Audry Rojas is a Senior Telecommunications Analyst at IDC Brazil
Notice: The opinion presented in this article is the responsibility of its author and not of ABES - Brazilian Association of Software Companies
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