Good morning, good afternoon, and good evening to everyone. I'm happy to introduce this Session of the New Ericsson Mobility Report. My name is Patrik Cerwall, Head of Strategic Marketing in Ericsson. I've been responsible for the mobility report the last 12 years now. Together with me today, I have Richard Möller, who is the Chief Analyst here at Ericsson, and I will introduce him as we go along and talk about a lot of the numbers that we have this time around. Later, we will also hear from Hai Thoo Cheong, Vice President, Mobile Network Engineering from Singtel, and we're very honored to have him joining us for a part where we have collaborated on an article together with Singtel. We'll come back to that.
Let's continue and just dig deep into the Mobility Report and the big numbers and the changes that we have done this time. As always, we start with the overall picture on mobile subscriptions in the world. You might, have you been around and seen this presentation before, you recognize this slide, which is basically an update on how the technology is progressing when it comes to subscriptions in the world. Right now, we are around 8.3 billion subscriptions in the world. We have just passed 1 billion 5G subscriptions in the end of last year. We're expecting that to go up to 1.5 billion in the end of this year.
Meaning then that we have 500 million new 5G subscriptions in the world, happening this year, or adding on this year. At the same time, 4G is continuing to grow, we're projecting it to peak this year at 5.2 billion. The dominant technology right now, but by 2028, it will be 5G. That will be the dominant technology. It's a slow transition towards 5G as the dominant technology. In many markets, 5G will soon be the technology of choice. End of 2028, we're talking about 4.6 billion 5G subscriptions, this is a change from what we said just half a year ago.
Now I introduce you, Richard Möller, and please give your perspective on the changes that we have done, how does the market look like, and how we change the forecast on 5G particularly.
Thank you, Patrik. We have made an adjustment on the 5G forecast. Basically three regions that affect the forecast. We've changed our view on 5G subscriptions in China, adopting closely the regulators' view, which changed the subscriptions by some 80 million in 2022. That change carries through the forecast period. We've also somewhat delayed the forecasted growth in Latin America due to the general economic conditions more than anything else. We've also slightly decreased the growth that we've forecast in Southeast Asia. Not a very large adjustment. We're still talking about huge growth.
Yeah, exactly. This growth is maybe easier to also look at when we see the growth per region. We have seen all markets going towards 5G, of course, it varies a lot between different markets right now, in terms of uptake, we see both in Northeast Asia and in North America. I think we've seen stronger growth in North America than we expected before. Can you comment a little bit on North America and what we're seeing there?
Yes. As you said, the growth has been even stronger than we anticipated last year. That's mainly down to the very strong competition in that market, where 5G is a central part of the competitive landscape, so to say, and that really drives the subscriptions uptake.
One of the big news or messages in the release this time is India. We have to talk about India because they launched 5G services in October last year. Already now, there's a lot of uptake on 5G subscriptions. By 2028, we expect 57% of all subscriptions in India being 5G. It's the fastest growing region right now when it comes to 5G subscriptions uptake. Richard, what is this? It's a phenomenal uptake that we are expecting here.
It is, and of course, that's a challenge to forecast as such. We've seen what India did with the launch of 4G. Again, fierce competition, really driving the market, and building the uptake, and lots of work on creating entry-level phones that, relatively speaking, entry-level, that contains new technology. We think this is gonna be huge growth.
Europe is, if you look at Western Europe here, is a little bit behind when it comes to uptake on subscriptions. What are we seeing in Europe right now?
Well, we are seeing Europe kind of lagging behind, in terms of subscription uptake. That's related not only to economic conditions, but also that the regulators in some cases have been little at a little later timetable for frequency auctions, delaying the rollouts of 5G. Europe is lagging behind a bit here, but we think that over the forecast period, it will catch up, so to say. The Europe is behind right now.
Yeah. We have a number of regions that are in the early days of 5G, that we'll start to see more of that coming up, you know, when it comes to Latin America or Africa, also Southeast Asia and Oceania. Of course, it varies a lot between market to market. Just because the region looks smaller or that it hasn't developed, there are countries that are very advanced, of course. If we continue and talk more about the economic situation, because when I was in down in Mobile Congress in the early time of this year, the biggest question I got was: where is the money? You know, is anyone making money off 5G?
What we did was updated this study that we did together with by basically analyzing a lot of data from operator service revenue. What you can see here is our take on it when you look at the top 20 5G markets, the ones that have the highest enough 5G subscription penetration. If you take all these markets and look at the subscription penetration in these markets, it's the orange line that goes up now to over 20%. Average 20% 5G subscription penetration in these markets. The blue line here represents the wireless service revenue, the top line, basically, of all the operators, the average among all the operators in these markets.
You would see the names of the markets in the bottom. We have weighted them equally. Even big countries and smaller countries, all are weighted equally here. What we've seen is, once subscription level came up to around 7, 8% in these markets, we have seen an up toward or upwards trend also on service revenue, which correlates very well with the 5G subscriptions uptake as well. The last two years, we've seen 7% in total, so 3.5% per year, basically. We don't know whether this will continue or not, but it is interesting, of course, to see what is driving this and the growth in revenue coming back to the industry, of course.
I do get questions sometimes whether this is inflation driven or not. I would argue that it's probably not. We saw a lot of inflation in many different segments during 2022, which was in food or energy prices. I would argue that communication prices hasn't gone up. There are some focus on places where operators have managed to increase prices, but usually that is not really the driving force here. It's rather than, that operators are managing to use 5G as the compelling event of upgrading, consumers' bucket sizes, offering new services, and so on.
Talking about new services, we have also included a study where we have gone, again, back to 310 operators' web pages, looked at all the different offerings that are available, and tried to look at the evolution of these offerings and what is actually happening when it comes to service packaging. Buckets continue to, of course, be the dominant pricing model. It is used by almost everyone in some way and form, but on top of that, many are also having an unlimited offering. Basically, 1/3 of all the operators we looked at had an unlimited offering.
We've seen service-based offering increasing to a high level the last couple of times we looked, and that is more of selling than streaming services, could be music, could be video, as a special offer where you sell it by the hour, or you sell it as a video pass or something like that. I won't go through all of these, but as you see, there is an increase also in device-based IoT, smartwatches, fixed-price access are going up. We will come back to that. I want to add one thing, and that is a trend that we've seen when looking at these offerings, is content aggregation.
Operators that are able to become almost like a hub, where consumers can, not just buy a mobile phone and a subscription, but also then, basically click in what type of streaming services they want. That is more and more operators are offering and becoming this hub, which I think is a very good step of actually being relevant to the consumer in the market and actually being able to offer that type of, content hub or content aggregator role. When new services come on top of 5G, will probably be a very good place to be. We've also seen a number of operators that are charging a premium or charging, differencing the prices on 5G, just because of 5G, it's actually going down. Now we see around 22% doing that.
Most operator now more trying to get operators to enjoy the better value that 5G gives, and with higher higher bucket sizes, they manage to get the consumers to actually go for a bigger packet or a bigger offering, and thereby increasing the revenue. If we continue and look more into the fixed wireless access, we have seen, and this is a regional picture, we have seen, it's quite varying how the adoption is, but we have more than 100 service providers offering fixed wireless access over 5G. Over 80% offer fixed wireless access in the regions North America, Western Europe, and Central Eastern Europe, and Middle East and Africa. Quite a diverse set of regions, but many are going for fixed wireless access.
The way operators are offering fixed wireless access has also changed a little bit. Some are doing, using more the volume-based offering, where you actually sell packets of data rather than an unlimited setting. That with 5G is changing, there's more and more that are actually doing, offering fixed wireless access, what we say, speed-based or quality of service-based, basically in the same way you sell a fixed program connection with an unlimited usage, but with speed tiers instead. That is more popular in, as you see here in North America, but it is growing in other markets, it varies a little bit.
Looking at fixed wireless access, Richard, if we go back to the forecast here, we haven't really changed our forecast in terms of number of connection. What can you say? We are introducing the first time here a regional split of fixed wireless access. Can you please comment on what that gives us?
Yes. Well, in similar to many other graphs here, you will see that Asia Pacific is the largest region. Of course, here is a difference that here it's actually India that drives the APAC part with very ambitious goals for fixed wireless access. That's also one of the key reasons why we increased our forecast in November. While China is not seen as a major fixed wireless access market. This is really a different picture compared to the usual one.
I would say 5G fixed wireless access connection being the dominant one very soon. It grows rapidly. If you look at another segment here, it's the IoT part. We are seeing, continued seeing an uptake on Broadband IoT, which is this more bigger IoT devices which require a little bit higher bandwidth. It continued to be rolled out in a lot of different markets. Of course, this might change a little bit. We know we recently seen, also in from a standardization perspective, this new standard called REDCap or Reduced Capability. I know, Richard, this is maybe putting you on the spot here, but we haven't really included those forecasts.
Can you say something about, you know, which segment would we, you know, see REDCap being maybe impacting?
We would consider it as part of the Broadband segment here. It is actually a little bit between the Broadband and the Massive IoT segment, offering a great flexibility between battery life, geographical reach, and bandwidth. We will see it as part of the Broadband IoT, and it will likely become a significant part of that segment. It's still early days to see where it ends up, but it has a good potential there.
Yeah. We do state in this slide here also that IoT devices connected via 2G and 3G are in slow decline. I forgot to ask you on the previous slide, how do you see sunsetting of 2G and 3G networks across the globe? Is IoT devices what keeps them running, so to speak?
It varies between markets. I mean, if you look at Africa and Sub-Saharan Africa, it's still the handsets and the price points and battery life, and robustness of the handsets that are a major factor in keeping the 2G networks alive. Of course, in many other countries, there is not a lot of 2G handheld devices left. Then there is really the IoT device that keeps it up and migrating or sunsetting the networks then becomes a case of how do you handle those IoT devices?
Let's move over to traffic, which is, of course, in terms of mobile network traffic or network in exabytes per month, is what we actually count here. This graph we have had since the start of the reporting back in 2011. As you can see, the growth continues. Right now, we are on a year-on-year growth of 36%. The black line here is basically the year-on-year growth, which have come down after some real spikes in the beginning of 2019 and even in 2017. Of course, with bigger base, the year-on-year is kind of expected to decline a little bit.
What can you say about the uptake of traffic in the world and the year-on-year growth? Especially going forward, maybe?
Going forward, we expect the slightly downward sloping growth rate to continue. We will most likely have a situation where the growth in Gigabits, added Gigabits each year is larger than the added Gigabits the previous year, still the growth rate as such will probably continue to decrease.
Here we look in the future on the traffic side. We are adding, you know, we have both the 2G, 3G, basically it's 4G data on the bottom here, where we have 5G on top, and then fixed wireless access over there. We say that all mobile data growth within 5 years will come from 5G. 4G will stop growing, is that what you're saying? How do you see fixed wireless access? That also grows with 5G then, by 5 years from now.
Yes, it will be a combination of the high-end users transitioning first to 5G, as what we're seeing today, decreasing the growth on 4G. By the end of the period here, it will be the kind of lower end users, so to say, that remain on 4G, and the bulk of the high traffic ones will be on 5G. The same will most likely be true for fixed wireless access.
We also state about XR-type services, which is an extended reality. Could be augmented reality, virtual reality, or combination, of course. We do talk about an initial uptake of services, but, you know, what do we see? We know we have an article also, which I will come back to, that talks a little bit deeper on that. How do you see XR impacting our, this forecast up to 2028?
Well, there is some XR in the forecast, but it's still our view that it will be a limited share in this forecast period. Of course, the timing of the takeoff is very difficult to estimate. It's still very early days, but we think that the major part of it will occur after 2028. Here we are talking about the global population, so when we say that we see a major uptake, we really, we need to see it as a mass market phenomenon.
Mm-hmm.
The early days, we have already, of course.
Looking at the data growth per smartphone, which of course can include some of the tethered traffic over XR, on top of what you do with your smartphone. These are the different regions. We're right now averaging, or we did average around 16 GB in end of 2022. I think we passed 20 GB on global average right now. We will do that. We'll reach that in end of 2023. What to comment on this maybe is, again, India. I know some reports couple years ago, we probably didn't expect India to continue to lead the regions in terms of smartphone usage. What has changed in our view here on smartphone usage?
Well, in simple terms, history has taught us that a market like India, with very fierce competition, can drive huge traffic flows. It's also evident that the assumption that at least I had many years ago, that we would have a closer connection between, say, GDP per capita and traffic volumes per subscription, no longer holds true. It's other factors that determines, and they will, of course, be access to content, the popularity of video content, availability of that, the availability of fixed networks in the homes.
Mm-hmm.
There will be many factors, but it's clearly not only GDP or isn't GDP.
Yeah. I guess there is also a lot of variation. Now, we talk about average traffic, and within those numbers, it varies, of course, between different types of users, and therefore, the forecasting itself becomes sensitive to those variations. If we look at... We actually did some measurements in both a European service provider and a North American service provider, where we looked at how much the share of subscribers and the traffic that actually are generated. Here you can basically see that if you just take the light users, those represent a subscriber share of about 60% in both these networks, while generating around 5% of the traffic.
On the other hand, you have the other scale, the extreme users, which are very few, but they generate, you know, almost 40% or even more than 40% of the traffic. This, of course, you know, how do you as a forecaster, you know, take all of that into account in terms of looking at how, the sensitivity in the forecast?
Yes. That's a tricky question, and it really shows the averages are just averages. Of course, when you weigh everything together, you will end up with an average, but that really says nothing about the individual subscriber as such. If you look at these, I mean, these numbers we will have at the extreme, we will have some fixed wireless access subscribers that consume maybe 1,000 GB per month. At the other end, we have a large share of the population, also subscription population, that really use quite moderate data amounts. This also in a way mirrors the situation between operators and between markets.
In some markets, there is very high data traffic, and in the neighboring market, there may be quite low data traffic due to tariffs or cultural things. There really is a huge variation beyond the averages that we talked about.
Good. We will move on and talk a little bit on the population coverage. We have added a little bit more information in our population coverage charts, where we have looked at the different regional splits as well. We're splitting out here both 5G in total and 5G mid-band. Basically, population coverage for 5G, including low band, including basically mid-band, also high band, of course. If you look at the 5G mid-band itself, you see that population coverage in the world is around 30% right now. It varies quite a lot, with North America being on 80% on mid-band and China around 90%. We have other markets which are lower. Europe around 15% on 5G mid-band, which varies a lot.
Of course, mid-band is important because that's where you get the more higher speeds and more the 5G capabilities coming, right? Of course, connected with stand-alone and connected with a good performance, then that, of course, changes the performance of 5G. What can you say, Richard, about the again, the comparison here between regions, both on total, but maybe more on the mid-band side?
Yeah, here it's very evident that in some regions, we are still in early days when it comes to 5G rollout for high capacity. We can see that the US, where there's strong competition around this and the frequencies have been made available in a timely way, and in China, where decision-making is a different process, will come a long way. Really, the rest of the regions are still have a long way to go in mid-band coverage.
We do see around 35 networks being launched with standalone, 240 overall in 5G. Of course, the more you get more standalone coming up, the more experience can actually improve. It's also connected, of course, to devices. Let me go to the device side. Here, we basically talk about both the shipment, but also the technology itself. There's a lot of abbreviations here. You probably need to go into the report to dig deeper into this and get all the abbreviations correctly. It basically talks about carrier aggregations in many different forms, especially for standalone, where you can get...
You know, we are also seeing, or, you know, device manufacturing talking about in 2024, having a 6-carrier aggregation between FDD and TDD for stand-alone. Also for on the uplink, between FDD and TDD. There is a lot of innovation and a lot of new types of combinations coming up. Here you also see the REDCap device capability. Overall, the smartphone shipment dropped, even though the high-end segment has been resilient. What does this mean for 5G? We're talking about the still a growth of 500 million 5G subscriptions this year. How does that combine with the smartphone shipment being dropped, Richard?
It ties in with the expectations here, given also that some of the smartphones will already be replacement devices. Of course, the smartphone shipment volume is a key to subscription penetration. If there's a further drop, then that will affect the forecast. If it goes better than expected, it will be the time to increase the forecast.
Mm.
Between-
Yes.
There's been quite big swings in this, like, last couple of years.
It is, it is. It's an impressive amount of 5G smartphones being launched, with more than 800 so far in 2023, almost 900 in total. Of course, the sheer amount of different models to choose from, help when it comes to the uptake of 5G. With that, we will leave the forecast. I know if you have questions, please... I see some of them are coming into the Q&A. Put them there and ask more questions. We will have a Q&A at the end of this session. Now I will move over, and welcome Hai Thoo here. We're very honored to have been able to work together with Singtel on a article exploring different edge services with 5G networks.
Hai Thoo, welcome, and please take it away.
Thank you. Yeah, good morning, good afternoon, good evening, and thank you for joining us and joining me in this particular segment and session. First of all, I want to thank Ericsson for featuring us in these issues and also for the partners, the 5G partnership, over the last 24 months. Yes, just getting a bit into the journey that the whole Ericsson and Singtel 5G standalone journey and achievement over the last 24 months. We launched the 5G standalone network in May 2021. That is almost 24 months ago. That's been really the first 5G SA network in Singapore.
We have gone on then, in, on a very aggressive rollout, over the 12, 14 months, and actually achieve nationwide coverage, which is in the Singapore regulators definition, more than 90%, 95% of the country. This, you know, Singtel and Ericsson, have jointly achieved this in July 2022, and that is two years ahead of the commitments or the requirements, put up by the Singapore regulator, IMDA. Having a nationwide 5G network was the really starting point for us, and shortly. That also coincide with the opening up of the Singapore's market due to post-COVID.
This COVID had subsided in Singapore at that point of time, the first major international event at that time was the Formula 1 Singapore in September 2022. We actually took the opportunity. We were piloting, we were experimenting on network slicing, and we took the opportunity to implement network slicing around the Formula 1 circuit. That was really a world first in the live network on a commercial basis. Since then, we have gone on to pilot, to implement network slicing on various major event like what you see here in November, the FIFA World Cup in Qatar.
We make network slicing available to people who subscribe, our in-house video streaming service, which you can stream live Live World Cup matches and on a dedicated slice, guaranteed quality of services, quality of service. We do see differences in terms of quality. The images was sharper even at crowded places. That has been. We have since then gone on and did various implementation through network slicing at the New Year crossover. We had commercial customers deploying network slicing. As we deployed 5G, we were looking forward to a lot of... We were drawing some lessons from what happens in the previous generations of mobile network.
One of the moment that we actually picked up was when we transit from GSM to 3G, and that was the introductions of for the first time. There was some form of data through the circuit switch network, but 3G data. 3G was really the first time the industry go into mobile data in a big way. You know, we were struggling to find use cases for mobile data at that point, until the iPhone moment, with the touch screen and the conceptualization of mobile apps, with one application having one function. That really helped mobile data to grow and usher in the era of LTE or 4G.
As we embark on the 5G network, as we had at the beginning of 5G, deployments of 5G and its application, there was much talk about the use cases to brought high bandwidth, through low latency, high density, ability to connect with many devices. I must say that the market kind of have trailed behind the technology again, in this particular instance. This is where we start to look at a new, potential new value, unique value proposition of 5G, and that is network slicing. This is only, we are able only to do that on the 5G standalone network.
This is where we found that there will be potential, a lot more potential use case, as spelled out in this slide, for across the consumer, the enterprise, and even the public sector. We have mapped out some of the use cases that can be fulfilled in the next 1 to 2 year, and some further out the years. Things like autonomous vehicle that requires a lot of other regulations involvement, smart energy, smart city. These are some of the application that's further down the horizon. On further on, more on network slicing, we are looking traditionally in mobile network, it has always been supported. It has always been powered by the consumer segment.
It drive the vast majority of the usage, and that's how mobile network, since GSM has been supported through GSM, 3G, 4G. That has allowed us to gain economy of scale. As we embark on 5G, we start to see that the potential incremental value may come from the business segment, from the B2B or even from B2B to X to C. This is where we see that we can transform. We can, from economy of scale, where you have a lot of user in one network, into economy of scope, that is where you have a lot of different application, different logical network. Through network slicing, you can have now multiple. You have the economy of scope. You have, you can multiple usage on the same network.
You can create multiple logical network, multiple customize purpose, fully built network for specific industry, for specific organization, for specific use cases. This form of network implementation also allow us to be very focused on our investment. You actually build or you customize network based on a specific network slice, a specific traffic segment, and you do not have to invest huge capacity, huge server, or licenses, or for the entire network to support a specific user. Instead, you are able to now purposefully build or customize the network based on network sizing, based on certain network network traffic. This is how we envision it, you know, almost like a marketplace to design and customize 5G network according to use cases through network slicing.
It's almost like a market, a supermarket, where you can pick and choose some of these network features. Over the last few years, we have piloted on Relative Priority. We have piloted on Radio Partitioning. We are now piloting and working on admission control, access priority, minimum bit rate, or even cybersecurity. We have in fact announced earlier this year in MWC that we have created a slice on network cybersecurity. Also through Paragon, we are beginning to test out this concept of customized, specialized network through network slicing.
We believe that in the coming months and years, this is going to be a important unique value proposition of 5G, where we can drive incremental value for our customers and drive incremental value for the industry. With that, come to just a very quick sharing about Singtel and Ericsson's partnership on the 5G standalone network and our adventures in network slicing. Thank you.
Thank you very much, Hai Thoo. That was very interesting and insightful. Thank you. We'll come back with the Q&A soon, and maybe there are some questions for you in the area as well. Let's just finalize the presentation part. I just want to say a few more, because this what Hai Thoo presented, our collaboration with Singtel, were one articles. We have three more articles in the report. Very much continue to focus on these topics, on traffic handling, quality of experience, and also related to possible scenarios for AR going forward. I would really encourage you all to have a look at that. Just to give you a snapshot of what these articles, the deep dive actually is about, let me just say a few words on those.
First of all, we have one article that talks about how traffic patterns in the self-driving network evolution. We have analyzed the patterns of different locations in North America and Europe, especially between urban areas and rural areas, and dense urban areas and suburban areas. If you compare the dense urban areas with rural areas, you see that traffic demand can be up to 1,000 times larger. When we talk about traffic in general, we have to have that in mind, that traffic may spread a lot. You know, it varies a lot between what type of area we talk about and where the growth is. We're also seeing uplink performance becoming more critical.
We talk about that also in the article, because of the different services that are coming out, but also the fact that 5G rollout is far from complete. 5G mid-band only deployed around 25% of all these sites globally. We look at these different deployments in two markets in E.U. and U.S., and also then compare how many of the sites have actually been upgraded with an RFDS, how many percentage of sites, total sites then have been having a mid-band, or how many have millimeter wave, which is then more prominent in the U.S. example. That you can see then how it varies between the denser urban, the urban, and the rural areas.
That, of course, is an interesting article if you want to understand a little bit more challenges in the mentioning and working with traffic across the network and how that relates to different population areas. The next article is more digging deeper into XR or AR, I would say, and how, what happens when AR will come in in a big way. We've all seen recently the announcement from Apple about new types of VR glasses. That's, I would say, a starting point of many more devices coming up. We have modeled scenarios here and used our own research department to look at what would actually it mean, or what would it take to handle a lot of new types of XR traffic in the network.
It's very clear that it could actually mean a doubling of traffic in 2020 or 2030, than what we basically are saying today. We don't have it as a forecast, but it's a scenario, depending on how much it actually, you know, takes up. But it is an area which we are looking very closely to see how the uptake will be and then how that means. That would require a new spectrum, additional spectrum to support, but also probably an increased RAM or Radio Access Network density. Please look into that article as well.
The last article I want to pitch, is one that we have worked with our colleagues in North America, looking at mobile quality of experience and how networks are ready for new services. Here, it's very clear that we have been used to measuring performance based on either bars on the phone or looking at speed tests and looking at download speeds only. When we go into more advanced streaming services or XR services or also gaming, experience might be difficult to measure just by download speed.
Here we introduce, based on acceptable, accepting or standardized models in the different industries, how we could actually work on introducing the old mean opinion score type of measure by basically, you know, using the right models to actually evaluate the experience rather than just one of the KPIs. I think this is an interesting starting point for discussion for what is experience, what is what type of quality of experience do we expect in our networks, does consumer expect, and how can we measure that going forward? With that, I think we'll round up the actual presentation part. These are the top key highlights, and this time, it's also part of the press release, if you've seen that.
The $1.5 billion by end of this year, 7% growth in top 20 markets the last 2 years, and the fact that we have 100 new service providers offering fixed-price access over 5G. As you've seen, there is tons of more figures and numbers in the report to dig further into. With that, I will open up for going into some of the Q&A. Please continue to ask questions, and I will welcome Richard and Sing, and Hai Thoo back to the meet, and I'll see what type of questions we have here. Thank you for giving those. Richard, I will start with one question for you. When do you expect broad availability of 5G standalone in Western Europe?
We were talking about standalone in Western Europe, but it's a little bit behind. What's your view on that?
I think it's probably a couple of years away, if we're talking, wide availability.
I guess, I mean, we are seeing a lot of interest in a lot of new type use cases. Of course, that requires 5G standalone that actually will improve that, but to have broad availability everywhere, of course, that takes time to build up that type of over capabilities. Which links very much into the mid-band discussion as well.
Thanks.
Haitou, we have a question here from Telstra: Singtel deployment of network slicing today via multiple static slices rather than URSP and dynamic slicing. Is that something you can elaborate on?
Yes. Today, the way that we were one of the first to really venture into this 5G network slicing. In fact, we have planned to implement dynamic network slicing, to network orchestration, looking at network assurance. We were very eager to embark on this pilot, and actually, we went on a static slice, and this is really non-URSP. It's really, it applies to the entire slice, to the entire line of the user. It, it's not applicable, application specific at this moment.
We are certainly looking at dynamic network slicing, we're looking at URSP, and we are, in fact, looking at many other features, like what I said, almost like a supermarket, picking and choosing, and the various features to rack onto this network slice.
Thank you. Next question I see here is, maybe I can answer that. It says: Ericsson says in its report that telecom revenue growth is connected to 5G. Do you think that there would be no growth of the telecom revenue without 5G, given inflation trends seen all around the world? Yes, I mean, 5G is a compelling event of actually being able to offer something more, and we have seen a good correlation. We cannot prove the causality between 5G subscription uptake and revenue uptake, but it correlates very well. I think inflation in itself is more of a pressure on cost for operators, I would say right now, but we would. We don't see so much increase in prices on communication.
I don't see inflation actually impacting that right now. We'll continue. There is a question here from Dean Bubley: Is there a negative correlation between average Gigabyte per month use in a country versus penetration of fixed broadband? That's, you know, Wi-Fi in homes. When you have a lot of Wi-Fi, does that spill over to how Gigabyte per month use works? Basically, the countries with good fixed broadband, do they have less Gigabyte per month usage? What do you say, Richard?
Let's say that I've tried to find proof of that idea because I think it's eminently natural to look at it that way, and I'm sure there is such a relationship. On the other hand, there is various other reasons, so many differences between markets in data traffic. That's kind of overshadows that correlation, or at least makes it difficult to prove. We have several markets with very high fixed penetration in the homes and still very high data traffic volumes, and we also have the reverse. I've not been able to prove it, no.
Thank you. There is another network slicing question here, more general, but maybe you, Hai Thoo, can please help me with this. This is from Jengo Esmer: How does 5G network slicing address the challenge of delivering customized and differentiated services across diverse industries, while ensuring efficient resource allocation and network optimization? I guess this is general, the value of network slicing among industries. How do you look at that?
How... Well, I think the network slicing, the features, is for the first time in the history of this industry, we are now able to, you know, particularly on the radio, which is where the resource is very scarce and limited. It's always the... For the first time in the history of the industry, we are now able to set aside resources. We're able to provide specific customization for a specific industry. I think this is something that is truly unique, and for the first time, we are able to achieve that. This is where we think that you can bring about. You can almost see 5G as a general purpose technology.
You know, it's a technology where now it become ubiquitous, become available, you can start to put multiple kind of enterprise operation on it. The CTO, the CXO, for the first time, is able to go to the board room and say that we can now leverage on 5G network to run mission-critical operation. That's something that it wasn't possible, and that is why there is always a limitation when it comes to mobility. For the first time in the industry, through 5G network, standalone network slicing, we now are able to put on enterprise mission-critical services on it. There's also a question about, you know, whether 5G is about efficiency or about growing revenue. I think the answer, it's always hard to predict the future, but I think the answer can be both.
You know, like what I said, you can now move from economy of scale to economy of scope. You can now do a lot more on the network than before. You can now build multiple logical network for different purpose, and that drive efficiency. You are able to now do more with less. At the same time, when you do that, you need to create value for your customers. In this case, apart from the consumer, like I mentioned, there's also the incremental value can be coming, that we can create for the enterprise customer or the enterprise customer's customers, and that's the B2B2X model. When you start to create value for your customer, and that's where the market will reward you with increased revenue and EBITDA and better ROIC.
Thank you, Hai Thoo. Very good. I think there's one question here which maybe we need to clarify a little bit. It says from James Moore: I'm curious about you saying XR will contribute significantly to mobile data usage. To date, there hasn't been a globally successful smartphone-based XR platform. There are a few smartphone manufacturers interested in making more and so on. I guess we didn't say that it will impact the forecast up to 2028, really. Can you clarify, Richard, a little bit? Of course, the amount of data in networks today across the world is huge, so it would take a bit to actually impact your forecast, wouldn't it?
Yes, with billions of users, using smartphones, the average traffic of upwards of 50 GB per month in the end of the forecast period, we need a large population of XR users to really make a dent in that curve, so to say. A big dent in that curve is not really expected until after the end of the forecast period.
Exactly. There was one more question here I thought might be interesting. When will we see an outlook for 6G services in your report? Richard, I don't know if you have a good answer on that. I think we're still waiting for the standardization to say when 6G will come, and so on. What's your view?
we are getting close to that.
Hmm.
Keep reading the coming editions.
Exactly. Keep reading, you will get it. There is one more question here: Do you expect future augmented reality use to drive outdoor data traffic or mostly indoor? If I start there, I think that when we look at the different types of use cases that we see today on XR, they could be. A lot is indoor, but it's more with navigation things in airports or malls, but it could also be outside. I think it's a mix of that. Of course, driving data traffic, I would assume that most of that would be outdoor AR traffic. What do you say, Richard? How would you see that impact?
Yes, that's our expectation. If we split XR in AR and VR, we will expect to see the VR part mostly indoors and perhaps in homes and industries, and AR to largely be outside and in specific industries.
Now we're getting close to the end here. I'll ask you, Hai Thoo, is there anything more you would want to add, given a lot of the questions that you see, and, or other things that you have thought about during that? I'll give you the last word here.
No, I suppose that I suppose that we are still, we have a peek into what the capability of 5G. I always like to use the quote from this William Gibson, that "The street find its own use for things," and sometimes the market will teach us what, how to make use and leverage on the capability of 5G. You kind of look forward to that, and you need to stay open minded to embrace that.
Thank you, Hai Thoo. That was a very good ending quote there. Thank you, Richard, for joining. I will say thank you to all of you that have joined this webinar. It will be able to be looked at on demand afterwards. Thank you again, and have a good rest of the day. Bye-bye.
Thank you.