Tuesday, 13 September 2022

5G Is Finally Starting to Make Sense to Consumers (and Cents for Providers)

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5G use among consumers is on the rise, almost by default, and there are opportunities for service providers to make more of their investment.

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So says Deloitte in a new report, “Deloitte Connectivity and Mobile Trends Survey,” which found that the percentage of consumers with a 5G device rose from 56% in 2021 to 68% in 2022.

Positively, consumers report that they are happy with their 5G service. More than nine in 10 respondents said 5G meets or exceeds their expectations. Moreover, one-quarter of respondents said they’re watching more streaming video thanks to 5G, and one-quarter of Gen Z respondents said they’re gaming more on their 5G phones than in the past.

Even so, approximately two-thirds of all respondents (those with and without 5G service) said they want a better understanding of the new capabilities 5G offers.

“Indeed, most users are doing what they already did with 4G, just faster and with better performance. They do not yet see any new revolutionary applications enabled by the technology.”

Couple this with research that suggests two-thirds of 5G phone users would value — and pay more for — premium bundles with “innovative 5G digital services and apps,” and you have a market waiting to be exploited.

To this end, 45% of service providers worldwide are using the promise of rich media and cloud gaming to drive 5G subscriptions and device sales, and nearly 40% include an unlimited option at the premium end of their tiered data plans.

Additionally, because 5G provides more bandwidth and speed to more devices, service providers can increasingly offer unlimited data plans, often with a subscription to a premium third-party streaming service (such as video, music and gaming). These unlimited premium bundles can help distinguish 5G from older 4G wireless plans, the analyst says.

In its second-quarter results, for example, Verizon reported that 57% of new accounts selected premium unlimited plans, resulting in a 2.4% increase in ARPA. AT&T also noted an ARPU uplift due to more customers upgrading to premium unlimited plans.

“There is still ample opportunity for MNOs to benefit from educating consumers on 5G’s benefits and developing new premium bundles that leverage 5G service.

“One clear opportunity is to bundle 5G mobile phones with 5G Fixed Wireless Access (FWA), which may offer similar performance to cable broadband connections.”

Deloitte’s survey revealed that only 22% of respondents obtain mobile and home internet from the same provider. When pushed to pick the top three factors that would convince them to bundle these services, lower combined cost, confidence in service quality, and ease of billing and payment ranked highest.

 


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