LIVE FROM GSMA MOBILE WORLD CONGRESS AMERICAS 2017: Five billion people are connected to mobile networks, representing two-thirds of the world’s population, but growth is slowing, according to GSMA’s Global Mobile Trends report.

The study found it took four years for the figure to move from 4 billion to 5 billion subscribers and connecting the next billion “will take longer still”.

Meanwhile, smartphone and mobile broadband growth is driving mobile internet usage and engagement, and new form factors are emerging beyond the smartphone, the report revealed.

4G and 5G
GSMA found that “industry excitement around 5G overlooks the fact that 4G still has plenty of headroom for future growth”.

4G is forecasted to account for two-thirds of global mobile connections by 2025, up from around a quarter today, driven by increasing 4G adoption over this period in major emerging markets such as Brazil, India and Indonesia.

Early 5G deployments will likely target high-bandwidth applications as an extension to 4G, notably 8K ultra-HD video and VR/AR apps, although the US will focus initially on using 5G as a last-mile technology for home broadband, the study said.

South Korea and Japan are likely to be among the first 5G markets, showcasing the technology at their respective Olympics Game in 2018 and 2020. However, on a global basis, 5G networks will be rolled out at a slower rate than 4G.

The report continued: “A paradigm shift in network architecture is required to support the shift to 5G and Internet of Things”, which means the creation of decentralised networks that combine a number of network technologies, such as small cells and LPWA, using software-controlled network functions and running over both licensed and unlicensed spectrum.

Edge computing and network slicing will also be needed to support major 5G applications.

Convergence
According to the report, convergence is occurring at an industry level, evidenced by the M&A boom that is creating telco-media conglomerates that seek to unlock new opportunities by combining content offerings with core network services.

Examples include Verizon’s acquisitions of AOL and Yahoo, and the proposed tie-up between AT&T and Time Warner.

However, the study warned that investors have yet to price in a growth premium for converged telco-media plays, which continue to be valued significantly below major tech players.

It said “the quintet of Apple, Amazon, Facebook, Google and Netflix have collectively grown enterprise value 3.5x since 2010, with large operators remaining relatively flat over this period”.