This week lawmakers in Washington hope to hash out the details of a proposed infrastructure bill that includes $65 billion for building out universal broadband. In its new global entertainment and media outlook report, PwC said the rise of e-commerce, streaming, on-demand viewing and video calls during COVID-19 lockdowns makes the rollout of next-generation infrastructures such as fiber broadband and 5G “a commercial and political imperative.”
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PwC noted in a press release that the $2+ trillion global entertainment & media (E&M) industry is on track to grow 6.5% in 2021 and 6.7% in 2022, fueled by strong demand for digital content and advertising. This comes after a slump during a challenging 2020 due to the pandemic, it said.
In a press release, CJ Bangah, technology, media and telecom principal for PwC in the U.S., said in part of the dynamics in play: “The power of digital, including the early stages of 5G use cases and the exponential growth of streaming, together with consumers embrace of new and enhanced experiences are a constant force for change. Dynamic shifts within the E&M ecosystem are likely to expand as the industry responds to the evolving landscape of future consumption patterns.”
Internet access accounted for 34% of E&M spending in 2020 and will increase at a 4.9% compound annual growth rate, to $880 billion in 2025 from $694 billion in 2020, per the report. Mobile internet access continues to drive market growth, rising at a 6.1% CAGR, to $605 billion in 2025, PwC said, “underpinned by the spread of 5G, advances in handset technology and premium content bundles.”
Nearly a billion new smartphone owners will emerge over the forecast period, the firm said, along with 681 million new mobile internet subscribers.
In an email Q&A, Dan Hays, PwC’s strategy leader for U.S. technology, media and telecommunications, said, “The continued rollout of 5G across the United States is helping to close the digital divide by enabling broadband access for previously unserved homes and businesses, as well as providing competitive options for those with limited broadband options.”
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On why broadband is no longer negotiable for consumers and businesses, Hays added, “Today more than ever, broadband is the lifeblood of both consumers and businesses. It became even more clear during the Covid-19 pandemic that being connected was a non-negotiable necessity.”
Meanwhile, he noted, “increased investment in wired and wireless infrastructure is also creating jobs in technology, manufacturing, engineering and construction that are needed to support nationwide rollouts.”
J.P. Morgan North America Equity Research predicts that 5G smartphone volume growth will peak this year.
Samik Chatterjee, telecom and network equipment/IT hardware senior analyst at J.P. Morgan, said in a report: “In 2020, we saw around 225 million 5G smartphone units sold globally. 2021 should be the biggest year in terms of growth, and we expect to see a steeper ramp in volume. Growth is likely to peak relatively early, and we estimate the total number of 5G smartphone units sold during the year to reach 525 million. This will be followed by moderating increases, and we would give a volume estimate of 725 million units for 2022.”
The biggest opportunity is in enterprise, Chatterjee said. Global enterprise opportunity enabled by 5G is expected to exceed $700 billion, the firm said. North America is a primary driver for enterprise opportunity, which could exceed $180 billion by 2030.
“Companies have only just started to scratch the surface in terms of investing in enterprise use cases, Chatterjee said. “Factory floor automation will be one of the big use cases. Another is fixed wireless, which could boost connectivity through private 5G networks deployed across organizations, regions or campuses.”
As TechRepublic reported in June, Ericsson predicted that 2026 will be the year that 5G becomes the global wireless standard by supplanting 4G infrastructure and devices.