Why a 5G rollout requires $2.7T investment by 2020

Infrastructure upgrades and IoT costs will lead to massive amounts of money spent on 5G networks, according to a Greensill report.

5G, smart cities, and other top tech trends for 2019 Quantitative futurist Amy Webb shares her predictions for 2019 tech trends.

The rollout of 5G technology is expected to hit $2.7 trillion by the end of 2020, according to a Greensill report released on Monday. Infrastructure upgrades, necessary to accommodate 5G, are estimated to need $1 trillion of investment.

A significant amount of 5G spending will also go toward Internet of Things (IoT) integration, the report found. Some $585 billion will be spent on 5G implementation on IoT hardware, and $469 billion will be spent on IoT services.

SEE: 5G technology: A business leader's guide (Tech Pro Research)

This type of funding poses challenges for many companies, the report found, since traditional banks alone can't provide the total necessary funding. Companies may want to look to other capital solutions to supplement the needed spending.

"Spending on 5G rollout is just the thin end of the wedge. This project is actually about funding the growth of the Internet of Things and industrial connection to that," said Tony Wonfor, Greensill managing director and telecoms finance specialist, in a press release. "In the automotive industry, for instance, 5G will be important for tracking components through the supply chain and in to the manufacturing process, then right through to an end product that has connectivity beyond anything we have seen so far."

This significant amount of spending on 5G will ultimately be worth the price. 5G is the future of connectivity, providing lower latency and greater bandwidth to devices. And in an IoT-centric world, this connectivity would affect a multitude of industries such as manufacturing, healthcare, and retail.

To learn more about how 5G will develop and evolve this year, check out this TechRepublic article.

The big takeaways for tech leaders:

  • Enterprise spending on 5G technology is predicted to hit $2.7 trillion by 2020. -- Greensill, 2019
  • 5G spending will mainly be geared toward infrastructure upgrades and Internet of Things (IoT) integration. -- Greensill, 2019

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