India’s digitalisation journey has sped up in the past decade. E-commerce spending has gone up almost three times bet­ween 2017 and 2021. This has been en­abled by the rapid adoption of smartpho­n­es. As of June 2022, smartphones constituted around 83 per cent of e-commerce sal­es in India. Fintech-powered digital tra­n­sac­tions have also increased substantially. Pay­ments powered by Unified Payments Inter­face, for instance, witnessed a whopping 92 times increase between 2017 and 2021. The increase in e-commerce spending and digital transactions can be credited to the rapid adoption of services during the past five years. Data consumption for an average Indian user has risen from 5.7 GB per mo­nth to 17 GB per month, marking a compound annual growth rate (CAGR) of 31 per cent. This makes Indian mobile us­ers the largest consumers of mobile data glo­bally on a per capita basis. Nokia’s MBiT re­port predicts that, going forward, consumption by an average Indian user will reach 49 GB per month by 2026.

Trends in 5G

With India now entering the 5G era, the digitalisation journey is expected to accelerate further. As per a recent survey conducted in September 2022, nearly 10 per cent of smartphones in India are already 5G-enabled. Further, Nokia’s MBiT report projects that mobile 5G services will generate $9 billion in revenue by 2026, equivalent to 37.7 per cent of the total mo­­bile service revenue.

Digitalisation of enterprises

5G will play a vital role on not only the consumer side but also the enterprise side. 5G will im­mensely benefit enterprises in efficiency gains, measured in safety, productivity and efficiency (SPE) metrics for each sector. Enterprises have witnessed the adoption of digitalisation in the form of technologies such as artificial intelligence (AI) and machine learning (ML). Digi­ta­lisation has enabled various industries to enhance their SPE.

In terms of level of digitalisation, ind­us­tries fall into three categories:

  • Digitally mature: These are industries that adopted digital technologies very ea­rly and have maintained ample sp­en­ding. Industries such as communicatio­ns, me­dia, and banking, financial services and insurance fall under this category. The­se industries have seen a four times growth in digital adoption since 2015.
  • Physically leading: Manufacturing, heal­th­care, transportation, education and ot­h­er such industries can be called physically leading enterprises. These industries have spent moderately on information and communications technology (ICT) but have scope for more investments. The sc­o­pe for better results keeps them inclined towards digitalisation. They are expected to grow around four times in terms of digitalisation and witness efficiency gains of over 12 times.
  • Physically lagging: These are industries that have not seen much investment in the ICT space, although they have seen significant results in some sectors. The barrier to easy digitalisation for these in­dustries is usually geographical. Indus­tries such as agriculture, construction, live arts and hospitality are some that are lagging behind in digitalisation. They are expected to see an increase of over five times in digitalisation by 2030.

Within the next 10 years, ICT investments will come largely from physical industries, constituting almost 65 per cent of the total share. The efficiency gains for these industries will depend upon 5G coverage, the degree of technology adoption and the type of industry vertical.

As 5G penetrates the Indian subcontinent, it is expected that the digital economy will soon reach its $1 trillion target. This will mean three times faster roll-outs, besides 500 million 5G subscribers by 2030. It is also expected that there will be a 10 times increase in machine-to-machine connections per square kilometre by 2030, and private wireless and edge computing will play a vital role. Interestingly, 5G will contribute to 50 per cent of this $1 trillion economy.

5G use cases for consumers

5G promises many interesting use cases for consumers. Fixed wireless access (FWA), for instance, is supported in over one-third of 5G launches in India. Cloud gaming is also said to be the first acknowledged 5G use case and is generating among the highest operator activity. The most common route for cloud gaming is operator partnerships with gaming providers, while also bundling their services with FWA and/or smartphone plans. Apart from these, with 5G becoming acce­ssible, consu­mers can enjoy imm­ersive events, more efficient airports, and smart ci­ties. All this will lead to many developments in the economy, including skill development and awareness, ease of doing business and collaborations for India-specific use cases.

Based on a presentation by Amit Marwah, Head of Marketing and Corporate Affairs, Nokia India