The period after the Covid-19 pandemic has witnessed a major shift towards digitalisation, with enhanced penetration in remote areas. Further, the world has entered the 5G era, with consumers benefiting from new applications, and businesses and industries taking advantage of new capabilities.

As India is gearing up for the roll-out of 5G, demand for robust mobile and data connectivity during the Covid-19 pandemic has driven technologies such as fix­ed wireless access to emerge as cost-effici­ent broadband alternatives. The recent edi­tion of Nokia’s annual Mobile Broad­band Index (MBiT) report 2022 displays the mobile broadband performance in India. The report aims to provide data and analysis on mobile broadband and traffic growth in India by co-relating these trends with various demand- and supply-side drivers of the connectivity ecosystem such as handsets, devices, content and subscriber usage patterns.

The MBiT Index assesses 4G and overall data traffic growth trends at the pan-India level as well as at the circle category level by capturing data consumption per user. Further, the report highlights how 5G is gaining momentum and providing connectivity to billions of de­vices, thus supporting digitalisation, In­dustry 4.0, virtual reality (VR), internet of things (IoT) and artificial intelligence (AI) applications.

A look at the key findings of the report…

4G trends

4G data traffic has increased by almost 6.5 times while mobile broadband (MBB) subscribers have grown over 2.2 times in the past five years. The report suggests that In­dia has more than doubled its mobile broadband subscribers from 345 million to 765 million in the past five years. The average data traffic per user per month reached 17 GB in 2021, with the highest growth happening in mobile broadband data. 4G mobile data grew 31 per cent in 2021, with the average monthly data traffic per user growing by 26.6 per cent year on year.

With a compound annual growth rate (CAGR) of 53 per cent in MBB data traffic during 2017-21, India’s data usage was amongst the highest in the world. The 4G data traffic witnessed a 31 per cent in­c­rea­se in the year 2021 with the share of 4G mo­bile data being consistent at ar­ound 99 per cent. The average monthly data traffic per user grew to 17 GB in De­cember 2021. Despite Covid relaxa­tion, 2021 ma­rked the highest growth in MBB data in absolute numbers. MBB subs­cri­bers inc­reased from 345 million to 765 million in five years (2017-21). Also, over 40 million 4G users were added to the 4G network. The upgradation of 2G subscribers to 4G continues.

Expanding the 5G ecosystem

5G is gaining momentum around the world and is projected to contribute up to 1 per cent to the global gross domestic product (GDP), or $1.3 trillion in revenue, by 2030, driven by multiple sectors, from healthcare, utilities, next-gen media and manufacturing to smart cities. Globally, operators have been developing use cases for their 5G networks as they look to monetise their investments. India’s mobile 5G services revenue is forecasted to grow at a CAGR of 164 per cent from 2022 to 2026.

The report predicts that by 2026, global mobile 5G subscriptions will reach 4.1 billion, equivalent to 37.1 per cent of total mobile subscriptions. Meanwhile, India’s 5G subscriptions are expected to grow at an in­creasing rate in the next few years. Glo­ba­lly, by 2026, mobile 5G services are expected to generate $645 billion, equivalent to 64 per cent of total mo­bile service revenue worldwide. With res­pect to India, mobile 5G services are forecasted to generate $9 billion, equivalent to 37.7 per cent of total mobile service revenue. The 5G service revenue is projected to grow at a whopping CAGR of 164 per cent from 2022 to 2026.

Key 5G use cases

The most relevant areas seen as 5G use cases are smart surveillance and public services as well as smart transportation. In ad­dition, smart grid and smart environmental protection are capable of driving more efficient resource usage through the deployment of IoT and automation of systems. Smart health and smart education are also expected to gain traction with the growing 5G footprint.

The key 5G use cases from India’s perspective can be categorised under the three broad heads of sustainability, digitalisation and innovation.

  • Sustainability: 5G can help in enhanced en­vironment monitoring such as flood dete­ction; regulatory compliance; and be­tter energy management in the form of smart utilities, grids, smart lighting, etc. Also, fieldworker safety can be en­sured through alerts and notifications, health monitoring and location tracking with 5G coming in. Moreover, health and sa­fety measures along with proper re­sou­rce management such as ensuring water purity and flood detection will be made possible with increased penetration of 5G.
  • Digitalisation: 5G is expected to become part of a multiservice capability and not necessarily a substitute for prevailing networks. With 5G technology becoming part of a layered wide area network (WAN) architecture, the network will enable a connected remote workforce and has the ability to support IoT at scale.
  • Innovation: With 5G coming in, smart sensors are forecasted to become popular for contact tracing and remote temperature checking. Additionally, 5G will enable asset tracking with fleet ma­nagement and improve visibility across the supply chain. Digital and connected pro­ducts are another area of innovation when it comes to the evolving 5G landscape in India. Embedding SIMs and other solutions in appliances, clothing, equipment, machinery, healthcare devi­c­es, etc., is a key focus area of the new-ge­neration technology. Smart video analytics is supposed to further boom with use cases such as people and vehicle tracking, distance detection, virtual classroom and video gaming.

Demand drivers

There has been considerable speculation about 5G’s potential to take wireless communications to another level, certainly in terms of capacity and bandwidth. The 5G technology market includes 5G connectivity technologies such as enhanced mobile broadband, ultra-reliable low latency communications and massive machine type communications. 5G technology is expected to redefine communication, entertainment, and how people connect to the internet. 5G technology can operate in mmwave bands, that is, within the high frequency spectrum ranging from 24 GHz to 100 GHz that facilitates faster data delivery.

With respect to India, there has been increasing demand for high speed connectivity. The next wave of smartphone adoption is happening in rural India, which will change the way content is consumed across the internet. Over 40 per cent of smartphone users were already using short-form apps in 2021. It is expected that user adoption will increase to 60-75 per cent of the smartphone user base by 2025. Also, the short-form video segment has the potential to account for 20 per cent of India’s digital advertising market, which is estimated to reach $25 billion-$35 billion by the end of 2030. The world has become far more tech-savvy. Millennials and Gen Z perceive technology as the means to information and empowerment. The Indian Gen Z spends 8 hours per day online on an average. This is the pace at which consumers in India are consuming internet, making them key demand drivers for high speed connectivity.

The way forward

India is progressing towards becoming a $1 trillion digital economy by 2025 and 5G will play a major role in this. 5G uptake will be driven by consumers and enterprise businesses. The technology lays the foundation for a connected society and a greener economy. Further, 5G is expected to bridge the digital divide for an inclusive digital economy. The Nokia MBiT Index considers 5G to be a good bet. However, India should strive to allocate 5G spectrum auctions soon and work on creating a suitable environment for the next-generation network to penetrate deeper into the remotest parts of the country.