5G service expansion to drive APAC mobile

Mobile communications services revenue in the Asia-Pacific (APAC) region is expected to grow at a compound annual growth rate (CAGR) of 8% from $326.2bn in 2023 to $479.1bn in 2028, according to research from GlobalData.

The region is becoming the centre of a technological race for supremacy in the next generation of mobile communications, with South Korea, Japan and China going beyond just the deployment of 5G to the creation of a wider 5G ecosystem supporting the vast electronics manufacturing and ICT industries in these countries.

GlobalData’s Asia-Pacific mobile broadband forecast pack (Q3 2023) observed that mobile data services will remain the largest revenue-contributing segment to the overall mobile services market in the region during the forecast period. Growth in this segment will be primarily driven by the expansion and increasing adoption of high average revenue per user (ARPU) in the region mainly through the mobile data segment, supported by the growing availability and adoption of 5G services across several countries.

The technology analyst calculated that while the mobile data segment will continue with the growth trajectory, mobile voice service revenue will decline at a CAGR of 2.2% over the forecast period as consumers continue to migrate towards OTT/internet-based communications.

The analyst also believes government support for 5G expansion will strengthen the mobile data services market in the region. It noted that the telecoms regulatory bodies and governing authorities in countries like South Korea, Japan, Australia, China and Taiwan have launched national 5G strategies and action plans outlining the vision and guidelines to establish 5G ecosystems.

These policies include several supporting initiatives, such as public sector investments in 5G applications, tax incentives and deductions, forums for industry-government collaboration, promotion of 5G led-technological innovations, and licence arrangements to enhance spectrum use and reuse.

Not surprisingly, the report confirms China as currently the largest 5G market in the world with an estimated 1.5 billion 5G subscriptions in 2023, which is set to go up to 3.3 billion by the end of 2028, driven by investments and the regulatory efforts to expand 5G networks and boost adoption. In March 2023, China’s MIIT announced plans to deploy 2.9 million 5G base stations by 2023 and 3.6 million by 2025 to expand 5G coverage to rural areas and industrial parks.

“With 5G services already available in most countries like China, Japan, Australia, Hong Kong, India and Korea, and set to be launched soon in countries like Sri Lanka and Bangladesh, the revenue prospect for mobile data segment will remain strong throughout the forecast period,” commented Srikanth Vaidya, telecom analyst at GlobalData.

“Operators like Dialog and Airtel in Sri Lanka, and Grameenphone, Robi and Teletalk in Bangladesh, for instance, conducted 5G network trails in major cities in their respective countries and are gearing up for 5G service roll-out by 2024,” added Vaidya.