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The Impact of 5G to The Global Economy

Published: 9th November 2020

The march towards 5G has been a natural evolution of cellular technology that has been happening since the invention of the telephone – however, the economic impact that 5G brings is what makes it the most significant one.

It has only been just over a year since the deployment of 5G began, yet so far the progress has been substantial. At the end of 2019, there were more than 17.7 million 5G connections globally. A study by Juniper Research estimated that this number will reach 1.5 billion by 2025, giving an impressive annual growth of 150% over the next few years.

With more connections come more opportunity, which translates to economic gains. In this article, we will take a closer look at the economic impact of 5G to the global economy.

Global Impact

5G will have a profound impact on global economic performance and GDP. In 2016, which is prior to the deployment of 5G, mobile technologies and services generated 4.4% of global GDP, which equates to around $3.3 million in economic value. In their study, IHS Markit predicts that 5G mobile technology will enable a wide range of industries, thus producing up to $13.2 trillion worth of goods & services by 2035. They also estimated that 5G could support up to 22.3 million jobs and drive the global GDP by $2.1 trillion in net present value terms, a substantial contribution that is equivalent to the present-day size of Italy’s economy.

According to the aforementioned study, the potential economic contribution of 5G to the global economy might come from three angles. The first one is potential sales of products and services that may be enabled by the pervasive use of 5G across a broad spectrum of industries, which will allow some industries to optimize their core business as well as establish new business models. Secondly, the 5G value chain would continue to intensify the base of underlying 5G technology through R&D efforts, investments in network infrastructure, and development of applications. Lastly, the enhancement of mobile network technology by 5G connections have the potential to drive long-term and sustainable growth of global GDP, which ultimately suggests healthy economic progress coming from 5G.

Impacted Industry

The advancement of 5G will disrupt many sectors, and possibly enable new industries to emerge in the global economy. One of its most substantial impacts will be on the healthcare industry. It is predicted that 5G will have a large impact on the quality of healthcare. It will enable a significant evolution in the way in which healthcare is delivered to patients – for instance, 5G will support the application of virtual reality, which will allow remote diagnosis to occur. This is especially beneficial for certain critical medical illnesses that require emergency on-the-spot diagnosis and treatment, such as strokes and heart attacks.

Another significant contribution of 5G in disrupting industries is in the automotive sector, specifically autonomous vehicles & smart cars. Although they have already been enabled to some extent by other technological developments, namely artificial intelligence (AI), the addition of 5G will be critical to the development of autonomous cars and smart vehicles. For example, it could enable the upload and download of 3D mapping data, allowing real-time traffic information sharing between all users, including pedestrians and other cars. This could significantly reduce collisions and other traffic accidents, enable automatic and efficient parking, and reduce unproductive hours that humans spend in commuting to and from work. This advancement is likely to be highly beneficial for society in general due to the tremendous improvements it brings to our life, such as increased air quality, increased productivity – from less time spent in commute and looking for parking, as well as increased overall life quality due to reduction in traffic collisions and fatality rate. As such, these social benefits may translate to trillions of dollars annually for the global economy.


However, there are challenges that we need to overcome. In order to truly realize the full economic potential of the 5G economy, it is crucial to continue the R&D effort and investment that has so far been successful in driving innovation and advancing 5G. Moreover, the pervasiveness of 5G technology and its fast pace in changing the existing technological landscape means that policymakers will be challenged to keep up with the ways that 5G progress. They need to ensure that policy and regulations will be continually adapted to the change in technology in order to ensure a smooth path to 5G economic growth.

In short, 5G will soon become an enabler for new products and services to enter a new world of possibilities, bringing positive impacts for the global economy. As a business, success in the future means being fully prepared with 5G adoption and successfully taking the lead in 5G deployment. In order to do so, make sure you have the right partner with the required experience and expertise to bring you forward. VIAVI’s 5G test and verification solutions will deliver essential validation, verification and visibility for 5G. We can provide you with the opportunity to test, enable and assure your operations on 5G and optimize moving forward with essential experts in the industry.

MCS Test are the approved UK partner for Viavi
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