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8.5 Million 5G Small Cells will be Deployed by 2020

The next wave of mobile internet service adoption will be supported by fifth-generation (5G) wireless technologies that form the foundation for many new applications, including numerous iterations of the Internet of Things (IoT).

ABI Research has forecast that mobile broadband service provider 5G revenue will reach $247 billion in 2025 with North America, Asia-Pacific, and Western Europe being the top markets. Moreover, mobile network operators, vendors, and standards bodies will finalize technical details by 2020.

"5G will be a fast growing cellular technology, most probably faster than preceding generations including 4G," said Joe Hoffman, vice president at ABI Research. "The technology migration over the next few years will mean the continued decline of 2G. 3G and 4G will grow in many markets but 5G will generate new use cases and market revenues."

Challenges for 5G Market Development

As infrastructure vendors and mobile network service providers prepare for 5G, the market faces several key challenges. Obstacles include spectrum fragmentation, standards development, coverage range, availability of devices -- and most importantly, the development of use cases that ensure profitable outcomes from the unique competitive advantages of 5G.

Unlike the case with 4G LTE, 5G stakeholders are trying hard to achieve spectrum harmonization. As with LTE, however, 5G will also include unlicensed and shared spectrum schemes. ABI believes that government organizations worldwide will need to work together to regulate the 5G spectrum and set the new standard.

Additionally, Enhanced Mobile Broadband coverage will be best achieved in urban areas that require faster speeds and greater capacity. While smart antenna technology can extend coverage reach, it will mean a small cells deployment.

Demand for Small Cell Infrastructure

ABI Research forecasts 8.5 million small cells to be deployed by 2020, setting in place the infrastructure for a rapid 5G millimeter wave adoption. And, according to the ABI assessment, in-band backhaul is a new tool to solve connectivity issues.

At the early stage of deployment, the leading 5G use case is enhanced mobile broadband, closely followed by critical and massive machine-type IoT communications. Leading mobile operators in North America and Asia-Pacific recently announced projects and plans to roll-out their own 5G initiatives.

"The 5G network of tomorrow will, over time, evolve to embrace cellular, Wi-Fi, and wired connectivity, in addition to millimeter wave," concludes Hoffman. "It will be better, cheaper, greener, and incredibly high-speed wireless data access for the mass market that will cause business innovation to explode."

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