5G Will Transform the Media Landscape and Enable Over US$69 Billion in Revenues to Cloud Gaming and Cloud Video by 2024
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"These numbers underline the growing demand for cloud-based entertainment services," says Leo Gergs, Research Analyst for 5G Markets at ABI Research. "As an important enabler for these new entertainment services, 5G will be critical for the telco industry to unlock these immense revenue opportunities and turn them into commercial reality."
The current situation around countries imposing social distancing in order to fight and delay the outbreak of Covid-19 is exacerbating the demand for cloud-based entertainment as well as remote video applications, such as remote education services or video calling platforms. Network operators across the globe are faced with surge of network traffic by an average of 15% (up to 30% in countries like Spain and Italy). Measures like school closings are giving a bump to video gaming and over-the-top streaming markets, with platforms like YouTube and Netflix reporting an increase in network traffic of 15% and 16%, respectively. "While due to current social distancing measures, most of these services will be consumed at home, using either mobile/fixed broadband or fixed wireless access. 5G will be an important enabler to transport these immersive media user experiences outside," Gergs explains.
In order to truly succeed in the media and entertainment domain, however, it is vitally important for network operators and infrastructure vendors to target enterprise use cases within media and entertainment. Gergs states, "If there is one lesson to learn from South Korean operators LGU+ or SK Telecom, it is the fact that revenues from the consumer domain alone will not be enough to pay off capital investment for 5G network deployment. That is why it is highly important for the telco industry to leave their comfort zone and advance to target media enterprise use cases."
To triumphantly address media enterprise use cases, infrastructure vendors and network operators need to fully embrace a service-based monetizing strategy and depart from a CAPEX intensive model. This should acknowledge the fact that large web scale companies and edge providers like Microsoft, Amazon Web Services (AWS, through their Wavelength offering) push on to the media and entertainment domain to offer edge capabilities or individual network functions as a service. "If the telco ecosystem does not successfully target media enterprise use cases, web scale companies will take over the domain and push the telco industry to the side," Gergs concludes.
These findings are from ABI Research's 5G in Media and Entertainment application analysis report. This report is part of the company's 5G Markets research service, which includes research, data, and analyst insights. Based on extensive primary interviews, Application Analysis reports present in-depth analysis on key market trends and factors for a specific technology.
About ABI Research
ABI Research provides strategic guidance to visionaries, delivering actionable intelligence on the transformative technologies that are dramatically reshaping industries, economies, and workforces across the world. ABI Research's global team of analysts publish groundbreaking studies often years ahead of other technology advisory firms, empowering our clients to stay ahead of their markets and their competitors.
For more information about ABI Research's services, contact us at +1.516.624.2500 in the Americas, +44.203.326.0140 in Europe, +65.6592.0290 in Asia-Pacific or visit www.abiresearch.com.
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