5G arrives at an interesting point in industry’s evolution, argues analyst Chetan Sharma. “For the first time, the network upgrade cycle is taking place amidst declining or flat service revenue growth for the operators,” said Sharma.
In the United States, one of the more profitable regions for profit, service revenues declined for three straight years before returning to modest growth in 2018.
“The story is the same for other mature markets,” says Sharma. “Even operators in developing markets are facing challenges.”
The path to revenue growth and EBITDA expansion is complicated. Many believe 5G will not necessarily boost consumer revenues. Enterprise services may well emerge as the source of incremental new revenue.
That is almost certainly going to require creation of new business models, based on new use cases.
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