As 5G networks continue to expand in coverage and reach more consumers, the next-generation technology will be a critical enabler for new use cases for other applications.
In the case of media, gaming and entertainment, 5G and edge networks are crucial to the development of these segments moving forward, according to new data from ABI Research.
5G will extend gaming into a fully immersive, multi-sensorial environment with multi-player collaboration to access and play the same game. This will drive 119 million cloud gaming users by 2024 and ABI forecasts that 5G edge networks stand to unlock cloud video revenues up to $67.5 billion by 2024, up from $5 billion in 2019. This will be a compound annual growth rate (CAGR) of 67%.
“In general, the tectonic shift in the entertainment sector toward streaming of video, music and games is exciting for communications service providers (CSPs) to tap into,” said Don Alusha, senior analyst for 5G core and edge networks at ABI Research. “5G edge networks integrate cellular architecture with IT and cloud infrastructure to reduce end-to-end latency for a multitude of services and use cases.”
In gaming, 5G will allow location to be immaterial because content can be produced and shared from anywhere without restrictions attached to stationary equipment. With 5G, content can be processed by multiple users in different locations in a simultaneous fashion.
Additionally, content can be reused for different requirements such as second screens or interactive games. This content can be created in rapid fashion, in multiple locations, and can reduce media production costs and timescales, something Vodafone, Orange, SK Telecom and LG are doing, ABI said.
“For example, there are 1.5 billion augmented reality enabled devices today (across smartphones, tablets, and smart glasses), and that is before the consumer AR smart glasses wave has even begun,” Alusha said. “Further, with the advent of 5G and edge capabilities, 2021 and beyond will be a time in which partnerships and collaborations between hyperscalers (e.g., Amazon, Google, Microsoft) and telcos will flourish for both the enterprise and consumer markets.”
ABI said telecoms are likely to establish collaborations with artificial intelligence, virtual reality and AR developers to benefit from 5G speeds to deliver more immersive experiences.
“The first step for the industry is to understand the value at stake from gaming, media, and entertainment use cases and be ready to move in at the right moment,” Alusha said. “The question for CSPs, hyperscalers, and network equipment vendors (NEVs) is whether they can find a reasonable commercial basis for taking action that will be predictable and positively affect top line revenues. Knowing how to answer that is not just one aspect of the game — it is the game.”
The full research can be found in ABI’s 5G and Edge Networks for Media and Gaming report.