Deloitte: Mobile Consumer Survey shows tepid demand for 5G

Research from Deloitte suggests consumers are currently struggling to become enthusiastic about 5G networks.  Wireless network operators all over the world are currently trying to create excitement for 5G, often in a bid to get customers to pay more each month for the service.  But for the most part, they haven’t come up with any compelling NEW 5G applications or use cases.

The 5G focus continues to be on enhanced mobile broadband which most consumers are not very much interested in.  The reason is that 4G-LTE is perfectly adequate for most video streaming and other high bandwidth applications today.  5G is yet to have a “killer application” for general consumers. Until that happens, it’s going to be a hard sell, according to Deloitte.

Author’s Note:

We have repeatedly stated that the real value of 5G will be in industrial automation, robotics and medical wearables all of which will take advantage of ultra high reliability/availability and ultra low latency.  That is hopefully coming in 3GPP Release 16 which MUST be folded in to 3GPP’s IMT 2020 RIT/SRIT submission to ITU-R WP 5D sometime in mid to late 2020.

From the Deloitte report:

As 5G rolls out, we’re starting to see Australians value different dimensions of connectivity, such as reliability and latency. And this will require operators, handset manufacturers and other parts of the ecosystem to get the consumer proposition right – and continue to evolve it.

Some possible emerging technologies like VR/AR could be an important 5G application, but only when ultra low latency is included in IMT 2020 and has been widely implemented. Mobile game streaming, like Google Stadia and Project xCloud, might be another use-case for 5G networks at that time.

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From Deloitte’s Mobile Consumer Survey – a multi-country study of mobile users:

• The impending roll out of 5G in Australia is being met with a lukewarm reception from consumers.  Current use cases appear tilted towards the enterprise and up to 84% of consumers are not convinced it is worth the proposed $15 monthly premium operators are vying for.

• 5G interest among consumers is decreasing, with the percentage of respondents who would switch to 5G as soon as it is available or upon hearing good things, down by 5% compared to 2018.

• Consumers are increasingly wary of the data they share and conscious of their right to withhold information, with 52% of respondents having used privacy enhancing applications and 89% at some point having denied an app access to location, photos, contacts, or other mobile phone features.

• Convenience and growing availability are driving increased use of biometric authentication.

• Since 2017, adoption of facial recognition software on the phones of respondents has seen a 100% compound annual growth rate (supported by the release of the iPhone X and other handsets), while fingerprint-authorized payments is also on the rise, especially among millennials.

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Peter Corbett, Deloitte Partner and National Telecommunications lead stated:

“We are probably entering a period of disillusionment with the technology until it becomes clearer for consumers on how 5G will improve their day-to-day lives.”

Corbett believes 5G early adopters should be prepared to not receive the experience they’d expect from a new generation network.

“Consumers should prepare to be disappointed with 5G in the short-term, as the network will experience growing pains until it is fully established which will come with small-cell deployments and the auction of mmWave in early 2021.”

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Hype around the globe:

Part of the tepid reception to the 5G roll out may be due to infrastructure delays. In South Korea, where the technology was first rolled out, a million subscribers signed up within 69 days; 11 days faster than 4G’s uptake.

However, this was driven by aggressive commercial promotions from local mobile operators showing K-pop idols as the world’s first subscribers rather than due to 5G-service functionality, which had a number of issues with coverage and speed on launch.13 Korean consumer hype was also driven by strong demand for 5G devices, with the Samsung Galaxy S10 5G’s launch based in South Korea.

Similar hype was experienced in the UK, with mobile operator EE launching 5G in June this year, to be quickly followed by Vodafone, Three and O2 by the end of the year.15 Initial reviews indicate the potential for uptake is there but coverage has a long way to go, with maximum speeds yet to be reached in the first six cities for 5G deployment.15 The consensus has been that the roll out of 5G has been smoother than 4G, and that moving to a 5G plan is not worse. However, it will likely only be the early adopters using the network until greater coverage and device diversity are available.

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The complete 2019 Deloitte Mobile Consumer Survey (Australia Edition) can be downloaded here after you complete a brief form.  The 2019 study comprises more than 44,150 responses across 28 countries. Australian findings are based on a nationally representative sample of over 2000 consumers aged 18 to 75, polled online during June 2019.

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U.S. Mobile Consumer Survey:

Information about the U.S. edition is here.  It will be available in December 2019.   For this year’s report, Deloitte surveyed 2,000 US-based consumers to learn more about behaviors and trends that are influencing a wide range of wireless and mobility products and services. This eighth edition of the Global
Mobile Consumer Survey also highlights the differences among US consumers across generational divides—capturing findings from six distinct age groups, ranging from ages 18 to 75.  Here are a few key data points from the executive summary of the survey:

  • While smartphones continued to thrive over the past year, other mobile platforms (including tablets) showed signs that the market is still trying to figure out if—and where—they fit. At the same time, all consumer age groups showed increased awareness about data privacy and security.
  • U.S. consumers expressed growing interest in voice assisted technologies, certain Internet of Things (IoT) applications
    and devices, and the introduction of fifth-generation (5G) wireless
    technologies.
  • Overall, 60 percent of respondents indicated that 5G is either “fairly” (34 percent) or “very” (26 percent) important to them now, compared with 55 percent who felt that way a year ago (see figure 12). The perceived importance of 5G is highest among the 25–34 age group (77 percent believe it’s either “fairly” or “very” important), followed by the 35–44 (73 percent) and 18–24 (69 percent) age groups.
  • 29 percent of survey respondents now believe that their current 4G/LTE network speed at home is either “a little” or “much” faster than their home Wi-Fi (vs. 27 percent in 2017). 29 percent perceive no difference in speed, and 22 percent say their 4G/LTE is either “a little” or “much” slower than their home Wi-Fi.

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References:

https://www2.deloitte.com/au/mobile-consumer-survey

https://www2.deloitte.com/us/en/pages/technology-media-and-telecommunications/articles/global-mobile-consumer-survey-us-edition.html

https://www.telecomstechnews.com/news/2019/nov/14/deloitte-consumers-apathetic-5g-networks/

 

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