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4G Growth Path in Emerging Markets in the Era of 5G

Saurav Jha

The ultra-fast wireless connectivity and ultra-low latency enabled by 5G technology have the potential to transform all industries. Many network operators and telecom companies have already started running field trials and testing use cases of 5G across regions. But 5G will neither make 4G obsolete nor replace it completely in major emerging markets and economies except China. 4G growth will continue in most of the major emerging markets.

China is one of the major emerging markets that have been taking initiatives to launch 5G aggressively.

But according to,

China’s telecoms operators are reporting impressive growth in 5G customer additions, but they are not all true 5G users.

Hence, a large percentage of smartphone users in China will still use 4G in the near future.

India – an emerging market with more than 500 million smartphone users – plans to auction the 5G spectrum in the last quarter of 2020. The leading telecom companies in India like Reliance Jio and Bharti Airtel will conduct field-testing of 5G only in 2021. Hence, they will need about 2 to 3 years to roll out 5G wireless networks on a mass scale.

According to Ericsson Mobility Report Projections for India,

5G subscriptions are expected to become available in 2022 and will represent 11 percent of mobile subscriptions at the end of 2025.

At the same time, several emerging economies have been expanding the 4G subscriber base steadily. For instance, 4G will keep growing in emerging markets like Indonesia till 2025 to achieve 361 million connections (74% of total connections).

That is why; 4G and 5G will coexist in the top emerging markets in the near future. Despite the availability of 5G devices and plans, the subscribers will take some time to switch from the fourth-generation mobile network to the fifth-generation mobile network. There are a number of reasons why 4G will keep growing consistently in major emerging markets in the 5G era.

4G Growth Path: Why Will 4G Keep Growing in Emerging Markets in The 5G Era?

Challenges in 5G Network Deployment

5G will be over 10 times faster than 4G. But the 5G networks will be more complex than 3G and 4G networks. The telecom companies have to use new-age architectures like Open Radio Access Network (OpenRAN) to simplify 5G network deployment by integrating software and hardware components provided by various vendors.

But they can leverage OpenRAN only fully only when the software and hardware components are 100% interoperable. Hence, the wireless carriers have to address a slew of challenges to trail and roll out 5G networks. As they will take time to offer 5G plans to subscribers, the telecom operators will focus on expanding and optimizing the existing 4G networks.

High Deployment Cost of 5G

The innovative use cases and Internet of Things (IoT) adoption will require the wireless carriers to invest huge resources in setting and expanding 5G infrastructure.

According to McKinsey & Company, “Network cost could double as operators strive to meet demand for increased capacity and deploy 5G.

The telecom companies have to increase network-related capital expenditure to enable individual and enterprise subscribers to leverage the key benefits of 5G technology.

The telecom companies still need to upgrade and expand 4G networks to deliver a richer network experience to subscribers. But the expansion and optimization of 4G infrastructure will not require them to incur huge network-related capital expenditure. Many telecom companies from emerging markets will keep optimizing 4G infrastructure to increase revenue without escalating capital expenditure.

5G Networks Will Need 4G

According to,

Right now, 5G networks in the US are something called “non standalone.” They need 4G as the anchor to make that initial handshake between a phone and network before passing the device along to a 5G connection.

The leading telecom operators opt for the non standalone model to accelerate 5G deployment without escalating network-related capital expenditure. They use 5G antennas while retaining the existing 4G core networks.

Hence, the 5G networks will not make 4G networks obsolete in both developed and emerging economies. The operators will rely on 4G core networks to provide 5G wireless services to subscribers until they adopt the standalone model. Hence, a large percentage of subscribers will use 4G to upload videos and 5G to download videos in the near future.

Availability of 5G Devices   

The end-users can access 5G networks using their existing 4G devices. But they cannot avail of the ultra-fast connectivity and ultra-low latency enabled by 5G without using 5G devices. At present, many device manufacturers have launched 5G devices in both developed and emerging markets. Also, the leading device manufacturers have already announced their plan to launch innovative 5G devices.

But none of the device manufacturers allow end-users to upgrade their existing smartphone and tablet to 5G. The users have to invest in 5G devices to leverage the next-generation mobile network fully. Most device manufacturers plan to launch high-end 5G mobile devices by 2022. The end-users will keep using 4G until they have the option to choose from a wide range of 5G devices.

4G and 5G Will Coexist Seamlessly

In a short amount of time, 4G replaced 3G completely in major emerging markets including India. But 5G will not replace 4G in a short amount of time. The 5G networks will initially need and rely on 4G LTE. The telecom operators will deploy 5G networks by updating the core components of the 4G network – software and radios.

That is why; many market research studies and forecast reports suggest that both the 4G and 5Gs market will grow consistently in both developed and emerging markets. The end-users will take some time to switch from 4G to 5G. Likewise, the telecom companies will improve the performance of 4G networks, while deploying 5G networks across regions.

In emerging markets, both individuals and enterprises will switch from 4G to 5G gradually. 5G will not replace 4G completely in many countries. In addition to rolling out 5G, the telecom operators will focus on boosting the performance of 4G networks. Hence, 4G will grow steadily in major emerging markets despite subscribers having the option to choose from a wide range of 5G devices and plans.

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