Russia Set for 80 Percent Population 5G Coverage by 2025

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Russia is powering ahead with its digital technology plans and is set to become a “fast follower” 5G nation on the global stage, with 5G networks forecast to provide coverage to more than 80 percent of the country’s population by 2025, according to a new GSMA Intelligence report. GSMA is an independent, international trade body that represents the interests of mobile network operators worldwide. Approximately 800 mobile operators are full GSMA members and a further 300 companies in the broader mobile ecosystem are associate members.

According to the report, Russian mobile operators are set to launch commercial 5G networks in 2020 and 5G is expected to grow to account for almost one in five of the country’s mobile connections (48 million) by 2025, establishing Russia as the leading 5G market in the Commonwealth of Independent States (CIS). Other countries in the region expected to launch 5G services by 2025 include Azerbaijan, Belarus, Georgia, and Uzbekistan, according to the Mobile Economy: Russia & CIS 2018″ report, which was published yesterday at the Mobile 360 Series – Russia & CIS event being held in Moscow.

“Our new study reveals how Russia will lead the CIS region into the 5G era over the coming years, as operators invest in rapidly building out 5G coverage across the country’s population, following the launch of the region’s first 5G networks in 2020,” said Mats Granryd, Director General of the GSMA. “These new networks have the potential to create digital economies and drive the transformation of industries, but will require a supportive regulatory framework focused on encouraging investment and innovation, for example, by ensuring the timely availability of harmonised spectrum to 5G operators at a suitable price.”

The CIS region is one of the most highly penetrated mobile markets in the world, behind only Europe and North America. At the end of 2017, there were 232 million unique mobile subscribers in the region, equivalent to 80 percent of the population. Russia accounted for more than half (128 million) of this total and is the region’s most highly penetrated market at 89 percent.

Given this high level of penetration, subscriber growth in the region over the next few years will be limited, forecast to increase by only two percentage points to 82 per cent by 2025. The majority of new subscribers over this period will come from Uzbekistan, the region’s third most populous market after Russia and the Ukraine, but one of the least penetrated at 60 percent.

Meanwhile, 4G has plenty of headroom for growth as the region enters the 5G era. 4G accounted for 16 percent of connections at the end of 2017, largely driven by Russia, which was one of the first countries in the region to launch 4G in 2012. All three main Russian operators have since launched LTE-Advanced networks, which provide an evolutionary path to 5G. By 2025, 4G is expected to account for more than two-thirds of the region’s total connections with 5G accounting for 12 percent by this point.

The first 5G-based use cases in the region are expected to focus on enhanced mobile broadband (eMBB), which will add capacity and higher speeds for mobile internet access, usually in urban hotspots where 5G will be an offload solution to ease network congestion.

However, 5G-based Internet of Things (IoT) and enterprise solutions will follow soon after. The number of IoT connections in the CIS region is forecast to triple over the next few years, reaching 660 million by 2025, opening up opportunities in areas such as smart cities and smart utilities. Other areas of opportunity for mobile operators in the CIS region include e-commerce, blockchain, and investments in the startup ecosystem.

“Russia is starting to move ahead of the EU in terms of new publicly available digital technologies”, says Chris Devonshire-Ellis of Dezan Shira & Associates. “This is scientific development long planned prior to sanctions and will effectively reboot Russia as an economic and trade platform force in the next decade. Investors into Russia will see the benefits of this in the medium and longer term and the future looks bright for Russian based businesses that can adapt.”


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