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5G to increase cloud video revenue to $67.5 billion by 2024

5G edge networks bring new capabilities allowing communications service providers (CSPs) to develop innovative applications, services, and revenue streams in the media and entertainment domain.

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Edge computing will be a critical enabler for these use cases by providing the perfect compromise between decentralizing network traffic, while centralizing processing capabilities.

According to global tech market advisory firm ABI Research, 5G and edge networks 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.

Furthermore, 5G edge networks stand to unlock cloud video revenues from US$5 billion in 2019 to US$67.5 billion by 2024 at a CAGR of 67%.

Today, most media and gaming use cases, especially cloud gaming and cloud video, are consumer-centric, but 5G and edge infrastructure will ultimately cross over to enterprise use cases.

“In general, the tectonic shift in the entertainment sector toward streaming of video, music, and games is exciting for CSPs to tap into,” explains Don Alusha, Senior Analyst, 5G Core & 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.”

5G low latency and edge computing capabilities are crucial for many aspects of media and entertainment services. For example, with 5G, location is immaterial because content can be produced and shared from anywhere without restrictions attached to stationary equipment.

Using 5G’s capabilities, the content can subsequently be processed by multiple users in different locations in a simultaneous fashion. Further, the content can be reused for different requirements like second screens, interactive games etc.

The ability to create content in a rapid fashion and in multiple locations can reduce media production costs and timescales. The likes of Vodafone, Orange, SK Telecom, and LG UPLUS are taking advantage of this.

Ongoing adoption of 5G edge networks will be a driver for several use cases with higher data rates and low latency. “For example, there are 1.5 billion AR enabled devices today (across smartphones, tablets, and smart glasses), and that is before the consumer AR smart glasses wave has even begun. 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,” says Alusha.

For telecoms, there will be more collaboration with AI, and VR/AR and software developers to benefit from 5G speeds to deliver more immersive and accurate 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. 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,” Alusha concludes.

These findings are from ABI Research’s 5G and Edge Networks for Media and Gaming application analysis report. This report is part of the company’s 5G Core & Edge Networks research service, which includes research, data, and analyst insights. Based on extensive primary interviews, Application Analysis reports present in-depth analysis on key market trends and factors for a specific technology. BCS Bureau

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