Video streaming a key driver for 5G in the U.S.

Aug. 30, 2019
According to a survey by IHS Markit Digital Orbit, the 5G era is set to drive the next wave of growth in video streaming, with 78% of U.S. consumers indicating they will expand ...

According to a survey by IHS Markit Digital Orbit, the 5G era is set to drive the next wave of growth in video streaming, with 78% of U.S. consumers indicating they will expand such activity as they adopt the new wireless standard in smartphones and home-networking solutions.

When asked to name which types of activities they are likely to increase due to the arrival of 5G, consumers ranked video streaming first, ahead of video calling, social media, mobile gaming, virtual reality (VR) and augmented reality (AR). As a result, the deployment of 5G is expected to help cause video usage to grow to 70% of mobile network traffic in 2022, up from 47% in 2015.

"The promise of faster video streaming through 5G is generating enormous enthusiasm among consumers," said Joshua Builta, senior principal analyst for IHS. "Interest is particularly high for those younger than 50, with 81% of survey respondents in that age range citing video streaming as the top activity for 5G. Consumers are expressing strong interest in video streaming both on smartphones and for home Internet services, which are equally supported by 5G."

Current 4G wireless services already provide sufficient performance to support most types of video content commonly streamed today. As a result, 5G's largest impact is expected to be felt in emerging areas of the market.

One of these areas is 4K UltraHD video. The 5G standard is expected to enable 4K on mobile platforms because of its increased capacity and speed. When coupled with the growing demand for and supply of 4K UHD content, the proliferation of 5G is expected to help drive mobile consumption of UltraHD content.

The 5G standard is also expected to be critical to promoting the consumption of general live video, particularly sports and live events.

In parallel with the trends in the smartphone market, U.S. consumers are expressing intense interest in engaging in 5G video streaming via home Internet access.

While often regarded purely as a mobile technology, the 5G standard also supports fixed wireless access (FWA) in the home.

Most consumers surveyed say they are attracted to 5G FWA by its faster speeds. The average speed of broadband connections in the United States in 2018 was about 35 Mbps. In contrast, 5G can theoretically operate at up to 1 Gbps, although initial deployments are expected to be much slower.

Survey respondents cited streaming of video, both prerecorded and live, as the most compelling reason to upgrade home Internet service. A total of 74% of those surveyed named video streaming as the chief motivation for upgrading to 5G in the home.

IHS Markit forecasts that global over-the-top (OTT) video subscriptions will pass the 1 billion mark in 2021, up from 620 million at the end of last year. In 2022, OTT video subscriptions are expected to surpass pay TV subscriptions.

The survey was conducted May 22-27 among 2,031 respondents, 95% of whom were U.S.-based. The median age of the survey respondents was 43, and 63% lived in urban areas.        

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