Ericsson ConsumerLab Report Highlights the Potential of Differentiated 5G Connectivity for CSPs
A recent report from Ericsson ConsumerLab has shed light on the growing demand for differentiated 5G connectivity among smartphone users. The research reveals that one-in-five 5G users are willing to pay a premium of up to 11 percent to enjoy value-added connectivity, such as quality of service, for demanding applications. This presents a significant opportunity for communications service providers (CSPs) to enhance their business case for 5G.
The report, titled “5G Value: Turning Performance into Value,” reflects the views of approximately 1.5 billion consumers globally, including around 650 million 5G customers. It highlights the increasing satisfaction among 5G subscribers and their willingness to pay for enhanced network experiences. The study also emphasizes the importance of delivering satisfactory 5G connectivity at key locations like stadiums, entertainment arenas, and airports, as unsatisfactory experiences can make customers up to three times more likely to switch providers.
The research indicates a shift in consumer satisfaction factors, moving from geographical coverage considerations to application-experience-based metrics such as video streaming quality, mobile gaming/video calling experience, and 5G speed consistency. Early 5G adopters, in particular, are seeking elevated and consistent network performance tailored to their specific needs.
Jasmeet Singh Sethi, Head of Ericsson ConsumerLab, highlights that approximately 37 percent of 5G consumers surveyed believe that increased data allowances in their 5G plans would justify premium rate charges from CSPs. Moreover, one-in-five 5G smartphone users expressed a clear preference for differentiated quality of service connectivity, indicating their willingness to pay a premium for it.
The report also emphasizes the impact of 5G connectivity experiences at busy locations and major event venues on customer loyalty. Consumers expect 5G to provide value-added experiences in such locations, and if their expectations are not met, they are more likely to switch to a provider that can deliver an optimal 5G experience.
Erik Ekudden, Ericsson’s Chief Technology Officer (CTO), highlights the potential of network Application Programming Interfaces (APIs) for developers to offer enhanced network experiences that customers are willing to pay for. These APIs provide developers with access to 5G capabilities, enabling them to deliver distinct premium experiences. For CSPs, APIs unlock new revenue streams by leveraging the inherent value of their networks.
The report also reveals that the bundling of 5G rich enhanced video content, such as 4K, 360-degree experiences, multi-view videos, and augmented reality (AR) applications, drives user engagement and mobile data consumption. On average, 5G users reported a 47 percent increase in time spent on enhanced video formats over the past two years, while the number of daily AR application users has doubled since the end of 2020.
In conclusion, the Ericsson ConsumerLab report highlights the significant opportunity for CSPs to offer differentiated 5G connectivity and capitalize on the increasing satisfaction among 5G subscribers. By focusing on delivering enhanced network experiences and meeting consumer expectations, CSPs can strengthen customer loyalty and drive revenue growth in the 5G era.