THE FOUNDATIONS FOR THE NEXT SOCIETAL AND BUSINESS LEAP
Article by: Malik Saadi and Dimitris Mavrakis
EXECUTIVE SUMMARY
5G and AI (Artificial Intelligence) are the breakthrough technologies of this decade. The two technologies, each in its own way, are bringing thousands of the most influential and in- novative companies together to build one of the strongest ecosystems likely to transform the way we live and work. The combination of these technologies will serve as a catalyst to many other emerging technologies and will pave the way for a variety of new business opportunities in the consumer and enterprise segments, otherwise not possible with existing technologies.
5G is more than just an access technology evolution to Long-Term Evolution (LTE), designed for extending the network capacity and lowering its latency. Thanks to network slicing and service orchestration capabilities, 5G and network transformation create the foundation for building intelligent, secure, and reliable infrastructure capable of accommodating new services, use cases, and applications with different resources and service requirements on demand.
Impact of 5G and AI: ABI Research Report
5G will create a fabric of processing capabilities at the edge of the network, coupled with high-bandwidth and reliable low-latency connectivity. 5G networks and corresponding use cases will require a higher level of flexibility and adaptability that current network design paradigms cannot provide. The requirement for such features will also increase exponentially when enterprise vertical use cases become mainstream, and Mobile Service Providers (MSPs) will need to adapt their networks in ways beyond what might currently be envisioned. The transformation of society, consumer experiences, and business workflows will not happen overnight, and more importantly, it cannot be driven by MSPs alone. Therefore, networks need to be flexible and adaptive to accommodate new features and cater to new use cases and, at the same time, be open to stimulate innovation from third parties.
On the other hand, AI is now enabling a host of new applications, augmented experiences, and efficient processes for several use cases across different verticals. Current AI implementations are largely public cloud-centric. The migration of more powerful processing capabilities to the edge, combined with 5G’s low- latency performance will likely create an infrastructure that will thrive in a private and secure way.
Network transformation will be necessary to achieve these steps. There will be a need for cloud-native platforms, network orchestration, network Application Programming Interfaces (APIs), and third-party access, as well as a considerable level of flexibility in terms of network components and traffic control. This transition will not be an easy feat, but a necessary one for service providers to take full advantage of business opportunities that the combination of 5G and AI will create.
For this report, ABI Research interviewed leading MSPs, technology suppliers, and technology implementers about the role 5G and AI will play in accelerating the economic growth of key industry sectors. Most companies interviewed agreed that enabling distributed intelligence is the most important asset that the combination of AI and 5G offers, with the goals of bringing computing capabilities, AI in particular, close to the end customer, improving the end-to-end service latency, and minimizing risks related to data privacy and cybersecurity attacks.
Based on the guidance of industry leaders, ABI Research has compiled market forecasts to illustrate the impact that the combination of AI and 5G will have on business productivity across many industry segments and the overall global economic growth. Market data indicate that this combination will create US$3.1 trillion worth of value in 2025, 41% of which will be driven by direct revenue in the 5G value chain, including consumer subscriptions and equipment sales. This will change radically when both technologies reach maturity. ABI Research forecasts that 5G and AI will create value worth 9.2% of the global Gross Domestic Product (GDP) in 2035.