John Woods

As Asian governments seek a speedy roll-out of 5G, the benefits will be delivered across the new economy

With the arrival of next-generation mobile networks, new services like remote surgery will suddenly be feasible. More immediately, expect a boom in video traffic and augmented reality content

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Boys wear virtual reality devices to experience 5G services at a LG Uplus 5G experience centre in Seoul. South Korea launched the world’s first commercial 5G network in April. Photo: AP

John Woods

Published: 3:00am, 12 Dec 2019Updated: 4:58am, 12 Dec 2019

Many Asian economies will take major steps forward in internet connectivity in 2020. This will give a meaningful boost to sectors of the new economy, representing an important theme for investors.

Between government support and end-user demand (which is expected to be strong even early in the introductory phase), there should be a speedy commercial roll-out of 5G, or fifth-generation mobile networks, and a fast adoption rate. This will accelerate consumption and delivery of mobile services, which is likely to lead to a rise in demand for cloud-computing capacity. Firms connected with the buildout of 5G networks and delivery of electronic content and services will see higher demand for their products.

The introduction of 5G comes against the backdrop of a multi-year shift in consumer activity online, and within that space, a shift toward mobile connectivity. Where 5G differs from its predecessors is its use of radio waves of a significantly higher frequency, which translates into data transfer rates up to 100 times higher and far less delay.

This, in turn, could make a range of new products and services suddenly feasible. More ambitious ones include self-driving cars and remote surgery. The artificial intelligence that propels autonomous vehicles will require high-speed communication not just to retrieve information on locations and traffic conditions, but also to share information with other vehicles in the vicinity. Remote surgery will require a seamless transfer of instructions from the surgeon and feedback from the operating theatre.

While these “moonshots” are still some years away, there are viable applications of 5G in the near term. South Korea launched the world’s first commercial 5G network in April and has seen data transfer rates rise from 50 megabits per second to over 700 Mbps. This enables the delivery of augmented reality, virtual reality and AI-enhanced real-time sports content.

In South Korea, hunger for greater speed and higher bandwidth has translated into 3.5 million 5G subscribers in less than six months, surpassing the adoption rate of 4G at the same stage. A total of 5 million subscriptions are expected by the end of the year.