Ericsson: 20% of 5G users willing to pay extra for enhanced connectivity

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In a study conducted by Ericsson ConsumerLab, it has been revealed that one in five 5G smartphone users are seeking differentiated 5G service experiences and are willing to pay a premium for enhanced connectivity.

The research, titled 5G value: Turning performance into value, indicates that these users – especially those engaging in demanding applications – are willing to pay communications service providers (CSPs) up to 11 percent more for value-added connectivity.

Jasmeet Singh Sethi, Head of Ericsson ConsumerLab, said:

“Interestingly, about one-in-five 5G smartphone users polled expressed a clear preference for differentiated quality of service connectivity.

Rather than settling for generic, best-effort 5G performance, these users are actively seeking elevated and consistent network performance specially tailored for demanding applications and specific key locations.”

This satisfaction-focused report sheds light on the growing potential for CSPs in the 5G market, as an increasing number of subscribers express higher satisfaction levels with 5G services.

Interestingly, the study also highlights the significance of user experiences at key locations like stadiums, entertainment arenas, and airports.

“A lot of 5G consumers clearly expect 5G to be able to give them a value-add experience – for example, to enhance a night out at a major entertainment venue, or when travelling through an airport. If their experience in such locations is poor, they are three times more likely to switch to a provider who can provide that optimum 5G experience,” added Sethi.

The research, based on the feedback of approximately 1.5 billion consumers globally – including around 650 million 5G customers – shows a shift in consumer satisfaction factors. 

While geographical coverage was a primary concern in the early days of 5G, users are now prioritising application-experience-based metrics. Factors such as video streaming quality, mobile gaming/video calling experience, and 5G speed consistency are becoming pivotal in shaping user satisfaction.

Erik Ekudden, CTO of Ericsson, commented:

“In the era of 5G, network Application Programming Interfaces (APIs) are business interfaces for developers and application providers giving them access to network capabilities via familiar easy to use interfaces.

As we observe consumers expressing a willingness to pay for new functionality and differentiated quality of service, it’s clear that these APIs are industry-changing. They foster an environment where developers get access to 5G capabilities to deliver distinct premium experiences.

For communication service providers, APIs unlock new revenues by unveiling the inherent value of their networks.”

The report also highlighted the increasing role of enhanced video formats and augmented reality (AR) applications in driving 5G user engagement and data consumption. On average, 5G users reported a 47 percent increase in time spent on enhanced video formats over the past two years. The number of daily AR application users has also doubled since the end of 2020.

Ericsson’s study indicates a changing landscape in the 5G market, where users demand more than just geographical coverage. Enhanced connectivity experiences and seamless performance in critical locations are becoming paramount, with some users willing to pay premiums for these services.

(Photo by James Yarema on Unsplash)

See also: Yamina Kelm, Deutsche Telekom: Enabling innovation at the edge

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