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Prepared by Research on Global Markets Proprietary and Confidential, Copyright © 2019, Netscribes, Inc. All
Prepared by Research on Global Markets Proprietary and Confidential, Copyright © 2019, Netscribes, Inc. All

Prepared by Research on Global Markets

Proprietary and Confidential, Copyright © 2019, Netscribes, Inc. All Rights Reserved The content of this document is confidential and meant for the review of the recipient. Disclaimer: The names or logos of other companies and products mentioned herein are the trademarks of their respective owners

Market segmentation and definition 5G refers to latest generation of mobile internet connectivity. It uses

Market segmentation and definition

Market segmentation and definition 5G refers to latest generation of mobile internet connectivity. It uses high
Market segmentation and definition 5G refers to latest generation of mobile internet connectivity. It uses high

5G refers to latest generation of mobile internet connectivity. It uses high frequency radio waves to achieve high data rates. Apart from this, the 5G technology is expected to reduce latency, and promote energy and cost efficiency, excellent connectivity, and very high system capacity.

Segments

Definitions

and very high system capacity. Segments Definitions SIM cellular connections A subscriber identification module
and very high system capacity. Segments Definitions SIM cellular connections A subscriber identification module

SIM cellular connections

A subscriber identification module (SIM) is an integrated circuit (IC), designed to securely store the international

of the subscribers on mobile telephone devices, such as, smartphones, tablets, non-smartphones, and computers, and its respective cellular network. SIM cards are used on GSM phones, and they are required for newer LTE- capable handsets.circuit (IC), designed to securely store the international mobile subscriber identity (IMSI) number and its related

mobile subscriber identity (IMSI) number and its related key, which are used for identification and authentication

key, which are used for identification and authentication SIM M2M cellular connections This refers to the
key, which are used for identification and authentication SIM M2M cellular connections This refers to the

SIM M2M cellular connections

This refers to the technologies that enable devices/machines and sensors within the Internet Of Things (IoT)and authentication SIM M2M cellular connections to communicate with each other, and other Internet-enabled

to communicate with each other, and other Internet-enabled devices and systems, without or with minimal human intervention.

and systems, without or with minimal human intervention. Connected homes Connected healthcare Connected cars

Connected homes

without or with minimal human intervention. Connected homes Connected healthcare Connected cars Connected cities Mission

Connected healthcare

human intervention. Connected homes Connected healthcare Connected cars Connected cities Mission critical

Connected cars

Connected cities
Connected cities
human intervention. Connected homes Connected healthcare Connected cars Connected cities Mission critical applications 2

Mission critical applications

human intervention. Connected homes Connected healthcare Connected cars Connected cities Mission critical applications 2

2

Executive summary

Executive summary

Overview

Currently, 5G is a crucial component of the global digitally connected ecosystem. It is estimated that between 2019 and 2025, the number of 5G users will increase by roughly 1.2 Bn, globally. China, the United States (U.S.), Japan, and the majority of European Union (EU) countries will account for 70% of 5G users by 2025.

Also, by 2025, it is expected that there will be around 300 Mn 5G enabled SIM M2M connections, and the total expected traffic from 5G enabled

devices will reach 490 exabyte (EB).

Once it is launched commercially in early 2020, the 5G market will expand at an exponential compound annual growth rate (CAGR) of 97.1% till 2025.

251

XX XX
XX XX
XX XX

XX

XX XX
XX XX

XX

XX XX
XX XX
XX XX
XX XX
XX XX
XX XX
XX XX

2020

growth rate (CAGR) of 97.1% till 2025. 251 XX XX 2020 2022 2025 USD Bn •

2022

2025

USD Bn

of 97.1% till 2025. 251 XX XX 2020 2022 2025 USD Bn • The ever-increasing demand

The ever-increasing demand for an enhanced mobile broadband experience, and the rising penetration of smartphones are a few critical drivers for faster 5G adoption.

5G is the solution for applications that require higher bandwidth. Hence, the demand for new and advanced application services, and the rising adoption of the Internet of Things (IoT) will propel the 5G market during the forecast period.

Ongoing investments in developing the 5G network will help in faster commercialization of 5G.

5G will drive network virtualization. Starting from 2019, the increasing number of carriers is expected to deploy virtualized network to support 5G applications. 5G will usher in a variety of new applications that would not have been possible using 3G/4G. Remote surgeries, full-fidelity virtual reality (VR), advanced location tracking, and autonomous vehicles are a few examples of these applications.

Automotive companies will be using 5G to enhance vehicular communication and safety. Enhanced features will include vehicle-to- vehicle (V2V) communication, vehicle-to-pedestrian (V2P) communication, vehicle-to-infrastructure (V2I) communication, and network- facilitated communication.

Organizations are looking at 5G to deliver extremely secure network for industrial applications, as security will be a core feature of the 5G infrastructure.

Trends

will be a core feature of the 5G infrastructure. Trends • New applications like self driving

New applications like self driving cars and remote surgeries will require reduced latency to ensure smooth operations. Delays can have detrimental effects on target-oriented applications. Though 5G is expected to deliver an ultra-low latency, however, ensuring smooth functioning of the network will pose a challenge, at least in the initial phase of deployment.

With the advent of 5G, it is expected that there will be a massive rise in connected devices. The rising number of such devices along with technological diversity will put 5G network to test.

For service providers in developing countries, margins are inadequate, reflecting growth and competitive challenges.

3

Global 5G depiction landscape By 2025, Asia-Pacific and North America are expected to have the
Global 5G depiction landscape
By 2025, Asia-Pacific and North America are expected to have the highest share of 5G SIM cellular connections and SIM M2M cellular connections, respectively.
North America
Europe
SIM
208 Mn
32.4 GB
SIM
257 Mn
23 GB
146 Mn
5.3 GB
SIM M2M
SIM M2M
51 Mn
2.8 GB
The Middle East and Africa (MEA)
SIM
81 Mn
28 GB
SIM
619 Mn
23 GB
Asia-Pacific (APAC)
Latin America (LATAM)
SIM M2M
3.5 GB
3.3 GB
9 Mn
SIM M2M
95 Mn
SIM
52 Mn
16 GB
Note:
SIM M2M
2 Mn
1.9 GB
Number of connections
Data consumption
per connection

4

Global market drivers

Global market drivers

Enhanced mobile broadband (EMB) adoption IoT connections on the rise • The number of IoT
Enhanced mobile broadband (EMB) adoption
IoT connections on the rise
• The number of IoT connections was aimed to
proliferate from 2017 to 2025, reaching 25 Bn
connections by 2025.
• Two critical facets of EMB that will drive adoption
and value creation in the 5G economy are:
o
• This will be driven mostly by industrial solutions
Extending cellular coverage to a broader
range of structures like office buildings,
industrial parks, shopping malls, etc.
such as smart factories, smart cities, and industrial
automation. Rise in industrial IoT will be supported
o
through investor financing, and a supportive
ecosystem.
Improved capacity to handle a significantly
higher number of devices using high
volumes of data, especially in localized
areas.
• These growth prospects are expected to propel the
5G market, since it will be a key enabler for IoT.
Investments in network infrastructure
• operators
Mobile
are
investing
in
developing
5G
network
to
support
migration
to
5G,
and
driving
High data traffic
customer engagement.
• The year 2020 and beyond will witness an explosive
growth in mobile data traffic.
• Between 2018 and 2020, an estimated USD 0.5 Tn in
capital expenditure will fuel the 5G market.
• According to estimates, global mobile data traffic
will grow by more than 200 times from 2010 to
2020, and by nearly 20,000 times from 2010 to
2030. Managing high data traffic necessitates faster
migration to 5G.
Smartphone adoption
• Smartphone connections, globally, will increase from 2.8 Bn
in 2016 to 5.8 Bn by 2020; 90% of that growth will be coming
from the developing markets.
• China is already the largest smartphone market, but India will
be one of the key regions driving growth.
markets. • China is already the largest smartphone market, but India will be one of the

5

Global market drivers - enhanced mobile broadband Consumer demand for a low-latency network and high-speed
Global market drivers - enhanced mobile broadband Consumer demand for a low-latency network and high-speed
Global market drivers - enhanced mobile broadband Consumer demand for a low-latency network and high-speed
Global market drivers - enhanced mobile broadband
Consumer demand for a low-latency network and high-speed mobile broadband experience is on the rise. The advent of 5G services will cater to this need across all mobile
devices and interfaces.
Tablets
need across all mobile devices and interfaces. Tablets • Handsets • • During the 2016-2021 period,
• Handsets • • During the 2016-2021 period, the average network connection speed for all
Handsets
• During the 2016-2021 period, the average network connection speed
for all handsets will increase from 6.8 mbps to 20.5 mbps, expanding
at a CAGR of 24%.
• By 2021, 4G speeds will be nearly double than that of an average
mobile connection.
• By 2021, an average mobile connection will have speed twice as that
of 3G.

8%.

During the 2016-2021 period, the average network

connection speed for all tablets will increase from

19.1 mbps to 27.8 mbps, expanding at a CAGR of

According to estimates, the combined number of mobile and tablet users surpassed the number of desktop users, globally. This trend is expected to continue.

This is mainly due to the feasible interface and mobility provided by such devices.

Global average mobile network connection speed for tablets (in mbps)

27.8 27.2 26.2 19.1 24.5 22.6
27.8
27.2
26.2
19.1
24.5
22.6

2016

2017

2018

2019

2020

2021

Global average mobile network connection speed for handsets (in mbps) 20.4 17.7 14.3 6.8 11.1
Global average mobile network
connection speed for handsets
(in mbps)
20.4
17.7
14.3
6.8
11.1
8.7
2016
2017
2018
2019
2020
2021
Smartphones Global average mobile network connection speed for smartphones • During the period 2016-2021, the
Smartphones
Global average mobile network connection speed for
smartphones
• During the period 2016-2021, the average network
connection speed for smartphones increased from
12.1 mbps to 20.3 mbps, expanding at a CAGR of
(in mbps)
20.3
18.1
12.1
11%.
16.2
13.5 14.9
• Smartphone users, on an average, spend time
accessing over 30 apps on a monthly basis, according
to recent survey reports.
• Consumers are turning to smartphone apps and
social media for daily activities.
2016
2017
2018
2019
2020
2021
for daily activities. 2016 2017 2018 2019 2020 2021 NOTE:- Download speed, upload speed, and latency

NOTE:- Download speed, upload speed, and latency characteristics vary widely depending on the type of application, be it video, radio, or instant messaging

6 6

Global market size - SIM cellular connections Globally, by the end of 2025, it is
Global market size - SIM cellular connections
Globally, by the end of 2025, it is expected that there will be 9.4 Bn SIM cellular connections. 4G SIM cellular connections will dominate, and the estimated number of 5G SIM cellular
connections will be 1.2 Bn.

SIM cellular connections (Bn)

XX XX XX XX XX XX XX 2016 2020 2021 2022 2023 2024 2025
XX
XX
XX
XX
XX
XX
XX
2016 2020
2021
2022
2023
2024
2025
XX XX XX XX XX 2016 2020 2021 2022 2023 2024 2025 Key observations • Globally,
Key observations
Key observations

Globally, the number of SIM cellular connections is expected to grow from 7.4 Bn in 2016, to around 8.6 Bn by 2020, and 9.4 Bn by 2025, expanding at a CAGR of 2%.

The major contributor to the increasing growth will be the Asia-Pacific region, considering the population and rate of smartphone adoption.

considering the population and rate of smartphone adoption. 5 G S I M c e l
considering the population and rate of smartphone adoption. 5 G S I M c e l

5G SIM cellular connections (Bn)

4G, 3G, and 2G SIM cellular connections (Bn)

XX XX XX XX XX XX 2020 2021 2022 2023 2024 2025
XX
XX
XX
XX
XX XX
2020
2021
2022
2023
2024
2025
 

3.3

 

2.3

   

2.0

   

1.8

   

1.6

   

1.4

   

1.3

 

2.5

2.5

2.5

 

2.5

 

2.5

 

2.6

2.3

3.8

4.2

4.4

 

4.5

 

4.5

 

4.4

1.8

           

2016

2020

2021

2022

2023

2024

2025

2G  2016 2020 2021 2022 2023 2024 2025 3G 4G Key observations • The number of

3G2016 2020 2021 2022 2023 2024 2025 2G 4G Key observations • The number of 5G

4G2016 2020 2021 2022 2023 2024 2025 2G 3G Key observations • The number of 5G

2020 2021 2022 2023 2024 2025 2G 3G 4G Key observations • The number of 5G

Key observations

The number of 5G SIM cellular connections is expected to grow from around 20 Mn in 2020 to 1.2 Bn by 2025, worldwide, expanding at a CAGR of 129%.

By 2025, Asia-Pacific is expected to have about 50% of the 5G connections, followed by Europe constituting about 20%, and North America accounting for 17% of the share.

Key observations

America accounting for 17% of the share. Key observations • Global 4G adoption is expected to

Global 4G adoption is expected to become the highest in the next few years, primarily attributed to the rising demand for a low-latency network, and high mobile broadband speed.

The global 2G connections will witness a decreasing trend since consumers are switching to faster and more efficient networks.

7

Global market size - SIM M2M cellular connections By the end of 2025, it is
Global market size - SIM M2M cellular connections
By the end of 2025, it is expected that there will be 2.8 Bn SIM M2M cellular connections, worldwide. 5G SIM M2M cellular connections are expected to reach around 300 Mn by 2025.
4G, 3G, and 3G SIM M2M cellular connections are all expected to grow.
SIM M2M cellular connections (Bn) XX XX XX XX XX XX XX 2016 2020 2021
SIM M2M cellular connections (Bn)
XX
XX
XX
XX
XX
XX XX
2016 2020
2021
2022
2023
2024
2025

5G SIM M2M cellular connections (Mn)

XX XX XX XX XX XX 2020 2021 2022 2023 2024 2025
XX
XX
XX
XX
XX
XX
2020
2021
2022
2023
2024
2025

4G, 3G, and 2G SIM M2M cellular connections (Mn)

 

260

 

448

   

472

   

518

   

594

   

697

   

773

 
 

478

 

587

 

717

 

887

321

   

390

       

119

235

311

408

 

539

 

700

 

899

53

               

2016

2020

2021

2022

2023

2024

2025

2G  2016 2020 2021 2022 2023 2024 2025 3G 4G Key observations Key observations • Globally,

3G2016 2020 2021 2022 2023 2024 2025 2G 4G Key observations Key observations • Globally, the

4G2016 2020 2021 2022 2023 2024 2025 2G 3G Key observations Key observations • Globally, the

2020 2021 2022 2023 2024 2025 2G 3G 4G Key observations Key observations • Globally, the
Key observations Key observations
Key observations
Key observations
2024 2025 2G 3G 4G Key observations Key observations • Globally, the number of M2M sim
2024 2025 2G 3G 4G Key observations Key observations • Globally, the number of M2M sim

Globally, the number of M2M sim cellular connections is expected to grow from 0.43 Bn in 2016, to around 1 Bn by 2020, and to 2.8 Bn by 2025, expanding at a CAGR of 23%.

The major contributor to the increasing growth will be the Asia-Pacific region, followed by North America and Europe having almost equal share of the market.

America and Europe having almost equal share of the market. • Globally, the number of 5G

Globally, the number of 5G sim cellular connections is expected to grow from around 3 Mn in 2020 to 304 Mn by 2025, expanding at a CAGR of 159%.

By 2025, North America is expected to have about 50% of the 5G M2M connection, followed by Asia- Pacific constituting about 30%, and Europe making about 17% of the remaining share.

30%, and Europe making about 17% of the remaining share. Key observations • modules M2M require

Key observations

modules

M2M

require

a

different

bandwidth

profile

based

on

applications

and

use

case

scenarios.

As a result, an increasing growth across all types of M2M connections can be witnessed in the next few years.

• As a result, an increasing growth across all types of M2M connections can be witnessed
• As a result, an increasing growth across all types of M2M connections can be witnessed

8

Global market size – revenue The global revenue from SIM cellular connections is expected to

Global market size revenue

The global revenue from SIM cellular connections is expected to reach USD 233 Bn by
The global revenue from SIM cellular connections is expected to reach USD 233 Bn by 2025, and revenue from SIM M2M cellular connection is expected to reach around USD 17 Bn by
2025.

Total revenue in USD Bn

233 Sim connections XX Sim M2M connections XX XX XX 17.8 XX XX XX XX
233
Sim connections
XX
Sim M2M connections
XX
XX
XX
17.8
XX
XX
XX
XX
XX
XX
2020
2021
2022
2023
2024
2025
XX XX XX XX XX XX 2020 2021 2022 2023 2024 2025 Key observations   •
Key observations

Key observations

Key observations
 

The global 5G revenue from SIM cellular connections is expected to be around USD 8 Bn at 2020, and from then onwards is expected to reach USD 233 Bn by 2025, growing at a CAGR of 95%.

50% of the global revenue contribution by 2025 is expected to come from

North America, followed by Asia-Pacific and Europe, respectively.

Key observations

Key observations

Key observations
 

The global 5G revenue from SIM cellular M2M connections is expected to be around USD 200 Mn in 2020, and will reach around USD 17 Bn by 2025, expanding at a CAGR of 152%.

60% of the global revenue contribution by 2025 is expected to come from North America, followed by Asia-Pacific and Europe.

9

North America - market trends

North America - market trends

North America is expected to witness a rapid change in consumer engagement with mobile devices,

North America is expected to witness a rapid change in consumer engagement with mobile devices, and the majority of the traffic generated will come from the use of video files. Companies will develop strategies and business models in order to generate more revenue from this major trend.

• In North America, 99% of the mobile connections will be 'smart' connections by 2021,
• In North America, 99% of the mobile connections will be 'smart'
connections by 2021, up from 81% in 2016.
1
2
2
3
3

In North America, in 2016, the average 4G vs. 3G vs. 2G speed

was 22,038 kbps vs. 6,180 kbps vs. 150 kbps.

The maximum 5G speed is expected to be 10Gbps.

Video traffic will be 77% of North America's total mobile data traffic by 2021, compared to 64% at the end of 2016.

Videos accounted for almost half of North America's mobile data traffic by year-end 2015 or earlier.

Streaming audios will be 5% of North America's total mobile data traffic by 2021, compared to 7% at the end of 2016.

In the U.S., over 60% of smartphone owners watch online

videos (e.g., YouTube, embedded video, and live streaming every week), of which 34% do so every day.

live streaming every week), of which 34% do so every day. • Revenue growth in North

Revenue growth in North America has been higher than other developed markets. This trend has been driven primarily by greater usage of both voice and messaging services, as well as growing consumer engagement, resulting in higher levels of data usage.

4
4
• In 2016, North America had 127 Mn wearable devices, accounting for 39% of the
• In 2016, North America had 127 Mn wearable devices,
accounting for 39% of the global total, and will grow to 378 Mn
by 2021, accounting for 41%.
5
5
Mn wearable devices, accounting for 39% of the global total, and will grow to 378 Mn

10

Company overview - Vodafone A British multinational telecommunications company, Vodafone Group PLC has its headquarters
Company overview - Vodafone
A British multinational telecommunications company, Vodafone Group PLC has its headquarters in London, the United Kingdom (U.K.). It predominantly operates as a
telecommunications company in the regions of Asia, Africa, Europe, and Oceania.

Key highlights

Key personnel

Key highlights Key personnel • Chief Executive Officer - Vittorio Colao • Chief Financial Officer -

Chief Executive Officer - Vittorio Colao

Chief Financial Officer - Nick Read

Chief Commercial Operations and Strategy Officer - Serpil Timuray

Major offerings

and Strategy Officer - Serpil Timuray Major offerings • The company offers voice, messaging, and data

The company offers voice, messaging, and data services across mobile and fixed networks, and converged communication services to small and large multinational corporations.

The company also offers IoT to connect machines to the Internet.

Key numbers (FY 2017)

to connect machines to the Internet. Key numbers (FY 2017) • Total revenue: USD 50,931.35 Mn

Total revenue: USD 50,931.35 Mn

Gross profit margin: 27.4%

Net income margin: 13.2%

Growth over prior year: 4.4%

EBITDA margin: 24.2%

Growth over prior year: 4.4% • EBITDA margin: 24.2% 5G growth strategy and investments Strategy

5G growth strategy and investments

Strategy

5G growth strategy and investments Strategy Investments • The Vodafone Group has partnered with notable equipment

Investments

5G growth strategy and investments Strategy Investments • The Vodafone Group has partnered with notable equipment

The Vodafone Group has partnered with notable equipment providers like Huawei, Nokia, Ericsson, Intel, and Qualcomm Technologies, Inc. to research 5G technologies, and prepare its networks for a transition towards the new mobile standard.

Vodafone plans to commercialize 5G by 2020 after significant tests and evaluations over a wide range of technologies, services, and applications.

Vodafone invested around GBP 2 Bn in the network hardware, software

and services over the last couple of years. Another GBP 2 Bn investment will be pumped during 2016 to 2018 into the existing LTE network and

fibre, making it future-ready for 5G.

11

Appendix Research methodology The study begins with identifying the right research question(s) . The question

Appendix

Research methodology

The study begins with identifying the right research question(s). The question depends on what we are going to achieve by conducting the research or what we want to convey to the prospective customers through this research. Next, we identify the logical steps to arrive at the answers to the question(s). These logical steps form our study begins with identifying the right research question(s) research objectives . The research objectives provide us research objectives. The research objectives provide us a guideline regarding what information we need to conduct analysis. We strongly believe that clear objectives will lead to clear results about the given market

objectives will lead to clear results about the given market The next stage of the research

The next stage of the research is conducted utilizing the secondary sources of information, process called desk/secondary research. Netscribes Inc. has a considerable volume of information in both quantitative and qualitative forms, across all major industries and its sectors. Also, we conduct in-depth study of the market, understanding its key stakeholders, drivers, trends, challenges and opportunities globally covering major regions such as North America, Latin America, Europe, Asia Pacific, and the Middle East and Africa. The key sources consumed for these research include (but not limited to) the following:

Financial reports published by the key market players

Government and other official sources including the National Statistics

National and International trade associations

Paid databases

Other reliable sources

Primary research complements the secondary research, as and when required, as it helps us to gain insights from the industries directly by communicating with the senior executives, key opinion leaders and independent consultants who are experts in their industries or specific industry sectors. Such interviews are conducted across the value chain of the market in question. A survey questionnaire is usually prepared for conducting any primary interview or survey. The questionnaire is developed with utmost care to fulfil the key research objectives and also to validate the assumptions about the market. This supplements the information otherwisePrimary research

unaddressed via secondary research. The primary data collection is done by expert interviewers who have specific industry knowledge. Linguists are hired to conduct interviews in the respondent’s native language. Some of the primary research methods applied at Netscribes include the following:

methods applied at Netscribes include the following:  In-depth Interviews  Executive Interviews 

In-depth Interviews

Executive Interviews

Expert Panels

The qualitative and quantitative findings from the above stages are brought together by specialists to perform a rigorous analysis. The regional market trends, drivers, and opportunities obtained during the analysis is compared with regional economic indicators, sector growth rates, population index, etc. to ensure the data consistency. After ensuring the consistency, these historical and present indicators help us to understand how the market will perform in future. Our proprietary forecasting model factors in all these indicators to predict the future market accurately.and quantitative findings from the above stages are brought together by specialists to perform a rigorous

in future. Our proprietary forecasting model factors in all these indicators to predict the future market

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