5G – Opportunity Cost Economics

When 4G launched in 2009, mobile operators didn’t see the great returns they’d captured with earlier generations. Despite their investments in 4G infrastructure, revenues showed flat or tepid growth. 5G technology is under testing and poised to launch in some markets later this year.

Mobile operators must invest in all network domains, including spectrum, radio access network (RAN) infrastructure, transmission, and core networks. These use cases require network performance to increase 10-fold over current levels.

Seeing lots of articles like this – More Cells = More Opportunity

These vendors are also going to benefit from the need for a significantly larger number of cell sites to serve 5G networks. This will include the need to bolster both traditional outdoor networks and the growing push by enterprises to deploy 5G services within their campus environments.

Research firm Omdia predicts the global 5G radio access network (RAN) will more than quintuple from $4 billion last year, to $21 billion in 2024. And that enterprise-based 5G connections are forecast to surge from 500,000 last year to 175 million in 2024.

5G benefits = more opportunity

Economists refer to the “opportunity cost” of a resource. They mean the value of the next-highest-valued alternative use of that resource. If your next-best alternative to seeing a movie is reading a book, then the opportunity cost of seeing the movie is the money spent plus the pleasure you forgo by not reading the book. (detail explanation here)

Auto210

References

Article 1

Example

Podcast