Mexican 5G Dash: Boosting Connections & Revenues to the Next Level

Mexico is poised for a technological leap with the rollout of 5G networks, which will bring faster internet speeds and better connectivity to the country. The market for internet access is expected to grow by 4% annually from 2023 to 2026, with a focus on reaching previously unconnected populations and areas.

With the increasing demand for mobile connectivity, hybrid work, and distance education, 5G technology will drive the growth of mobile services and video consumption, accounting for up to 80% of all data usage.

The use of innovative technologies like AI, AR, and digital twins is also expected to surge, boosting the competitiveness of Mexico in the Latin American region. Get ready for Mexico's 5G sprint toward a connected future.

5G Speedsters: Racing to a Connected Future in Mexico

The faster rollout of 5G networks in Mexico will be good for the market for internet access, which is expected to grow by 4% a year from 2023 to 2026.

"5G technology will benefit locations where there is currently no coverage, as it will be able to reach populations and areas where access via fiber optics is difficult." "For this reason, we estimate that internet access in Mexican society will grow up to 4 percent annually in the next three years," said Anderson Ramires, technology, media, and telecommunications leader at PwC.

During the "Trends 2023 Forum: What do 5G-driven technologies have in store for us?" organized by AT&T Mexico, Ramires assured that currently, more than 55 percent of internet service accesses are through mobile services, a figure that will reach more than 70 percent by 2026.

"Factors such as a greater demand for connectivity on cell phones, the growth of hybrid work schemes, and distance education will be some of the factors that will drive the mobile services market over the next few years," he said.

PwC predicts that 5G networks will increase video consumption, which will account for up to 80% of all data usage by 2026. This will cause Mexicans to use up to 20% more mobile data every year.

Also, the use of technologies like augmented reality (AR), the metaverse, video games, and artificial intelligence (AI) is expected to grow quickly in Mexico. This growth, however, will depend on the development of technologies that make it easier for people to use these technologies.

"Access to the metaverse could double in the next three years, and even revenues from this market could grow up to 93 percent; however, as long as users do not have devices that facilitate their daily use, it will be complicated for this technology to take off," commented Arturo Barraza, director of the 5G Innovation and Technology Lab at AT&T Mexico.

According to the AT&T Mexico executive, AI is one of the technologies that will have the greatest development during 2023, a situation that will boost its use by up to 20 to 30 percent.

"We have seen artificial intelligence programs such as Dall-e or Chat GTP that have had incredible development and that allow for the massification of this technology, which will end up impacting the lives of Mexicans," Arturo Barraza said.

Barraza said that, in addition to AI, the use of digital twins will also grow a lot, especially in the industrial sector, where they will be used to test technologies so that they can be used more efficiently.

Mexico's 5G Sprint: Revolutionizing Revenues and Connections

This technological deployment is contemplated in Mexico City, the State of Mexico, Guadalajara, and Monterrey, where, strategically, a 60 percent coverage is generated. The companies that are going to deploy the 5G network are betting on two businesses: mobile telephony users and business and industrial coverage.

Companies in the manufacturing, energy, security, financial services, entertainment, and agribusiness sectors will benefit from the fifth-generation network. It is estimated that by 2030, in the country, these sectors will have a growth of between 120 and 125 percent in their revenues thanks to the benefits of this technology.

By the end of 2025, Mexico is expected to have a reach of between 23 and 25 percent of 5G users. With these figures, the power and strength of Mexico in the technological field will be important, as it is the best number in terms of 5G competitiveness in Latin America. While Mexico expects to reach 25 percent of users by 2025, the average growth in the region will be just 17 percent.

Analysts agree that the use of the 5G network during these first years of incorporation will have a higher cost for users, as mobile companies must amortize the costs of investments made in infrastructure.

At first, 5G network plans will be geared toward people with higher incomes because the plans offered by mobile phone companies will be more expensive. As the 5G network spreads across the country, however, there will be more competitive offers.

Even though the population hears about the 5G network and knows that it is a technology that will revolutionize telecommunications, the reality is that for most of them, it does not represent a big difference in the connectivity they have. Users have to become digitally literate because the 5G network offers speeds a hundred times faster than 4G.

In Mexico, this promising generational leap began in 2021, according to national telecommunications authorities, and at this rate, the proportion of 5G mobile connections in the country is expected to increase to 12 percent by 2025, according to Statista.

By 2025, around 14 percent of mobile network access (worldwide) is expected to be through 5G technology. Among the main advantages of implementing this new network are faster data transfer speeds and the possibility of having more devices connected simultaneously. Even so, the benefits of the successor to 4G will not be able to reach all corners of the planet at the same time.