Telecommunications companies are increasingly interested in the potential for virtual reality and augmented reality to bolster their bottom lines, according to a new report.
But the analysis from GlobalData also indicated that those technologies could stress the capacities of already stretched wireless networks.
The report said that in addition to providing a path to monetizing 5G systems, VR and AR could provide telecoms with new opportunities in connectivity, content and services.
“Telcos have a key role in enabling VR-AR services as providers of broadband and mobile network services, but we see them beginning to explore revenue opportunities in VR-AR that are beyond 5G data and connectivity,” GlobalData Research Director Ozgur Aytar said in a statement.
Aytar pointed to VR platform acquisitions by Verizon and AT&T’s investments in VR experiences and AR apps. Among overseas carriers, French carrier Orange is investing in a range of VR and AR systems and services, while SK Telecom is building its own VR platform.
Although the market remains in its infancy — despite “robust momentum” on the supply side — the report cautioned that pressure on networks is expected to increase as those systems become more common.
Industry officials interviewed for the report, however, varied widely in their expectations for VR and AR traffic.
Only 7 percent expected VR and AR to result in a minimal traffic demand increase — 10 percent or less — by 2025, while 16 percent expected an increase of more than 80 percent over that span.
More than three-quarters of respondents fell somewhere in between, with 45 percent expecting an impact of 11 percent to 40 percent more traffic from VR and AR, and 32 percent anticipating 40 percent to 80 percent more traffic.
Analysts noted that telecom companies are upgrading their networks and piloting 5G systems in order to take advantage of next-generation VR and AR systems. Aytar added that “cross-industry partnerships” will also be crucial to building content and user volume.
“VR-AR represents an opportunity for telcos to increase their digital services imprint and explore new revenue streams, but success in VR-AR will require a long-term vision,” Aytar said.