Ericsson Bets on AI Traffic and 550 Million 5G Users to Drive India Growth
In this article (9)
Ericsson expects artificial intelligence applications and rising monthly data traffic to fuel a second wave of network investment in India, where 5G subscribers reached 550 million by September 2026.
Monthly data consumption across Indian networks has climbed to between 36 and 37 gigabytes per user, according to company figures presented at the India Mobile Congress in New Delhi.
The Swedish telecom equipment vendor is seeking fresh revenue after the rapid initial rollout of fifth-generation mobile infrastructure cooled. India accounted for 12 percent of Ericsson’s regional business covering South East Asia, Oceania, and India in 2025, down from 20 percent in 2023 during the peak of initial carrier deployments.
Network Capacity Over Pure Consumer Use Cases
Indian operators deployed 5G across 99.9 percent of the country’s districts in less than four years, making it one of the fastest national buildouts globally. The buildout occurred primarily because carriers needed immediate spectrum efficiency and radio capacity rather than waiting for specialized consumer applications.
Nitin Bansal, managing director for India and head of networks for South East Asia, Oceania, and India at Ericsson, noted that 5G currently reaches roughly one-third of the country’s population. He argued that shifting directly to 5G rather than expanding older 4G infrastructure provided the necessary capacity to handle escalating consumer usage.
Direct monetization remains the chief challenge for telecom operators Bharti Airtel and Reliance Jio. Both carriers spent heavily on spectrum auctions and radio deployments starting in late 2022 and are now pushing higher-margin services to improve average revenue per user.
Fixed Wireless and Enterprise Slicing
Fixed Wireless Access has become the fastest monetization channel for Indian network operators looking to bypass fixed-line broadband delays. Data from the Telecom Regulatory Authority of India showed 13.45 million 5G FWA subscribers active at the end of August 2026.
“He argued that shifting directly to 5G rather than expanding older 4G infrastructure provided the necessary capacity to handle escalating consumer usage.”
Service differentiation is shifting toward premium enterprise and high-tier retail customers. Bharti Airtel introduced commercial 5G network slicing, carving out dedicated network resources to provide guaranteed speeds and lower latency to postpaid retail subscribers.
For equipment vendors including Ericsson, Nokia, and Samsung, these software-defined features generate recurring software licensing fees rather than purely hardware-driven revenue.
Artificial Intelligence Shifts Network Requirements
Emerging artificial intelligence workloads on mobile devices are changing baseline infrastructure demands across Asian markets. Generative AI tools and spatial computing applications require heavy uplink capacity and reduced latency, forcing operators to tune cell sites that were originally configured primarily for downlink video streaming.
Ericsson expects carriers to reconfigure their 5G standalone cores to handle automated traffic management and machine-learning compute loads. Critical infrastructure monitoring and industrial automation in manufacturing hubs around Pune, Chennai, and Gujarat are also pulling private 5G deployments into commercial operation.
Vendors face pressure to prove these upgrades deliver real cost savings. Indian telecom operators operate with some of the lowest tariffs in the world, leaving slim margins for speculative infrastructure spending without clear returns.
Targeting One Billion Subscribers by 2030
India launched commercial 5G services in October 2022 and has since become one of the two largest mobile data markets alongside China. The central government has set an official target of one billion 5G subscribers by 2030.
Meeting that target requires converting roughly 450 million additional mobile users from legacy 4G and 2G connections over the next four years. That conversion will hinge on the availability of entry-level 5G smartphones priced below 8,000 rupees, alongside wider rural cell coverage where standalone economics remain tight.
Questions & Answers
Q.What percentage of Ericsson's regional business did India account for in 2025, and how does this compare to previous years?
What percentage of Ericsson's regional business did India account for in 2025, and how does this compare to previous years?
India accounted for 12 percent of Ericsson’s regional business covering South East Asia, Oceania, and India in 2025. This was down from 20 percent in 2023, during the peak of initial carrier deployments.
Q.Why did Indian operators focus on capacity rather than consumer applications during the initial 5G rollout?
Why did Indian operators focus on capacity rather than consumer applications during the initial 5G rollout?
The initial buildout occurred primarily because carriers needed immediate spectrum efficiency and radio capacity. They opted to shift directly to 5G rather than expanding older 4G infrastructure, as this provided the necessary capacity for escalating consumer usage.
Q.What is the primary challenge for telecom operators Bharti Airtel and Reliance Jio after their heavy 5G investments?
What is the primary challenge for telecom operators Bharti Airtel and Reliance Jio after their heavy 5G investments?
Direct monetization remains the chief challenge for both operators. They are now pushing higher-margin services to improve average revenue per user, having spent heavily on spectrum auctions and radio deployments.
Q.How will Ericsson and other equipment vendors generate revenue from new software-defined features like network slicing?
How will Ericsson and other equipment vendors generate revenue from new software-defined features like network slicing?
For vendors like Ericsson, these software-defined features generate recurring software licensing fees. This represents a shift from purely hardware-driven revenue, helping to monetise new network capabilities.