Saudi Arabia 5G Technology Market Outlook to 2030

Saudi Arabia 5G Technology Market Overview

The Saudi Arabia 5G technology market is valued at USD 2.1 billion, primarily driven by the nations Vision 2030 initiative, which aims to diversify the economy and enhance technological infrastructure. The adoption of 5G is crucial for supporting advancements in smart cities, IoT, and autonomous technologies. With increasing demand from both consumer and enterprise sectors, the rapid deployment of 5G networks by major telecom players like STC and Mobily is fueling market growth. This expansion is further bolstered by rising investments in network infrastructure and the governments push for digital transformation.Saudi Arabia's major cities, such as Riyadh, Jeddah, and Dammam, dominate the 5G market due to their advanced infrastructure and population density, making them prime locations for early 5G adoption. Riyadh, as the capital, attracts significant investments from both government and private entities, while Jeddah and Dammam are key commercial hubs. These cities have seen high demand for enhanced mobile broadband services and smart city projects, which are among the primary drivers of the 5G technology market.The Saudi CITC plays a critical role in overseeing the deployment and regulation of 5G technology in the kingdom. In 2023, CITC implemented new guidelines to ensure fair competition and set security standards for telecom operators. These guidelines mandate that telecom operators must offer 5G services across all major urban areas by 2024. The CITC is also responsible for regulating 5G spectrum allocation and enforcing strict cybersecurity protocols to protect the integrity of national networks.

Saudi Arabia 5G Technology Market Segmentation

• By Deployment Type: The market is segmented by deployment type into standalone and non-standalone 5G networks. Standalone 5G networks, which operate independently of 4G infrastructure, have a dominant market share due to their ability to provide faster speeds and lower latency. The growing demand for ultra-reliable low-latency communication (URLLC) applications in industries like manufacturing and healthcare further supports this dominance. Companies like STC and Mobily have made significant investments in standalone networks to cater to industrial and enterprise needs, driving their market share.
• By Application: The Saudi 5G market is also segmented by application into enhanced mobile broadband (eMBB), ultra-reliable low-latency communications (URLLC), and massive machine-type communications (mMTC). Enhanced mobile broadband dominates the market, accounting for a large share due to the widespread consumer demand for faster internet speeds and higher data capacity. The increasing adoption of high-definition video streaming, mobile gaming, and other data-intensive applications further strengthens this segments market share. The rollout of 5G in key urban areas has also facilitated the rise of eMBB as the primary application.

Saudi Arabia 5G Technology Market Competitive Landscape

The Saudi Arabia 5G market is dominated by a few key players that have made significant contributions to the deployment and advancement of 5G technology. These companies have established themselves through a combination of strategic investments, collaborations with global technology firms, and participation in public-private initiatives under the governments Vision 2030 plan. Companies such as STC, Mobily, and Zain are leading the market by investing in state-of-the-art 5G infrastructure and offering cutting-edge services to both consumers and enterprises.

Saudi Arabia 5G Technology Industry Analysis

Growth Drivers

• Government Vision 2030 [Market Policy Driver]: Saudi Arabia's Vision 2030 initiative, led by the government, is a transformative economic and social reform plan that heavily emphasizes the digitalization of its economy. Under this program, the country has allocated $15 billion to boost its 5G network infrastructure. The Communications and Information Technology Commission (CITC) is driving these investments to meet Vision 2030 goals, aiming to have 90% of urban areas covered with 5G by 2024. This strategic policy has accelerated the demand for 5G technology as a core pillar for modernizing the economy, focusing on AI, IoT, and smart cities.
• Increasing Demand for Mobile Data [Consumer Adoption]: Saudi Arabia's mobile data consumption is among the highest in the world, averaging over 21 GB per user per month in 2024. This surge is driven by the country's youth, who make up around 70% of the population, with rising demand for high-speed data services for streaming, gaming, and e-commerce. The growing number of smartphone users, which surpassed 41 million in 2023, pushes telecom operators to expand their 5G networks to meet the increasing demand for faster and more reliable internet services, supporting a market ripe for advanced technologies like 5G.
• Expansion of Smart Cities [Infrastructure Development]: Smart city projects such as NEOM and the Red Sea Development are pivotal in the expansion of 5G technology in Saudi Arabia. NEOM alone, a $500 billion mega-city project, is designed to be a tech-driven city utilizing IoT, AI, and autonomous vehicles, all dependent on 5G connectivity. By 2024, more than 75% of NEOMs technological infrastructure will integrate 5G to support real-time data processing and management of smart grids, transport systems, and urban management services. This infrastructural growth is crucial for the widespread adoption of 5G technology in urban planning and smart city projects.

Market Challenges

• High Infrastructure Costs [Capital Expenditure]: Deploying 5G infrastructure in Saudi Arabia comes with significant financial challenges, with estimates showing that rolling out a nationwide network could cost upwards of $10 billion. Much of the spending is required to build new 5G towers, fiber-optic backbones, and data centers across the countrys diverse terrain, including desert regions. The operational expenses also rise due to the need for continuous upgrades to handle the growing bandwidth demand. These costs put pressure on telecom companies, particularly smaller players, limiting the speed of 5G deployment outside major cities.
• Regulatory Delays in Spectrum Allocation [Regulatory Framework]: One of the major obstacles facing 5G deployment is the delay in spectrum allocation by the CITC. As of 2024, only 1.2 GHz of mid-band spectrum has been assigned for 5G use, which is lower compared to neighboring countries like the UAE. These regulatory bottlenecks slow down the pace of 5G rollout, particularly in rural areas, as telecom operators need broader spectrum access to deliver high-speed services. Ensuring timely and adequate spectrum allocation is critical to achieving the governments Vision 2030 objectives and expanding the countrys 5G network reach.

Saudi Arabia 5G Technology Market Future Outlook

Over the next five years, the Saudi Arabia 5G technology market is poised for significant growth, driven by government-backed initiatives like Vision 2030, which aim to transform the nation into a digitally-enabled economy. The expansion of smart cities, along with increasing demand for IoT and autonomous systems across industries, will further fuel this growth. As Saudi Arabia continues to invest in 5G infrastructure, including the deployment of standalone networks, industries like manufacturing, healthcare, and transportation will experience the most significant impact from 5Gs transformative capabilities.

Market Opportunities

• Growth of IoT and AI Applications [Technology Integration]: The integration of 5G technology is driving rapid growth in IoT and AI applications in Saudi Arabia. By 2024, the country will host over 30 million connected IoT devices, up from 20 million in 2022. Sectors like healthcare, logistics, and manufacturing are set to benefit the most, with 5G enabling real-time data analysis and automation at scale. For instance, AI-driven medical diagnostics can leverage 5Gs low latency to provide quicker and more accurate results, offering significant opportunities for digital transformation across industries.
• Industrial 5G Adoption for Automation [Industrial Applications]: Saudi Arabias industrial sector is rapidly adopting 5G for automation, particularly in oil and gas, where 5G-enabled sensors monitor pipeline integrity in real-time. In 2024, ARAMCO announced the deployment of 5G networks across its major facilities, enabling automation and reducing operational downtime. The total value of automation projects powered by 5G in the industrial sector is expected to exceed $1.5 billion by the end of 2024, demonstrating a key growth opportunity for 5G providers.