From its humble beginnings at the arcade to its growth via consumer electronics in the 1980s and 1990s, gaming has gone through multiple phases and iterations. One of the most significant in the last decade or was the rise of mobile games, supported by items in-app purchases, and the growth of 4G.

In the last five years, we saw virtual reality and augmented reality appear on the scene. While both have found loyal users, widespread adoption is just beginning. The next wave of technical innovation could help change that. The rollout of 5G, which began in 2018 and in which AT&T aims to include 30 cities by the end of 2019, promises exciting gaming experiences not previously thought possible. It’s likely we’ll see more cloud-based services, multiplayer games and subscription titles.

On mobile devices, 5G is set to bring faster speeds, hyper-capacity, new viewing experiences like 8K resolution streaming, and 360-degree video — which is important for the development of mixed reality. This will change the way that people use their devices every day. Games will become more dynamic, with real-time multiplayer games through augmented reality. Watching experiences will become more vivid through 8K resolution and virtual reality Let’s look closer at how this technology will drive the next evolution of gaming — widespread adoption of AR

Speed and connectivity

With the introduction of 5G, latency decreases from 10 milliseconds to 1 millisecond. This kind of speed will provide for instant interaction between devices and players, creating a whole new gaming experience. The time between click/tap and action will probably blur out of existence. At the same time, peak data rates on 5G go from 1GB to 20 GB.

Most importantly, 5G provides for million connections per square kilometer. This capability to communicate massive amounts of data in near real time will enable a new wave of connectivity and entertainment, paving the way for IoT devices and mesh networks. For example, downloading a movie or the new season of a favorite TV show could take a consumer seconds rather than minutes.

Video games are now mainstream

Analysts estimate that by 2021, 200 million people will have 5G access. The bulk of that population will be located in the United States and Asia, two of the largest gaming populations globally. As these two regions experience the benefits of 5G, expectations will grow among gamers in other areas to enjoy the same performance standards.

Widespread 5G adoption coincides with growing millennial influence over economics and mainstream culture. Economists say that millennials will have the largest buying power of all living generations by 2021, when their average age will be 34. This also happens to be the prime gaming demographic. Combine this millennial ascension with the ever-increasing number of women playing games and you start to see how video games are set to take off.

AR offers new experiences

In 2016 we saw the explosive release of Pokémon Go followed by ARKit/ARCore in 2017, which drove worldwide interest and discussion around AR. With 5G’s mobile capabilities, gamers will have the ability to experience augmented reality with their own smartphones, wherever they are, without needing an additional device. Already, for example, mainstream retailers like Walmart have teamed with Lego and tech provider Seek to bring Lego kits to life, battling and interacting right on the store floor. A quick scan of a QR code, and shoppers can point their phone cameras at the floor to see the selected items moving as they will when fully built. It’s not a big jump from that to giving people AR games, that they can access and play anytime, anywhere.

Other factors are accelerating AR adoption, as well. Because it’s so much easier to augment reality almost anywhere, rather than force consumers into problematic VR visors, consumer AR revenue is projected to pass consumer VR revenue the same year the cash-carrying millennials reach their peak buying power. Companies in the gaming industry seeing these revenues rise will invest further in the technology and offer more AR games and experiences, furthering accelerating adoption.

The mainstream adoption of 5G in 2021 provides gaming companies the opportunity to offer new levels of engagement to their users thanks to new speed and connectivity capabilities. This same year promises to bring cash-empowered millennial gamers seeking new experiences. The combination of these forces will drive interest and adoption of AR and create new opportunities for both gaming companies and gamers alike.

Tom Treanor is the Global Head of the Marketing at Arm Treasure Data, and drives the marketing strategy and execution for Treasure Data’s CDP (Customer Data Platform) and IoT Data Analytics solutions.