5G service delivery is not just about network speed – it’s about quick thinking
January 24, 2020
By Hayim Porat, CTO, ECI Telecom
The smartphone revolution triggered by the arrival of the first iPhone was something of a happy accident for operators preparing to pitch their 4G networks. The combination of the new smartphones and 3G networks helped create an appetite for mobile data hungry applications that 4G networks were designed to serve. In many ways, history is now repeating itself as 4G networks have enabled a mobile-centric ecosystem and fuelled the move towards cloud services which 5G networks are ideally suited to deliver.
However, where operators will rightly be wary of history repeating itself, will be in the business model and ROI. The service provider community lost out on 4G to the OTTs who were quicker to think of, and deliver, value-added services to businesses and consumers that effectively side-lined the operator’s involvement.
At the moment, for consumers, operators are promoting the speed of 5G networks; but as the earliest 5G networks are operating over 4G infrastructure, the speed gain is marginal. What’s more, there’s little evidence that consumers will pay that much more simply for a faster network speed. Indeed, while some carriers are experimenting with a ‘limited’ premium on 5G services, others are charging nothing extra at all.
Meanwhile, for businesses and enterprises, there is no 5G pitch yet that is markedly different from the consumer one. The 5G business pitch should be about the different types of services the advanced network technology enables, not simply Fixed Wireless Access or enhanced mobile broadband speeds.
In order for operators to reap the benefits of their 5G investment, the focus needs to be on those benefits and services that only 5G can deliver. Of course, over the last few years, the industry has discussed a slew of ‘new’ 5G services that promise to generate new revenue streams. But in the main, these services require investment in more than just a 5G radio. On top of that, it will also take some time before these use cases are fully realized. Even then, the best revenues from services such as autonomous cars or industry 4.0 may not lie with the operator. Third-party providers or private 5G networks are likely to capture much of the specialist revenue.
All of which means service providers are caught in a 5G limbo of sorts, upgrading the RAN while relying for the most part on their 4G backbones. Many will regard this delay in CapEx spend as just the breathing room they need for the use cases to develop before they ‘go again’. However, without the use cases, the network investment is a risk; and without the investment, the availability of the advanced services is pushed out even further as well as towards the third-party vendors. That raises the possibility that the happy accident of the 4G networks becomes a 5G accident waiting to happen
It’s time to think a little outside of the normal telecoms box. A 5G network is very different from any previous mobile infrastructure. It’s designed to deliver advanced, non-standard services and is far more adaptable and flexible than any other generation of mobile. In comparison, today’s networks high end data services are mostly manual, static environments limited in their ability to support new business cases.
The dynamic flexibility of a 5G network opens up new possibilities when it comes to operators selling services to both consumers and businesses. And here, I’m not talking about the advanced use cases of autonomous cars, Industry 4.0 and the IoT. A 5G network has the ability to offer different standards of service at the same time. This distinction will be of interest to consumers as well as businesses, and operators could investigate the ability to sell both different styles of service and temporary boosts of quality.
For example, they could target mobile gamers who will pay for high speed, low-latency connections to experience the rush of a gaming tournament on the go, but who would revert to standard service at other times. Sports fans might temporarily want a 4K video feed to live stream a match to their mobile, while businesses might take the option of a high speed, mega bandwidth link twice a day in order to back up their entire network to a cloud server.
These service boosts are something that only the network – and a true 5G network in particular – can deliver. What’s more, they can be developed quickly and are ‘operator services’ so the revenue boost is not going into the hands of a third-party vendor.
A 5G network is about so much more than faster network speeds, and a quick-thinking operator can introduce value-added services based on 5G network capabilities that are the very definition of a quick win in revenue terms.