Prepare for 5G: what does the future look like for mobile operators?
In the first of a series of articles in advance of this year’s Broadband World Forum, Niall Hunt, the digital content lead for the event, explores how preparations for 5G are progressing. Although many operators and businesses are already busy pushing their 5G messages, the truth is that 4G isn’t going anywhere just yet. 4G and 5G networks will continue to coexist for the foreseeable future, sharing the same wireline network infrastructure between cell sites and data centres.
As mobile broadband and IoT traffic continues to grow exponentially on these networks, latency, throughput, reliability and security requirements will be extremely demanding and require more than a simple network upgrade or expansion.
The huge increases in capacity, performance levels and increased speeds that need to be achieved by mobile networks will have to be supported by an efficient fixed infrastructure. Mobile operators therefore have to recognise that 5G fixed-mobile convergence will be key to the full force of 5G being realised.
For example, over the coming years they will have to install millions of small cells in order to densify the network and ensure that they are able to meet growing capacity requirements. The higher frequencies used by 5G do not travel as far as the lower frequencies used today, and also have a harder time penetrating physical barriers such as walls and trees, highlighting a need to deploy cells that cover smaller areas and serve fewer people – albeit at much higher speeds.
So, mobile operators will have plenty to think about before they will be ready to respond to the changes 5G will bring, but there are also some key opportunities for them to exploit.
Go above and beyond
To maximise the opportunities of 5G, mobile operators should look to move away from traditional business models. For example, one option is to offer managed, end-to-end, customer broadband experiences that are seamless both inside and outside the home. This can be achieved by extending network functions to include wireline ones, allowing for flexible service design and a faster time to market.
On the enterprise side, factors such as the shift in workloads from centralised cloud to distributed, the mobile workforce and new workloads at the edge (VR/AR, smart sensors, autonomous vehicles etc), create an immense opportunity for service providers in the 5G context.
These factors open up potential new revenue streams such as wireless sensors and 4K streaming, both of which demonstrate the importance of rating and billing flexibility in order for mobile operators to make 5G services viable and profitable.
Essentially, there are four main use cases for mobile operators to tap into. The first – and by far the biggest – is Enhanced Mobile Broadband. This is predicted to be a trillion dollar global industry by 2026 and includes applications such as real-time augmented and virtual reality.
The second is Fixed-Wireless Access (FWA), which again presents a huge financial opportunity. In urban areas, connecting businesses and residential structures is expected to generate around $100 billion globally over the next eight years.
The final two use cases concern the Internet of Things (IoT) and consumption-based services. IoT is set to provide major revenue streams for mobile operators across several different industries over the next few years, while offering Network-as-a-Service (NaaS) solutions for both business and consumer markets can present additional sources of income.
Mobile operators clearly have plenty to be excited about, but what does all this mean on a practical level?
Modernise business support
If they want to rate and bill for the new wave of services and business models set to be thrown their way, mobile operators must be ready to transform their business support systems (BSS). Any operator that fails to do so will likely miss out on significant revenue opportunities enabled through innovative 5G technology.
This is shown by the fact that consultancy firm Ovum expects spending on revenue management-related BSS to grow from US$8.2 billion in 2017 to US$10.6 billion in 2020, with increases in revenue management and analytics revenues driving overall growth in the BSS domain.
BSS optimisation is especially important from an FWA point of view. The model of the relationship between fixed and mobile players can take a number of forms and a great variety of ‘teaming models’ – such as asset sharing – are already emerging.
Since mobile operators are already wholesale customers of fixed operators, this relationship is expected to grow. Putting it into context, wireless operators must bring creativity and customer-centricity to the table as they launch FWA in the coming years. This will entail creating a single customer experience across traditional mobile and new fixed-wireless services.
The technology must allow a seamless handoff between home and external connectivity without disrupting existing services, which will require real-time, location-aware rating and charging so customers can roam freely without any performance deficiencies.
Lastly, it requires creative service bundling that enables customers to take advantage of the cost benefits of choosing a single provider and, in cases where a broadband service is already present in the home or office, to consolidate all services with their wireless provider.
These are the key challenges facing mobile providers as they look to transition to the next era of mobile communications and remain competitive in a rapidly-changing landscape.
Discover more about what 5G means for converged operators at Broadband World Forum on the 23-25 October at the Messe, Berlin. It is the only event that brings together all the key players and building blocks of network technology.
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