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In December 2017, the first 5G standard specification was formally approved by 3GPP, the global body responsible for setting cellular standards. It was always going to be big news and will be showcased at MWC.

5G does not just usher in an era of faster network speeds. As relevant as speed is, 5G’s essential architecture is what sets it apart. Imagine a generation where everything is virtual. Imagine no longer needing hardware to host an application. The implications for the telecom industry and throughout the IoT ecosystem are seismic. Connectivity is the new battle ground and there will be big winners—and losers. Service providers need to be innovative and they can sell to a global customer base – not just restrict themselves to a local offering.

Look before jumping

As excitedly as many welcome 5G, some are not so sure. After all, operators might be forgiven for being a bit cautious since many are still engaged in fully monetizing their 4G investments.  However, when it comes to the 5G land grab, understanding the opportunities for monetization early will be critical to making an impression on this burgeoning landscape.

As the biggest mobile show on earth kicks off in Barcelona, the burning question will be how to make 5G pay. Here, we examine the ten strategies to monetize those 5G networks.

 

  1. Slice it anyway you like it: Network slicing is a technique that relies on virtual “slices” of network being sold to different users, according to usage requirements, geographic location etc. It’s a “mix and match” approach that sees virtual slices of network being created out of a single global infrastructure and matched with different applications’ resource requirements.

    With virtual infrastructure and a service delivery model, the granularity with which providers can tailor solutions will make a big difference to their ability to monetize the network. Every aspect of the network is up for grabs. For example, access to the slices can be further defined according to the access levels and flexibility required by the user.
     

  2. Connectivity is the currency: The network architecture for 5G democratizes access. The architecture is defined to allow non-3GPP and 3GPP alike equal access to connect, meaning 5G enables connectivity to be monetized through one single infrastructure.  Vendors can provide many types of connectivity to the core, and even handovers across non-3GPP are easily possible.
     
  3. Pay for infrastructure as you go: When infrastructure goes virtual, even small vendors requiring connectivity for their enterprises can use the service based on their use. The “pay as you use infrastructure” model will come of age.
     
  4. Developer-friendly access arrangements: Connectivity providers can offer attractive options for developers seeking access, with usage flexibility as well as all the required QoS and other features. This business model is already gaining ground in the field of MEC, but could even be used for applications which require a centralized cloud. 
     
  5. Conduct phased trials: Trial roll-outs, or phased roll-outs, are enormously valuable to service providers in teaching them what works and what doesn’t. However, the mistakes can be expensive and the process as a whole has not always been efficient. With 5G, infrastructure vendors can define network slices to roll out services in a phased manner, which means they can gauge the reaction of users of the service in an area to learn how to monetize the service better before expanding into other territories.
     
  6. Give 5G the “edge”: Many value-added services can be provided by hosting applications at the edge using MEC deployments. Carriers can offer the network infrastructure to allow application vendors to choose to deploy services in the central cloud and define how it can easily be replicated or upgraded on the network edge. Carriers will also be able to provide services based on the number of edge updates or edge transactions and even, different number of edge technologies.
     
  7. Ease of Expansion: 5G will provide connectivity for a very great number of IoT devices, while also multiplying the number of network users due to, among other factors, network slicing. Thanks to the 5G architecture, carriers can monetize from both expansion based on number of devices connected as well as expansion of users of the infrastructure.
     
  8. Reclaim value-added services: Over the years, carriers have seen many of their value-add services eroded. 5G will provide a fresh opportunity to get out of the “dumb pipe provider” pigeon hole and position themselves as providers of additional, value-add services again. For instance, carriers could evolve into platform providers for a variety of micro-services, assuring low latency where needed by providing them on the edge. With this model, application vendors could simply define how they want their applications to perform and let the connectivity provider make it happen.
     
  9. Cloudifying ultra-low latency applications: Applications like robotics, translation applications, applications for moving vehicles etc. are normally put in end devices. With 5G networks, carriers can monetize these as well by putting compute functionality on ultra-low latency edge networks and thus putting it on cloud for the compute processing without compromising on latency.
     
  10. Next-generation optimization: 5G network usage will vary wildly between different applications, and so effective optimization of network resources becomes paramount. For instance, an IoT application which works on a low power level would need very less throughput, but the number of such devices connected may be larger; while on the other hand applications like video streaming requires larger throughput, but lesser mobility requirements.

Learning the lessons of the past

4G network rollout was helped along immensely by the demand for services from devices like the iPhone. They created a high demand for high capacity data requirements, and similarly 5G network rollout will be helped by the increased number of devices which require connectivity. As the number of connected devices surge, all with varying requirements, it will help to scale and slice the network and build out the infrastructure to roll out new applications and services easily.

The secret to monetizing 5G is in the architecture. It will not just increase connectivity, but its virtual nature will also help to optimize network resources, enable carriers to expand globally and create a platform for many new service offerings.

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