Today: November 29, 2023

Tapping into the 5G opportunity

3 mins read

Marc Price, CTO, MATRIXX Software | 29 March 2022

A chance for telcos to cash in, and add value to our everyday lives

Even before 5G launched, technologists have been excited about the revolutionary promise the next generation of cellular technology will bring. However, while it’s been three years since the first 5G networks have gone live, the technology has failed to catch on in a significant way, accounting for just 4% of global mobile connections.

An exception is the developed nations of Asia Pacific and Greater China, where the number of 5G connections is almost double that of the rest of the world[2]. By 2025, 67% of all connections in Australia, Japan, Singapore, and South Korea will be 5G, and there will be nearly 900 million 5G connections across Greater China alone.  

Consumers in these territories enjoy high levels of coverage, incredible connection speeds and low latency which makes watching videos or playing games anywhere, at any time, even easier. You only have to look at the Hong Kong MTR during rush hour to see the impact 5G can have on mobile usage.

But these services are based on 4G concepts, and even with a better experience are not yet transformational. For the most part, consumers and enterprises have not yet experienced the full, immersive benefits 5G can bring. In part this is because truly transformational devices have yet to emerge. At the moment, 5G is largely a faster version of what we’ve had before, while there is potential for it to be so much more. Imagine the value 5G will bring when augmented reality becomes more accessible, providing contextual information to improve one’s enjoyment while watching at the winning goal at the football match. Or when biometric statistics from wearables instantly update real-time applications from training videos to next-generation games.

These kinds of evolved experiences – and many more just like it – will be possible with 5G, and consumers across Asia are more than ready for it. The hold-up comes as telcos across the region evolve from simply providing ‘connectivity’ to becoming enablers of richer, more value driven services.

Imagine a scenario that is not so far in the future where a self-driving taxi picks up a commuter on their way back home from work. The commuter’s phone connects automatically to the car and, in return for lower rates, the taxi company serves up a series of ads. One of these is for a home-delivered pizza which is too tempting to pass up.

In this scenario, who pays for the 5G connection? The commuter, taxi company or the pizza restaurant? More pertinently, how does a telco, used to charging for data usage by minute or volume, make the transaction possible? What happens when that pizza ad was an immersive, make-your-own VR pizza experience, consuming large amounts of ultra-low latency data?

These kinds of scenarios will become more commonplace over the next few years as businesses see real-world commercial opportunities. Their success, though, requires telcos to evolve the way they operate.

A key part of that evolution is an overhaul of the unglamorous, ‘back-end’ systems telcos use to bill users. These systems worked well when telcos were calculating call minutes, SMS and bytes of data but work less effectively in a more dynamic, value-driven model.

Up until now, telcos have been limited in the types of value they can transact. The business model was like a giant meter with the operator passing on the cost to the appropriate user. The opportunities that come with 5G and its open ecosystem, represent a fresh start for operators; a chance to redefine the way they work. That redefinition could lead to innovative ways to bill customers that would create opportunities for telcos while delivering a new world of experiences for users.

Let’s take a look at a football scenario that illustrates the point. Instead of offering a simple replay to fans in the stadium, imagine that someone in the crowd can access not just the 30 camera angles used by broadcasters to cover the game but another dozen cameras that provide unique views. With 5G, fans could stitch together – in real-time – several camera angles to create unique footage of a goal, or even what-if scenarios that show what might have happened.

In the current business model, this would present a problem of who would pay for those additional angles. Fans accessing them? Stadia operators? Teams? Broadcasters?

In a brave new 5G world, this kind of fan-focused service presents a huge opportunity for the spectator, but it also benefits teams, the stadium operator, and the broadcaster. The telco can play the part of integrator, offering a way for the spectator to be served one-of-a-kind experiences while the other parties also benefit through customer data, fan engagement and additional in-stadium revenue opportunities

For those who have bemoaned the decline in crowds, this new approach would make the stadium experience more compelling than it is today, bringing back spectators who would have a superior experience to watching the game on the TV. And the same model works in a whole range of settings from live music to clothes shopping where, for example, a customer could watch the latest runway fashions, hear pundits discussing high street trends and use augmented reality mirrors to see how items of clothing would look.

There is little doubt that these kinds of valuable experiences can and should be monetised. Telcos have a significant role to play, but they need to evolve from the way they have done business over the last two decades if they are to reap the rewards. Consumers in Asia are ready for more than just faster downloads; the question is whether telcos are able to play their part, not only in delivering new experiences, but in enabling the new business models that become possible.

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