Everyone is talking about the opportunities that 5G will deliver for MVNOs but what exactly are they and is there a killer app?
I hate to disappoint but the honest answer is that there is no killer app yet. However, there is a lot of potential and it would be prudent to spend time assessing the options and developing a mid-term strategy.
For consumers we’ll see an abundance of applications come through once we start to see handsets on the market. They will be geared to doing more of what you love to do now only faster. In the immediate future, 5G will be all about how fast we can get content ie less streaming and more ‘super-fast’ downloading. It means content will be instant.
That’s nice but not life changing. We need to look further afield for a glimpse at to what will change the world. In advanced markets like South Korea where there has been huge take up of 5G, operators ensured that there was also an ecosystem of applications for consumers to engage with. It meant buying a 5G handset was worthwhile. You would get a different experience and value for money.
There was particular emphasis on launching VR and AR applications for sport and media. SKT developed baseball applications for example. Fans get real-time stats when they point a smartphone camera at a player, can stream a game from a variety of different camera angles and get immersive experiences like seeing fire breathing dragons during match warm-ups when wearing a VR headset at the stadium.
Dragons add drama and entertainment, but VR and AR can also be used in very practical ways such as helping you compare more complex pieces of home tech from the comfort of your home.
Talking of the home, we’ll see the advent of fixed wireless replacement. With a 5G router, consumers can truly cut the cord and have a fast, low latency high bandwidth wireless internet connection. This is particularly interesting to service providers and MVNOs offering multi-play propositions to younger demographics who are highly mobile and may not stay at one address for more than six months.
But probably the real payback on 5G comes in the enterprise area, and that’s where MVNOs could do some very interesting things. There are four main use cases:
Massive Machine to Machine: the scale of 5G networks and the bandwidth they can support unlocks huge machine to machine opportunities with ‘things’ talking to other things globally. Whether this is sensors in gas pipes, connected cars or wearables for emergency services the scope is only limited by battery life, the size of the IoT modules/things, the needs of customers and our imaginations.
Better business communications: Covid has taught us that connectivity is vital for business and 5G expands the scope for rich communications between businesses whether it is holographic video conferencing, spinning up an office, shop or exhibition anywhere or giving better VR/AR product demos. This may seem sci-fi, but actually with the events industry on its knees there is real scope to offer immersive interactions that help people make connections and do business.
Low latency applications: 5G enables extremely low latency meaning that there is very low delay in accessing the internet, a business network or data. This makes gaming an incredible experience in consumer land but in business it means that edge computing can make AI based decisions quickly, whether that is semi-autonomous robots in a warehouse or a real time quality control check on a production line. Being able to root out defective products early is just one of the ways manufacturers can save money and time.
Private networks: 5G allows organisations to slice their networks allocating each one to different applications and ensuring that security, priority and quality can all be managed on that network slice. It’s ideal for large campus based organisations and transportation hubs. It’s worth noting that research by Cap Gemini shows that 75% of companies believe that 5G is a key enabler for their digital transformation, and 47% of large organisations would consider getting their own 5G licence. So surely this adds up to an opportunity here for MVNO entrepreneurs and their host networks?
So while 5G might not be all around us yet, it’s certainly coming and taking advantage of what the more advanced markets have learnt will be imperative to ensuring the UK makes its 5G mark.
MVNOs have a significant role to play here and their heritage of innovation and entrepreneurial spirit certainly bodes well for capitalising on the opportunities.
I’m a firm believer that fortune favours the brave, but even the brave need a plan. MVNOs should be looking at their business models, customer segments and assets, and identifying where 5G fits. Questions need to be answered. What investment, skills, innovation is needed to bring it to life? How can the service be differentiated at launch? What other parties will be integral to making it happen? What are the risks and challenges and crucially how big is the reward?
Only by getting into the nitty gritty will MVNOs be able to establish their place in the market and a winning formula for success. It’s worth doing it now, because when 5G does take off it will go with a bang and anyone late to the party will have a lot of catching up to do.
About the author
Managing Director at Graystone Strategy
James has over 25 years of experience working in the telecoms, MVNO and retail industries. He is an expert in subscription based business models, CRM, direct and indirect channel management and major proposition development and launches. He has held a number of Marketing Director & Consumer Director roles with mobile networks and retailers and now advises boards and start-ups on business and marketing strategy.