From network slicing to non-telco services, what are the 5G themes and trends to watch? And is 4G still a contender? Ndirangu Kibata, Director - Strategy and Growth, TAU SPACE, Alen Ng, Head, Corporate Development, M1 and Mythri Hunukumbure, Chief Engineer, Samsung R&D Institute UK share their view.
Network slicing will open doors for MVNOs
For Ndirangu Kibata, while everyone knows about the super-fast speeds, for MVNOs what’s of more interest is network slicing. “About 20 years ago, when I was still in my infancy in telecommunications, we were working with an MNO that was a start-up. The MNO needed to roam on an established network who also happened to be their competitor. One of the intractable problems that we were trying to solve was how to remove the name of a competitor from a SIM card. And the answer was that we couldn’t. But what network slicing enables you in some countries is to have your own network ID. This means that if you can pretend to be an MNO and no-one will be none the wiser.
5G can improve the negotiating position with MNOs...
Ndirangu also noted that delivering data over 5G is much, much cheaper than 4G. “So in instances where the 5G network is already in existence and your use case can either go 5G or 4G, you’ve got a much better negotiating position when you go talk to your MNO because their OpEx is going to be much lower when they are running on 5G than on 4G.”
... but data consumption could pose a cost challenge
Alen Ng expects higher data consumption to be an issue for some: “We saw this when we moved from 3G to 4G, too. We’re still running trials around this, and it’s too early to get an entirely clear picture because the data hasn’t yet stabilised. What we may see happening is that some MVNOs could struggle from a data consumption / cost exposure POV, meaning that they’ll need to renegotiate or adjust their pricing model with their MNOs so that they can afford this.”
Connectivity will not be the primary offering
Alen also foresees “5G MVNOs providing more non-telco services. Beyond selling data, with 5G, we’ll sell more unique services, and therefore have more unique propositions. This might be, for instance, a manufacturing solution, or logistics management that we’ll provide the connectivity for.”
4G is still in the game – but it’s not a safe bet
Some MVNOs may feel they have customers who are happy with 4G – they are either unwilling to pay for 5G, or don’t need that high speed and latency, Alen notes. “This will probably remain the case for the next few years. But, sometime down the road there will be 5G solutions that their peers and competitors are offering. The MVNOs, therefore, who opted to stay away from 5G will be penalised because they built their business propositions around a low cost, substandard product. I think being ready for 5G right now is just futureproofing whatever you’re going to develop.”
Future-proofing your investment means finding the right time to make the switch
The 4G-5G transition is a dynamic process, as Mythri Hunukumbure, explains – and a bit of a balancing act: “Standards don’t stay still, they evolve, and 4G will evolve as well. There will be new releases coming. The
networks today are mostly software upgradable – MNOs will upgrade and there’ll one or two operators who are trying to push 4G to the very limit. They’ll offer some of the capabilities that 5G can with their 4G
networks, but maybe at a lower price.
“But futureproofing your investment comes into play because, at some point, as happened with 3G and 4G, everyone will want the next evolution. So, in two or three years, all customers will want a 5G phone and 5G
capabilities. But – when it comes to capabilities – it’s an evolution and a flow. This means that you have to define the point where you want to switch from 4G to 5G, keeping front of mind that this process will be a
dynamic one and that there’s no fixed point.”
Key takeaway Know that the 4G-5G transition is a dynamic process, and a bit of a balancing act. Some MVNOs may feel that their customers are happy with 4G, but opting to stay away from it entirely could be damaging.