There is growing excitement about the potential for 5G, and particularly when linked to the Internet of Things and streaming analytics. Around the world, telecoms companies have started to invest in or plan for new network upgrades to support 5G. However, it is also becoming clear that many telcos do not yet know how 5G will help them to deliver better customer experiences, or even where the most compelling use cases for 5G are likely to be. This, in turn, makes it harder to identify how they will deliver a return on investment in 5G.
A lot of the hype about 5G has been about gaming
It is widely agreed that 5G will reduce latency. Coupled with better virtual reality technology, this will make gaming better and easier on mobile. It looks likely that many of the early adopters of 5G will be individuals. However, this seems unlikely to be the most compelling use case in the longer term, because it remains a fairly niche activity. This lack of clarity makes it hard to think about new business lines, or new use cases. Even though there is general agreement that 5G will broaden the telco customer base considerably.
Research suggests that very few telcos know how they will actually monetise 5G, or capitalise on the excitement. Many are also impeded in their thinking by legacy monetisation systems. These make it harder to think through new options, or see the potential – and the costs of continuing maintenance and support of these legacy systems also make it harder to invest in new technology. There are, however, some interesting developments around the world. These may point to areas for further investigation or particularly promising options for monetisation of 5G.
Managing transitions through analytics
Many telecoms companies found it hard enough to make the transition from fixed telephony to mobile. Many, though, have made a successful move through digital transformation to a more omnichannel approach. They have used analytics to focus on customer experience and personalised customer journeys and offers. Even the more "back office" functions, such as network optimisation and fraud prevention, are ultimately supporting improved customer journeys. Good network quality, achieved through better predictive maintenance, is perhaps the most essential building block to better customer experience.
5G has huge potential to improve customer experience in both B2C and B2B markets, but enterprise adoption is expected to be the biggest driver in the long term. In combination with IoT and streaming analytics, I think we will start to see some of the biggest markets for 5G in smart cars, homes, other buildings and stadiums, and manufacturing lines.
In broad terms, we will see analytics supporting customer intelligence, connectivity and productivity, and crowd management. This will take a change in thinking. Telcos will need to look beyond communicating directly with "a customer" to thinking about how they are supporting an ecosystem. Think about the span of use cases to support smart cities, which require partnerships across multiple constituents. The ecosystem will comprise many new partnerships.
Other use cases
Some companies are also looking at the potential for 5G to support telemedicine, especially in remote locations where there are limited health care services. Virtual reality may offer ways to carry out surgery remotely, drawing on experts far away to support local health care practitioners. There are other promising developments in the area of logistics, for example, to track containers and other shipping. In real estate development, sensors have been used in construction to check the stability of the ground before starting to build apartment complexes, and to monitor heavy equipment.
Other use cases include:
- In agriculture, to track livestock, or predict flood risk.
- In business, to provide remote access to services, improve remote working, and enable video meetings. This is likely to be increasingly important in the wake of the coronavirus crisis, as businesses and individuals realize that remote working has unexpected benefits.
- Long-range remote control of factory robots, extending the use of predictive and preventive maintenance in manufacturing. This will include using sensors to predict anomalies and make proactive changes.
Developing new skills and knowledge
There is, of course, a further challenge for telcos: developing the necessary skills to take advantage of these opportunities. Having an agile, end-to-end automated process will help speed up the process. Operationalizing analytics, and particularly developing an analytics culture, requires both technical skills and soft skills, such as stakeholder engagement and project management. People with the right skills are in short supply.
However, we are already seeing telcos rising to the challenge. Some are working with universities to improve skills or drawing on consultancy support. It is clear that they are determined to be in a position to take advantage of potential around 5G. I think we can expect to see rapid movement in this area over the next few months and years.