Why are Telecom operators obsessed with deployment of 5G?

• Capex investments made by telcos in 3G and 4G in the last decade have provided a major technological shift in the form of high-speed global mobile networks. We have already discussed how this has allowed the entry of OTT players who, leveraging the connectivity infrastructure of the telco operators, have grown revenues exponentially over the past decade, while telecom operators themselves haven’s profited in any substantial way from this 5G, quite like its predecessors, is a huge leap forward in terms of speed, capacity and latency. But when combined with the distributed architecture and real-time Edge computing capability, this technology is unmatched. The Edge computing infrastructure allows telcos to shift the data processing and application deployment to devices they control, thus changing their equation with OTT providers.
• The connectivity needs of enterprises are rapidly evolving. Enterprises are no longer interested in static services; what they want is the ability to subscribe to varying speeds based on differentiated QoE (quality of experience), or the ability to use varying network capacity/slices, with the option to enhance or downsize network resources dynamically. The real power of 5G technology lies in its capability to enable and provide such transformational services for enterprises and industrial customers.
• However, for telcos to win in this scenario they will need to leapfrog in terms of product design to deliver world-class experience, including IOT devices and applications, to their customers. This will require innovative collaboration with OEM manufacturers, building a thriving ecosystem of tech startups to build pointed applications, and upgradation of their own product development and GTM infrastructure to stitch all these elements into compelling solutions for different industry-based enterprise customers and end consumers.

5G will mean a massive investment on the part of telecom players. The reason they are so excited about this is because it can potentially tilt the scales back in their favour on the customer’s share of wallet. It opens up new possibilities in terms of new products and services that they can offer, thus driving new revenue streams. At the same time, 5G also provides them a way to drive legacy modernization across the OSS/BSS (operations support systems/business support systems) stack, which can drive cost optimization and unshackle their organizations from their decades-old systems and processes.

However, capitalizing on these advantages and the promise of 5G will also require telcos to focus on the following:

• Stronger push on digital channels
• Monetization of their massive data assets
• Legacy modernization to unshackle the organization
• Leveraging AI to build innovative solutions and enter new markets