GlobalData’s Emma Mohr-McClune comments on 5G expectations for the year ahead. Last week, I was lucky enough to be invited to be a Speaker at a Huawei-sponsored webinar entitled ‘Maximize Bit Value in Pipeline’, which was attempting to do just that; take a long hard look at both 5G expectations and realities, with suggestions of ways carriers can improve the business balance.
My own role was to set the 5G stage, provide context to the puzzle, but also address some of the more awkward questions. Why have carriers struggled to monetize B2C 5G effectively, where are the network bottlenecks, and how much of this can be mitigated in the short to mid-term? But also, why has the mobile data traffic induced by Covid-19 home working and learning, together with increased uptake of online gaming, VR/ AR entertainment and lockdown-lifestyle platforms failed to translate into increased mobile ARPUs for the carriers who have already invested so much facilitating these experiences?
Next gen latency is key for 5G
Experience – there it is, the problem, but also the key. Because with all these next-gen wireless experiences, next-gen latency and capacity is vital, and there have been a few bumps along that road. To be candid, super-low latency – what I call the ‘killer feature of 5G’ – is still somewhat theoretical. The fact is, most 5G operators on non-SA 5G networks are struggling to achieve anything close to the requirements for latency-sensitive applications such as immersive, real-time entertainment with VR and AR, or even enhanced teleworking experiences.
To be fair, there have been headwinds. Covid-19 has stalled the evolution of 3GPP standards, which has served to put the brakes on 5G evolution overall. Network slicing standardization is still in limbo. And there’s still so much to do in the Transport network. Fronthaul transport standards are needed to allow for a more time-sensitive, deterministic network to evolve. And finally, QoS mechanisms, standards and solutions are not as mature as the industry had have hoped by the end of 2021. All these issues are impacting the customer experience of these new 5G use cases, which in turn has fanned 5G carrier scepticism, investment delay and ecosystem hurdles.
Because it’s not a want of creativity or vision that’s holding us back. Whilst use cases such as permanent teleworking and cloud gaming have become ‘the new normal’, the business case for 5G use cases such as remote surgery, next-gen industrial automation and online working with enhanced forms of VR and AR entertainment, has also been strengthened.
What we’re dealing with is essentially a MBB latency performance issue, which is a network core issue. As Huawei’s Orpheus Liu pointed out during his presentation, applying AI to network decisions will help carriers glean important customer experience performance insight, and reapply that logic for QoE-level monetization opportunities. To be sure, experience awareness, optimization, and AI are all unique capabilities of the core network, which means learning to manipulate experience at the core is critical for new types of 5G monetization.
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The first areas in which we’ll likely see MBB QoE monetization in action is for the more mass market ‘new normal’ use cases, such as teleworking and cloud gaming, to ensure the type of service level guarantees that can make these experiences more effective, and enjoyable. But even for the more futuristic scenarios, we’re seeing promising signs too: SK Telecom’s Ifland is well set to generate new subscription revenues with metaverse add-ons and enhanced experiences. Social gaming, with AR and VR, is also set to enter the carrier services portfolio in 2022; the demos are promising, the applications exciting. And finally – the big one – teleworking. In many ways, 2022 may be the year in which the global business community comes to terms with the concept of (Permanent) P-WFH.
We’ll need to study the requirements of the new features associated with these use cases, optimize the associated customer experiences and map them more closely to the core performance requirements currently serving as a key hurdle to MBB performance. My own hope for 2022 is that 5G discourse matures a little. It’s not question of optimism, but optimisation.