By An Jian, president of Carrier Networks Business Group, Huawei Middle East
5G is expanding at an exciting pace, creating opportunities for operators and end users alike. In the past, after a new generation of mobile communication technology has been launched, the pace of network deployment is managed step by step by operators, while investment and ROI come mainly from the consumer market. However, 5G is changing things – the differentiated capabilities offered are much more, the projected demand segments are diversified and the business model is redefined. In order to better monetize the available markets, 2C and 2B, a multi-way collaboration model between all stakeholders ought to materialize especially between carriers and vertical industries.
Traditionally, in the consumer market, traffic and connections are the metrics to monetization. With 5G, new monetization metrics are naturally made available, for example, services data rates like 4K, virtual reality (VR) videos, as well as the low latency services like online gaming and cloud augmented reality (AR). In South Korea, one of the most established 5G markets in the world at present, data show that users are willing to pay a premium in return for a superior experience in VR, AR and live streaming. For a 36% higher price, users get 16 times more data. In the first quarter after deploying its 5G network, South Korea carrier, LG U+, saw a 25% increase in revenue and a 4% increase in market share – proving that 5G networks is initially creating win-win scenarios for both carriers and consumers. With 5G devices available at increasingly affordable prices, we could foresee that more 5G applications would emerge and more end users will enjoy 5G service with anticipated exponential growth.
There are also monetization opportunities to be leveraged in-home broadband services. Consider this. In the Middle East, a typical household has at least five members. Each household will generally have three types of terminals, such as mobile phones, tablets, computers and 4K TVs – and maybe robots in the near future. The normal demand for home bandwidth exceeds 100Mbps. Delivering 5G fixed wireless access (FWA) can meet this need at low cost and with a rapid time to market, replacing the long cycle and high cost of fiber network deployment.
From 2C to 2B market, from connection to beyond connection, 5G will bring more possibilities to every person and every home, as well as benefitting every organization and industry. Along with other technology enablers, such as AI, cloud, big data and edge computing, 5G provides an excellent digital transformation medium for various industries to enhance their productivity and introduce new business opportunities. In the 2B market, network planning, service management, device management, service provisioning and billing are all different from the consumer market. The networks need to guarantee that the 2B services operation model is SLA (service level agreement)-oriented, as we need to understand the network needs of different industries, to plan, deploy and redefine the network with needed operation and maintenance capabilities.
Huawei is excited to be among the world’s frontrunners in embracing 5G to digitally transform vertical industries, simplify the internal and external workflow, make the machine more intelligent, enhance productivity and open new economic opportunities.
Here in the Middle East, we are delivering a series of solutions for industries, including 5G private line, 5G CCTV with AI and cloud, and 5G Private Campus, amongst others. This is just the start. These solutions will evolve in the future once 3GPP standard R16 is frozen bringing an SLA-based 5G network to different industries with predictable performance, guaranteed QoS and measurable billing. The current first wave of 5G industry solutions can be replicated to meet the needs of areas such as energy, electricity, ports, public safety, transportation, mines and more.
Huawei is ready to adapt our solutions to be deployed for all relevant industries to embrace 5G.
We are just at the beginning of the Middle East’s 5G journey. Collaboration at this stage is key, in order to harness its full potential and value. All players within the ecosystem – including regulators, vendors, operators, industries and industry organizations, and so on – must enter into a conversation to drive a continued evolution that will generate shared 5G value for everyone. In the Middle East, Huawei has established a 5G ecosystem service platform with more than 70 partners. We also have a 5G innovation OpenLab to promote 5G commercial success. Extending a working alliance between regulators, carriers, verticals, vendors and partners, will enable us to: figure out the optimum collaboration mechanism; define digital metrics for each industry; incubate more 5G use cases; optimize policies and standards and innovate business models. By exploring these avenues, we can build a mature 5G business ecosystem that will facilitate digital transformation throughout the region.