Wednesday, 18 March 2015

New Business Model required for 5G?

Mobile operators’ business models need to evolve to address the changing capex environment, which has become more challenging over the last decade, said Hatem Bamatraf, Etisalat group CTO, at Mobile World Congress. 

The key question, he said, is “how are we going to justify investing in a certain technology? People love technology, but there needs to be a balance between the investment and the business case. There are lots of ratios we are looking at before we decide how much money to invest in a certain market and in a certain technology”. 

Speaking during a panel session on 5G, he said all of those ratios are related to revenue and profitability. “We all know there are huge challenges when it comes to top-line growth as well as bottom-line growth.” Asked how much operators will need to invest to the point of being able to launch 5G, he joked that you first need to ask Huawei what it will sell its 5G equipment for, “then we’ll be able to address that”. 

Mischa Dohler, professor of wireless communications at King’s College London, said there is an opportunity to crowdsource some of the deployment of 5G technology, because the industry is not only connecting people but also industries. 

“When you start adding industry by industry, you crowdsource in a sense, so your capex can actually go down because someone else is paying.” Seizo Onoe, NTT DoCoMo CTO, insisted that the market leader in Japan is keeping to its aggressive 5G roadmap schedule. “I’m sure we can launch 5G by 2020.” 

He said his preference is to have one 5G network for all 5G use cases, but “we’ll probably end up using different technologies. My dream is to finally have one technology covering all use cases, however, that will probably be 6G.” 

Yang Chaobin, Huawei’s CMO of wireless networks, agreed, noting different vertical industries should be able to share a common infrastructure and be able to tap services on demand. He noted that 5G shouldn’t just be an update of existing technologies but should be an enabler of many disruptive innovations in other industries.