The promise of 5G, however far away it is, is clear. Lightning-fast speeds, low latency, great reliability – essentially it heralds the realization of every use case on every Powerpoint slide for the last 20 years.
What is also clear is that the last vestiges of traditional billing models must evaporate along with the last wisps of hype.
In many cases, the pricing and billing of 5G should be about what doesn’t happen. In the same way that Chinese medicine is preventative by design (in other words, you are essentially paying the doctor to keep you healthy, and traditionally if you got sick anyway you didn’t pay him), it may be that the pricing model for 5G should mirror that by leveraging analytics.
Indeed, analytics will be key to providing the value for billing – and therefore the monetization of 5G, far more so than technologies that have gone before. Consider – with 5G (and the latest upgrades of 4G), superfast connectivity will practically be a commodity. The real value add is when the analytics engine picks up a blip in the water pressure behind a dam, say, or the blood pressure in the heart patient. That knowledge has enormous value to the doctor, and more so for the patient.
We have discussed for many years how to bill for value. Finally, with the advent of 5G, we will almost be forced to do so. Billing for time or speed or data (apart from on a subscription basis) will be completely redundant.
5G, more than anything else, will blow apart old business models. The IoT, which we still talk about as a ‘thing’, will disappear. Healthcare will evolve as the industry understands how to use the technology, from apps and monitors to teaching and diagnosis.
So, too, in other industries, from retail to automotive to logistics, 5G will disrupt and remold.
How telcos think through their pricing and billing models – whether based on QoS, analytics or another method based on value – will determine the success of a range of services, industries and companies for the next 20 years or so.
If we end up ‘billing for value’ as we have discussed through the 3G years and the 4G years, then telcos need to start thinking now about the value of 5G to customers and how they can turn that into money.