Whilst the hype around 5G is reaching a pitch that only small children and dogs can hear, the truth may be that 5G success rests on pretty boring things.
The hype last week reached some ridiculous levels. Last week, Spark announced it shall give the Emirates New Zealand America’s Cup team 5G to play with, as and when it is available in mid-2020. Apparently 5G will allow the team to collect more data, faster, about how the water hits the hull and this will allow them to modify the trim or the design or what have you.
Really? If you are – presumably – at sea and racing through the water at 25 knots or so, how is 5G even going to work? In the next year, the only environment in which 5G will be able to impress is a static one, probably in a laboratory and probably in a fixed/wireless general mish-mash scenario.
Leaving aside the fairly obvious marketing puff from our friends at Spark – in fact, leaving aside all the promises of 10,000 base stations on their way to customers, 5G being used to film VR stuff and all the rest of it – the starter business case for 5G is very simple.
Or so says industry veteran Bengt Nordstrom, CEO of Northstream. According to Nordstrom, 5G is actually ahead of schedule, which means that revenues should come more quickly than expected.
These revenues, says Nordstrom, will look very much like the revenues that telcos are currently generating – subscriptions to broadband access, but with greater speed and throughput and a lot less latency. People know about buying broadband.
Although this makes you wonder why we even decided to call it 5G and not 4G ++ or LTE +++ (which is also happening), Nordstrom (and many others, it seems) are unflustered by the lack of sexy business cases. He sees the telecoms industry as being in a strong position – in fact, the most robust position in the value chain that is emerging today. Telcos have good, fundamentally solid revenues and low churn. And, yes, in a few years’ time IoT and other opportunities will come along and telcos will add a ‘few percentage points’ to their bottom lines. And then there is TV and music and e-commerce opportunities that telcos are beginning to engage with anyway, along with the beginnings of sensible analysis and use of data (recommendations, profiling, etc).
And, says Nordstrom, we should not confuse the IT and the Telecoms parts of 5G. The hype is generated via the IT piece by Microsoft, Amazon, Netflix and (many) others. The solid, reliable, fast, jitter-free connectivity is the Telecoms piece, and we are already good at that.
In fact, the IT piece is much more prone to disruption that the Telecoms piece – and has been for ages.
Now, perhaps, we can throttle back the 5G roll out into a gentle scream, rather than suffer the insanity of small children in a playground on an epic sugar rush with a puppy to play with.
Thank you, Bengt.
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