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5G offers little value for the traditional telco

The telecom industry may need to change the way it thinks and talks about 5G.

Robert Clark

July 15, 2021

3 Min Read
5G offers little value for the traditional telco

Asian telco execs and experts shared some lessons in building 5G business at the Asia Tech X conference this week.

Lesson number one is that 5G doesn't offer much for traditional operators.

Olivier Rival, a BCG partner based in Singapore, said a breakdown of the 5G value chain "did not make for happy reading for telcos."

The prime 5G use cases involved a complex technology stack – compute and storage, platform apps, security, system integration and data analytics – with the result that connectivity is a small part of the total value.

"It's about 12% to 18% – not much more than that," Rival told the conference.

Another lesson is the industry needs to change the way it talks about 5G, said Julian Gorman, head of GSMA Asia-Pacific.

"The GSMA has been as guilty as anyone," he said. "For three years we've been saying [5G will deliver] 1ms, 10Gbit/s, 'enterprise is going to change overnight.'

"Those peak technology speeds are not what we should be talking about. We should be talking about how you're going to change lives and what people are going to use it for.

"We can play a big part in that value chain and step above connectivity. But we need to act with a better story as an industry."

Ian Watson, CEO of Cambodian operator Cellcard, says 5G is about experience, not download speeds.

"We don't talk about speeds, we talk about a new dimension of connectivity. We're not an MNO any more. We're a digital live service provider and we will make your life easier through 5G applications."

That may sound like an elevator pitch, but Watson points to specific apps the operator has developed, such as the local language chat app that has garnered 250,000 subs in two weeks, and what he says is the world's first digital passport app.

Want to know more about 5G? Check out our dedicated 5G content channel here on Light Reading.

The other lesson seems to be that operators need change themselves.

Manjot Singh Mann, CEO of Singapore's M1, says it has undergone a digital transformation over the past 18 months.

It had changed its IT stack and restructured itself to become a digital service platform. It was now "92% in the cloud" with a fully cloud-native BSS/OSS, he said.

"That allows you to have quick integration with partners that you bring onto your ecosystem so you can provide services to your consumers that are contextualized and real-time.

"I think that is where our future lies because we have been able to create this digital platform. We are now onboarding our partners so we are able to deliver those services to our customers."

The other internal change is not technology but people and processes.

M1 has been trying to build a more innovative, risk-taking culture. "It takes a lot to get that culture going."

Indosat Ooredoo has been working through a similar transition.

COO Vikram Sinha said the company was trying new ways of working, setting up teams that break the functional silos and embrace risk and reward.

No one function can solve all these problems, Sinha said.

"As leadership team, we need to tell our teams it's OK to fail, but fail fast and move on. I'm happy to say we have seen some change."

— Robert Clark, contributing editor, special to Light Reading

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About the Author(s)

Robert Clark

Contributing Editor, Special to Light Reading

Robert Clark is an independent technology editor and researcher based in Hong Kong. In addition to contributing to Light Reading, he also has his own blog,  Electric Speech (http://www.electricspeech.com). 

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