Customising the digital economy

The one-size-fits-all network model is not dead yet. But it’s already starting to fall over. However it is defined, 5G is not going to operate in the same way in all cases: the various areas of bandwidth being reserved for it will see to that. High peak data rate and IoT (Internet of Things) capability, for example, each make very different demands on, and may use very different parts of, the radio spectrum.

For example, at parts of the spectrum above 30GHz early 5G users will take advantage of the high-capacity and high-speed mobile communications that such bandwidth allows. But these benefits won’t initially be matched by coverage. Thus a workable model here could be campus networks for businesses.

However, for IoT, what matters is range, battery life and cost, not throughput. Millions or billions of sensors sending out tiny pieces of information will offer data that can be used to enhance business practices and improve efficiency. This may imply different equipment, and will require different business models and network management systems from basic voice or mobile broadband.

For consumers it’s different again, though what they will want is hard to say just yet. Whatever 5G is used for, promoting the impression that it is one all-encompassing fast broadband network concept is not going to encourage innovation — or indeed be a reflection of reality.

Hence the much-discussed concept of 5G ‘leadership’ needs to be refined. 5G includes technologies that can and will mean different things to different sectors. Real leadership will involve not pushing 5G as broadband for all users everywhere but understanding and explaining what it can offer to specific sectors and users and how that can be tailored, delivered and marketed.

It will therefore be important to ensure that 5G consultation is held with all relevant sectors, and governments should facilitate prioritization of resources according to areas of economic impact. It will also be important to create the regulatory environment for key verticals to have access to optimized wireless networks, rather than assuming that one size fits all.

This way the improved service 5G will bring can benefit mass markets, while customised services enabled by 5G can be, as it were, made to measure for automotive, transportation, healthcare, energy, manufacturing, and more. Each sector and service requires different levels of speed, security, reliability and latency. And each service model will have different attributes and benefits customised to need and budget.

This is also a technology play as well as an economic and regulatory one. 5G NORMA — Novel Radio Multiservice adaptive network Architecture — in which Real Wireless is playing a leading role — aims to develop a conceptually novel, adaptive and future-proof 5G mobile network architecture that will be able to offer network customizability, in particular using available infrastructure more efficiently to meet growing traffic volumes and growing demand for novel communication services.

So, yes, the decline of one-size-fits-all is a good thing when addressing different industry sectors. Driving the digital economy should be more than a nice, catchy slogan. The economic and social benefits of 5G differ by sector and should be examined, discussed and delivered accordingly.

Virtual infrastructure, real value – Simon Fletcher, CTO, Real Wireless

The C in C-RAN is all about Centralisation, isn’t it? Well, not necessarily. When it more commonly stands for Cloud we can better understand how C-RAN can transform the value creation possibilities of wireless infrastructure, in ways that enable operators, in particular, to feel that their networks are more than just pipes.

This is an urgent consideration. Political and economic groupings (such as the EU) are predictably excited by tapping the potential of future communications services and its place in the evolving digital economy. This digital economy, in case we need reminding, is centred round things like – well, you name it: real-time data, delivery tracking, wearables, preventative healthcare, smart meters and the (potentially) vast savings they can produce and income they can generate.

The so-called eInfrastructure behind this super-smart, super-connected digital future is important; 5G should be part of this eInfrastructure. At the moment, the view of many political institutions seems to be that 5G is simply an incremental infrastructure play beyond today’s 4G and Wi-Fi. That is, it’s just more cost efficient connectivity and not much use if it isn’t transporting something of value – which is where true economic potential lies.

I would like to suggest a different view – that there is value in 5G infrastructure over and above its transport function. Explicitly positioning RAN as part of the Cloud business eco-system – where C-RAN means Cloud RAN – transforms 5G eInfrastructure into something that can add value in and of itself.

‘Cloudification’, then, brings new business models into the conceptual domain – but not just through new services. Cloud-RAN is a platform for creation of value within the pipe. With Cloud in play in the network and at the edge, new business innovations become obtainable. Such as mobile network multi-tenancy to support on-demand allocation of networking, storage and compute resources in a fully multi-tenant environment. Or multi-service- and context-aware adaptation of network functions to support a variety of services and corresponding QoE/QoS requirements.

Another way to put this is that dedicated networks contained in slices can meet the need of different services and tenants, be they service quality and performance, service-specific functionality, or adaptation to available infrastructure.

Potential new revenue drivers like these simply require innovative thinking and – as slicing and multi-tenancy imply – cooperation, which will be needed to open interfaces, enable control and user plane splits. It may also be necessary to embrace deferring capex for opex. Nevertheless, with a concerted change of mindset, there will be real intrinsic value in 5G infrastructure where there was – at least according to some people – none before.

Convergence across verticals means new revenue opportunities for the wireless industry

This piece originally appeared on RCR Wireless as part of the publication’s “Analyst Angle” section. You can view the piece here.

Simon Fletcher chairing the 8th Future of Wireless International Conference

Simon Fletcher chairing the 8th Future of Wireless International Conference

Last month’s Cambridge Wireless Future of Wireless International Conference (FWIC) provided a great opportunity to bring together representatives from many vertical industries with wireless technology providers. As ever the attendees were highly engaged, with plenty of challenging questions and thought provoking panel and open forum discussions.

Perhaps the most interesting insight from the conference was the way in which it was clear that there is a convergence of challenges across multiple vertical sectors. A lot of speakers were articulating similar challenges — in areas as diverse as healthcare and automotive — and this is vital for the future of wireless. Convergence opens up opportunities for greater standardisation and the creation of platforms that have applications in multiple sectors, increasing efficiencies and revenue opportunities for vendors and service providers.

For example, the continuing need to improve remote and in-building coverage was mentioned by several speakers — particularly those from the automotive industry. The poor coverage on the UK road network was highlighted as a significant barrier to future innovation and revenues. The relatively poor coverage of the UK is a well-known issue for the wireless industry. But now transport industry players are highlighting the issue as a significant deficiency that needs to be addressed, and government departments that take an interest in transport systems are also applying pressure to improve coverage.

The topic of regulation remained ever-present in a number of the industry sector sessions. Several speakers noted that regulatory frameworks could put up significant resistance to wireless enabled change, which will create opportunities for disruptive start-ups in a number of sectors.

A final major point of convergence was also the impact that “OTT” players are having in the vast majority of vertical sectors, often already being an ‘incumbent’ themselves. The OTT has driven the data demand on networks and, whilst financial results indicate that the mobile operators have struggled to keep up with this demand, the OTT is now part and parcel of the wireless industry package. Having seen how the presence of the OTT, with their global reach over the mobile internet, challenges existing business models, some vertical players may be looking to defensive approaches that can resist change. To take a defensive stance is unlikely to keep the competition at bay and will certainly not create a competitive advantage. A number of panels observed that their challenges are more cultural or regulatory — rather than technological. However such a perspective overlooks significant opportunities for vertical markets to partition technologies into manageable platforms, where the pace of change in each area can be better understood.

Aside from these challenges, there were also encouraging signs of progress within a number of the vertical sectors themselves.

In the health sector, after many years of failed large IT projects implemented from the top down, there is a growing trend of putting wireless devices in the hands of frontline doctors and nurses. This is having a transformational effect on technology in healthcare from the bottom up.

Smart city technology trials have been ongoing for a number of years. The smart city panel explored the tipping points at which scale up to common platforms may occur. The recently started Innovate-UK funded work in Manchester and the news that Singapore is establishing collaborations with countries like the UK, start to show promising signs of the possibility of common platforms emerging.

The fintech session also served as a good illustration of how the large incumbent banks are establishing incubators to increase awareness of innovation and determine how these developments could be adopted in their mainstream business.

Overall it was interesting to see that there seems to be broad recognition — both within the wireless industry and the verticals themselves — that new business models are required in a number of vertical sectors if significant new revenue growth is to be realised. What will be interesting is to see how that plays out, whether it will be directed by ‘top-down’ or ‘bottom-up’ approaches, or if large incumbents and smaller disruptors will ‘join forces’ in certain sectors to nurture these new approaches.

There’s a lot of work to do to get acceptable connectivity on trains…

Cmglee_London_Kings_Cross_platform_6Everyone on trains has, at one point, suffered from poor connectivity on their phone, tablet or laptop when working while commuting, trying to access social media or catching up on the day’s news.

Poor on-board connectivity has become a fact of life at the moment, and consumers are becoming increasingly agitated at their inability to receive the same quality of connectivity on trains as they do at home. Nor is this frustration without justification; if the population could receive reliable connectivity onboard trains, it would likely create value for not only passengers and train operators, but the wider economy as well.

It’s therefore no surprise that the government has been vocal on this topic, calling for consumers to be able to receive a similar level of mobile voice and data access on trains as they do in urban areas — irrespective of service provider. The government has attached a specific target to this demand — Wi-Fi on 90% of journeys by 2018 — but, when you consider that just 62% of British rail routes currently have mobile coverage let alone Wi-Fi, you can see there’s still a long way to go.

What many consumers are unaware of when they complain is the sheer expense and complexity of providing reliable connectivity on trains, something we’ve blogged about before on this site.

What’s the industry doing about it?

I recently chaired the inaugural Gigabit Train event at techUK to discuss the technical and commercial challenges of providing wireless connectivity to trains by 2020. At the event were a number of rail wireless providers, including Nomad Digital and Fluidmesh; a satellite provider, Hispasat; the Department of Transport; and Ofcom.

I wrote an article for techUK on my first set of impressions from the workshop: that the technology required for wireless on the railways is starting to get better. However, I wanted to take the opportunity to follow up by considering another issue highlighted in the discussions; the amount of investment necessary to get mobile connectivity to an acceptable standard.

The crux of this problem is that the industry still needs to establish a business case for on-board connectivity. Without one, there is no commercial incentive for train companies to improve standards beyond their current level, especially when many train companies see Wi-Fi as a drain on resources.

A few years ago Real Wireless examined how such a business case could be constructed, for the RSSB. Our report found that, done correctly and efficiently, there’s actually a very clear opportunity to build such a business case — though it must look beyond Wi-Fi to mobile connectivity as a whole. The business case would need to encompass how to:

  • Get advertisers on board and set expectations for ad revenue based on the length of passenger journeys
  • Extend the benefits of connectivity to train companies themselves — as well as their customers — so they can make day-to-day train operations more efficient
  • Introduce new services and applications with a potential ‘killer’ app to improve the passenger experience — because relying on big data isn’t sufficient

With enough of a common view of the viable value propositions of these components the industry can tackle the next significant hurdle: achieving economies of scale by getting stakeholders to agree on a scalable solution and revenue model — something that will prove particularly difficult in the UK’s franchised rail network.

How to make progress? There is no doubt that the rail companies are a significant stakeholder; as part of their digital strategy they should drive the initiative and lead on establishing value chains that point to a sustainable business case. But the mobile operators also have an important role to play, establishing backhaul that is capable of supporting this solution.

The future of wireless and the case for exploring verticals in 5G

CdGpWwtW4AAQjhTAs we outlined last month in our guide to the challenges facing 5G and IoT, the connected devices of the future offer real potential to make existing businesses, services and utilities more efficient and more effective — better tailoring the service they provide.

In the wireless industry, the reality is that there is limited appetite to pursue the new generation of wireless technology (5G) for the industry’s own sake. Despite rapid takeup of LTE (4G) cellular technology, shrinking profit margins are affecting infrastructure spending, leaving finances that may not look attractive to investors and cause difficulties for a further round of investment so soon after completing the last round of upgrades.

The real business case for 5G, therefore, needs to come from the vertical industries that will benefit from the technology.

The rationale behind this was recently vindicated by the results of the European Commission 5G socioeconomic project Real Wireless contributed to, announced in Brussels on the 9th March 2016 (which we explored in more detail in a separate blog post). Our work found that, for an approximate deployment cost of €56 billlion, 5G can be expected to generate benefits of €95.9 billion across automotive, healthcare, transport and utilities alone — per annum.

However further quantitive evidence is required for a vertical-orientated business case to be established, and it falls to the wireless industry to lead the way in kick starting this process.

Any eventual solution will need to account for not only what dynamics are at play in the verticals, but also expert input from the leaders in these vertical industries on how they will evolve in the coming decades. It’s therefore crucial that the other verticals that could benefit from 5G are stakeholders in the development of this technology, to ensure they can fully benefit.

As chair of the executive committee for Cambridge Wireless’s Future of Wireless International Conference, I believe this year’s conference will provide an important opportunity for the industry to come together and explore how wireless can impact these verticals. Not just the cost savings each vertical can enjoy, but the challenges 5G will need to overcome, the opportunities that exist and — crucially — the common themes that span across these vertical industries enabling platforms of scale.

The Future of Wireless International Conference 2016 will be held at The IET, Savoy Place, London on 21–22 June. More information and registration details can be found here: http://www.cambridgewireless.co.uk/futureofwireless/