May/June 19 - ChannelVision Magazine

Mobile & Wireless “The reasoning behind this could be either that 5G is viewed as so important that it just has to move for- ward or that the ‘working’ commercial teams – those below the CEO level – haven’t pushed for it yet,” said McK- insey researchers. While often dubbed as the even- tual enabler of smart homes and smart cities and roads filled au- tonomous vehicles, among other advancements, McKinsey surveys suggest network operators currently see 5G primarily as an opportunity to cement, gain or regain network leadership, cited as the number one reason for 5G rollout by 48 percent of respondents. In other words, a key driver could simply be the fear of fall- ing behind. The next highest priority in the near term was customer expe- rience, while IoT and new fixed wire- less access was selected as a top two reason by just 22 percent. Equally surprising, said McKinsey researchers, is that operators also currently envision a relatively limited investment in operational support sys- tems (OSS) and business support sys- tems (BSS), “the very systems needed to be able to market, price, sell, provi- sion and operate the new uses cases so many of them have been talking about,” McKinsey analysts continued. A separate survey by 451 Research of 105 global telecom operator tech decision-makers with knowledge and visibility into 5G deployments likewise showed confidence in deployment timelines. A full 98 percent expected to have their first 5G services available by 2021, while 61 percent planned to have 5G access in at least half of their coverage areas sometime between 2023 and 2025. North American opera- tors, in particular, expected to have the highest percentage of early deploy- ments, with 47 percent of North Ameri- can respondents saying they will have total 5G coverage by 2025 to 2027. Once 2021 arrives, a full 96 percent of respondents expect to deliver “exist- ing data services” over 5G infrastruc- tures. That’s probably not surprising. What might be, however, is that only 39 percent expect to deliver new consumer services by that timeframe. Equally disconcerting is that only 18 percent of respondents said they expect to offer new enterprise services by 2021. “Our suspicion is that operators are not yet spending enough time ideating new service offerings they can own and deliver and may believe others will capture that value on top of their connectivity,” said 451 analysts, “or they want to get the basics right before extending into new services and value chains.” Overall, McKinsey argues that its survey paints a picture of 5G as a pow- erful new technology just waiting to be tapped for innovative new uses cases. “However, until those cases emerge, most operators will tread cautiously, leveraging 5G for near-term objectives and waiting for a clearer view on the use cases’ economics to accelerate,” said the research firm. Yet given the expense required to prove those significant use cases, “it could be an uncomfortably long wait,” they continued. The business case is made even more complex by concerns among Top 3 reasons for 5G rollout, % of respondents Data Ne Source: Avan E Source: McKinsey & Company % OF SE Source: Ava Top 1 reason Top 2 reason Top 3 reason 76 15 48 13 54 24 13 17 46 13 30 46 9 13 24 33 9 13 11 33 11 22 11 9 2 Network leadership Customer experience Capacity expansion Internet of Things Fixed wireless access New digital adjacencies Other 3 Current status of 5G strategy development, % of respondents Source: McKinsey & Company Complete and approved strategy First-draft strategy No strategy/ early thoughts 22 57 22 24 54 22 37 39 30 26 43 39 17 43 5G pilot strategy Technology strategy Business case Operations and maintenance strategy Commercial strategy 24 Connectivity challenges for 5G Upgrading access and aggregation layer network resilience to enable 5G for more critical commercial services Adding backhaul bandwidth or new links to 5G base stations Performing network security tests for compliance and risk mitigation Adding fronthaul capacity to 5G radio towers 64% 52% 52% 50% Dat 61% Data w/o Data Conn SERVICE UCaaS/CC Voice SD-WAN Office Prod Colocation SaaS laaS SECaaS Managed l 5G* Top 3 reasons for 5G rollout, % of r spondents Data Ne Source: Avan Source: McKinsey & Company % OF SE Source: Ava Top 1 reason Top 2 reason Top 3 reason 76 15 48 13 54 24 13 17 46 13 30 46 9 13 24 33 9 13 11 33 11 22 11 9 2 Network leadership Customer experience Capacity expansion Internet of Things Fixed wireless access New digital adjacencies Other 3 Current status of 5G strategy development, % of respondents Source: McKinsey & Company Compl te and approved strategy First-draft strategy No strategy/ early thoughts 22 57 22 24 54 22 37 39 30 26 43 39 17 43 5G pilot strategy Technology strategy Business case Operations and maintenance strategy Commercial strategy 24 Dat 61% Data w/o Data Conn RVICE UCaaS/CC V ice SD-WAN Office Prod Colocation SaaS laaS SECaaS Managed l 5G* 12 Channel Vision | May - June, 2019