• According to Juniper Research, 5G operators will move to charge against a whole range of “currencies”, including latency, throughput, reliability as well as data consumption.
• And, it says, 5G’s virtualised environment will generate new efficiencies
• Operators may be looking to monetise every dimension, but will users buy it?

Juniper Research has completed a report on 5G, its monetisation and the best way to tap into its capabilities from the service provider perspective.

The research company is bullish on the near term revenue returns. It expects that 5G services will generate $73 billion by the end of this year, a big step up from 2020 which bagged just $20 billion due to networks still being built out and Covid disruption. However, by the end of this year 5G will represent 8.5 % of telco revenues it claims. So given that trajectory, it expects data demand, already on an upward curve on cellular networks, will surge and make the management of the network challenging as users start generating and consuming huge volumes of 5G data by getting their fingers into new applications involving things like mobile gaming and immersive reality.   

In its report ‘5G Monetisation: Business Models, Strategic Recommendations & Market Forecasts 2021-2026’ Juniper recommends that operators should  be thinking ahead to focus on virtualising the core of the network so that they will have tools to analyse and tackle the strain  as demand builds. This data surge, at least initially, won’t be driven primarily by the new corporate and vertical applications that operators have their sights set on either. 

Juniper predicts that a full 80% of 5G data will come from mobile broadband connections - mostly smartphones - and it recommends that operators increase network virtualisation and network orchestration, while funding roll-outs of fibre backhaul infrastructure to handle high data generation, and thus reduce the threat of traffic congestion over 5G mobile broadband services. 

Seeing, as Juniper does, the virtualisation of the core as the key to gaining access to new tools and software, chimes with a point made by Danielle Royston of TelcoDR, in conversation recently with Ray Le Maistre. “For telcos the public cloud is not about outsourcing your infrastructure,” says Danielle, “It’s about  the software and services that you get access to.”  (Watch - “Danielle Royston talks telco cloud, Totogi, tennis (and funding”).

That ‘access’ to software and functions via virtualisation is actually similar territory for telcos when it comes to managing and monetising 5G. In its free whitepaper - How to Monetise Future 5G Services Juniper finds that 5G service revenue is expected to exceed $600 Billion by 2026 - that’s a good thing.  However, the advanced data capabilities of 5G standards will drive adoption in areas such as mobile gaming and immersive reality, which will proliferate as geographical coverage and device support increase over the next 5 years. Operators will therefore have to brace themselves and look to network orchestration tools to enable the real-time management of network performance, says the report. 

Changing charging rules

Juniper expects that 5G will usher in a new charging system, so operators should anticipate new charging rules and prepare for network slicing. That means the BSS layer needs flexibility and agility to support real-time rating, metering and charging for new digital services with new monetisation schemes.  

The range of monetisable (new word?) parameters has grown with 5G - where before charges were made against data volumes or minutes and texts only, 5G may see service qualities of various kinds metred to enable users to interact with cloud native functions and stay within laid down parameters. Juniper now expects new “currencies” like latency, throughput, reliability, mobility, QoS, energy efficiency and many more may be used to articulate value and construct revenue models for the particular use cases. 

Given all this, it seems likely that pricing will get much more complicated before it eventually gets simpler - at least for non-corporate mobile broadband users. Back in the 2G to 4G world mobile ‘deals’ were constructed with numbers of minutes, numbers of texts, amounts of data consumed etc which made it difficult (perhaps on purpose) for users to know where they stood. Recently there’s been a move towards simplicity with all you can eat data deals and a single charge. It’s possible that 5G and beyond will see a similar cycle.  Corporate and business charging, though, is likely to stay complex, mirroring to some extent the multi-dimensional charging models of the cloud and data centre.