Oct 15, 2024

Unlocking 5G’s Innovation-to-Market Bottleneck

Ultra reliable, low-latency communications (URLLC) accounts for the largest number of standard essential patent (SEP) declarations for 5G. This is based on data from GreyB Services, a specialist in intellectual property (IP) for the communications sector.  

However, URLLC’s strong showing of URLLC does not show up in market offerings. Instead, 5G market propositions feature mobile broadband for consumers which map to the enhanced mobile broadband (eMBB) category. The difference suggests a disconnect between supply-side technologies, where innovators have invested, and commercial outcomes that should address demand from gaming and enterprise types of application.

 Explaining the difference is complex. It involves the life-cycle steps of taking innovation through standardization into market ready networking equipment. Then, communications service providers (CSPs) face decisions in balancing the rewards from new propositions against the costs of incremental technology licensing fees and business model changes. Value-chain bottlenecks also arise when insufficient evidence about end-user demand results in corporate hesitancy. 

The Challenges of Looking Beyond Consumer Demand 

 One reason CSPs struggle with enterprise demand stems from their origins in the consumer mass market, based on wide-area networks and offers of relatively undifferentiated and best-efforts connectivity. The supply-to-demand industry model is ineffective in the enterprise sector because CSPs lack sufficient insights into a different type of demand and their required service-delivery models. 

Overcoming this weakness requires a shift in mind-set to one where “demand-pulls-supply.” This will challenge CSPs, especially as the operating environment is itself changing. The industry’s traditional value chain model, moving ‘left-to-right’ from research and innovation to customers is under pressure.


Engineering and business-model innovation are creating niche segmentation opportunities and giving rise to mesh structure. There are many more participants within each segment of the traditional value chain. This is true in research and standardization stages. For example, complements to 3GPP are arising from vertical-specific alliances and industry bodies targeting application frameworks and reusable software. Similar fragmentation is happening in other parts of the value chain. Within this more fragmented and wider stakeholder universe, there are many more pathways for connecting supply to demand. 

Reverse Value-chain: Insights to Enablers 

In addition to gathering more stakeholders, the evolving industry model is also more dynamic. Open-source approaches and software are speeding up the pace of innovation. The environment enables more opportunities for partnering and for nimble participants to carve out specialist channels to market. 

The CSP challenge is to expand a business model conceived for consumers to a variant that can serve enterprise and verticals’ demand. At the same time, CSPs need to mitigate the risk that competing actors will bypass them. Industrial customers that can secure spectrum rights for private networking use cases are one source of competition. Others might be innovative and opportunity-led vendors as well as vertical-sector service provider specialists. 

CSP change might demand greater autonomy in their enterprise focused business units and a re-design of performance metrics, both financial and operational. Think of how to translate enterprise sector performance indicators into CSP propositions. For example, production-line uptime in a factory, or customer wait times in a fast-food restaurant do not depend solely on connectivity (possibly multi-access). They also require service providers to commit to a wider set of capabilities. Among others, these include service guarantees, financial incentives, and remote intervention capabilities to eliminate downtime of connected devices that lack human-in-the-loop diagnostic and cannot be re-started without interrupting factory production. These requirements go beyond network access and connectivity offerings. More than ever, CSP ‘marketing’ needs to learn from users and feed insights back along the value mesh (moving in a reverse direction from right-to-left) to elicit commercially appealing propositions. 

In MARCOMs parlance, instead of COMmunicating capabilities and propositions to users (left-to-right value chain thinking), the industry can benefit from better MARket research to reverse the flow and innovation potential of market intelligence.

4 comments:

  1. 15 October 2024 update

    Evolving network architectures in the 5G era

    Contrary to much industry commentary, the transition to a version of 5G in which the native service-oriented architecture of the core is readily available remains at a very early stage.

    This emphasis on service-oriented architecture clearly signals an acceptance by standards bodies of the need for a logical representation of repeatable business activity in the form of a growing range of enterprise use cases. But MNO appetite to build-out from such standards seems limited. And this reluctance is easily understood. Broadly speaking, the most significant challenges are, as ever, an absence of devices, a rich legacy of high-quality LTE RAN and core infrastructure and the determination to preserve investments which, in most instances, are likely to prove fit-for-purpose for many years to come.

    The big question is, perhaps, fit for what purpose?

    All this might add up to a significant moment – the inflection point at which the dominance of MNO deployed architectures for mobile wireless is seriously threatened for the first time.

    There are certainly no shortage of new players emerging with different architecture choices and a range of business models and service menus. Players like Cisco, offering white-box, private 5G solutions, Rakuten’s Open RAN advocacy and Amazon’s private network offer are all variations of software-enabled as-a-service models. After what seems like a decade of false dawns, it feels like software-isation is finally starting to take hold, although not quite as many anticipated.

    https://real-wireless.com/evolving-network-architectures-in-the-5g-era/

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  2. 17 October 2024 update


    - Nokia has reported its third-quarter financial results
    - The vendor had anticipated an uptick in spending in some parts of its business
    - But the market is “turning slowly”
    - Like its rival Ericsson, Nokia’s growth prospects mainly lie outside the telco sector
    - “Datacentres will be our number-one growth target for the coming years,” stated CEO Pekka Lundmark during Nokia’s earnings conference call

    Lundmark, though, is pumped about growth opportunities with enterprise customers, with private wireless networks (where Nokia already has nearly 800 customers), in the defence sector, and in the datacentre market, where there is not only business to be had from helping to build the high-capacity data network routes that connect the growing number of datacentres around the world but also from providing the optical technology that will increasingly be deployed inside datacentres to interconnect servers. That latter part of the equation – providing optical as well as IP routing technology for the ‘datacentre fabric’ – is a new focus for Nokia, but the vendor values that potential market at about €20bn, so there are some significant growth prospects in that part of the datacentre infrastructure market – and those prospects have been one of the main drivers behind Nokia’s planned $2.3bn acquisition of optical networking rival Infinera, a deal that was announced in June.

    https://www.telecomtv.com/content/access-evolution/nokia-suffers-as-capex-rebound-fails-to-materialise-in-q3-51548/

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  3. 18 October 2024 update

    Technology Counter-Offensive! Fight Back Against Disruption

    Firms threatened by disruption need to consider both demand elasticity (the likelihood that customers, or large niches, will stick with the existing technology), as well as technical and competitive elasticity (the potential for improvement of the existing technology and the challenges of commercialising the new technology).

    Put simply, companies should consider how attached their customers are to their product, and whether they can significantly improve it to keep up with the competition. By considering these factors, firms can choose the most effective counter-offensive strategy.

    https://knowledge.insead.edu/strategy/technology-counter-offensive-fight-back-against-disruption

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  4. 24 October 2024 update

    Boldyn intros four-tier private 5G managed service model

    Boldyn Networks has introduced a new four-tiered private 5G service to offer enterprises differentiated performance and reliability at different subscription price points. The firm is offering monthly private 5G subscriptions to enterprises to cover equipment, deployment, and management of the service. The tiers are named and staggered as: innovation, digitalisation, automation, and mission-critical.

    These go from simple subscriptions just to get hold of the technology for tests and trials, to fully-fledged systems to achieve “maximum control over mission-critical objectives”, it said – for enterprises of all stripes, from “small hospitals needing reliable diagnostic controls to ports with complex automation needs”, it added. “Services include network operations, monitoring, maintenance, annual health checks, and spare parts management,” it said in a statement.

    The service does away with the “burden of significant investment or maintenance”, it added. The Port of Kemi, in Finland, is among the first European organisations to utilise the service, apparently – which also identifies the firm as an early proponent of private 5G in the ports sector. It is unclear which subscription it has taken. Boldyn Networks claims 60 private 4G/5G deployments around the world.

    It said it is investing €300 million to “support the broader adoption of private networks worldwide”. The money will go to help fund enterprise customers private 5G trials and deployments, it said. An Omdia survey says “high deployment cost is the leading challenge to private network deployment”. It stated: “Outsourcing private 5G as a service allows teams to mitigate large initial costs and focus on core business activities instead of network management.”

    “We’ve seen a significant demand for services that align technology with customers’ specific use case needs. With many customers already opting for monthly payment instalments, we have identified a growing demand for an as-a-service solution that matches technology with their needs, rather than just pushing 5G to enterprises. We are committed to making private networks more accessible by funding digital transformation enterprise projects.”

    Markku Rautio,chief executive at the Port of Kemi, said: “Boldyn’s solutions have enabled us to address real-time vessel and cargo management challenges, particularly those posed by extreme weather conditions. This has significantly optimised the movements and wait times of vessels coming into the port. By opting for a service-based subscription, we have seamlessly integrated this technology.”



    https://www.rcrwireless.com/20241024/private-5g/boldyn-intros-four-tier-private-5g-managed-service-model

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