5G has plenty of market potential, but cellcos have to get their heads around the complexity of evolution and the fact that they really have to embrace software over hardware for 5G to pay off.
That was the message from I Chih-Lin, chief scientist of wireless technologies at China Mobile Research Institute (CMRI), who kicked off the keynote sessions at PTC 2017 on Monday.
I Chih-Lin said that she saw plenty of opportunities for 5G apps, particularly driverless cars, which are “the highest value and the greatest revolutionary opportunity”, as well as smart homes, robots, virtual reality, augmented reality, industrial control systems, and agriculture apps.
“There will also be a number of black swans that we cannot predict, so our imagination has to be unlimited,” she cautioned.
She also contrasted the health of telcos with that of OTTs – with the former generally being not at all well.
“The OTT numbers are much more attractive,” she said. “When you look at their profit as a percentage of revenue, in some cases it’s over 50%.”
This is because they have the advantage of having an agile, software-based infrastructure, she continued. “Telco systems take years to upgrade – an OTT can roll out a service in the morning and release Version 2.0 by that afternoon. That’s the power of being software.”
She emphasized the importance of shifting from hardware to software as part of her recommended “green and soft” strategy for 5G, adding that operators tend to be more enthusiastic about the former than the latter.
“The green part is obvious because it means more efficient energy usage, and better efficiency is always good in the telco world,” she said. “But ‘soft’ is still something that a lot of operators resist, so I have to tell the OTT story over and over again.”
I Chih-Lin also discussed the complexity of 5G evolution that is markedly different from previous Gs. “We’ve gone through four generations of essentially turbocharging a horizontal platform. With 5G we’re not just doing that – we’re also simultaneously building embedded vertical virtual platforms. This also means we will have way more KPIs to meet than we did with previous generations.”
In essence, just about every aspect of cellular has to be rethought, from fronthaul and protocol stacks to the business models and even compliance with Shannnon’s Law. The good news is that cellcos don’t have to do everything at once.
“You don’t have to meet all of these KPIs to do 5G,” she said. “You can start with three or four initially.”
This article was first published on our sister publication DisruptiveAsia.