Ways that Telecommunications Companies Can Benefit from 5G

Over the next few years, 5G is positioned to become the standard for mobile communications technology, ushering in a new era of connectivity, speed, and possibility. 5G is poised to connect businesses, people, and processes at enormous scale. Mobile networks will be up to 100 times faster and have 1,000 times the capacity than what we experience today. Businesses and consumers may finally have it all: high capacity, ultra-reliability, low latency, reduced energy usage, and massive connectivity.

5G is a fifth-generation mobile technology that defines the workings of cellular networks such as radio signals, frequencies, and data exchange. Compared to its predecessor, it is estimated that the fifth-generation network allows 1,000 times more data transmission compared to 4G.

The benefits of 5G include:

1) Higher Transmission Speeds – 5G has lower latency and higher bandwidth, enabling higher transmission speeds of up to 15-20 GB per second. Lower latency makes it possible to make the reaction and execution time of orders or transactions 10 times shorter than the current one. In simple terms: everything becomes faster.

2) Enabler for AI, IoT, VR, AR, Cloud Computing and more – Technologies ranging from artificial intelligence (AI) to Virtual Reality (VR) and Augmented Reality (AR) will be fully developed through the realization of 5G. This is because these technologies require much higher processing powers for the constant streaming of massive volumes of data. 5G networks will lead to advances to Internet of Things (IoT) and cloud computing as well.

Over the next four years, telecommunications companies are expected to invest heavily — up to US$57 billion — to build higher network density, add spectrum and upgrade active equipment (source: PwC). There are many ways that telecommunications companies can reap the benefits from 5G’s low latency and higher transmission speeds. Investments in 5G networks provide opportunities for the telecommunications industry to create new services for individuals and companies. Here are some of the use cases:

1) Smart Roads – Telecommunications companies can collaborate with municipalities to implement the Smart Roads project. This is a technological plan that enhances road safety by using special sensors placed on crosswalks to inform passing cars that a pedestrian is approaching. The project also plans to place units on vehicles and bicycles that provide reciprocal information to each via mobile devices (such as a smartwatch) or GPS navigation systems to improve safety and avoid road accidents. All this is made possible due to 5G technology. By reducing latency times to a minimum, information can be immediately exchanged between multiple devices simultaneously.

2) Smart Cars – For the automotive industry to implement smart cars, it needs to collaborate with telecommunications companies. Autonomous driving vehicles need to rely on the 5G network since it is the most efficient technology for transferring large amounts of data quickly, constantly, and in a stable way. Although 4G is fast enough to stream high quality audio and video or play online games, it is not fast enough to process the massive amounts of incoming and outgoing data traffic between vehicles in transit that must communicate with each other in real time. Telecommunications companies that are the first to adopt 5G technology will be the first to provide a network large and powerful enough to process all of this data.

3) Home Automation – 5G in the telecommunications sector is key to expanding home automation. This includes the installation and usage of smart home devices such as refrigerators, blinds, doors, light bulbs, heaters, ovens, and other home appliances that can communicate with each other and mobile devices for control and monitoring. Among all the digital trends of 2022, having a more connected and efficient home is one of the most promising for telecommunications companies. Many countries in Europe have implemented a home automation tax benefit that is available, which provides tax deductions for smart home devices.

4) New Business Models and Revenue Streams – With 5G, telecommunications companies can rewrite “business as usual” and create new revenue streams, namely by serving 5G-reliant service providers in addition to end users. As the above use cases have shown, telecommunications companies can work and collaborate with various industries by providing 5G capability to enable smart devices and connections between applications, systems, and even whole sectors (such as being the connector between fast food industry and the automotive sector, enabling a smart food ordering and drive-through system, where ordering and payment would be handled through sensors in the car and fast food booth, without the use of any mobile devices or apps). By powering enterprises in every industry, telecommunications companies can boost their revenue potential.

Telecommunications should expand high-speed availability, create new products and revenue streams leveraging 5G, and maximise country coverage in order to realize the benefits of 5G.

1) Expand High-Speed Availability – Building the infrastructure for 5G creates a high amount of expense, but the payback will be worth it in the long run. This is especially true for first-runners who get the first dibs in the 5G “pot”.

2) Create New Products, Services, and Revenue Streams Leveraging 5G – By understanding and applying the use cases such as smart roads, smart cars, and smart homes, telecommunications companies can work with various industry players to provide 5G services and help those other industries elevate their games when it comes to the Internet of Things (IoT), VR, AR, AI, and more. The new products and services that are possible from using 5G are endless. With these new products and services, new revenue streams will also come, offsetting the initial heavy investments in 5G infrastructure.

3) Maximize Country Coverage – As demand for 5G grows, carriers can update their core networks and offer more advanced services, which are funded by returns from earlier investments.

5G is the backbone of the future of connectivity, smart devices, and IoT. All of these can be made possible if industries work together collaboratively. The telecommunications industry is at the centre and forefront of this promising transformation, as it can help build the infrastructure and provide 5G services to other industries that will then further innovate their product and service offerings.