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Summary

Although the first 5G launchers this year will sign up very small numbers of users, the first launches will mark the beginning of an important step change for operators. 5G opens the door to significantly more complexity and, for the operators that get their launches right, more opportunities than previous technology generations have enabled. Ovum's latest research on 5G aims to help operators navigate their approaches to 5G's increased complexity, and how they can capitalize on the expanded range of opportunities it makes possible.

5G offers many more opportunities to differentiate than 4G, and operators need to identify the areas they want to compete in

5G not only brings in new kinds of technology, such as network slicing, Cloud-RAN, and virtualization, to name just a few, but also opens the door to very high- and low-frequency spectrum, as well as new types of services, such as massive IoT. What we've seen with 4G is that the operators that are succeeding the most are the ones with the best networks and the most relevant range of "connectivity plus" services, whether that be content bundled with consumer subscriptions, or helping enterprise customers improve the services they offer their customers.

Building on the 4G foundation, 5G will enable operators to pursue an expanded range of "connectivity plus" options on the one hand, while differentiating from rivals on network excellence even more than they can today. Amid this increased complexity, operators will have a lot more questions they need to answer than they do now, including how they want to build and operate their networks, and which markets to compete in. As with 4G, the operators that get these questions right will succeed over those that don't.

Ovum argues that rather than seeing the launch of 5G as a race, operators should take the time to work out how they want to position in the market, what services they want to offer, and how they plan to use 5G network excellence to differentiate in the market. Operators will struggle to be active in all service areas and be market leaders in every one of them, which is why they need to optimize their networks for the specific areas they want to compete in beyond network access, and identify how they can add value beyond pure connectivity wherever they can.

Ovum's latest research on 5G analyzes which network operators will launch first, the steps the early runners are taking to prepare, what "5G services" operators are working on, and what success in 5G will look like based on what we've learned from 4G. Ovum finds that the operators that get 5G right are likely to be the ones that prepare best by identifying how 5G's expanded range of capabilities can help them compete better in new and existing areas, rather than the ones that switch on their network first, especially when there is a limited range of devices available. Operators that launched 3G and 4G first were able to make a big marketing noise and sign up early adopters, but mid- and long-term market share gains come about through network and service excellence, not by being first.

Operators with the highest chance of success with 5G will understand its increased complexity best, and be able to identify how they want to use the technology to position themselves in the markets they want to compete in, and what kind of "connectivity plus" operators they want to be.

Appendix

Further reading

5G: Regional and Global Approaches to a Technology Step Change, GLB007-000092 (July 2018)

5G Service Provider Tracker: 1Q18, GLB007-000055 (April 2018)

"Major US operators are aiming for different 5G goals," GLB007-000070 (May 2018)

Latin America 5G Outlook, GLB007-000046 (March 2018)

Middle East 5G Outlook, TE0015-000435 (April 2017)

Africa 5G Outlook, TE0015-000444 (June 2017)

"5G focus needs to be on proposition, not applications," GLB007-000072 (May 2018)

"Middle East 5G debut comes forward but business case remains hazy," GLB007-000062 (April 2018)

Author

Paul Lambert, Senior Analyst, Europe

paul.lambert@informa.com

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