1、Telecoms 5G future Creating new revenue streams and services with 5G, edge computing, and AI Research Insights How IBM can help More than ever, communications service providers need to rely on the latest solutions related to 5G, (hybrid) cloud, artificial intelligence, edge computing, platform techn

2、ology and blockchain to enable the digital transformation of the network needed to thrive in todays environment. IBM has an extensive global network of telecom solution labs, research labs and innovation centers to support its industry offerings. With more than 22,000 subject matter experts in the c

3、ommunications industry, we work with more than 200 major communications service providers across the globe. IBM continues to invest significantly in key acquisitions to add expertise and capabilities that enable clients in this industry. Learn how IBM solutions can personalize customer experiences,

4、accelerate network automation, and create new revenue streams. See telecom-media-entertainment 5G will enable new groundbreaking use cases in virtually every industry The congregation of 5G, edge computing, and artificial intelligence (AI) is expected to enable entirely new use cases in vertical ind

5、ustries and accelerate the adoption of Industry 4.0. Consumers see value in 5G and would even switch providers for better video quality Consumers have high expectations for 5G, and many are willing to pay extraeven switch to a different providerfor a better mobile video experience and/or for future

6、immersive media applications. AI at the network edge will lay the foundation for ultra-low latency 5G applications Locating AI close to the edge is crucial for applications where near-real-time feedback and decision-making are a priority for applications. This will enable previously unimagined laten

7、cy-dependent wireless solutions. By Bob Fox, Marisa Viveros, and Rob van den Dam Talking points5G: Creating an opportunity for CSPs to position for growth Today, the telecommunications industry stands on the brink of a pivotal new eraone in which advances in multiple technological areas, specificall

8、y 5G, edge computing, and AI, are congregating to fundamentally change the world. These technologies have the potential to alter how consumers communicate, consume content, work together, and interact with the environment. As well, they are poised to shift the dynamics of industries, both inside and

9、 outside of telecommunications. The focus of this IBM Institute for Business Value (IBV) Research Insights report is two-fold: it is designed to explain how new 5G technology will unlock entirely new groundbreaking applications simply not possible today,. Also, it will detail how communications serv

10、ice providers (CSPs) can use this technology to create value and enhance revenue in both the enterprise and consumer spaces. From a broad perspective, 5G has the potential to empower people, societies, organizations, and enterprises. It is a game-changer, with the capacity to create huge opportuniti

11、es for a wide range of industries. For telecommunications, 5G could open opportunities for much-needed new revenue streams. However, CSPs are proceeding with caution because of the high risks and investments involved in moving toward ubiquitous 5G networks. For example, according to a report on 5G s

12、pending from Greensill, the worlds biggest non-bank provider of working capital solutions, infrastructure upgrades will need global investment in the neighborhood of USD 1 trillion.1 Rolling out 5G requires denser (than 4G) arrays of masts and small cells, an intensive fiber-optic backhaul, and many

13、 other new infrastructure elements. Furthermore, additionalmostly high-priced 5G-spectrum has to be acquired. And these are only the anticipated CSP investments. They dont include, for instance, upgrading Internet of Things (IoT) devices. 1 Additionally, CSPs will need to make these large investment

14、s during a period of relatively flat revenue growth. In 2018, the annual year-over-year revenue growth was 1.4 percentless than half of global GDP growth.2 And after a small pick-up in 2019 and 2020, the growth is expected to slow to around 1 percent by 2025, according to the GSM Association (GSMA).

15、3 Even more, CSPs still have to amortize their 4G core networks. 4G has made a gigantic leap in network capabilities, but substantial investment was required to accomplish this. The first 4G services came online in the early 2010s. Between 2010 and 2018, CSPs spent well over USD 1 trillion globally

16、on upgrading their networks to 4G.4 And many CSPs are still upgrading to cope with growing demand. As a result, most CSPs will not prioritize the core network in the first stages of 5G deployment. Instead, “islands” of 5G New Radio (NR) coverage will be added to the 4G core, mainly to solve the capa

17、city issue. This evolutionary approach will be the natural approach for most CSPs, allowing them to lessen initial investments with the revenue potential remaining small. 5G: Addressing todays pain points of smartphone users There is a general agreement that the greatest potential for CSPs to genera

18、te revenue from 5G is in industry applications, including the IoT. However, that requires building networks in which 5G NR is paired with a 5G core and huge investments. A significant amount of work remains to upgrade technology, standards, support systems, and business models. It could be the middl

19、e of the decade before all of this is sufficiently accomplished. Consequently, early 5G services will focus on addressing current pain points of smartphone users, particularly those related to the explosive growth in mobile video. Mobile video, according to Cisco, will account for 79 percent of tota

20、l mobile data traffic by the end of 2022.5 49% of telecom leaders report that their companies will make large investments in 5G mobile technologies in the next two-to-three years 77% of 5G early adopting consumers would opt for 5G when available if it resulted in a superior mobile video quality expe

21、rience 94% of telecom executives expect edge computing implementations to improve operational responsiveness in the next five years 2 The rise in the number of mobile devices used to watch streamed content has contributed to a rapid increase in video viewing time. And the amount of embedded video in

22、 social media and the evolution toward higher resolution are further increasing pressure on current networks, resulting in degraded video experiences. The previous mobile network transition from 3G to 4G offered significant improvements in video viewing, but it has not kept pace with the rapacious c

23、onsumer appetite for high- resolution video content. Executing early commercial launches 5G is set to have the fastest global roll-out of any generation of mobile network technology. The number of 5G subscriptions is growing more quickly than expected. In 2018, Ericsson forecast 1.5 billion 5G subsc

24、riptions globally by the end of 2024, but rapid early momentum and consumer enthusiasm has led the company to adjust this figure in 2019 to 1.9 billion.6 By 2024, 5G coverage is projected to reach 45 percent of the worlds population, while 5G networks are forecast to carry 35 percent of the global m

25、obile traffic.7 The GSMA has a somewhat more conservative forecast, estimating 1.57 billion connections by 2025.8 Although it will take some time to hit critical mass, the race to 5G is clearly on. CSPs in several markets have gradually switched on 5G. Timing largely depends upon the availability of

26、 5G-compatible smartphones and 5G spectrum allocation, with each country having a schedule for either reserving, auctioning, or making formal plans for 5G spectrum. South Korea started its first 5G commercial networks on April 4, 2019, and surpassed the three million subscriber mark five months late

27、r. 5G coverage now reaches almost all of the countrys population.9 Data use has surged on South Koreas 5G networks as a result of ultra-high definition (UHD) 5G live broadcasting and entertainment applications such as augmented reality/ virtual reality (AR/VR) gaming.10 In spring 2019, Verizon, AT n

28、=70. 59% 53% 49% 44% 40% 29% 27% Many CSPs are already evaluating edge computing on 5G networks. For example, AT data is processed by computers on the robots. In the new situation, an onsite MEC device at the foundry allows computers to be removed from the robots and to process data on the customers

29、 prem- ises. The trial aims to prove the benefits of 5G and MEC for robotics and other applications that require high speeds and low latencies. Processing data locally also gives Badger more control over what data travels outside of its stores and what data stays onsite to address privacy and securi

30、ty concerns. Empowering enterprises and industries with 5G For CSPs, the real prize is in addressing enterprise needs. The most advanced 5G use casesand those that offer the greatest revenue growth opportunities for CSPsare found in the enterprise and industrial markets. 5G holds the potential to be

31、come the foundation for many new industrial applications and to support entirely new use cases not possible with current networks. Embarking upon new technology; uncertainty remains 5G is expected to reinvent entire industries. However, this “revolutionary” aspect of 5G remains beyond the near- term

32、 horizon. Though the technology strategy is fairly mature, it will still take years to migrate to a 5G environment that makes such a transformation possible. It depends on having a cloud-native 5G core network, leveraging extensive network virtualization, and implementing AI-based automation.30 Most

33、 operators are still in the early phases of developing this envisioned ubiquitous 5G network infrastructure. A significant amount of work remains in standards, regulations, and, in particular, operational and business support systems. Uncertainty about business cases and the expected return on inves

34、tment is also delaying full-scale 5G deployment. Confidence in the technology is high, but the uncertainties around the strength of the business cases and the underlying economics make many operators hesitant to go full speed ahead with 5G investments. CSPs are also dealing with risks such as increa

35、sed competition, fast arrival of new technologies, changing regulations, and access to finance. 8 The results of our 2019 Global IBM Global C-suite Study, in which interviews were conducted with 730 telecom CxOs, revealed that only 15 percent of CSPs worldwide have made large investments in 5G techn

36、ologies in the past two-to-three years.31 However, CSPs increasingly realize that these investments are important to secure their future in industry verticals. Forty-nine percent of telecom leaders in the survey (those excelling in revenue growth, profitability, and innovation) say they plan to make

37、 large investments in the next two-to-three years (see Figure 3). Delivering the promise of network slicing With a full-fledged 5G network available, CSPs can deliver services to specific verticals through network slicing, which provides the ability to deploy any number of virtual end-to-end network

38、s on a single physical infrastructure, with each virtual network representing one slice. CSP leaders Other CSPs Source: 2019 IBM Global C-suite Study; n=730. Non to minimal Some Large Figure 3 Level of investment in 5G mobile technologies in the next 2-3 years 26%40%25%27%49%32% It enables telecom o

39、perators to reserve a slice for a specific customer or application at a guaranteed quality of service.32 Network slicing allows operators to dynamically balance disparate requirementssuch as availability/ reliability, throughput, and latencyamong different applications, such as those for remote heal

40、thcare and autonomous connected cars (see Figure 4). Enterprise and industrial applications will especially benefit from 5G network slicing in combination with edge computing. Edge computing distributes storage, compute, and intelligence to multiple levels of the network, including to the extreme ed

41、ge for very low-latency use cases. Thus, it delivers certain types of applications or services in dedicated slices closer to devices and end users. In addition to enabling ultra-low latency, it also helps enhance security and supports backhaul cost savings. Optimized for high bandwidth Optimized for

42、 low latency Optimized for energy efficiency Optimized for reliability, density IoT devices, mobility and more Figure 4 Network slicing Common physical infrastructure Source: IBM Institute for Business Value. Smart home slice Connected car slice Remote healthcare slice Other slices With a full-fledg

43、ed 5G network available, CSPs can deliver services to specific verticals through network slicing. 9 Vodafone: Electric car factory boots production with 5G-fueled robots33 Automotive manufacturing production, enabled by 5G, network slicing, and edge computing, is now a reality for German electric mi

44、crocar company e.GO Mobile AG at its Aachen complex. The solution helps deliver security-rich, near-real-time data networking across the production chain, from digital material management to autonomous vehicle control. The optimized on-site network spans 36 antennas in the 8,500 square-meter facilit

45、y, delivering gigabit bandwidth and latency of just a few milliseconds. The security-rich automatic identification and delivery of production materials to each specific vehicle as it goes through the assembly process increases oper- ational speed and efficiency across the chain. This replaces the tr

46、aditional production line that moves vehicles from station to station. In the future, autonomous forklift trucks and small trains will also be used to transport material between warehouses and the production line. The assembly plant is an Industry 4.0 factory, fully networked in information technolo

47、gy. Connectivity links the phys- ical and the digital worlds. Deploying network slicing and edge computing in a 5G core network environment creates the possibility for previously unimagined latency-dependent wireless solutions, including those for connected autonomous vehicles and smart factories, a

48、mong others. The concept of 5G with network slicing and edge computing is being evaluated by a number of CSPsby Vodafone, for instancefor the German electric microcar company e.GO Mobile AG at its Aachen complex (see sidebar: “Vodafone: electric car factory boots production with 5G-fuelled robots”).

49、 Assessing 5G-potential for IoT and industry verticals 5G enterprise and industrial use cases are specifically centering on IoT. In fact, 5G has been designed with IoT use cases, which are extremely diverse, in mind. For instance, in the consumer IoT space, use cases range from connected homes and cars to personal electronics, such as wearables. In our 2019 Global Telecommunications Consumer Survey (which will be explored in detail in the second part of this report), 30 percent of consumers stated they are excited about 5G smart home