The hype around 5G is all about network speeds. But communications service providers know that a different kind of speed is even more important: speed of innovation. 5G will help service providers get new products out faster for both consumer and enterprise customers.
Service providers won’t be able to get the full revenue benefits of innovation, however, without charging systems—the software that handles how much to charge customers for service—that can keep up with 5G speeds. Additionally, service providers need customer experience software that matches 5G agility.
The communications industry is fundamental to how we live, work, and play in an increasingly digital world. That trend has been building for decades, and it came to a head during the COVID-19 pandemic, when millions of us have come to depend on apps for food, packaged goods, entertainment, and work—and still expect nearly immediate gratification.
Those changes to consumer behavior will be permanent. More than three-quarters of consumers plan to stick with pandemic business habits after the crisis ends, according to an August 2020 study by Accenture. These include in-app ordering (84 percent say they plan to make that habit permanent), home delivery (82 percent), shopping via social media platforms (80 percent), and more.
To meet those needs, service providers will become even more important as 5G matures. Low latency and network slicing will allow new generations of services to be spun up on the fly, with close collaboration between service providers and businesses across industries.
Today, there isn’t much coordination between service providers and app providers. Consumers get their phones from service providers and apps from the phone’s app store. The application provider owns the relationship with the consumer, relegating the service provider to the position of delivering the “dumb pipes” of commoditized network services.
Those relationships will change as 5G matures. Service providers and business partners, including businesses in the app economy, will need to collaborate closely to deliver customer satisfaction. And they’ll need to collect and split revenue from customers, which is where a new generation of charging systems for service providers comes in.
Consider the innovation possibilities
Imagine it’s a beautiful fall day, and I’m at football game. As I roll into the stadium, I get a phone alert offering faster, premium service for the game. I sign up on the spot by tapping an app.
Later, a star player comes on the field, and I get a text message offering to show a video clip of that player’s game-winning goal from the previous night—part of the premium service I ordered.
Two weeks later, I’m back at the stadium. My service provider knows I have season tickets, so it offers me an unlimited data upgrade for the whole season, good inside the stadium.
Can’t make it to the game one night? I get an exclusive video recap as part of my service.
That kind of service requires complex business relationships behind the scenes. The service provider collects payment from me and splits that revenue with the team. Both the service provider and team require metrics—how many people saw the offer, how many clicked on it, how many watched the video. All of that data goes to fine-tuning the service to make it more appealing and profitable.
That football stadium example was hypothetical, but not far from reality. In February 2021, Verizon announced that it invested more than $80 million and expanded permanent 5G deployments in Tampa, Florida and at Raymond James Stadium—site of Super Bowl LV—to deliver immersive and interactive mobile viewing experiences for fans in the stadium and at home.
Another example: Gaming is largely delivered on phones today and therefore highly fertile for 5G innovation. Some 90 percent of gamers play on smartphones, and 40 percent play only on smartphones, according to research by the GSMA mobile operator organization. The market is enormous, with 2 billion gamers worldwide.
5G will enable cloud gaming companies to deliver on the high bandwidth and low latency demanded by the most skillful players and complex games. A game developer could partner with service providers to offer premium network service to accompany the latest hot title for improved gameplay or just to download the game in one burst.
Improved network connections can bring the latency down to make responsiveness closer to real time for online gaming and cross talk. Virtual reality gaming will require even more bandwidth and faster response times, providing yet another opportunity for gaming companies to partner with service providers.
Immersive reality offers enormous potential for 5G innovation. Sports arenas and concert venues will be able to deliver virtual reality, augmented reality, and other immersive experiences that give the audience watching on screens something closer to a live experience. And folks lucky enough to attend in person—when we all go back to doing that—will be able to receive high-speed networking and video highlights.
The consumer experience is just the beginning. The Internet of Things will enable new generations of smart factories, smart cities, and more. In fact, only 25 percent of service providers anticipate consumer business models to be the biggest revenue drivers for 5G. Instead, service providers expect most of their revenue from cities, governments, enterprise, and other business services, according to a survey by analysts at Omdia.
The new generation of 5G services will require service providers to partner closely with broadcasters, gaming companies, sports leagues, music businesses, enterprise systems integrators, software providers, and more. Today’s competitors will be partners in the next deal.
Monetization has to get easier
Monetization provides a potential bottleneck. Monetizing services is already a challenge for many service providers with the complexity of existing mobile and fixed offerings, apart from other value-added services, and that problem will become even more difficult as they roll out products that are more flexible, delivered in real time, and in complex partnership with other companies.
Service providers require modern converged charging systems—such as Oracle’s 5G-ready Converged Charging System. To truly reap the benefits of 5G, the charging system needs to be cloud native and optimally integrated with converged policy management to support dynamic 4G and 5G data offerings. The modern charging system needs to support both prepaid and postpaid consumer business models. It should also be part of a holistic approach to digital experience with commerce, billing, and customer experience.
Enterprise use cases will increasingly require the support of unique rating and charging parameters, such as charging based on network slice, device type, location, or number of sensors. Having a real-time and highly scalable charging system is key to supporting these business models.
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