Raf Meersman offers three routes to 5G that could ensure less capital and operational expenditure for operators, for all of which, convergence is key
5G is here. Or, rather, it should be here. Any telecom operator or broadband provider who wants to stick around for the coming decades is going to have to – or at least plan to – deploy this next generation wireless network and its indispensable fibre network backhaul.
This investment is nothing less than an absolute necessity. Data traffic has already, and will continue to, explode in the coming years, caused by data-devouring applications such as TV streaming and online gaming. This evolution tests the limits of any data network infrastructure. FTTH (fibre-to-the-home) and 5G are the only futureproof technologies capable of coping with this data tsunami.
Everyone claims to be a 5G expert nowadays. Just Google ‘5G’ and you will get more than 713 million hits. I challenge you to find actual large-scale 5G projects. Spoiler alert! Apart from investments in South-East Asia and some small-scale projects in airports and urban areas in the West, the results are less than thrilling. And no, we do not consider ‘4.5G’-type networks a realistic alternative.
Don’t look too far to find the answer, as it will inevitably lead you to the same conclusion.
Large investment
A 5G network has more speed, lower latency, and can be used in a much broader spectrum than its predecessor. However, these benefits come at a great cost for the provider. 5G is dependent on a dense cell site network and these cell sites need to be fed by a fibre optic backhaul. This requires extensive civil work, additional equipment, and upkeep of maintenance. This investment will cost billions of dollars.
Unsurprisingly, many telecom providers are reluctant to roll-out this brand-new infrastructure, as they are in an extremely unfavourable position. On the one hand, huge commitments of both time and money are needed in order to upgrade or replace existing copper or 4G networks. On the other hand, revenue streams are flatlining since customers are not willing to pay extra for this state-of-the-art network. The true winners of these investments are companies like Google, Facebook, and Netflix, which, backed by higher speeds and lower latency, can extend their services.
The telecom industry needs to find a solution to this unsustainable situation. I see three strategic roads that can lead to significantly lower capital and operational expenditure, while still offering optimal service. The magic word is convergence.
1) Plan a complete network
Data traffic will grow exponentially in the coming decades, with 5G being its key carrier. So, operators must think aheadand anticipate when they plan their fibre network. Deploying a converged FTTH/5G network minimises expenses in the long run as both of these networks share a significant percentage of the same infrastructure.
2) Set your differences aside, build one network
Telecom providers are in a rat race to get to the customer first; all deploying their own infrastructure. But does this ‘traditional’ model of single physical network ownership still make sense today? The answer is no. Deploying a shared network will cut costs and open up the budget to increase the network’s capacity.
3) Build a bridge to other utilities
Today, internet access is a basic utility. We rely on internet access as much as we do on electricity. Consequently, electricity companies are obvious allies as they already have an extensive infrastructure in place. Join together to build or upgrade your network to a fibre-5G-electricity network.
This win-win situation is obvious. Electricity providers and telephone companies share the investment burden and the telephone companies can use the existing infrastructure to get to places that perhaps otherwise would not be profitable for them to go.
If the telecom industry can turn these three strategies into a reality, operators and providers will face a much more positive future, with a network that will last for decades.
Raf Meersman is CEO at Comsof
