Cautious But

Optimistic:
Telecoms
Industry
Attitudes
Towards 5G
Sponsored by

ENTER
Telecoms industry
expresses cautious
optimism about 5G
Telecoms.com recently conducted a survey to gauge the industry’s attitude
towards 5G. Enthusiasm from the industry has been very strong. By the
time the survey was closed at the end of April, a total of 420 respondents
had completed the survey and shared their views on a range of 5G related
questions. The key findings and analysis are summarised in this report.

The largest group among the respondents, 22% of the total, were C-suite
executives and VPs. This was followed by engineers and developers (18%),
mid-level management (17%), and sales and marketing professionals (14%).
In terms of the types of companies the respondents represented, 30% of
them were from mobile network operators (MNOs) or mobile virtual network
operators (MVNOs), which was followed by system integrators, value-added
resellers (VARs), and technology consultants (22%).

When it comes to the respondents’ industry experience, the survey has

attracted plenty of telecoms veterans. Nearly a quarter of all respondents
(24%) had been in the telecoms industry for more than 25 years, and an
almost equal proportion (23%) had been in the trade between 20 and 25 years.

Geographically, the largest proportion of respondents are based in Europe

(38%), followed by the group from North America (20%) and Asia Pacific (19%).

Therefore, the demographics of the respondents showed that the large

majority of the respondents have an intimate understanding of the
technologies, a close relationship with the market and customers, an overall
view of the development of 5G, and a rich experience in the telecoms industry.

The views expressed in the survey can be treated with a high degree of confidence
as representing the true attitude of the telecoms industry towards 5G.

Wei Shi
Intelligence Content Manager
wei@telecoms.com
5G Opportunities abound,
but not without challenges
The first half of the survey relates to the
opportunities the industry expects to create with
5G. Having been the single biggest buzz word of
the telecoms industry for many years, 5G is finally
with us. Live networks have been switched on in
Asia Pacific and North America, numerous trials
are being carried out in different parts of the world,
while large amounts of investment have been
made by operators to acquire 5G licences and roll
out networks. The expectations are high, not only
for returns from the consumer market, but also
from serving other industries and businesses. The
respondents were overwhelmingly optimistic with
the values 5G can generate, but there is also some
concern with the tasks in front of the stakeholders.
To start with, three quarters of the survey
respondents were confident that commercial 5G
service will be available in their markets in the next
two years. These included two thirds confident
that this would happen, and 10% coming from
the markets where 5G commercial service has
already gone live. A further 19% believed 5G will be
unveiled in their markets within five years. Fig 1
The survey respondents were cautiously optimistic
about the number of mobile subscribers that will use
5G. Nearly half of them (46%) believed that, in three
years’ time, the total number of mobile customers
using 5G will not go above 25% in their markets.
Another one third of the respondents believed this
ratio to be between 25% and 50%, while a more
optimistic 15% believed more than half of all mobile
users in their markets will be using 5G by 2022.
Telecoms.com Intelligence / 5G Opportunities Survey Report
When being asked which type of services would One factor that might have tipped the mild
likely to generate the highest business returns preference among the respondents for enhanced
for mobile operators, the choices made by the mobile broadband access could be that the
respondents were rather evenly distributed current live 5G networks all focus on offering fast
between the three key use cases. 38% picked internet access. This is chiefly because the current
enhanced mobile broadband access, 31% believed live networks have been built in non-standalone
Ultra-Reliable Low-Latency Communication / mode. For the purists, this is not good enough
Industrial IoT / Industry 4.0 would have the best and does not do the name 5G justice. But for 5G
chance, while 27% chose M2M / Massive IoT. to support the more advanced cases, especially
the ultra-low latency services, we need end-to-
Fig 1 When do you expect 5G end 5G networks. Good news for the industry is
commercial service to launch in that operators in different markets are trialling
your market? low-latency service cases with standalone 5G,
which in due course should improve the industry’s
confidence in values these industrial cases can
bring in addition to fast internet.
Operators in different
markets are trialling low-
latency service cases with
There is already commercial 5G service
in our market.................................................................. 10% standalone 5G, which in
By the end of 2019.................................................. 20%
due course should improve
2020-2021................................................................ 45%
2022-2024................................................................ 19%
the industry’s confidence
I don’t see 5G commercial service being in values these industrial
launched here in the next 5 years................................3%
Not sure........................................................................4%
cases can bring in
addition to fast internet.”
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improve customer engagement and
be ready for the opportunities from
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From monetising content and
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innovative enterprise IoT offers over
5G, Openet’s Digital BSS offers a fast
and agile alternative to the large
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of over-charging and under delivering
has resulted in high failure rates of
large scale transformation projects.
Since its foundation in 1999,
Openet has been at the forefront of
telecoms software development and
innovation. Our success is personified
by the many long-term relationships
it has fostered with the largest,
most progressive, and demanding
operators across the globe.
For more information visit
www.openet.com
When it comes to the expectations of consumer spending on 5G Fig 3b Do you think the benefits of 5G
services, most of the respondents believed ARPU would go up. 40% have been effectively communicated to
of them thought ARPU would marginally increase, by less than consumers?
10%, while a more optimistic group, 31% of all the respondents,
expected ARPU to grow by over 10%. Nearly a quarter did not believe
consumers would pay more for 5G. Fig 2

The fact that the optimism for ARPU growth was measured is also likely
to have come from the respondents’ belief that the industry should
vastly improve the effectiveness of communication of 5G benefits to
consumers as well as to the businesses that it aims to serve.

When asked if the respondents believed the benefits of 5G have been

effectively communicated to consumers, two thirds of them said
“No”. Only a fifth thought the communication has been effective.
Yes............................................................................... 22%
The sentiment was only slightly better regarding the communication of 5G benefits to
Fig 2 What impact do you see 5G have on ARPU No................................................................................ 66%
(average revenue per user)? business customers. Just over a quarter (28%) of the respondents said “Yes”, 56% said
No Sure....................................................................... 13%
“No”. Fig 3a&b
100%

Several factors could have contributed to the concerns expressed by the telecoms
90%
professionals with delivering effective messages on the benefits of 5G. To start with, Fig 3a Do you think the benefits of 5G
80% 5G networks are not yet widely available, therefore the benefits can only be able to be have been effectively communicated to
communicated indirectly. business customers?
70%

While this approach may work in certain B2B context, especially with those businesses
60%
that are more savvy of telecoms technologies, it would be harder for consumers to be
50% convinced without the touch and feel. However, in markets where 5G has been launched
and handsets available (e.g. South Korea) we have seen significant adoption (600,000 5G
40% users have been reported 50 days since launch). In most countries 5G handsets are not
yet available and this will impact confidence levels.
30%

20% Another factor is related to the communication messages. Instead of focusing on the
technologies, telecoms companies, especially when attempting to convey the messages
10% to consumers, should focus on what consumers can do with the new technologies. While
0% explaining the technologies is necessary to the business customers, again more focus
No impact, ARPU will go ARPU will go ARPU will should be on what actual problems 5G can solve for these customers. Yes............................................................................... 28%
users will not up by less up by 10% drop
pay more for than 10% or more No................................................................................ 56%
5G One way of driving up ARPU is to provide more customised offers for customers to improve No Sure....................................................................... 16%
the chance of upselling. However, more does not necessarily mean better.

Telecoms.com Intelligence / 5G Opportunities Survey Report

There are also challenges, not the
least that telecom operators need to
undergo profound transformation
to be digital operators.
Communication of 5G’s benefits,
to both consumers and business
customers, can also be improved.”

Fig 4 What key digital transformations should

operators undertake to capture 5G opportunities?
100%
A recent research published by the UK’s telecom regulator Ofcom also The telecom professionals also have different views on what the
confirmed that consumers can get confused with the large number of leading operational challenge in deploying 5G is. “Commercial and
90%
options on offer, and, instead of choosing more products they would regulatory complexities relating to new services” was selected
80% more likely hold back and go to the simpler choices. A large number of by 32% of the respondents, but both “processes relating to new
the industry professionals answering the survey also shared this view. service types” (25%) and “migration: handling of 4G services in a
70% One third (34%) of them thought there should not be more offers than 5G environment or vice versa” (24%) also captured the attention of
for 4G, while 21% believed the number of offers could double. However, significant numbers of respondents.
60%
there was also a significant minority who thought customers should be
50% offered much more choices than during 4G era. Additionally, many respondents also highlighted deployment cost as
an important challenge. In comparison only 9% saw “existing vendor
40% It is without question that telecom operators need to transform into commitments” as a big challenge, indicating the industry’s strong
digital operators in order to capture the 5G opportunities. But digital confidence in the vendors.
30%
transformation has a multitude of implications and is not a single
20% linear process. In summary, the industry professionals see in 5G big business
opportunities for the telecoms sector, values to be created for
10% The answers to “what key digital transformations should operators consumers, as well as for other industries that 5G can serve.
0% undertake” are well distributed. While 30% of the respondents, the Meanwhile there are also challenges, not the least that telecom
Process Stronger Move to Vertical Other largest group, chose “process automation / move to cloud based operators need to undergo profound transformation to be digital
automation analytics open and knowhow /
platforms” as the leading transformation target, the other three options operators. Communication of 5G’s benefits, to both consumers and
/ move to capabilities real-time partnership
cloud based / AI platforms all gathered more than 20% of votes, and a number of respondents also business customers, can also be improved.
platforms commented that all the four areas are critical. Fig 4

Telecoms.com Intelligence / 5G Opportunities Survey Report

Sponsor’s
Comment...
75% expect to see 5G services in their country before
end of 2021. At the time of writing (May 2019) that’s
just 30 months away. There’s been some billing
system implementations take longer than this. If
operators haven’t started planning to upgrade their
BSS (business support systems) to cater for 5G then
they could be running out of time.

But upgrading BSS to cater for 5G isn’t just adding

a patch or a small upgrade. The question about key
digital transfomations was interesting. It shows
that all options listed (automation /cloud based
platforms, open/ real-time systems, vertical expertise
/ partnerships and analytics / AI) are all critical.

Change can be tough, but the good news is that

innovative vendors are re-inventing their systems to
be built for 5G, while at the same time supporting
existing 3G and 4G networks. In BSS there are
different options for change. – from microservices
based co-development approaches, to adjuncting
legacy kit with digital platforms. Good news is that
change is happening and a rate not seen before in
telecoms. Digital and 5G is driving a new way of
working for operators and vendors alike. It’s about
speed, partnerships, collaboration and openness.
Bit like 5G really.

Martin Morgan
VP Marketing
Openet

Telecoms.com Intelligence / 5G Opportunities Survey Report

5G technologies fast maturing,
with obstacles to be overcome
The second half of the survey is aimed at gauging
the industry’s attitude towards 5G technologies.
While earlier step changes in mobile telecoms
industry, from 2G to 3G then to 4G, were led by
technology renewals, 5G is the first generational
transition where the technologies and the use
cases have been developed in tandem. Industry
players and standardisation bodies have set the
technologies up so that they can serve the leading
use cases with minimum friction. The feedback in
the survey has also confirmed the confidence.
Looking across a range of technologies, the survey
asked the respondents to name those that have
the best prospect to be most broadly implemented
in 5G. Four technology areas have been selected
by large numbers of respondents, including three
of them chosen by over half of the respondents:
virtualisation / NFV / SDN (61%), cloud-based core
(54%), and RAN on New Radio (53%), with edge
computing following closely behind (45%). Fig 5
The fact that virtualisation and SDN, and to a
large extend, cloud-based core, have come on
top should not surprise anyone in the industry.
Although the discussions of virtualisation and
software-defined networks started long before 5G,
to actually implement them would need the 5G
technological properties, in particular the end-to-
end software-based networks. This view is also
reflected in the comments where “network slicing”,
a special implementation of virtualisation, has been
mentioned by many.
Telecoms.com Intelligence / 5G Opportunities Survey Report
About Qorvo:
Qorvo is making 5G deployment a reality and
supporting the growth of mobile data and network
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solutions that simplify design, reduce product
footprint, conserve power, and improve system
performance. Qorvo combines systems-level
On the other hand, RAN on New Radio is new for 5G. Although some countries may have expertise, broad manufacturing scale, and the
the luxury of re-farming the low frequency bands to deploy 5G for the coverage, we all industry’s most comprehensive product and
technology portfolio to help the world’s leading
need to move to New Radio to capture the new possibilities 5G technologies are creating. manufacturers accelerate delivery of LTE Advanced
It is only on the New Radio frequencies, and in most markets going to the millimetre wave Pro, 5G and IoT products.
(mmWave) frequencies, can we realise the full benefits of 5G. However, the industry still needs
Qorvo’s core RF solutions offer unmatched
to overcome a few technological impediments before the new technologies can deliver the
integration and performance at the heart of the
benefits. In the telecom professionals’ mind, the stand-out technological impediment was the connected world. Our product portfolio covers both
lack of consumer devices, voiced by 41% of all respondents, and the message would also be infrastructure and smartphone applications, and
repeated in the subsequent questions of the survey. includes PAs, phase shifters, amplifiers, switches,
integrated modules and other high-performance RF
solutions. Qorvo’s early start in 5G comes from our
legacy of millimeter wave (mmW) R&D and product
Fig 5 What new technologies do you expect to have the best prospect
to be most broadly implemented in 5G? (Please select all that apply) development in defense and aerospace markets. We
are also a leading supplier of sub-6 GHz RF solutions
100% to the world’s cellular base station manufacturers.
Qorvo offers a family of high-performance discrete
RF components to provide flexibility to system
90%
designers, as well as the highest level of integration
80% of multifunction building blocks to reduce size, lower
costs and accelerate time to market.
70%
To learn more about how Qorvo is helping drive 5G,
visit www.qorvo.com/5g
60%
Qorvo (NASDAQ:QRVO) makes a better world
50% possible by providing innovative Radio Frequency
(RF) solutions at the center of connectivity. We
40% combine product and technology leadership,
systems-level expertise and global manufacturing
30% scale to quickly solve our customers’ most complex
technical challenges. Qorvo serves diverse high-
20% growth segments of large global markets, including
advanced wireless devices, wired and wireless
10% networks and defense radar and communications.
We also leverage unique competitive strengths
0% to advance 5G networks, cloud computing, the
RAN on New Virtualisation Cloud-based Edge Distributed Other Internet of Things, and other emerging applications
Radio / NFV / SDN Core Computing Ledger that expand the global framework interconnecting
Technology / people, places and things. Visit www.qorvo.com to
Blockchain learn how Qorvo connects the world.
 before the election made it impossible for the regulator to prepare
Fig 6 What in your view is the biggest technological
the awarding of the high-demand frequencies. In the US, the National
impediment to 5G success?
Telecommunications and Information Administration (NTIA) and the
100% Federal Communications Commission (FCC) disagreed on how to allocate
the mmWave frequencies, facing the conflict between the telecoms and
90%
the satellite industries, among other issues. On the other hand, the fact
80% that frequency did not come out as the biggest impediment may also
show that the respondents are generally confident that the industry
70% stakeholders, the regulators, and the policy makers would be able to
reach a satisfactory solution. Fig 6
60%
50% To take 5G from labs to the field, the industry also needs to overcome a
couple of technical as well as operational challenges. On the technical
40% side, mmWave frequency requirements was viewed as the biggest
challenge by 53% of the respondents, presumably because this is new
30%
for the telecoms industry. This was followed in second place by the
concern over the 4G and 5G coexistence (47%). On the operational
side, Next-Gen network security was identified as the leading
challenge, chosen by 58% of the respondents, followed by process
automation (41%), and Next-Gen BSS and OSS (39%).
The telecoms professionals also identified the top obstacles to translate
successful technologies into successful delivery of 5G services. The
biggest concern, chosen by a third (34%) of the respondents, was the
“cost of 5G infrastructure”. Some also commented that the high cost
would result in thin operator margins, which would in turn hamper their
re-investment capability. Lack of 5G handsets/mobile devices came
second on the list, selected by a quarter (26%) of all respondents. 21%
of the respondents though 5G’s range limitations, particularly in urban
environments, would prove its biggest technology impediments.

20%

10%

0%
Frequency Deployment of Lack of Other
Availability 5G RAN over 4G Consumer
Core / Non- Devices
Standalone
Mode

Deploying 5G RAN over 4G core also caused a quarter (26%) of

respondents’ concern. Presumably they were worried that the
non-standalone mode of 5G would limit the use cases that can be
supported, especially the value propositions like network slicing, or
the applications that demand ultra-low latency, which would need
end-to-end 5G networks.

Nearly a quarter of respondents (23%) identified frequency availability

as the biggest impediment. This is expected. The challenge with
frequency is both its scarcity and often the lack of clarity of policies.
Telecom operators have left billions of dollars on the auction table to
win access to radio frequencies in order to roll out 5G networks, but
in some markets the frequency issue has become political. In South
Africa the refusal by the outgoing government to issue policy directive

Telecoms.com Intelligence / 5G Opportunities Survey Report

 Fig 7 In which year do you expect to
see large scale shipments of consumer
devices/mobile handsets below $500
USD selling price with 5G capability?
2019...............................................................................0%
2020...............................................................................9%
2021............................................................................ 31%
2022............................................................................ 31%
2023............................................................................ 12%
After 2023................................................................. 16%
The industry needs
more assurance that
certain challenges can be
overcome, in particular
those related to the
availability and affordability
of consumer devices.”
channels also show that the premium, $500
plus segment, is not doing extremely well.
At this stage, we see that many smartphone
OEMs have got the message with regard to 5G
handset pricing. While the flagship products,
like Samsung’s Galaxy S10 5G, could cost well
over $1,000 (and Huawei’s Mate X 5G well over
$2,000), most challenger vendors are pricing their
5G products at a more competitive level.
However, launching a product is different
from making the product broadly available to
consumers. This brought us to ask the survey
respondents to estimate when large scale, sub-
$500 consumer devices and smartphones will be
shipped in volume. The overall sentiment from
the survey is a realistic optimism. Nearly one-third
(31%) of all the respondents believed that large-
scale shipment of affordable products will happen
in 2021, while a similar number of respondents
saw it happening in 2022. The more optimistic 9%
expected volume shipment to hit the markets in
2020 already. Fig 7
the survey. In second place (19%) is chipset cost,
which will be directly reflected in the prices of the
finished products. Next on the list were limited
customer interest (15%), component cost (13%),
and product performance (12%). Fig 8
In summary, the telecoms professionals
represented in this survey see a lot of opportunities
for the new technologies that will be implemented
by 5G, especially virtualisation and the new radio
technologies. On the other hand, the industry
needs more assurance that certain challenges can
be overcome, in particular those related to the
availability and affordability of consumer devices.
Fig 8What do you see as the biggest
challenge to implementation of 5G
capability in consumer devices (e.g.
smartphones)?

Given the global consumer market dynamics,

As was identified by the industry professionals, in particular the smartphone market, it most
to bring 5G benefits to the customers, be they likely would surprise no one when most survey
consumers or businesses, we need widely respondents (64%) selected East Asia (China,
available, reliable, and affordable terminal devices, Japan, and Korea) as the market that is going to be
including mobile devices, and other customer the fastest to support 5G consumer devices. It is
premise equipment (CPE). Lately the supply side followed by North America, and, at a distant third
looks increasingly positive, with at least a dozen place, Western Europe. Performance............................................................. 12%
smartphones and about 20 other devices (indoor
Chipset cost............................................................... 19%
and outdoor CPEs, USB-dongles, Wi-Fi hotspots, This ranking is not only related to device prices,
Component cost....................................................... 13%
etc.) already launched. They are powered by but also largely dependent on which markets
chipsets from at least five vendors. would roll out 5G networks faster and more Reliability.......................................................................6%

extensively. Network coverage was ranked by Limited customer interest..................................... 15%

On the other hands, recent market trends have the respondents as the number one challenge Limited network coverage..................................... 31%
shown that the global smartphone market has to implementation of 5G capability in consumer Other..............................................................................3%
reached its peak, and results from multiple devices, chosen by 31% of all those who answered

Telecoms.com Intelligence / 5G Opportunities Survey Report

 Sponsor’s
Comment...
5G networks and services are now launching
across Asia, North America and Europe, but many
technical hurdles remain. For consumers to realize
the full benefit of 5G networks - including increased
data speeds and capacity, low latency and global
availability on a single device - 5G technology
will need to continue migrating from sub-6GHz
frequencies to higher millimeter wave (mmWave)
frequencies.

More than half of respondents, or 53%, acknowledge

that mmWave frequency requirements are the
biggest technical challenge facing the industry.
Nearly as many respondents, or 47%, cite 4G and 5G
coexistence as the biggest technical challenge.

To overcome these technical challenges, 5G

infrastructure and mobile device makers are
increasingly turning to RF chipmakers with high-
volume commercial expertise in mmWave and
advanced filtering who can bundle solutions into
complete front-end modules.

5G begins with networks, and respondents cite

the high cost of 5G infrastructure as the biggest
impediment to delivery of 5G services. The second
highest impediment is the lack of consumer devices.
Fortunately, operators and mobile device makers
still have time to fulfill the promises of 5G. 62% of
respondents don’t expect large scale, sub-$500 5G
consumer devices and smartphones to be shipped in
volume until 2021 and 2022.

Telecoms.com Intelligence / 5G Opportunities Survey Report

 For more information,
visit http://www.telecoms.com