With the release this year of the ITU’s 6G Framework document and the NGMN’s design requirements we are getting more clarity on the technical aspects of what 6G might need to be or do. However, there are one or two questions which arise on the commercial front. Unless the industry can find answers to these, the technology solutions may not be widely adopted and the very real opportunities go to waste. The article below sets out some issues, many of which we are starting to feel today but which will be that much more significant in future.
Many governments have requested that 6G be used to reduce digital divides within and between countries. This has also fed into the ITU’s framework document. The preferred option seems to be a network-of-networks concept, which makes great technical sense. By switching seamlessly between multiple access technologies, including non-terrestrial networks, private networks and presumably Wi-Fi for indoor coverage, service continuity can be improved.
Ultimately, if people could reliably get service wherever they happened to be, that would be a feat that has eluded the sector up to now. Network effects would encourage the adoption and use of services in environments that don’t require a person to be tethered to their nearest Wi-Fi hotspot. However, there are at least two major commercial issues here which will need addressing in order to make the system take off.
One is simply to do with the network-of-network concepts itself. While this should be good for the end user’s quality of experience, telecoms providers are used to competing on the basis of who has the best coverage or fastest network. If every customer’s device simply roams onto the best available network where they are, everyone gets effectively the same network performance. Competition for the end customer’s attention would have to be based on other elements, such as customer service; service differentiation; or the dangerous territory of price competition.
Of course, there may well be companies who would rather not have that direct relationship and just deal behind the scenes as a provider of network capabilities. After all, they are no longer the ‘one neck to strangle’ when there are problems with the end user’s service and they may be able to make a sufficient business out of roaming fees or wholesale capacity provision.
Meanwhile, companies who do own the customer relationship need not be the network owners at all. MVNOs have proliferated for years; all it takes is for one of them to negotiate roaming deals with the key access network providers in mobile, non-terrestrial and perhaps even large-scale private networks: then they can have the customer devices use whatever resources are available to offer more complete performance than any individual network owner, and pocket the difference between the income from their customers and the fees for network usage.
Private networks could also play a major part in the densification and growth in capacity in future networks, with enterprises, towns and building owners setting up networks for their own ends but making capacity available for other users, at a price.
As things stand today, however, it would probably require some different approaches to managing roaming than have existed before. We are looking at hundreds or thousands of private networks in any given country, and many more than that if – as some hope – it becomes as simple to instal and manage 5G as Wi-Fi. In that case it may be necessary to set up standard terms for managing roaming inbound and outbound, including how rating, billing and settlement work; or if not one set of standard terms, a handful that best reflect the circumstances of any given private network or network node, such as ‘my customers only’, ‘prioritise my users’ or ‘maximise income’). This is a process that could be managed in a distributed and automated process these days, given agreement on what to do and someone to set up the software to do it.
Service delivery to reduce digital divides also carries another implication. Globally, the vast majority of people without service live within a coverage footprint. They just can’t afford the devices, or can’t justify the cost based on the services available to them. A different business model altogether is required to reach them. Some possible alternatives include:
- Public broadband or MVNOs offering subsidised services for low-income families. This would take those customers out of the pool for commercial telcos and would create a state-owned de facto competitor on a different footing from the commercial players. It is unclear whether this would be a palatable option for the telcos or for the regulators.
- B2B2X models where services to end-users are free, but the operator receives revenues from advertisers or other service providers who want to reach this audience. Those service providers could be government agencies, healthcare providers or financial institutions.
In some countries use of mobiles as financial instruments has enabled the development of different forms of credit risk assessment, lending and other facilities among people without formal bank accounts. Enabling support for online banking and a reduction in the use of cash can reduce fraud both against government and for consumers due to greater transparency. Meanwhile, easy access to medical advice can be invaluable in reducing the impact of diseases or identifying health issues early. So there may be an argument that such a move could pay for itself through broader benefits to the economy.
- Government subsidies, for example in the form of dedicated benefits for people on low incomes to enable a level of broadband access. These payments would feed through to regular commercial service providers.
Whether any of these approaches appeal to established players is an open question; however, globally we have 95% population coverage but only 60% of the global population accessing the web. That’s not a problem with the basic connectivity. Sooner or later policymakers and operators will need to address it.
There are early indications from pre-WRC notes that there will be greater conversations about the use of spectrum: for example, sharing between different service providers. Purchasing licensed spectrum is a huge cost for many national-scale telcos, which at present they recoup through their own services.
There are some problems to do with the spectrum auction concept generally, insofar as spectrum costs create a huge barrier to new entrants buying for access over a national level. In an environment where national-scale providers are now expected to coexist with direct-to-ground HAPS and satellite service providers and private networks operating within very specific geographic boundaries, a model that worked for national-scale telcos is not a good fit
Meanwhile, winners in those spectrum auctions could well be delayed in their deployment of infrastructure thanks to the very cost of the spectrum. New approaches will likely be needed, not least to leverage the spectrum which has already been licensed at great expense.
One approach might be to set up systems whereby licensed spectrum can be shared or sub-let by ‘spectrum tenants’ using their own radio access infrastructure on frequencies owned by another organisation. This could help accelerate returns on the investment cost for the winners in auctions, while multiple players are involved in the build-out of systems that can leverage that spectrum… meaning that it gets into widespread commercial use that much faster. Spectrum could be shared or provided on a geographically limited basis, for example in a private network, or deals done whereby the licensee and its sub-licensees share the spectrum but the licensee’s traffic gets priority in the case of congestion (which helps make ownership of the spectrum desirable).
This would require some changes to current licensing but, more than that, would require the setting up of new types of commercial agreement (most likely standard kinds of agreement as per the roaming note above) but also methods to track, bill and settle spectrum usage in these shared environments.
Overall, we have a great opportunity to rethink how the telecoms industry operates, makes money and serves a wider set of customers – certainly the ideas above are only the tip of the iceberg and are likely to be highly contentious. However, the market is changing slowly but surely, which will require different approaches to competition and new types of commercial relationships.
For those with billions sunk into the current models, that’s going to be hard to change not only from a mindset perspective, but also altering operational and business processes to match. These are not minor issues and should, in an ideal world, form part of the digital transformation we are seeing service providers taking from telco to techco. We need to be working out the future of the telecoms commercial landscape just as much as the technical underpinnings.
If we don’t, there’s a risk that companies who can leverage new technology and new commercial approaches will be able to reduce the influence and impact of existing players; or, equally alarming, that we find all the technology development going to waste.
This is an opinion piece and I hope that readers disagree with some or all of what has been presented, or have views they’d like to share. If so, I’d love to chat with you – drop me a note at email@example.com.
Alex Lawrence is Managing Editor at 6GWorld. His mission is to bring together stakeholders from across industries, countries and disciplines to make sure that, as technology evolves in the coming decade, it’s meeting the changing demands of society, government and business.
He has been involved as a professional nosy person in the telecoms sphere since 2004, with short detours through industrial O&M and marketing.
If you’d like to talk to Alex about your ideas or projects he’d love to hear from you. @animalawrence or firstname.lastname@example.org.