{"id":4166,"date":"2023-04-26T10:50:59","date_gmt":"2023-04-26T09:50:59","guid":{"rendered":"https:\/\/squire-technologies.co.uk\/blog\/?p=4166"},"modified":"2023-06-07T12:33:21","modified_gmt":"2023-06-07T11:33:21","slug":"gsma-mobile-economy-report-2023-key-themes-part-2","status":"publish","type":"post","link":"https:\/\/squire-technologies.co.uk\/blog\/gsma-mobile-economy-report-2023-key-themes-part-2","title":{"rendered":"GSMA Mobile Economy Report 2023 Key Themes \u2013 Part 2"},"content":{"rendered":"
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GSMA Mobile Economy Report 2023 Key Themes \u2013 Part 2<\/strong><\/h2>\n<\/div>\n<\/h1>\n

\"GSMA<\/p>\n

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The recently published GSMA Mobile Economy Report 2023<\/strong> walks a fine line between forecasting good news and bad news. While predicting global 5G adoption will hit 54% by 2029 and will contribute $1 trillion to the global economy by 2030, it also notes that it might be difficult for mobile operators to generate good returns on the expected $1.5 trillion network investment they will make over the next seven years, with 92% of that investment being in 5G.<\/h4>\n<\/div>\n
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Mobile operator Capex (billions)<\/strong><\/p>\n<\/div>\n

\"Mobile<\/p>\n

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Source \u2013 GSMA Intelligence<\/p>\n<\/div>\n

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Added to that is the speculation about the fantastic opportunities of private networks and the metaverse. Though, these can only be realised in their best form if the telecommunications industry first overcomes several 5G hurdles.<\/p>\n

This good news, bad news situation might be causing mobile operators to wonder what they should be focusing on. So, we\u2019ve searched for some practical guidance and found three overarching themes running through the main sections of the report: sustainability, collaboration, and diversification. Whether directly or indirectly, each of these themes plays a part in GSMA\u2019s analysis and operators may want to consider them when developing their business strategies around the following sections of the report.<\/p>\n<\/div>\n

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The Circular Economy<\/h3>\n

Many industries now view sustainability as an essential part of their strategies. Businesses must consider the circular economy, whether diversifying or consolidating their offers.<\/p>\n

Earlier this year, GSMA Intelligence headed a round table on energy-efficient networks, pointing out that businesses typically treat sustainability goals as individual business goals, which exclude wider network sustainability concerns. GSMA identified Scope 3 emissions as the most concerning group. They are the biggest source of CO2 emissions and are the most indirectly connected to operators, involving supplying chains and consumer use. So, operators need to work across horizontals and verticals to manage the problem.<\/p>\n

In the report, GSMA provides some simple principles for businesses to adapt to a circular economy but doesn\u2019t highlight the importance of collaboration in the process. The GSMA Intelligence round table discussion placed large-scale collaboration as paramount for any efforts to redesign supply chains, reduce, reuse, and repurpose materials, and agree on a universal benchmarking system for evaluating progress.<\/p>\n<\/div>\n

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A Circular Economy Concept<\/strong><\/p>\n<\/div>\n

\"Circular<\/p>\n

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Source \u2013 GSMA Mobile Economy Report 2023<\/p>\n<\/div>\n

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GSMA Intelligence also showed that 5G will play a big part in sustainability as mobile traffic volumes increase. As 5G consumes less energy for the traffic it processes than 4G, it will be critical in minimising the energy consumption of that increase in traffic volumes. How 5G is geographically deployed will also be crucial. By working with other operators and utilising AI and machine learning to analyse geographical, digital consumption rates, operators can further minimise energy consumption by designing 5G networks that cover wider areas with fewer 5G nodes.<\/p>\n

Without these measures, GSMA Intelligence predicts energy consumption in five years will be 25% higher than it needs to be. Combining information from the Mobile Economy report and GSMA Intelligence reveals how essential 5G deployments and inter-organisational cooperation will be when reducing the climate impacts of the telecommunications industry.<\/p>\n<\/div>\n

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Revenue Growth and 5G Monetisation<\/h3>\n

The monetisation of 5G is a serious issue that the report tries to tackle. A heated conversation is going on about operators charging media streaming businesses and operators in other industries for the traffic they generate. However, the pushback that mobile operators are receiving makes this a risky bet.<\/p>\n

Thankfully, we gleaned several overall revenue-boosting options from GSMA\u2019s Mobile Economy report. The first is industry-wide revenue growth, such as tax reductions for mobile operators and subscribers, and the second is making spectrum auctions cheaper and less focused on government revenues. Doing so could increase revenue to support ramping up 5G deployments. Unfortunately, making these happen is somewhat out of the hands of operators.<\/p>\n

Other options are in the hands of individual operators, such as leveraging 5G to diversify offers through private networks and taking advantage of new opportunities in the metaverse and fintech.<\/p>\n<\/div>\n

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Private networks<\/h3>\n

For operators that want to achieve substantial revenue through private networks, GSMA\u2019s report highlights how essential it will be for them to partner with those who can provide network management tools and billing systems, security and authentication mechanisms, and other solutions. These partnerships will be vital if operators wish to cost-effectively upscale private networks and develop offers beyond connectivity.<\/p>\n<\/div>\n

\"5g<\/p>\n

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Source \u2013 GSMA Mobile Economy Report 2023<\/p>\n<\/div>\n

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Use cases for private networks might initially be around manufacturing but will spread to transport and logistics, and media and entertainment. Reliability will be a big factor for businesses that choose to set up private networks, and mmWave 5G could be the most desirable spectrum band due to its low latency and capacity. According to GSMA Intelligence, the biggest obstacles to deploying mmWave 5G for this purpose are a lack of spectrum allocations and the deployment method, which is different from previous network generation deployments.<\/p>\n<\/div>\n

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The Metaverse<\/h3>\n

Low latency network connections will also be central to delivering the metaverse dream in whatever shape it comes, and with those connections will come revenue. However, the collaboration will again be vital in achieving the multi-industry metaverse objective. The establishment of The Metaverse Standards Forum, a body that aims to enable an open metaverse, and the recently launched GSMA Open Gateway, are small examples of how businesses must work together to manage the metaverse project. Unfortunately, the effective use of transformative technologies like the metaverse, private networks, and connected cars will rely heavily on 5G deployments, so until large-scale standalone 5G is achieved, much of it is still just dreaming.<\/p>\n<\/div>\n

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Fintech<\/h3>\n

Fintech is possibly the most secure option for operators to generate revenue with a non-core service offer in the near term, judging from the report. GSMA suggests that the market is fractured and ripe for acquisitions and partnerships that seek to capitalise on long-term growth potential by consolidating those fragments.<\/p>\n

According to a recent GSMA Intelligence article about how operators can capitalise on fintech opportunities, consolidation could be literal in the form of super apps. Another option is mobile financial services like digital payments, online gaming charges, and credit services.<\/p>\n

While the report hints that 5G could be helpful in B2B fintech retail solutions, the vast majority of fintech solutions don\u2019t require 5G. So, many operators can take advantage now with their existing networks.<\/p>\n<\/div>\n

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Customers and 5G deployment<\/h3>\n

At the heart of almost all the revenue-generating options is 5G, but delivering results with it will require well-thought-out strategies. In addition to 5G\u2019s monetisation and deployment challenges, GSMA\u2019s insights show that most consumers only see 5G as a speed upgrade and are yet to grasp how it can enhance our lives, which could stall its adoption. While businesses are seeing 5G as ground-breaking, end customers are still waiting to hear what the killer 5G app is going to be that will get them to part with their money.<\/p>\n

Earlier this year, Qualcomm, a leading connectivity technology firm, divulged at a GSMA mmWave 5G event that poor connectivity is the biggest issue for mobile users. So, reframing 5G from a speed upgrade to a reliability upgrade could be important when pushing it out to subscribers.<\/p>\n<\/div>\n

\"melissa<\/p>\n

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\u201cThe future is bright for telecommunications, but it will take lots of hard work to create it. Solving 5G issues will be pivotal if the follow-on industries of the metaverse, private networks, connected cars, and the like are to become a reality. If operators want to compete, then strong partnerships and diversification with beyond connectivity offers will be critical, and in all cases adopting sustainable ways of working will be essential.\u201d <\/span><\/div>\n
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Melissa Webb, Head of Marketing at Squire Technologies.<\/strong><\/p>\n<\/div>\n

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