How Will 5G Change the World: New Jabil Survey Reveals Challenges and Opportunities
As 5G’s “toolbox” of capabilities has expanded, the opportunities for 5G applications have only grown. Still, telecommunications leaders have differing opinions on the network’s advantages over 4G and how new technologies like Open RAN will impact the deployment of 5G. To find out how companies are putting 5G’s capabilities to work and what challenges they face in deploying them, Jabil partnered with SIS International Research to survey 193 individuals with decision-making responsibilities at telecommunications companies. Here are some key findings.
“How will 5G change the world?” Pose this question to a dozen telecommunications experts and you may receive a dozen different answers. Four years ago, telecommunications leaders already had varying opinions on 5G’s possible applications and the extent of its potential impact. Connected vehicles, an expanded industrial Internet of Things (IoT) and the advent of remote healthcare were just some of the functions the nascent technology could enable. Since then, 5G has grown in complexity. Instead of three main benefits over 4G — faster speeds, lower latency and the ability to hold many more IoT connections simultaneously — 5G’s “toolbox” now contains at least 11 different capabilities for providers to explore and develop. Those new tools create an even wider array of opportunities for 5G — and thus more ways for telecommunication leaders to differ on what the future of 5G applications could look like.
Still, no one can say for sure yet if 5G will be a disruptor or just an elevation of 4G. One point of agreement has been that 5G’s promise opens new opportunities for non-traditional players to enter the telecommunications market through the disaggregation of hardware and software via open interfaces and cloudification — also known as Open Radio Access Network, or Open RAN. With Open RAN, flexibility, innovation and competition could increase; every company is supplied and can be a supplier. Could Open RAN be the future of 5G? What are the existing hurdles for telecommunications companies working to deploy 5G? Aiming to answer these questions and get a feel for the current and future state of the industry, we fielded an online survey to 193 telecommunications stakeholders responsible for strategy, planning, technology evaluation, development, operations, engineering and product management. All participants were directly involved in development, implementation, or adoption of 5G technologies at leading telecommunications companies in North America, Europe, the Middle East and Asia-Pacific. The survey posed several questions about the adoption, opportunities and challenges associated with 5G.
5G IS ON THE CUSP OF TRANSFORMING COMMUNICATIONS
64% of respondents believe 5G will become mainstream in the next one to three years. • Almost two-thirds (65%) expect 5G to be a superior technology that will dramatically transform telecommunications, up from 49% in 2018. • 59% strongly agreed that the transition to 5G will create opportunities for new telecommunications companies, but only 42% strongly believe the next “killer app” will propel 5G’s true potential and consumer interest. • Financial services is the industry with the most potential to be impacted by 5G solutions. • More than half (58%) of respondents believe businesses will benefit from 5G’s “killer app” first. • 87% of respondents believe business applications will adopt 5G solutions first.
AS 5G TECHNOLOGY DEVELOPS, HURDLES REMAIN
Business model challenges are the most difficult 5G hurdle for organizations to overcome. • Creating subscription models for 5G is the most difficult business challenge respondents face in developing and implementing 5G. • Identifying the physical locations to install 5G equipment is the most difficult organizational challenge respondents reported in developing and implementing 5G. • Availability of spectrum, or lack thereof, is the most difficult challenge respondents face in developing and implementing 5G. • 84% of companies that face user or customer challenges believe 5G is a superior technology that will transform telecommunications. • Companies facing operational challenges are split between viewing 5G as transformative and an incremental advance over 4G that will create some changes for telecommunications
OPEN RAN PRESENTS NEW OPPORTUNITIES AND CHALLENGES
More than half (55%) of respondents are seriously considering an Open RAN strategy. • 57% believe Open RAN will be ready to be deployed in the next two years. • 81% expect Open RAN will reduce CAPEX, including 100% of companies who already have an Open RAN strategy in place. • 85% expect Open RAN will reduce OPEX, including 100% of companies who already have an Open RAN strategy in place. • Almost all respondents (93%) believe 5G will foster partnerships between service providers and software or web services companies. • More than three-quarters (79%) of companies expect variability in network performance (call quality, call drops, throughput) occasionally or often when first rolling out an Open RAN network. • 39% of companies facing business model challenges expect variability in network performance often when first rolling out an Open RAN network, but 60% believe they’ll never see variability. • 64% of respondents are willing to accept a higher incidence rate in exchange for the financial and operational benefits of Open RAN. • Less than half (44%) believe hyperscalers (like Amazon, Microsoft, Alibaba and Google) fit into their Open RAN strategy, but two-thirds of companies that have already implemented an Open RAN strategy do believe hyperscalers have a place. • The need for fixed wireless and the industrial Internet of Things will drive broad 5G adoption over the short term and over the long term.
