Monetising 5G: Telcos grapple with revenue challenges

Matone Ditlhake, CEO, Corridor Africa.

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5G is a game-changer, promising unprecedented speed, reliability and connectivity. By 2030, projections suggest that nearly half of all mobile connections worldwide will be powered by 5G networks. However, amid the excitement and anticipation, one crucial challenge looms large for telcos – the monetisation of 5G.

Unlike its predecessors, 5G requires a significant overhaul of existing infrastructure, including the deployment of small cells and massive MIMO antennas. This necessitates substantial investments from telcos to upgrade their networks, posing both financial and logistical challenges.

Moreover, the capabilities of 5G extend far beyond traditional mobile broadband. With ultra-low latency and high reliability, 5G enables a plethora of new use cases, from internet of things (IOT) applications to mission-critical services in sectors like healthcare and manufacturing.

5G will open up new revenue streams for telcos, but it requires them to adapt their business models and service offerings accordingly.

Research suggests that while consumers are eager to experience the benefits of 5G, they are often unwilling to pay a premium for it. This presents a dilemma for telcos, who must balance the need to recoup their investments in 5G infrastructure with the expectations of price-sensitive consumers.

Furthermore, the commoditisation of connectivity poses a threat to traditional revenue streams for telcos. Over-the-top (OTT) players, such as streaming services and social media platforms, leverage telco networks to deliver their services, but capture a significant share of the value themselves.

As 5G enables faster and more reliable connections, the lines between telecommunications and content become increasingly blurred, making it challenging for telcos to capture value from the growing digital ecosystem.

To overcome the monetisation challenges posed by 5G, telcos must adopt a multifaceted approach that encompasses both technological innovation and strategic partnerships. Offering value-added services such as edge computing and network slicing can enable telcos to differentiate their offerings and capture additional revenue streams.

Furthermore, collaboration with vendors, device manufacturers and content providers is crucial for unlocking the full potential of 5G. By co-innovating and co-creating new solutions and business models, telcos can position themselves as indispensable partners in the digital ecosystem, rather than mere infrastructure providers.