Economics will drive operators to adopt 5G more quickly, as they seek to reduce the cost of delivering data to customers and consolidate operating expenses, Qualcomm president Cristiano Amon (pictured, left) explained.
As operators begin to build out 5G networks and start paying day-to-day operating expenses for the new infrastructure, Amon explained it is in their best interest to push high capacity traffic to those networks to both become more efficient and save money. He noted the same shift was seen in the move from 2G to 3G and on to 4G as operators migrated traffic and consolidated legacy networks to reduce opex.
Speaking during a media event, the executive acknowledged the 5G story is primarily about capacity and performance, but argued operators will also need a coverage layer in place to realise the full economic value 5G use cases have to offer.
“The faster an operator completes the transition, the better the economics are going to be for the operator,” he said: “You can’t take one of the 5G business models without the other. The full value proposition is going to be realised when have a mature network…You won’t get away just building one or another market.”
Economics will also provide an incentive for operators to push a transition on the device side as well. Amon noted it costs operators more to deliver service to customers with older devices lacking advanced capabilities like 4X4 MIMO because more resources are needed for a longer period of time to transmit the data to customers: “For the economics for an operator today in 4G, it matters if you have a higher performing modem or not.” The same principle will apply in 5G, he said.
Amon’s comments come as operators in the US lay out their strategies for 5G rollouts. Verizon opted to lead with fixed-wireless deploymentsin a handful of markets later this year, while AT&T is preparing to launch both fixed-wireless and a 5G mobile hotspot by the end of 2018. Others, including Sprint and T-Mobile are looking a bit further out to 2019 and 2020, respectively, to achieve nationwide mobile deployments.