My interest when considering new technologies is not always what they do, but how can they address business challenges, foster economic growth, social advancement, and individuals’ quality of life. The new technology I want to explore in this article is 5G; and the high level answer to the question on the business potential of 5G is that it can create an estimated US$1.2 trillion in revenues by 2026*. That is impressive and worth considering further.
Fostering Economic Growth
The US$1.2 trillion in revenue relates to the opportunity from 5G enabled industry digitisation for 8 key global industries: Manufacturing, Energy Utilities, Public Safety, Financial Services, Healthcare, Automotive, Public transport, and Media and Entertainment.
In addition, the Ericsson paper, ‘The 5G Business Potential’, shows that biggest opportunities will come from the Energy Utility sector, followed by Manufacturing and Public Safety. Data relating to Australia from the Ericsson and Arthur D Little study, shows a US$12.7 billion 5G enabled addressable revenue opportunity for telecom operators in 2026. That is a growth opportunity of 45% compared to their traditional revenues.
What is 5G?
But first you may be asking what is 5G, so I will explain. 5G is the name for the next evolution of mobile network infrastructure. 4G was launched in 2011 in Australia, and so far a new generation of technology is commercialised roughly every 10 years. 5G is due to be commercially available in 2020, with some telecommunications operators looking to launch trial networks earlier.
Where 4G focused on providing improved speeds and capacity for individual mobile phone users, 5G is being developed for industrial applications and will be a major technology in industrial digitisation. Some examples of industrial digitisation are autonomous driving, remote robotic surgery, and the use of augmented reality in maintenance and repair situations.
5G will enable innovation across all sectors with the unique combination of capabilities it will deliver. Key capabilities include: data rates up to 100 times faster than today’s networks; network latency lowered by a factor of 5; mobile data volumes 1,000 times greater than today; the ability to connect up to 110 times more devices; and stretching of battery life of cellular devices to 10 years or more. I would like to dive deeper into why capabilities such as device connectivity and low latency, are so important.
5G technology will provide a platform for emergent technologies such as the Internet of Things (IoT). As mentioned it will support the connectivity for massive numbers of connected devices. This will be required for industrial IoT solutions, that will bring us closer to a reality of autonomous cars, remote sensors to protect our power grids, and remote-controlled equipment that will let humans perform tasks in inhospitable environments.
What are some 5G use cases?
The near zero latency offered by 5G will be essential for remote control capabilities. 5G will enable the quick reaction time required for operating machinery using haptic control, which allows the operator to ‘feel’ what is going on in the machine’s environment. A doctor undertaking remote surgery would be able to feel resistance in his patient’s body in a distant operating room, a miner could work machinery remotely with great precision. These capabilities will help industries create new products and services to grow their markets, increase productivity, reduce costs and increase safety and security.
Encouraging business growth is an important step in the emergence of new technologies. Manufacturing is an area identified in The 5G Business Potential study, as having strong market potential for 5G enabled growth. 5G technologies can help to address business challenges such as hyper-competition, increased volatility from short business and production cycles and smart factories. One example is enabling and enhancing control of production line robotics.
Here, critical control of production line robotics includes tethered or untethered robotics that are controlled, monitored, and can be reconfigured remotely. This technology could be used in factory floor production reconfiguration and layout changes, real-time analysis and can even be used to steer a robot’s movement from a remote location.
The low latency offered by 5G will allow factories to shift a robot’s ‘intelligence’ to the cloud, lowering the cost for individual robots while expanding the ability to control many robots at once, enabling better coordination between robots on factory floor or across another industrial environment. The 5G Business paper also shows that, industrial control and automation systems are the largest use case categories in the manufacturing industry.
Ericsson recently announced a joint cellular IoT-based factory initiative with China Mobile and Intel; one key component was connecting screwdrivers in the production chain. With connected screwdrivers, the factory can replace manual tracking of the tool usage data with an automated solution. Also, by connecting the tools over the cellular IoT network, intelligent analysis of the collected data allows for optimised maintenance. The resulting benefits include a longer lifespan of tools and a reduction of human errors during operations.
Operators in Australia are preparing for 5G. Telstra and Ericsson have run successful outdoor trials of 5G Radio prototype technology. Local trials make an important contribution to the global development of the 5G standards; which the international standards body ITU advise will be released in 2020, with commercial deployment of 5G networks soon after.
Success will come from partnerships
There is a great opportunity now for enterprises to get ready for 5G by working on their digital transformation programs, considering what systems can benefit from digitisation, IoT and mobility solutions. Trials and pilots can be put in place using today’s networks to ready business for the improved capacity that 5G will bring.
The success of 5G will be driven through partnerships with telecommunication companies and industry sectors, to deploy digitisation strategies to extract the productivity and growth potential 5G offers. Ericsson research shows that 94% of industry respondents feel that next generation mobile networks are a top strategic priority. Furthermore, we see that many are investing in these technologies to improve or develop new offerings for customers (88%) for operational efficiency (89%).
With 5G networks, operators will have extremely agile networks with the capability to provide ‘network slices’, which can be the combination of network speed, capacity and latency that is required by a particular industrial use case. Creating new service offerings from evolved network capabilities will be a key for telecommunications operators.
The Ericsson paper ‘The 5G Business Potential: Industry digitisation and the untapped opportunities for operators,’ provides detail on key industry trends and challenges faced by the 8 key industries covered. I also encourage you to review an earlier paper, ‘Ericsson 2017 and Opportunities in 5G: The view from 8 Industries’. Respondents to this survey included CIOs, CTOs, CMOs and other heads of IT infrastructure in the industrys most likely to be impacted by 5G: Automotive, Utilities, Public Safety, High-Tech Manufacturing, Healthcare, Financial Services, and Media/Gaming.
It’s an exciting time to be in ICT and contribute to the deployment of new technologies that really will change the way we do business. We are enabling the communications industry and other sectors to do better business, increase efficiency, improve user experience, and capture new opportunities. This represents huge opportunities, because — in a networked society — anything that can benefit from being connected will be connected.
