The 5G Monetization Imperative

The rollout of 5G technology is transforming the telecommunications industry by introducing multi-Gbps transmission speeds with ultra-low latency and greater reliability, thereby unlocking new revenue streams in both consumer and enterprise segments.
Telecom companies can maximize the 5G opportunity by identifying high-value use cases, such as automation in manufacturing.
Establishing a thriving 5G monetization paradigm requires exploring flexible business models, including outcome-based pricing, subscription plans, and partner revenue-sharing arrangements.

The potential for unprecedented connectivity and innovation is within reach as the telecommunications industry stands on the brink of a 5G revolution. However, realizing this potential requires more than just deploying the technology. For communication service providers (Telecom companies), the challenge lies in effectively monetizing 5G.

Hurdles to 5G Monetization

Three major hurdles stand between telecom companies and 5G monetization:

Limited Imagination: Many telecom companies only see 5G as a way to make mobile internet faster. This limited view misses the tremendous opportunities 5G can offer, especially for businesses. Beyond just quicker internet, 5G has the power to transform healthcare with remote robotic surgeries, turn factories into intelligent, automated hubs, and bring new experiences to entertainment with augmented reality.
More Focus on Technology Than on Business Models: The rush to set up 5G networks has often overshadowed the need to develop business models that capture the value these networks deliver. According to McKinsey, telecom companies are expected to invest more than $600 billion in 5G infrastructure between 2022 and 2025. Traditional connectivity pricing isn’t enough to make back these massive investments. Telecom companies need to get creative, exploring outcome-based models, subscription plans for specific services, and revenue-sharing arrangements with partners.
Lack of Agility: Telecom companies traditional structures, characterized by silos and slow-moving processes, are not suited for the dynamic and collaborative ecosystem needed for 5G. Embracing agility and breaking down these internal barriers is essential for developing and executing new revenue streams. Zero-touch automation across OSS/BSS solutions can help telecom companies optimize their operations and monetize new services effectively.

Strategies for 5G Monetization

To truly harness the transformative power of 5G, telecom companies must adopt innovative strategies and business models. By focusing on high-impact use cases, flexible pricing, strategic partnerships, and tailored solutions, telecom companies can unlock significant revenue potential and position themselves as leaders in the 5G era. Here are the key takeaways for effective 5G monetization.

1. Develop and Prioritize Use Cases

Identifying high-value use cases is crucial for telecom companies leveraging 5G. This involves conducting in-depth research to pinpoint industry verticals where 5G can have a significant impact. Engaging with potential customers to understand their unique needs allows for developing tailored solutions. For example, remote surgeries in healthcare require ultra-low latency connections, while automation in manufacturing benefits from massive IoT connectivity.

2. Implement Flexible and Innovative Business Models

Telecom companies must explore flexible and innovative business models to move beyond traditional connectivity pricing. Outcome-based models, where charges are tied to the results achieved using 5G services, can provide a more compelling value proposition. Subscription plans tailored to specific services and revenue-sharing arrangements with partners can also unlock new revenue streams. Usage-based pricing models that reflect the actual value delivered to the customer, such as pricing based on the number of connected devices or the volume of data processed at the edge, are particularly effective.

3. Leverage Telecom Marketplaces for Service Bundling

Telecom marketplaces offer a strategic platform for Telecom companies to bundle 5G connectivity with third-party applications and services, creating comprehensive solutions tailored to industry needs. For example, service bundles could include high-speed 5G internet paired with IoT solutions or VR gaming subscriptions. These marketplaces make it easy for enterprise customers to access and customize their 5G services.

4. Build a Robust Partner Ecosystem

Building a fast, reliable, and secure partner ecosystem is vital for accelerating innovation and delivering comprehensive 5G solutions. Collaborating with system integrators, technology providers, and industry players allows telecom companies to leverage diverse expertise and resources. Establishing strategic partnerships ensures seamless integration of various components and services, creating end-to-end solutions for enterprise customers. A well-structured partner ecosystem supports the rapid development and deployment of 5G solutions, driving value for telecom companies and their customers.

5. Expand and Scale Solutions Across Industries

To expand and scale solutions across industries, telecom companies must define and tailor their offerings to meet specific needs. Zeroing in on key sectors like healthcare and manufacturing lets telecom companies create solutions that address unique pain points. Onboarding partners who can support applications, hardware, and integration ensure their offerings meet industry standards. Such a strategy broadens the impact of 5G innovations and drives value across various industries.

By focusing on these strategies, telecom companies can unlock the full revenue potential of 5G. These steps will help telecom companies recoup their significant investments and position them as leaders in the 5G revolution to drive substantial value for their customers and stakeholders. The time to act is now, and those who embrace these strategies will lead the way in transforming telecommunications.

About the Authors

Siddhi Aggarwal
Consulting Partner - Communications and Media, Wipro Consulting

Siddhi brings 24 years of expertise in telecom solution consulting and architecture, with emphasis on business and digital transformation globally. At Wipro, she drives solutioning, business development, and offer creation for the North American region, specializing in digital transformation, modernization, and cloud transformation across BSS and OSS. Siddhi excels in crafting technology roadmaps and IT strategies that align with client business objectives.

Lalit Kashyap
VP and Sector Head - Communications, Media, and Information Services

With over 20 years of extensive experience in the industry, Lalit is known for his expertise in driving agility and fostering customer-centric growth. In his current role at Wipro, Lalit spearheads strategic initiatives that align with client objectives, leveraging advanced data analytics, cognitive technologies, and artificial intelligence to deliver transformative solutions. His leadership has been instrumental in guiding top-tier organizations through complex digital transformation journeys, optimizing their go-to-market strategies, and enhancing platform and product development.

Lalit’s deep understanding of the communication and media landscape enables him to craft innovative solutions that address the unique challenges of the sector. His commitment to excellence and strategic vision has consistently resulted in significant business outcomes, making him a pivotal figure in Wipro’s success and a trusted advisor to clients.