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Taken in isolation, investment in 5G has thus far failed to deliver on its promises – both technically and commercially. In this combined market forecast for edge computing, private networks and telecom APIs until 2030, we identify how telcos can leverage all their assets to help deliver on the original ambitions of 5G.
In the past decade, 5G has been a driving force in defining the use cases for new telco revenue through a reinforcing cycle. As the capabilities evolve, so do the range of use cases 5G can support.
5G capability and use case evolution
While telcos have been slow to bring full standalone 5G to market, the telecom and tech industries have invested in a range of enabling assets to support enterprise adoption of new solutions. These enabling technologies include:
- Edge computing
- Private networks
- Network exposure (through APIs)
- Self-healing networks
- NTNs
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This network of enabling physical and logical assets represents a significant investment to be monetised.
Over the last four years, STL Partners has quantified the value beyond legacy connectivity services through our market forecasts for edge computing, private networks and telecom network APIs.
In this research, we bring all these forecasts and insights together to calculate the combined value operators could capture from their evolved networking and compute assets. Most of this value requires operators to have full 5G services (i.e., a 5G SA core, although a virtualised 4G network could enable telcos to access some of the value). We therefore call it 5G monetisation for short.
Supporting assets for 5G monetisation
These assets (beyond 5G itself) are crucial to monetising 5G. They are most valuable when used in conjunction, with network effects that create more value than the sum of their parts. For example:
- Private networks provide a foot in the door for offering on-premises edge services.
- Network exposure through APIs can make edge or private network services stickier by allowing them to be discovered and consumed more easily.
In this analysis, we focus on the value chain segments from our forecasts that are directly addressable by telcos.
What’s included in our network evolution forecast
Considering these supporting assets as an integral part of 5G monetisation implies a platform approach
Structuring the 5G opportunity around these modular assets (and not just 5G itself as a product) is an inherently platform-like service architecture. However, telcos should go all the way in applying a platform service architecture to 5G monetisation by ensuring the full range of their network assets are able to be combined in expandable ways, with good tooling to ease integration and encourage programmability.
As discussed in our enterprise manifesto, to date, telcos have been less successful in implementing the other two platform pillars – revenue and ecosystem architectures. Yet, these are equally crucial to realising the opportunity. Services need to be easy to consume in a scalable anything-as-a-service (XaaS) model and telcos should acknowledge the broader ecosystem that enables these 5G use cases.
Three pillars of platform business models
Table of contents
- Executive summary
- Introduction
- The network evolution journey
- Infraco
- Servco
- Key takeaways on the platform approach to network evolution
Related research
- 5G: The next phase
- Connected health: Enabling smarter, secure and scalable care
- An investment quandary: How AI is redefining enterprise connectivity
- Partnering for telco growth
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