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Darryn Lowe: Why 5G Won't Cost as Much as Pessimists Think

Bain Partner Darryn Lowe outlines three reasons that providers can go on the attack and succeed in 5G.


Darryn Lowe: Why 5G Won't Cost as Much as Pessimists Think

Network providers are pessimistic about 5G because of concerns over capital requirements, but Bain research shows why deploying 5G could be within the capabilities of providers. Darryn Lowe a partner in Bain's Telecommunications practice, outlines three reasons that providers can go on the attack and succeed in 5G.

Read the Bain Brief: Why the 5G Pessimists Are Wrong

Read the transcript below.

DARRYN LOWE: Some mobile network operators are pessimistic towards 5G. The biggest reason for this is that they're spooked by the amount of capital investment they expect is going to be needed. We think this is ultimately wrong, and that the most sophisticated operators will be able to deploy 5G within their existing capital spends.

There are three reasons why this is the case. The first is that it's not necessary to cover the entire market with 5G right out of the gate. It's quite viable to start with the densest areas in the urban markets, and then expand over time.

The second is that you can leverage your existing 4G network investments, and add 5G on top. The cost to do this per node is relatively low, because it's simply adding an extra antenna, and upgrading some software in the base stations to be able to do it. That won't be the case everywhere, but it will certainly reduce the cost relative to a clean build.

Third is the reality that 4G mobile demand continues to grow out of control. By adding 5G capacity into the network, every subscriber that moves to 5G is one less subscriber that's going to be requiring 4G investment.

The net result of these three things is that the most successful operators will be those that go on the attack with 5G. This is because they'll be able to drive market share gains, both from mobile competitors and fixed competitors, and they'll be able to lay the foundation for the Internet of Things in multi-axis edge compute networks that will come in the future. All in all 5G will favor the bold.

Read the Bain Brief

Die 5G-Pessimisten schaden sich selbst

5G-Technologie verbessert Geschwindigkeit und Leistungsfähigkeit der Mobilfunknetze enorm.


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