Experts Say 5G May Leave Consumers Wanting; Reliability Issues Hurt

Wireless carriers are concerned that mobile broadband has “maxed out” its opportunities for revenue growth, Hans Hammar, Ericsson head-business strategy for business area networks, said during a Mobile World Live webinar Monday. Other speakers agreed that 5G faces challenges, including living up to what providers promised the new technology can do.

Carriers are concerned that no matter how much network capacity they add or how much they improve performance, “they can’t really charge more,” Hammar said. Providers have trouble making a business case for increasing investments in their networks, he said. Hammar sees service differentiation as a possible answer.

He compared mobile broadband with coffee, saying there are dozens more options than two decades ago and people spend 10 times as much. “Mobile broadband has been 'one product fits everything' for 10 years,” he said. Service differentiation is “one thing that will start to drive an uptick in revenues,” he said.

Carriers worldwide see wide-area coverage and network speeds at the top of what they’re trying to deliver “by a large margin,” said Peter Jarich, head of GSMA Intelligence. The 5G era “is all about doing new things.”

While stand-alone 5G networks haven’t taken off as quickly as expected, providers understand their value and want deployment “as soon as possible,” Jarich said. The foundations are set for stand-alone “and we can see the consumer use cases for reliability, for low latency, for delivery [of] differentiated services,” he said. Providers may be downplaying automation and analytics, which have been near the bottom of their areas of focus, he said.

Since 2019 5G has changed fundamentally, boasting almost 1.6 billion consumers today, which is projected to reach 5.8 billion during the next few years, said Jasmeet Sethi, head of Ericsson Research’s ConsumerLab. The promises of 5G “have not necessarily materialized in terms of new experiences that consumers were expecting,” Sethi said. There's a “lack of innovation” in use cases and a “lack of creativity on how to really think about pricing … thinking about differential connectivity,” he said.

Sethi said when consumers encounter service problems, they start expecting the network will never perform as promised. For example, if someone trying to livestream a concert experiences problems nine out of 10 times, that customer questions the “real value of 5G” because the promise was "more capacity in the most demanding sort of locations,” he said. “This is now a real challenge,” he said.

5G is sold “as a bit of a glorified speed upgrade,” Sethi said. Customers are satisfied with peak speeds in general, he said. Some customers are dissatisfied with streaming quality, mobile gaming or other apps, he said. They’re more focused on uplink speeds than just downlink speeds, he said. Many users with limited data plans find they are significantly under their caps each month, and it’s hard to sell them on moving up to the next service tier, he said.

Consumers expect a network “just to be working in certain places” and get frustrated when it doesn't, Jarich said. More than improved video streaming or gaming, GSMA finds, consumers want mostly “a reliable connection,” he said. Consumers appear willing to pay more for reliability, he said.