Making 5G pay: Monetising the impending revolution in communications infrastructure

April 2019

The next generation of cellular mobile communications technology has arrived. 5G, which is set to succeed the 4G standard over the next few years, offers an exponential improvement in functionality over 4G — it is 100 times faster and has 1,000 times more capacity. The results will be mobile networks that offer far higher capacity and reliability, much lower latency, reduced energy usage, and massive connectivity for devices.

To ensure operators reap a fair return for their enormous investments in 5G, they must think holistically about the monetization opportunities, going beyond simply charging consumers more for faster data. Instead of relying mainly on end-users paying telecom companies directly for connectivity, operators in a 5G world could generate substantial revenues by charging the companies that are providing 5G-reliant services to their customers. Variants of this model, which is widely termed business-to-business-to-X (B2B2X), where X can be a consumer, a business, or a public agency, will be suited to a vast array of widely differing use cases.

In China, although the three major operators are already actively setting up for the future, they remain cautious. For the must consider the amount of investment in infrastructure construction, the complexity of operation and maintenance, the maturity of the 5G industry value chain and the difficulty of business model transformation. We believe that rather than enhancing shopping and entertainment experience with 5G technology, the better opportunities for Chinese operators lie in fostering business innovation in multiple industries such as IoT, Industry 4.0, autopilot, smart medical services, etc., and to integrate emerging technologies such as Big Data, AI and Cloud computing to improve the edge computing capabilities of terminal devices. By doing so, 5G can effectively support the fulfilment of “smart cities” and further form the cornerstone towards “smart societies”.

Contact us

Wilson Chow

Global Technology, Media and Telecommunications Industry Leader, PwC China

Tel: +[86] (755) 8261 8886

Jianbin Gao

China TMT Leader and Private Equity Group Central China Leader, PwC China

Tel: +[86] (21) 2323 3362

Stephen Wong

Entrepreneurial and Private Business Co-Leader, PwC China

Tel: +[86] (10) 6533 2255

Steven Zhao

Partner, PwC China

Tel: +[86] (10) 6533 7219

Tiger Shan

China Consulting, Strategy Consulting Leader, PwC China

Tel: +[86] (10) 6533 2166

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