5G roll-out is gathering momentum across the Asia-Pacific region. By the end of the year, we can expect commercial 5G services to be up and running in...
5G
5G roll-out is gathering momentum across the Asia-Pacific region. By the end of the year, we can expect commercial 5G services to be up and running in South Korea, China and The Philippines, cementing the region’s position at the forefront of the global 5G economy. That is a trend set to continue into the middle of the next decade and beyond, with APAC countries set to account for the majority of global 5G connections.
For MVNOs, there has always been a sense of ‘wait-and-see’ about the 5G opportunity - wait and see what new use cases the vastly enhanced network specifications bring for mobile, wait and see what the best opportunities for monetising them are, wait and see what kind of wholesale deals can be struck with MNOs.
What has not always had the attention it perhaps deserves is the potential for 5G to significantly shake up the way MVNOs operate, and perhaps even blur the traditional distinctions between MVNOs and MNOs. To some industry insiders, as 5G technology matures, we could soon not be talking so much about mobile virtual network operators, as virtual mobile network operators - VMNOs.
Sasaki Futoshi, Deputy General Manager of MVNO Strategy and Business Development at Internet Initiative Japan (IIJ), explains the difference and what it is about 5G technology that changes things. He argues that the virtualization of 5G networks will challenge the traditional definitions between ‘full MVNOs’, which run segments of a network under license, and ‘light MVNOs’, which leave all the technical management to the operator and just run services from it. “5G network architecture is characterized by virtualization and will go beyond the horizon of virtualization,” said Sasaki.
“In the 5G era, MVNOs could utilize the host operator’s mobile network to build their own business, the same as before 4G. However, it might be the virtualized core network, called the ‘slice.’ Network functions virtualization (NFV) and ‘slicing’ could be inevitable for many MVNOs in the 5G era. From this perspective, we also have to look for new and unprecedented relationships with our host operators.”
Started with 4G and LTE network technology, 5G will complete a process of network virtualization which abstracts the resources and services you can run on a network from the physical infrastructure underpinning it. Network slicing is an important concept, because it means that a single set of physical network resources can, via NFV, be repurposed into multiple virtual networks that all act independently of one another.
This makes it possible to allocate network to different use cases even within the same spectrum range - a slice for consumer mobile, a slice for enterprise, a slice for fixed wireless broadband, a slice for utilities services, a slice for connected cars and so on. It also offers benefits with things like dynamic billing, as the virtualized network slices can be very rapidly scaled up and down according to demand, so you only ever charge for what is used.
But network slicing also makes it possible for virtual operators to behave more like carriers in the market. With the power to generate their own independent virtualised network functions on demand, there is the potential to expand into wholesale operations, renting out network access to other businesses. It will make it much easier for virtual operators to develop B2B solutions, especially as IoT develops - they can offer enterprises full control over their own network, with a full range of support services thrown in.
Much like cloud computing, all of this will be done via software - no special equipment, no engineers, just a platform to provision and manage the different network slices, and an ‘as-a-service’ digital business model that can be adapted for B2B and B2C. That is the what the VMNOs of the future will potentially look like.
