5G: Business and industry on the front line

If 5G once again means higher throughput, the expected gains will be on the industry and B2B side. It is also necessary to imagine the services and uses.

France does not intend to miss the 5G train. Government and regulator are currently putting in place the puzzle to ensure that the entire ecosystem is ready for 2020, the year of the commercial launch of the 4G successor.

However, it is important not to make a mistake when targeting the wrong target. While the general public is obviously concerned (with an increase in throughput to make applications such as virtual reality more convenient), it is companies that should primarily benefit from the advantages provided by this new standard.

5G is just faster 4G. The 5G offers upstream and downstream flows greater than 10 gigabit per second theoretically but especially by more capacities and a very low latency below the millisecond against 25 to 40 ms in 4G. This is a major asset to communicate the millions of connected objects currently deployed. But not only that.

"We are focusing on B2B industrial applications, this is a deliberate approach taken by the European Commission, we are targeting verticals, unlike Asia and the United States, which are committed to improving coverage or supporting fixed-line services," explains Carole Manero, research director for Idate, a French think tank.

The crucial issue of training

This is enough to support the growth of many sectors: autonomous and connected cars, logistics, remote medicine, fleet management, transport, video surveillance, security, real-time readings, critical application management, so-called reliability...

Moreover, Arcep, the telecoms regulator, is not mistaken. In its roadmap for 5G concocted with the government, the Authority thus calls on companies to imagine new services and uses by 2020.

"The national strategy aims to support the development of these new uses in the sectors identified as priorities. Particular attention will be paid to the emergence of pilots, in which the potential new uses of 5G will be tested: road traffic control, energy optimization. These experiments are intended to involve all the players concerned: local authorities, operators, equipment manufacturers, vertical players, test users, innovative start-ups. In order to facilitate the formation of consortia for the implementation of the pilots, the government intends to rely on the National Industry Council.

Industrialists, operators and equipment manufacturers are thus beginning to multiply their experiments through provisional licences (the final ones should be awarded at the end of next year), particularly in the automotive sector.

"There are already quite a few projects presented, industry players are mobilising, but it is true that the automotive sector is at the forefront, through projects co-financed by the European Union. Other sectors are less advanced but look closely at 5G: the building industry, for example, where there is a lot to invent, such as remote machine control. This will boost the competitive advantage of players in the sector," continues the specialist.

5G can therefore offer elements of differentiation for companies of all kinds, it is therefore an accelerator for the digital transformation of companies. "This can profoundly change the way they operate as long as employee training follows, and this is a challenge," says Carole Manero.

This implies an extension of the ecosystem historically limited to operators and equipment manufacturers with the entry of the industry, specialized start-ups and business players. 5G is therefore a lever for differentiation and transformation of companies but also a business opportunity.

12.3 trillion dollars ($12.3 trillion) and 22 million new jobs created, this is the contribution of 5G to the world economy in 2035 according to a study by IHS Markit. France is expected to take 85 billion dollars of income and nearly 400,000 jobs from this manna, even if these forecasts are to be taken with some caution.

Finally, this 5G could provide a breathing space for French telecom operators confronted with the equation of low prices + rising investments.

However, nothing is certain. "Obviously, we will have to monetize something other than the increase in flows. We can imagine the implementation of packages that play with the slider of latency, quality of service in order to identify new targets ready to drop a few more euros. But if the price of licenses reaches the same peak as in Italy, the equation will remain complicated for operators," concludes the specialist.