Huawei’s Mobile Broadband Forum, being held on Thursday and Friday in Tokyo, began with signs that the mobile industry is beginning to address its co-operation problem. Amongst a host of keynotes awash with the usual stats and visions of mobile’s future – IoT, VR, man machine interface and so on – Huawei made an announcement that it is launching X Labs – an initiative designed to provide the opportunity for the much-vaunted industry “verticals” to participate in service co-design with mobile operators, and Huawei.
TMN wrote last month about the lack of any visible interface or co-operation between mobile networks and the industry “verticals” upon whom many 5G business models are being formulated.
A key pillar of proposed 5G mobile business models to date has been the vision of industries transformed by 5G and the IoT. Call it Industry 4.0 or whatever you like, the idea is that dense sensor networks, low latencies, network slicing and mass analytics can be combined to transform industry operations and create opportunities for new partnerships. Applications such as industrial automation, smart cities and transportation, and enhanced enterprise services have all been proposed.
Yet there have been very few concrete realisations of exactly how 5G will enable this productivity transformation. Indeed even scoping out what industries will require from 5G has been a chicken and egg process to date. “Tell us what you need,” ask mobile operators of, say, the connected car sector. “What have you got”, answer the car makers. (Anecdata: one major strategic lead at a Group operator has said to TMN that industry-operator engagement has been a real issue.)
The recent formation of the 5G Automotive Association was formed to counter this mutual incomprehension with the car-making sector, and other vendors aside from Huawei have also taken certain initiatives – such as a research lab opened in 2014 by Ericsson to explore how transportation and 5G might be aligned. Mostly there has been a lack of understanding between the mobile industry and “verticals”. “We have to reach out,” says the mobile industry, to an audience of… itself.
Yet at Huawei’s Mobile Broadband Forum there were signs steps are being taken to resolve this conundrum of an industry seemingly distanced from the key verticals upon whom it is building its future.
X Labs is notable because here is the industry’s leading vendor taking concrete steps to bring together the verticals with the carriers and developers. There will be three areas of focus within X Labs – mLab, which will look at mobile user experiences like VR and live streaming, hLab which will look at home automation, and vLab which is aimed at the target industry verticals.
Ken Hu, Huawei CEO, said X Labs “will help us to better understand how to use mobile technology as an enabler in the digital transformation process of all vertical industries.”
“It is a new platform that will bring together carriers, technology providers, and vertical industry partners to jointly explore future use cases for mobile applications, promote innovation in business and technology, and to promote an open ecosystem,” he added.
Speaking after Hu, Craig Ehrlich, industry veteran and now head of TD-LTE industry association GTI, said the GTI would also be opening up an innovation lab that looks to work with new industries, in association with China Mobile as a key operator supporter. And closing the morning keynote sessions, Orange’s Arnaud Vamparys, SVP of Radio Networks, said that the operator is working through its Business Services arm to understand the requirements of different verticals. This would enable the operator to go to market in differentiated ways per each vertical sector, he said, proving a relevant network slice to each vertical consuming Orange’s network service.
That we are only at the launch of initiatives such as these shows that the mobile industry is not finding it easy to gain a ready audience within those industries upon whom it is pinning a great deal of hope.
5G – ubiquitous, ultra-reliable, always available, massively high in capacity and flexible in latency and throughput, is not going to come cheap. This is an industry that is, as GSMA head Matts Granyard said, set to spend $900 billlion in capex between 2016 and 2020. Recouping that spend will rely on a lot more than being able to provide more mobile bandwidth for a few more dollars per month to a consumer base that is already topped out in many markets. Instead, recompense must come from the hoped-for “new business models” that will spring out of the combination of self-service networks and Big Data automation.
These business models rely on new services that the mobile industry must co-design with the verticals – health, transport, security, government, automotive, industry, entertainment, utilities, agriculture – with which it hopes to engage. Initiatives such as X Labs and GTI’s collaborative initiative must, if they are to be useful, provide a space for real co-operation between a mobile industry that is used to a “delivery-consumption” model and verticals that are yet to really take a place at the table.
If they cannot do that then the operators will become irrelevant as places in which the applications and services that will define their future will be imagined and created. This is, in turn, just as much a threat to the major vendors supplying those telcos as it is to the telcos themselves. Hence Huawei investing in something like X Labs.
Some may ask, and they would be right to do so, if facilitating this process is something that is best done by vendors. After all, there are many associations for operators to work within – such as the GSMA or NGMN – that could engage industry verticals in similar programmes. Perhaps now we will begin to see them do so.