The opportunity
New network slicing capabilities powered by 5G standalone deployments can increase revenue opportunities through tailored subscriptions designed to meet consumers’ specific connectivity needs.
This presents an opportunity for Communication Service Providers to evolve from the downward spiral of the single internet subscription model with its focus on marketing better performance and more GB for a lower price, to a monetisation model that delivers connectivity with different characteristics based on new types of subscriptions and charging. This scenario also benefits the user, who can make more informed and personalised decisions about which subscription they should buy to suit their needs.
For example, a ‘multi-pay’ offering – whereby multiple invoices can be sent for the same device – opens up more revenue streams for the operator, as well as flexibility for users who may want to have more than one subscription, paid for by multiple users. While 5G will eventually connect all devices, those revenue streams for advanced use cases are still in their infancy, while multi-pay on smartphones represents a tangible opportunity in the here and now.
These types of multiple subscriptions based on different quality of service characteristics, including speed and volume, are supported by the EU’s open internet regulatory framework and the regulatory guidelines that complement it.
Creating differentiated services
For Communication Service Providers, the effective definition of a ‘user’ is critical to creating services that are differentiated. The ‘user’ in this instance isn’t necessarily the person or organisation that uses the service, but rather it is the one that decides which subscription to buy and then pays for it.
For example, an employer is the ‘user’ when selecting and buying a subscription for an employee. A parent is the ‘user’ when buying for their child. A school can be the ‘user’ when selecting solutions for its students. The principle of Yield Management – whereby Communication Service Providers undertake a variable pricing strategy based on anticipating usage based on user characteristics and network availability – makes perfect sense in this scenario.
Putting control in the hands of the user
One of the underlying principles of the EU’s open internet framework is to empower the user. Multiple subscription models give user the choice and flexibility to define connectivity that best suits their needs. For example, when we use our smartphone for internet-shopping, we are the user - but when we use it to join a video conference with colleagues, our employer is the user. Having multiple subscriptions on that same device, to allow for the different ways in which it will be used, makes sense for all parties the Ultimately the user decides which element of their subscriptions they want to tap into and when.
From a technology perspective, 5G Standalone and its central functionality, network slicing, will be key to delivering on the multi-subscription, multi-pay and multi-performance opportunity. Network slicing provides service flexibility and the ability to deliver services faster at scale, with high security, isolation, and applicable characteristics. Network slicing represents an opportunity of $200bn by 2030 for Communication Service Providers – and user-based subscription models could represent a very attractive slice of that pie.
