5G Technology
Network Slicing —
New revenue streams
from 5G.
Network slicing is one of the most talked-about features of 5G technology. Application subsystems can be assigned a dedicated slice of the mobile network, with guaranteed bandwidth, low latency, and availability — customized to the specific needs of an application use case.
Network slices designed to serve different needs

Network slicing is one of the most highly anticipated capabilities and potentially an integral enabler for monetizing 5G. Slicing promises to enable more tailored flexible connectivity services, designed to meet end customers’ specific requirements — such as ultra low latency, high reliability mission-critical services in Industry 4.0, or high bandwidth infotainment services.

Network slicing provides a huge business potential for CSPs, opening up many different opportunities across a wide range of use cases and industry segments: virtual and augmented realities, remote healthcare, autonomous vehicles and smart cities, to name just a few.

The current CSP business will have a 0.75% CAGR, compared to 12% for digital industrial. According to the latest Ericsson report, a $200 billion opportunity for CSP network slicing can be derived from the total global digitalization revenues.

$200 billion network slicing opportunity for CSPs per industry
Show me the money

Let’s talk about getting new revenue streams by adding completely new services. Take healthcare as an example — the largest piece of the pie.

CSPs can use network slicing to provide isolated, low-latency and high-throughput connectivity for video streaming and assessment of patient conditions in an emergency vehicle. In addition, the CSP could also partner with software and hardware developers to sell a complete solution.

Premium pricing

Slicing can generate revenue by enabling premium pricing and new business models. Demanding use cases can require custom-made services which result in higher fees.

For example, a network slice to a transportation company that provides more bandwidth and network isolation to enable high-quality and secure monitoring for transport of high-value goods that require a strict cold chain.

New business models and go-to-market roles: B2B2X

Network slicing opens up new business models as the network becomes a platform for other businesses. This will result in new partnerships and go-to-market models. CSPs will play a different role in relation to the end-customer depending on the domain:

B2C
Business to Consumer
The CSP charges a premium directly to the consumer for higher quality or dedicated access to content delivered by slicing.
Examples: A customer buys access to low latency mobile gaming on their smartphone or gaming device.

The CSP offers fixed wireless access (FWA) based on a dedicated network slice.
B2B / B2G
Business to Business / Government
The “slice buyer” is the end customer — typically a government entity or business that uses the slice to realize a use case for internal operations.
Example: A manufacturer buys a service based on a network slice to realize a robotics use case on a production line.
B2B2(B2)X
Business to Business to X
The slice buyer uses the slice to realize a use case for a customer. The chain could be long, with the second customer selling slice-enabled services to yet another entity.
Example: A cloud service provider buys a slice to provide dedicated, high-throughput wireless connectivity for a gaming platform company who then powers a premium game subscription for consumers.