Gartner: Telco Pricing Options for 5G Services (before 5G is standardized)
by Stephanie Baghdassarian with Comments by Alan J Weissberger
The advent of 5G will bring opportunities for Communications Service Providers (CSPs) to renew their commercial approach to end users. Whether they propose new services or repackage existing ones, CSPs should focus on simplicity and flexibility to make the most of their offerings.
CSPs should differentiate their 5G services by selecting and combining pricing approaches that fit with their customer base but not limit themselves to pricing as a tool to promote 5G.
AJW Comment: This Gartner report is only available by subscription. However, we think it is very premature as “5G” networks continue to be deployed well before the IMT 2020 set of standards is completed ( IMT 2020.specs for RIT/SRIT won’t be completed till end of Nov 2020 at the earliest). Hence, CSPs really don’t have any foundation to charge for 5G services till at least 2021.
From the ITU 5G Backgrounder webpage:
IMT-2020, the name used in ITU for the standards of 5G, is expected to continue to be developed from 2020 onwards, with 5G trials and pre-commercial activities already underway to assist in evaluating the candidate technologies and frequency bands that may be used for this purpose. The first full-scale commercial deployments for 5G are expected sometime after IMT-2020 specifications are finalized.
Furthermore, spectrum is a scarce and very valuable resource, and there is intense – and intensifying – competition for spectrum at the national, regional and international levels. As the radio spectrum is divided into frequency bands allocated to different radiocommunication services, each band may be used only by services that can coexist with each other without creating harmful interference to adjacent services.
ITU-R studies examine the sharing and compatibility of mobile services with a number of other existing radiocommunication services, notably for satellite communications, weather forecasting, monitoring of Earth resources and climate change and radio astronomy.
National and international regulations need to be adopted and applied globally to avoid interference between 5G and these services and to create a viable mobile ecosystem for the future — while reducing prices through the global market’s economies of scale and enabling interoperability and roaming.
That’s why it was important for the additional spectrum to be used by 5G to be identified and harmonized at global and regional levels. For similar reasons, the radio technologies used in 5G devices need to be supported by globally harmonized standards.
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AT&T and Verizon said to have new 5G phones in 2020:
Chris Penrose, AT&T’s senior vice president of Advanced Mobility and Entertainment Solutions, told CNET on Wednesday at CES that the company plans to have 15 5G phones this year.
Most of the phones will be capable of taking advantage of AT&T’s low-band 5G spectrum as well as its higher-frequency millimeter wave. Additional devices like laptops, tablets and hotspots will also be available, but no exact number of products were given.
The low-band 850Mhz network, which AT&T calls simply “5G,” went live in December and is currently active in 19 markets. Penrose says that the company plans to expand this network to cover 200 million people “by the summer.”
As with T-Mobile’s similar low-band network, speeds on 5G are comparable to 4G LTE (which AT&T has confusingly branded as 5GE) though it covers wider areas and can reach inside buildings.
The millimeter-wave network, which AT&T calls “5G Plus,” has been live since late 2018 and most recently expanded to parts of 35 cities, but has thus far limited access only to developers. As with Verizon’s millimeter-wave network, 5G Plus offers significantly faster speeds than low-band 5G, but its coverage is often severely limited to a handful of outdoor locations in the cities where it’s live.
Penrose equates AT&T’s 5G strategy to a chocolate chip cookie, with the cookie representing the larger low-band 5G footprint and the chips equating to the assortment of millimeter-wave cities “sprinkled in across the country.”
New phones, Penrose says, will enable consumers to have access to the “entire cookie” and tap into AT&T’s full 5G network.
While it is unclear when the next batch of 5G phones will arrive, rumors point to Samsung’s next Galaxy S line being among the first phones to support both flavors of 5G. Samsung announced Saturday that it will be hosting an Unpacked event, the method it traditionally uses to launch major new mobile products, on Feb. 11 in San Francisco.
Ronan Dunne, head of the Verizon Consumer Group, told CNET on Tuesday that his company plans to have 20 5G devices in 2020 with some being priced under $600 later this year.
Penrose would not go into specifics on pricing for AT&T’s 5G devices but did say that the company will be “competitive in the marketplace.”
AT&T CFO John Stephens remarks on “bundling services” at Citi TMT conference Jan 2020:
We’re going to have a national footprint on 5G this year in our core network. We already have 35 cities up and running for the 5G+ service and about 20 cities up and running for 5G (?) in our core network.
But — so they (AT&T customers) will be able to consume wireless services, but also data, also entertainment. They will use it as their — not only their wireless, but their broadband, wireless broadband. And we’ll be the provider who can have the ability to do that, not only from a traditional postpaid account, but a prepaid account or with our capacity, even resellers.
Secondly, on the fiber side or on the whole broadband side, the ability to bundle that with video, the ability to bundle that with wireless services. The ability to bundle that with a full TV package clearly have that advantage, whether it be AT&T TV, whether it be our wireless services, whether it be our fiber-to-the-home.
as new 5G comes out, we’re going to have just, quite frankly, a really unique intersection. We have a network that’s, quite frankly, ahead of devices, which is the first time that’s really happened. And so we’re going to have a national footprint. By the middle of the year, we’ll have great speeds, great — and it will continue to improve and grow throughout the end of the year.
In the middle of this year, we’ll have HBO Max coming out, and we’ll have tremendous packages for our wireless customers to bundle with those. And then we’re going to have new 5G phones come out throughout the year. We have some out today, but they will be coming out throughout the year. And when you put that grouping in place as an offer for customers who are looking throughout the year and certainly in the second half of the year, that’s a tremendous magnet for those customers, a really attractive situation. So, we feel really good about where we’re at.
But I would — in short order, I would think, people are going to consume broadband data in much the same way they do today, but it’s going to be higher demands for speed, more continuing demands for bundling, continuing demands, growing demands for video, and we feel like we’re going to be really extremely well-positioned to play in that market.
As DISH prepares to build the first virtualized, standalone 5G broadband network in the U.S., the company announced it will release a Request for Information and Request for Proposal (RFI/RFP) for Telecom Transport Services in the coming weeks.
The Telecom Transport Services RFI/RFP, the fifth in a series of RFPs for different elements of the national network, will include requests for telecom transport service companies to facilitate lit and dark fiber connectivity to cell towers, buildings and data centers.
DISH Executive Vice President of Wireless Operations, Jeff McSchooler stated:
“We’re building a 5G network from the ground up, with the opportunity to apply fresh ideas and new partners. We’re seeking input from local and regional telecom transport partners, as well as the national providers that have supported our existing video business for decades. We see an opportunity to learn from nontraditional partners as well, like utilities and municipalities that may be deploying fiber in their communities. We are exploring varying transport infrastructures to support our aggressive buildout.”
DISH has committed to building a standalone 5G broadband network available to at least 70 percent of the U.S. population by June 2023.
The Telecom Transport Services RFI/RFP is the fifth such document DISH has issued as it pursues its 5G buildout. The RFPs issued to date include:
— July 2019: 5G Network RFI/RFP seeking input for the network elements
— September 2019: System RFP seeking responses from vendors to provide a
software solution for project management, workflows, reporting and other
utilities that aid in deploying the national network
— October 2019: Deployment Services RFP seeking input for end-to-end
deployment services including pre-construction and construction services
— January 2020: 5G Component RFP seeking input from vendors regarding
physical assets of the network such as mounts, cabinets and hybrid cables
— January 2020: Telecom Transport Services RFI/RFP
Vendors interested in receiving the Telecom Transport Services RFP can contact DISH Wireless at [email protected] prior to January 30, 2020.
DISH Network Corporation is a connectivity company. Since 1980, it has served as a disruptive force, driving innovation and value on behalf of consumers. Through its subsidiaries, the company provides television entertainment and award-winning technology to millions of customers with its satellite DISH TV and streaming Sling TV services. Through its strategic spectrum portfolio and other assets, DISH is poised to enter the wireless market as a facilities-based provider of wireless services with a nationwide consumer offering and development of the first standalone 5G broadband network in the U.S. DISH’s OnTech Smart Services brand offers in-home installation of connected home devices and entertainment solutions. DISH Media serves as the company’s advertising sales group delivering targeted advertising solutions. DISH Network Corporation (NASDAQ: DISH) is a Fortune 250 company.
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