“Put 5G on the agenda, because we all have to go along with it”

05/04/19

New 5G telecom technology

The new 5G telecom technology is going to change our lives dramatically. “Telecom companies are currently investing in the roll-out of 5G or in preparing for it. We expect that within three to six years, 5G will have taken over the role of the old telecom technologies.” That’s the emphatic view of Steven Pattheeuws, a partner at Strategy& – part of PwC – and a specialist in the field of telecom.

“5G means faster Internet and greater capacity for consumers. But the big breakthrough is in the application of ‘Connected Things’, in other words allowing large numbers of devices to exchange data autonomously. 5G technology will allow more than 350,000 devices to be connected per square kilometre, which is five hundred times more than with comparable existing technologies. Companies that aren’t yet looking into the possibilities offered by 5G need to do so now. If they don’t, they run the risk that their products won’t follow the trend of connected things. And that means the risk of demand for their products drying up.”

What makes 5G technology so special?

“With 5G,” says Steven Pattheeuws, “you can send and receive very large data files at extremely high speed – in just thousandths of a second. That means that it’s not just people but also devices that can communicate with one another independently – for example cars, ships, trains, household appliances, all kinds of machines, and robots. Thanks to this technology, concepts such as smart cities, smart houses, the Internet of Things, and autonomous cars will soon become reality.”

Does Europe have an agenda for the roll-out of 5G?

“The European Commission sees 5G as crucial for the further digitalisation of a wide range of sectors and industries. The EU is therefore closely monitoring whether governments and regulators in the various countries are taking action in the run-up to 5G, such as freeing up and auctioning new frequency spectrum. We’re still at an early stage, and now’s the time when the right preconditions need to be created. At the moment, we’re mainly working on legislation and regulations.”

What does the EU’s 5G policy mean for the situation in the Netherlands?

“In order to enable 5G, we need to free up frequencies. We’re already working on that. As soon as those frequencies are available, they’ll be auctioned off to telecom providers. \And we’re already implementing pilot projects, for example in the port of Rotterdam, to see whether the equipment and technology work properly. I expect 5G to start being rolled out in the Netherlands in 2020.”

What opportunities are there for Dutch companies?

“Once the 5G network has been installed here and in neighbouring countries, then the possibilities are in fact unlimited. Every industry or commercial sector will benefit. Using drones, for example, will make it easier to check and maintain the road and rail networks. They can provide details of the condition of the infrastructure. It’ll no longer be necessary to run special monitoring vehicles. Thanks to the high speeds of the network, cars will increasingly be able to drive more safely and independently. The 5G system won’t only help reduce traffic congestion and accidents but also achieve our climate objectives. The agricultural sector can use sensors to check on a consignment of products or on the welfare of animals that are being transported."

What are the challenges for the roll-out of 5G in the Netherlands?

“5G actually only offers added value if it’s everywhere: throughout the Netherlands, in all the surrounding countries, and in all the EU Member States. If it’s only installed in cities but not outside them, then all the 5G applications, such as self-driving cars, will only work in the cities. So it’s important that telecom companies that work with 5G in the Netherlands ensure that there’s countrywide coverage. That requires major investment. On the other hand, the business market can become extremely interesting for telecom companies thanks to 5G. It can become part of a new revenue model for telecom providers and an important addition to traditional telephony, TV, and Internet services. When telecom companies are considering extending their own services to the business market, then they should thinking whether they need to enter into alliances or make acquisitions.”

What does the advent of 5G mean for entrepreneurs and businesses?

“5G technology enables connectivity between devices. It’ll lead to a veritable tsunami of machine-to-machine data traffic. I expect that communication between devices will in the long run overtake communication between people. Because machines and devices will be able to communicate with one another and exchange data, the demand for these kinds of smart devices will also increase.

If manufacturers fail to keep up with this development, it could eventually lead to the collapse of demand for their products. Take the construction of houses. In a few years’ time, someone who buys a new house will expect it to be ‘smart’ and to make possible the exchange of data with the devices it contains. That connectivity between the home and the devices means smarter energy use, for example, and it offers greater convenience and comfort for the occupants. Entrepreneurs need to realise that they have to keep up with these developments, and that it’s becoming increasingly important to ensure that their products are smart and can be connected to other products if they are to remain attractive for users.”

What do entrepreneurs need to do to keep up?

“First of all, they should take a good look at their roadmap for developing new products. Which of those products are suitable for the old technology and which are suitable for 5G? If connectivity isn’t yet part of their product development schedule, then they need to change that fast! And if they don’t have the right people for that, they need to recruit them. Companies that consider themselves too small to keep up with these developments can decide to enter into partnerships or to be taken over. In short, put 5G on the agenda, because we all have to go along with it.”

Read also: Making 5G pay: Monetizing the impending revolution in communications infrastructure or download below the full report The great potential of 5G ecosystems.

Contact us

Steven Pattheeuws

Steven Pattheeuws

Partner Strategy&, PwC Netherlands

Tel: +31 (0)88 792 29 36

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