How SK Telecom is Monetizing the 5G Opportunity
Contributed by David Trigg, Global Vice President, Market Development, Telecom Systems Business, Dell Technologies.
Wireless operators want to know: where are the best 5G revenue opportunities for our business right now?
The telecommunications industry has been talking about 5G for so long that it’s easy to forget 5G deployments are still in their infancy. The architectures have been painstakingly mapped out, the use cases thoroughly discussed, and the projections for revenue impact clearly outlined. The only question that remains unanswered for wireless operators is perhaps the most crucial question of all: Where are the best 5G revenue opportunities for our business right now?
It’s a question that wireless operators would have posed to industry analysts or market research firms in the past. Increasingly, however, they’re asking their 5G vendors to not only help them integrate their 5G technology but also help them innovate with it by identifying profitable 5G use cases, co-designing solutions, and co-developing a go-to-market strategy. It’s a question that, frankly, many 5G equipment vendors would just as soon avoid. That’s because most of those vendors are one step removed from enterprise customers and have little experience developing, deploying, and marketing enterprise solutions. And that’s part of what sets Dell Technologies apart from most 5G vendors because we build business solutions every day.
A great example of this new kind of vendor-operator partnership is the work we’ve been doing with SK Telecom – check our previous blog – Building One of the First MEC Solutions. SK Telecom is one of the world’s biggest wireless operators and is at the forefront of developing innovative MEC solutions that will drive new edge applications. They are leveraging Dell Technologies industry defined Dell EMC PowerEdge XE2420 server to power their recently announced 5G MEC Platform. Now, SK Telecom, along with Dell Technologies and VMware, have announced their fully integrated MEC solution called “OneBox MEC”. The OneBox MEC combines the SK Telecom 5G MEC Platform, Dell Technologies PowerEdge and PowerSwitch technologies, and VMware’s vSphere and Tanzu Kubernetes into one fully integrated MEC approach. This fully integrated solution is designed for enterprises that require a fast, secure MEC platform to support their application needs (in other words, nearly every enterprise).
What makes this solution so unique isn’t just the technology behind it, although there is that. It’s the people behind it. Members from SK Telecom, Dell, VMware, and Intel all came together to build a business case for the solution before they built the solution. And they didn’t just build it and wish SK Telecom luck. They stuck around to formulate an effective go-to-market strategy and continue to help SK Telecom market the solution today to ensure it generates real revenue. It’s that kind of “long-haul,” ROI-driven relationship that wireless operators are now looking for from their 5G vendor-partners.
Edge computing is still something of a brave new world for wireless because it extends beyond the traditional wireless network into the enterprise’s network. We know from research that enterprises want this kind of managed, private 5G network service. In a new study from STL Partners (download study) co-commissioned by Dell, 40% of enterprises have issues with their current networking solution’s latency. In some industries, such as healthcare, dissatisfaction was even higher. Sixty-one percent of healthcare companies cited network performance issues with their in-hospital patient monitoring systems, and 70% of engineering and construction firms felt their current networks weren’t secure enough.
But we also know that operators have historically delineated network services at the customer’s demarcation point. With edge computing, that demarcation point is blurred, and that can feel, well, risky for some operators. For companies like Dell and Intel, however, supporting businesses is our bread and butter. And so, for operators, partnering with a vendor like Dell that has deep enterprise solutions expertise becomes a “stronger together” story.
This new, 5G-inspired spirit of partnership isn’t just between operators and vendors. For example, SK Telecom has joined forces with other regional operators to create the Bridge Alliance: a consortium of operators in the Asia/Pacific and Middle East/Africa regions that is committed to sharing knowledge and accelerating 5G solutions for their customers. One of the Alliance’s goals is to expand the use of edge computing in those regions, a subject that SK Telecom expects to learn (and share) a lot about in the coming months.
If there’s one takeaway from all this, it’s that wireless operators shouldn’t expect to enter the 5G market alone, with little or no guidance. They need their technology partners to step up and help them identify the best 5G revenue opportunities, build and market those solutions, and have a vested interest in that solution’s success. In addition, they need broad community support to share best practices and accelerate 5G adoption around the world.
We’ve talked about the profitability of 5G long enough. Now is the time for 5G vendors to make the profitability of their operator-customers their business.