As expected, MWC21 Barcelona saw an array of announcements on the leading innovations, developments and partnerships which will shape the future of the industry.

It comes as no surprise, then that as the dust settles post MWC21, most of the announcements and updates from the industry in the last month have focussed more on the day-to-day activities ranging from spectrum, network coverage, M&A and other updates.

From these, we decided to share an update on the latest developments in standalone (SA) 5G networks and consumer gaming.

How long is the SA 5G journey to become mainstream?
Did you know? By mid-August, 15 operators from 12 markets has deployed commercial SA 5G services covering mobile and fixed wireless access (FWA).

And 90 operators from 45 markets, around 38 per cent of operators which have either launched or plan to launch 5G, had also announced plans for SA deployments (conducting trials, and forging infrastructure and solution partnerships) after having initially launched non-standalone (NSA) 5G.

SA networks are expected to be one of the key enablers for myriad 5G use cases across enterprise and consumer markets. This explains why the investment in these networks is a natural step for operators in their 5G journey.

A recent GSMA Intelligence survey found operators foresee the following as top benefits from deploying SA networks (see chart, below, click to enlarge).

[1]

The momentum and progress is also reflected in the following announcements from operators sharing updates on their coverage plans, new launches, partnerships, and trials (see table, below, click to enlarge).

[2]

So what? The true success of SA 5G will only happen when it becomes more mainstream. How long this will take, therefore becomes one of the key questions to answer.

Any network evolution is a gradual process and can take anywhere from months to years depending on the specific operator circumstances, strategies and investment decisions. However, referencing the lifecycle of existing LTE networks, based on GSMA Intelligence data covering 150 operators, it took an average of two-and-a-half years to upgrade from LTE to LTE-Advanced. This does not suggest a direct correlation for understanding the lifecycle of an SA upgrade from NSA, but it serves as a good analogy.

LTE-Advanced, of course, was a technical advancement on existing LTE networks, whereas a move from NSA to SA will likely be more significant for most operators and might take similar or more time than LTE upgrades. It will be interesting to see how long it takes for SA networks to become mainstream.

Meanwhile, in the near- to medium-term, building on established coverage of LTE, NSA will continue to do the heavy lifting of 5G, but operators still need to incorporate SA network planning in their long term roadmap.

Related reading:
5G SA means business – but also consumer [3]
5G SA networks are going global, ready to become mainstream [4]

Operator opportunity in shifting gaming behaviour
Did you know? A GSMA Intelligence consumer survey found 60 per cent of the adult population across 20 developed countries play digital games at least once a week. But what percentage of gamers pay for these?

On average, only a third of gamers pay for games. The recent gaming surge among consumers coupled with this presents monetisation opportunities in the gaming ecosystem.

Not only this, the survey also brought to light shifting consumer behaviour.

A preferential shift to gaming on smartphones (thanks to a multitude of games available on cloud platforms, affordable smartphones, and the increasing availability of 5G networks and devices).

Gaming is now for every age group, however the proportion of people playing varies among different age groups: 72 per cent of 18 to 24 year-olds play games at least once a week, while 42 per cent of people aged 65 and over do so.

Undoubtedly, the changing consumer behaviour and surge in gaming creates new monetisation opportunities for operators beyond connectivity or upselling larger data packages, and also creates opportunities for other players in the gaming ecosystem. This is also corroborated in the following recent developments in industry on the gaming front (see table, below, click to enlarge).

[5]

So what? It is clear the industry sees an opportunity in gaming and is making progress towards trying to capture it. The question then becomes what are the options available to operators for monetising the opportunities in gaming and what success will look like.

Drawing insights from the same GSMA Intelligence report [6], there are four routes available for operators to capitalise on the opportunities: two in B2C (selling third party games, developing in-house games); and two in B2B (offer networks services including edge and private networks to gaming and media companies, or develop e-sports products).

Operators will derive their success in the form of new revenue, premium customer base and reduced churn, alongside other benefits highlighted in the report.

Now, which route to take will then depend on some underlying factors such as market profile, operator network assets and their strategies.

Clearly the gaming industry is expected to grow manifold in the coming years and it’s time to capitalise on the opportunities.

For more detailed insights related on consumer gaming behaviour, the options available to operators and the underlying factors please refer to the following GSMAi publications.

Gaming comes into its own: capitalising on shifting consumer behaviours [7]
Consumer gaming: assessing the new revenue opportunity for operators [8]

All the above analysis is based on news curated by GSMA Intelligence’s team of analysts and taken from their Industry Updates feed, available here [9].

– Radhika Gupta – head of data acquisition, GSMA Intelligence

The editorial views expressed in this article are solely those of the author and will not necessarily reflect the views of the GSMA, its Members or Associate Members.

[1] https://www.mobileworldlive.com/wp-content/uploads/2021/08/GSMA_Intelligence_operatorsurvey.jpg
[2] https://www.mobileworldlive.com/wp-content/uploads/2021/08/GSMA_Intelligence_5G_partnerships.jpg
[3] https://data.gsmaintelligence.com/research/research/research-2021/5g-sa-means-business-but-also-consumer
[4] https://data.gsmaintelligence.com/research/research/research-2021/5g-sa-networks-are-going-global-ready-to-become-mainstream
[5] https://www.mobileworldlive.com/wp-content/uploads/2021/08/GSMA_Intelligence_gaming.jpg
[6] https://data.gsmaintelligence.com/api-web/v2/research-file-download?id=60621093&file=230621-gaming-consumer-behaviours.pdf
[7] https://data.gsmaintelligence.com/research/research/research-2021/gaming-comes-into-its-own-capitalising-on-shifting-consumer-behaviours
[8] https://data.gsmaintelligence.com/research/research/research-2021/consumer-gaming-assessing-the-new-revenue-opportunity-for-operators
[9] https://data.gsmaintelligence.com/industry-updates

Last week saw the release of a white paper focused on the 5G-Advanced mobile core.

As is often the case with these sorts of technical white papers, titling erred on the side of word count versus catchiness: 5G-Advanced Technology Evolution from a Network Perspective – Towards a New Era of Intelligent Connect X.

Broader visibility wasn’t helped much by a release in the middle of summer, at the tail end of earnings season and as the Olympic Games were winding down. Combined with an APAC-focused contributor list, you shouldn’t beat yourself up too much if you somehow missed this.

And yet, a source company list which includes Ericsson, Huawei, Nokia, Samsung, ZTE, KT, SK Telecom and every major mobile operator in China makes this something to pay attention to. It’s not every day fierce competitors collaborate on future forward market messaging and what they agree on is telling.

What’s it all about?
While the whitepaper title won’t win any awards for concision, it does manage to capture the key themes. Three terms, in particular tell you everything you need to know about the content: 5G-Advanced; network perspective; and intelligent connect X.

The first, 5G-Advanced is a 3GPP term for the evolution of 5G, but one which stops short of what we might get with 6G someday. Think new goals and capabilities for 5G networks, services, and operators. The term network is a broad one. Here, however, the network perspective is firmly centred on the mobile core. Yes, 5G-Advanced will touch the RAN as well as the core, but the paper avoids the former to remain focused.

And the final term? Intelligent connect X isn’t a commonplace industry term. However, it does capture the notion of intelligently connecting multiple different stakeholders along with a diverse set of user types and devices. To that end, it conveys 5G-Advanced aspirations fairly well.

What will operators need to support?
In the early days of 5G R&D, discussions of what the next generation would bring focused almost exclusively on use cases versus technologies. It’s only logical, then that discussions of 5G-Advanced would follow suit, and here the whitepaper makes a case for key market drivers across a number of dimensions.

5G versus 6G. We all know 6G is coming, but is still years away. Yet, as the paper argues, “the current capabilities of the 5G network are still insufficient,” for executing on the 5G vision. To this end, enhancements in line with 3GPP Rel-18 and beyond are coming.
Consumer versus enterprise. 5G was built to address business and consumer needs. To its credit, then, the paper highlights 5G-Advanced must, “meet the needs of personal consumer experience upgrades and digital transformation of the industry.” Of course, where enterprise verticals are a well-understood revenue opportunity for operators, their needs dominate the whitepaper’s context setting.
IT versus OT. Early on, the paper notes “in addition to ICT technology, there will be more demand from production and operation in the future.” This is a nod to the need for IT and OT integration as IoT further penetrates the enterprise segment.
Vertical versus vertical. Any recognition of 5G touching on OT demands must acknowledge different verticals have different needs. Or, as the paper puts it, “businesses in different industries…need the network to provide them with a differentiated business experience”.
Cloud versus edge. Against the backdrop of new low-latency applications, the paper minces no words in stating “the network edge is the centre of future business development”. Recognising operators are looking to meld edge cloud and central cloud assets, however it also asserts the need for 5G-Advanced to “integrate the characteristics of cloud-native and edge-native”.
Fixed and mobile. As with the discussion of differentiated vertical demands, a 5G-Advanced focus on the enterprise requires acknowledging fixed and mobile networks will need tight coordination, or “convergence of fixed network and mobile network”. Of course, with 5G tackling residential broadband use cases, this applies to home networks as well.

What will help operators succeed?
If there is one takeaway from the whitepaper’s discussion of market drivers, it’s that 5G-Advanced will need to support an increasingly broad set of industry requirements. Different device types and vertical demands, IT versus OT processes and protocols, and diverse network topologies.

To do so, three key technology advancements and trends get much of the paper’s focus.

Convergence. To be fair, convergence is more of a concept than a technology. But, considering the market drivers noted earlier, it is the concept which ties all of those drivers together. Convergence across different technology generations, fixed and mobile networks, diverse cloud localities (local versus central), and enterprise IT and OT domains. And, based on a broad set of whitepaper contributors, convergence across the views of diverse ecosystem players.
Distributed edge. I’ve mentioned edge computing a number of times already, so it shouldn’t be surprising to see it pop up as a key 5G-Advanced tech cited in the whitepaper. From a convergence perspective, the use cases are myriad, including the integration of fixed and mobile enterprise apps, or apps at the edge of multiple generations of technologies. Digging deeper into the enterprise, the role of edge in supporting private networks, low-latency applications, and applications where data needs to remain on premise is clear. And none of this should obscure the role of edge in supporting low-latency consumer applications. Of course, these dynamics are not exclusive to 5G-Advanced or waiting for its arrival. But the market shifts and demands driving 5G-Advanced development will only serve to make the edge more important.
Intelligence. If the idea of converging an extremely disparate set of use cases and service requirements seems like a dauting task, that’s because it is. And, if the idea of converging disparate networks and network localities (from the network core to the edge) seems daunting, that’s because is it. Success, then, will require support which goes beyond standard human assets and skills. This is why the paper spends a lot of time on the role of AI. For network set-up, maintenance and optimisation. For service set-up, slicing orchestration and SLA monitoring. For consumer and enterprise end-users. Again, the move to pervasive AI isn’t new or unique to 5G-Advanced. But, if there’s one technology message the paper tries to convey, it’s that 5G-Advanced will drive AI forward.

To be fair, there isn’t much that is incredibly surprising in the whitepaper. Its aim is to outline a roadmap of how 5G-Advanced can (or should) support industry goals. Where those goals are generally agreed on, there shouldn’t be too many surprises. At the same time, like many roadmaps, there is some good and bad news to consider.

The bad news is much of this isn’t new. The industry has been talking about enabling verticals, edge computing, convergence and AI for years. Any discussion of how 5G-Avanced involves all of this suggests we haven’t been successful.

Ultimately, this probably isn’t bad news as much as it is just reality. The good news, then, is we know what will help to support these aspirations and the industry is intent on making them a reality.

– Peter Jarich – head, GSMA Intelligence

The editorial views expressed in this article are solely those of the author and will not necessarily reflect the views of the GSMA, its Members or Associate Members.

We knew it was not a matter of if, but when: like with music and video in the past, digital transformation is now disrupting the gaming industry. Shifting consumer behaviour is a major driving force, as is recent progress with enabling technologies such as cloud, 5G and immersive reality. Here we look at the transformation of the gaming industry across different areas, and analyse what it means for mobile players.

Gamer behaviour is changing
Gaming is a popular pastime for people of all ages. GSMA Intelligence Consumers in Focus research shows that 60 per cent of the adult population across the 20 major countries we analysed plays digital games on consoles, PCs or mobile devices at least once a week. That is a significant user base. Our research also shows gamer behaviour is changing. First, there is a shift of gaming time from consoles to mobile devices, especially smartphones. This brings greater reach and higher consumer engagement, owing to the ubiquitous adoption of smartphones and the plethora of games available on mobile app stores.

Second, like with music and video, a subscription model is now emerging for gaming, as consumers show interest in it. Today, gamers have a broad and diverse range of options to choose: these include subscriptions for consoles (for example PlayStation Now, Nintendo Switch Online, Xbox Game Pass), cloud gaming subscriptions (Google Stadia, Tencent Start, GeForce Now), subscriptions designed for mobile (Apple Arcade, Google Play Pass) and subscriptions provided by game publishers (Uplay+, Origin Access).

What does this mean for the gaming industry?
It means disruption and innovation. The advent of mobile as a gaming platform and the rise of cloud-based gaming have disrupted the position of consoles as the dominant platform, opening up the market to new competitors. Console sales have been hit in recent years, while some OEMs have enhanced the gaming capabilities of their smartphones. Flagship mobile devices (Samsung Galaxy S21, Razer Phone 2 or Asus ROG Phone 5) are marketed specifically for gaming, with aftermarket accessories which can turn these devices into dedicated mobile gaming consoles.

It also means a new business opportunity. Let’s do the maths: 15 per cent of gamers in the countries we analysed already have a gaming subscription; half are not interested in a gaming subscription (for now), leaving an incremental market of at least 35 per cent of gamers. If subscription gaming is to work as a mass-market commercial product, gaming companies will need to attract non-paying gamers and turn them into paying gamers.

The prominent cloud gaming services in operation are run by the big companies with established cloud and content delivery network infrastructure footprints (for example Microsoft, Google and Tencent), but mobile players including Apple and a range of operators are making progress here too. Also, Netflix recently confirmed its intention to enter the gaming market, which is certainly a big development.

Why are operators looking at gaming, and why now?
So far, operators have mostly benefitted from gaming indirectly through upselling, as heavy gamers need larger mobile data allowances. However, the shift of gaming to mobile devices, coupled with technology innovation which heavily involves (or is led by) operators (for example cloud, edge, 5G) are driving new thinking.

The 5G element is important for at least two big reasons. First, streaming requires cloud-based content access, delivery and consumption, which in turn requires high-speed connectivity and low latencies: this is 5G territory. The rollout of 5G networks enables the faster and low-latency connections smartphone gamers need to have higher-quality, uninterrupted cloud-based gaming sessions.

Second, 5G users are more engaged with gaming than 4G users (twice as much to be precise) and are more interested in having gaming services bundled with their mobile connectivity contracts (40 per cent higher interest). Also, nearly half of people playing games on their smartphones frequently find the enhanced gaming experience enabled by 5G appealing, especially among younger generations (see chart, below, click to enlarge). This is something for operators to consider when designing their 5G and multi-play offerings and tariffs.

[1]

What are the strategic routes to gaming for operators?
An increasing number of operators are aiming to monetise the transformation of gaming via a more direct role. We have identified four possible routes for operators. Two of them are B2C-focused, selling third-party gaming services or developing own-branded services, often bundled with mobile or quad-play offerings. The other two are B2B-focused, offering premium network capabilities including edge technology, network slicing and private networks to gaming/media companies or developing e-sports. These routes are not mutually exclusive: a complete gaming strategy may well involve a combination of these options.

Selling third-party gaming services bundled with mobile represents the fastest and most common approach for operators, but it is largely a customer acquisition/retention strategy. Developing own-branded gaming services offers greater revenue potential. As with video streaming, operators will find it challenging to have a cloud gaming service which is competitive globally, however it is within their reach to launch competitive propositions for local markets. A range of operators have already launched local cloud gaming propositions, including Deutsche Telekom, TIM, Vodafone Italy, China Mobile and the three South Korean operators. KT and SK Telecom each aim to reach 1 million gaming subscribers over the next two to three years: this would correspond to around 10 per cent of their 5G subscriber bases, assuming most gaming subscribers will be 5G users.

What is the incremental revenue opportunity for operators?
Our revenue opportunity model considers multiple factors, such as the current adoption of subscription gaming, the probability core gamers will adopt a subscription in the future, the 5G effect (a function of 5G penetration 5G gamer behaviour) and pricing dynamics. We sized both the direct (gaming subscription revenue) and indirect contribution (core ARPU uplift) of gaming. The indirect contribution is important, as the average mobile spend of paying 5G gamers is 20 per cent higher than 4G, meaning 5G gaming attracts premium mobile subscribers.

Taking 2020 mobile revenue as the base, gaming subscriptions could generate up to 4 per cent of new revenue for operators in 2025. This ranges from 3 per cent in the UK, Italy and the US, to 4 per cent in South Korea. Given annual mobile revenue is set to grow by low single-digits in three of the four markets (and decline in Italy), the gaming opportunity, which comes on top of these figures, can be remarkable. In addition, operators are exploring the gaming opportunity in a period when traditional pay-TV revenue is under pressure and falling in some markets, providing one more reason to try and do well in gaming.

As mobile increasingly shapes the future of gaming, we will continue to track and assess technology developments, gaming adoption, and business opportunities.

You can read more on this topic in our latest report [2] Gaming comes into its own: capitalising on shifting consumer behaviours.

– Pablo Iacopino – head of research and commercial content, GSMA Intelligence

The editorial views expressed in this article are solely those of the author and will not necessarily reflect the views of the GSMA, its Members or Associate Members.

[1] https://www.mobileworldlive.com/wp-content/uploads/2021/08/GSMA_Intelligence_5G_gaming.jpg
[2] https://data.gsmaintelligence.com/research/research/research-2021/gaming-comes-into-its-own-capitalising-on-shifting-consumer-behaviours