5G networks are envisioned to provide consumers and industry with improved transmission performance and advanced communication possibilities. To deliver on this promise of ushering in faster downloads and lower latency, mobile network operators are called upon for substantial investment in network infrastructure. Investors and operators need a clear 5G business case before making such investment. So far, very little research has been published on the topic of the 5G business case. This article studies the impact of different elements driving the business case of a 5G network. The study was performed within 3 boroughs of central London, UK, for the period 2020-2030. 5G-related costs and revenues were calculated to derive the business case. The results show that the business case for a 5G network providing mobile broadband services alone is positive over the time period 2020-2030 but has some risk in the later years of this time period. The business case is also particularly sensitive to assumptions on the revenue uplift and the rate of traffic growth which are inherently challenging to forecast. The sensitivity analysis shows that the return on investment becomes negative if both traffic and costs are significantly higher and revenues increase more slowly than our baseline forecasts. Network sharing helps to substantially improve the business case. Further research is needed to understand the business case on a regional or nationwide basis, and for a network that provides additional services beyond broadband.
Purpose
5G systems will enable an improved transmission performance and the delivery of advanced communication services. To meet the expected requirements, operators will need to invest in network modernisation, with the radio access network being the most expensive network component. One possible way for operators to reduce this investment would be via sharing of resources by means of a multi-tenancy concept. This implies that a mobile service provider may use the common infrastructure of one or various infrastructure providers, whereby it provides services to multiple tenants. This paper aims to study the expected cost savings in terms of capital expenditures (CAPEX) and operational expenditures (OPEX) that can be achieved when using a cloudified 5G multi-tenant network.
Design/methodology/approach
A cost model was used. The study period is 2020-2030 and the study area consists of three local districts in central London, UK.
Findings
This paper describes that the total cost reduction achieved when using multi-tenancy for a 5G broadband network in comparison with the case where operators make the investment independently ranges from 5.2% to 15.5%.
Research limitations/implications
Further research is needed to assess the cost implications of network sharing for 5G on a regional or nationwide basis.
Originality/value
Very little quantitative research about the cost implications of network sharing under 5G networks has been published so far. This paper sheds light on the economic benefits of multi-tenancy in a 5G broadband network.
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