Is 5G FWA the Golden Ticket for Telcos to Monetise 5G

FWA is not a new concept or technology. It was just not feasible with 4G because of the low bandwidth. But with 5G, FWA can make a huge difference as it can not only provide data connectivity to smartphones but can also be connected with the Internet of Things (IoT) products to boost the Smart Home ecosystem.

Highlights

  • 5G is driving the major chunk of capital investments from the Indian telcos.
  • Indian telcos, including Airtel and Jio, are going to offer 5G FWA services to consumers sooner or later.
  • In the United States (US), users have already been purchasing 5G FWA connections from telecom giants such as T-Mobile.

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5G is driving the major chunk of capital investments from the Indian telcos. While 4G is relevant and an important aspect of the telecom business today, the telcos are more motivated to promise customers a superior 5G experience. But funnily enough, they can’t monetise it right now. I mean, sure, offering unlimited 5G to 4G customers is going to drive the adoption of 4G, which in turn adds to revenues, but that doesn’t really create a huge revenue difference for them as people were already subscribing to 4G.




So where’s the opportunity to monetise 5G? The answer lies in the use cases of the technology, and when you look at the use cases, you realise that most of them are meant for enterprises. For direct retail customers like you and me, 5G doesn’t change much in terms of experience if we get great 4G. But one strong use case of 5G that has been identified for consumers is 5G FWA (fixed wireless access).

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Indian telcos, including Airtel and Jio, are going to offer 5G FWA services to consumers sooner or later. In the United States (US), users have already been purchasing 5G FWA connections from telecom giants such as T-Mobile. 5G FWA replaces the need for physical fiber as if operated on mmWave (millimetre wavelength) frequencies, it can deliver up to 3+ Gbps speeds to customers. It can also be operated on C-band frequencies to deliver up to 1+ Gbps speeds.

FWA is not a new concept or technology. It was just not feasible with 4G because of the low bandwidth. But with 5G, FWA can make a huge difference as it can not only provide data connectivity to smartphones but can also be connected with the Internet of Things (IoT) products to boost the Smart Home ecosystem.

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Telecom operators can’t really push consumers to pay more at scale for 5G if it is not for 5G FWA. Frankly, most consumers in urban cities would rather get a fiber connection for their homes to get access to high-speed internet. Only a rare subset of data users would require 5G speeds while travelling.

But even with 5G FWA, there’s one big limitation. It is that it costs a lot. Not just for the consumers but even for the telcos. Regardless, according to a Vantage Market Research report, the 5G FWA market is expected to cross $150 billion USD by 2028. The Consumer Premises Equipment (CPE) cost needs to be at a sustainable level to ensure that 5G FWA can grow fast in price-sensitive markets such as India.

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Tanay is someone with whom you can chill and talk about technology and life. A fitness enthusiast and cricketer, he loves to read and write.

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