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Business trends

5G carriers battle to provide new experiences

Annual investments to reach $500bn as South Korea and US prepare launch

GSMA's Mats Granryd speaks at the Global Digital Summit in Tokyo. Seated next to him are John Harrington of Nokia Japan and Jim Cathey of Qualcomm Technologies.

TOKYO -- The ultrahigh-speed 5G mobile networks rolling out worldwide over the next several years will demand costly investments by telecom carriers, forcing them to rethink how they serve companies reaching for the opportunities created by the new technology.

The once-in-a-decade revamp of the mobile standard guarantees fierce competition among technology companies as well as telecom carriers.

"This has become a much more competitive market than it has been historically, and for a good reason," said Jim Cathey, senior vice president of telecom equipment company Qualcomm Technologies. "The value that's created from 5G will dwarf the value that came from the previous generations."

His sentiment was echoed by John Harrington, CEO and president of Nokia Japan, a unit of the Finnish telecom infrastructure operator.

"Increasingly, the networks have become commoditized," he said, noting that his company focuses now on enabling third parties to provide new services using its network, rather than simply being a pipeline operator.

Nokia sees itself as "a more software-defined network than a physically defined network," Harrington said.

Harrington and Cathey spoke Monday at the Global Digital Summit in Tokyo, a Nikkei-sponsored technology symposium.

Fifth-generation mobile networks are set for commercial launch in the U.S. and South Korea this year and next, while Japan is expected to debut its own in 2020. Global mobile industry group GSMA estimates $500 billion in capital investment will be required annually between now and 2020, but the technology should drastically improve the user experience. 

Mats Granryd, GSMA director general, hailed these advances, saying that "360-degree videos will put you at the center of an amazing expedition. We will be able to use virtual reality to have a VIP access to the hottest and coolest event, even if it is on the other side of the planet."

"You can be there and experience it, devoid of the hassle of traveling," he said. "You might even be using a hologram to visit your children while you are traveling." 

Some speculate that creating new business-to-business services such as the "internet of things" will prove key to generating revenue.

"We should think about more than just consumers," Harrington said. "We have to think about business to business. We need to think about how the wireless industry works with vertical segments, like transportation and connected cars."

Automation in the construction sector is one area that will benefit, he said.

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